Exhibit 1.1
CVR Partners, LP
19,200,000 Common Units
Representing Limited Partner Interests
Underwriting Agreement
April 7, 2011
Morgan Stanley & Co. Incorporated
Barclays Capital Inc.
Goldman, Sachs & Co.
As representatives of the several Underwriters
named in Schedule I hereto,
c/o Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
Ladies and Gentlemen:
CVR Partners, LP, a Delaware limited partnership (the “Company”), proposes, subject to the
terms and conditions stated herein, to issue and sell to the Underwriters named in Schedule I
hereto (the “Underwriters”), for whom Morgan Stanley & Co. Incorporated, Barclays Capital Inc. and
Goldman, Sachs & Co. (collectively, the “Representatives”) are acting as representatives, an
aggregate of 19,200,000 common units (the “Firm LP Units”) representing limited partner interests
in the Company (the “Common Units”), and, at the election of the Underwriters, up to 2,880,000
Common Units (the “Optional LP Units”). The Firm LP Units and the Optional LP Units that the
Underwriters elect to purchase pursuant to Section 2 hereof are collectively called the “LP Units.”
The Company, Coffeyville Resources Nitrogen Fertilizers, LLC, a Delaware limited liability
company and a direct wholly-owned subsidiary of the Company (“Operating LLC”), and Coffeyville
Resources, LLC, a Delaware limited liability company (“Coffeyville Resources”), hereby confirm
their agreement with the several Underwriters as set forth below. Concurrently with the First Time
of Delivery (as defined in Section 4 hereof), CVR GP, LLC, a Delaware limited liability company
(“Managing GP”), will enter into a joinder agreement to this Agreement, the form of which is
attached hereto as Annex II (the “Joinder Agreement”), pursuant to which Managing GP will become a
party to this Agreement and be considered a CVR Party (as defined below) to the same extent as if
it had executed this Agreement on the date hereof. The Company, Operating LLC, Coffeyville
Resources and, upon the execution and delivery of the Joinder
Agreement, Managing GP are
collectively referred to herein as the “CVR Parties” and each individually as a “CVR Party.”
This is to confirm the agreement concerning the purchase of the LP Units from the Company by
the Underwriters.
In connection with the sale of the LP Units hereunder, the Company and its affiliates will
enter into a series of transactions described in the Registration Statement (as defined below)
under the caption “The Transactions and Our Structure and Organization” (collectively, the
“Transactions”). This Agreement, the Joinder Agreement, the Amended and Restated Partnership
Agreement of the Company (the “Partnership Agreement”) and the new $150.0 million credit facility
described in the Registration Statement under the caption “Management’s Discussion and Analysis of
Financial Condition and Results of Operations—Liquidity and Capital Resources—New Credit Facility”
(the “New Credit Facility”) are referred to herein, collectively, as the “Transaction Documents”.
Morgan Stanley & Co. Incorporated (“Morgan Stanley”) has agreed to reserve up to 6.5% of the
Firm LP Units to be purchased by it under this Agreement for sale to the directors, officers and
employees of the Company, Managing GP, CVR Energy, Inc. and its subsidiaries (collectively,
“Participants”), as set forth in the Pricing Prospectus (as defined in Section 1(i)) under the
heading “Underwriters” (the “Directed Unit Program”). The Firm LP Units to be sold by Morgan
Stanley and its affiliates pursuant to the Directed Unit Program are referred to hereinafter as the
“Directed LP Units”. Any Directed LP Units not orally confirmed for purchase by any Participant by
the end of the business day on which this Agreement is executed will be offered to the public by
the Underwriters as set forth in the Pricing Prospectus.
1. The CVR Parties, jointly and severally, represent and warrant to, and agree with, each
of the Underwriters that:
(i) A registration statement on Form S-1 (File No. 333-171270) (the “Initial Registration
Statement”) in respect of the LP Units has been filed with the Securities and Exchange Commission
(the “Commission”); the Initial Registration Statement and any post-effective amendment thereto,
each in the form heretofore delivered to you, and, excluding exhibits thereto, to you for each of
the other Underwriters, have been declared effective by the Commission in such form; other than a
registration statement, if any, increasing the size of the offering (a “Rule 462(b) Registration
Statement”), filed pursuant to Rule 462(b) under the Securities Act of 1933, as amended (the
“Act”), which became effective upon filing, no other document with respect to the Initial
Registration Statement has heretofore been filed with the Commission; and no stop order suspending
the effectiveness of the Initial Registration Statement, any post-effective amendment thereto or
the Rule 462(b) Registration Statement, if any, has been issued and no proceeding for that purpose
has been initiated or, to the knowledge of the CVR Parties, threatened by the Commission (any
preliminary prospectus included in the Initial Registration Statement or filed with the Commission
pursuant to Rule 424(a) of the rules and
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regulations of the Commission under the Act is hereinafter
called a “Preliminary Prospectus”; the various parts of the Initial Registration Statement and the
Rule 462(b) Registration Statement, if any, including all exhibits thereto and including the
information contained in the form of final prospectus filed with the Commission pursuant to Rule
424(b) under the Act in accordance with Section 5(a) hereof and deemed by virtue of Rule 430A under
the Act to be part of the Initial Registration Statement at the time it was declared effective,
each as amended at the time such part of the Initial Registration Statement became effective or
such part of the Rule 462(b) Registration Statement, if any, became or hereafter becomes effective,
are hereinafter collectively called the “Registration Statement”; the Preliminary Prospectus
relating to the LP Units that was included in the Registration Statement immediately prior to the
Applicable Time (as defined in Section 1(iii) hereof) is hereinafter called the “Pricing
Prospectus”; the final prospectus, in the form first filed pursuant to Rule 424(b) under the Act,
is hereinafter called the “Prospectus”; and any “issuer free writing prospectus” as defined in Rule
433 under the Act relating to the LP Units is hereinafter called an “Issuer Free Writing
Prospectus”);
(ii) No order preventing or suspending the use of any Preliminary Prospectus or any Issuer
Free Writing Prospectus has been issued by the Commission, and each Preliminary Prospectus, at the
time of filing thereof, conformed in all material respects to the requirements of the Act and the
rules and regulations of the Commission thereunder, and each Preliminary Prospectus, at the time of
filing thereof, did not contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
provided
,
however
, that this
representation and warranty shall not apply to any statements or omissions made in reliance upon
and in conformity with information furnished in writing to the Company by an Underwriter through
the Representatives expressly for use therein;
(iii) For the purposes of this Agreement, the “Applicable Time” is 6:00 p.m. (New York
City time) on the date of this Agreement. The Pricing Prospectus, when considered together with
the information listed on Schedule IIA hereto, as of the Applicable Time, did not include any
untrue statement of a material fact or omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were made, not
misleading; and each Issuer Free Writing Prospectus listed on Schedule IIB hereto does not conflict
with the information contained in the Registration Statement, the Pricing Prospectus or the
Prospectus and each such Issuer Free Writing Prospectus, as supplemented by and taken together with
the Pricing Prospectus as of the Applicable Time, did not include any untrue statement of a
material fact or omit to state any material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not misleading;
provided
,
however
,
that this representation and warranty shall not apply to statements or omissions made in the
Pricing Prospectus or an Issuer Free Writing Prospectus in
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reliance upon and in conformity with
information furnished in writing to the Company by an Underwriter through the Representatives
expressly for use therein;
(iv) The Registration Statement conforms, and the Prospectus and any further amendments or
supplements to the Registration Statement and the Prospectus will conform, in all material respects
to the requirements of the Act and the rules and regulations of the Commission thereunder and do
not and will not, as of the applicable effective date as to each part of the Registration Statement
and as of the applicable filing date as to the Prospectus and any amendment or supplement thereto,
contain an untrue statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading;
provided
,
however
, that
this representation and warranty shall not apply to any statements or omissions made in reliance
upon and in conformity with information furnished in writing to the Company by an Underwriter
through the Representatives expressly for use therein;
(v) Each statement made in the Registration Statement, the Pricing Prospectus, the
Prospectus and each Issuer Free Writing Prospectus listed on Schedule IIB hereto within the
coverage of Rule 175(b) under the Act, including (1) any projections or statements with respect to
future available cash or future cash distributions of the Company, (2) any statements made in
support thereof or related thereto under the heading “Our Cash Distribution Policy and Restrictions
on Distributions” and “How We Make Cash Distributions” and (3) statements made with respect to the
anticipated ratio of taxable income to distributions, was made or will be made with a reasonable
basis and in good faith.
(vi) Neither the Company nor Operating LLC has sustained since the date of the latest
audited financial statements included in the Pricing Prospectus any loss or interference with its
business from fire, explosion, flood or other calamity, whether or not covered by insurance, or
from any labor dispute or court or governmental action, order or decree that would, individually or
in the aggregate, reasonably be expected to have a material adverse effect on the current or future
financial position, partners’ capital or members’ equity (as the case may be), or results of
operations of the Company and Operating LLC, taken together as a whole (“Material Adverse Effect”),
in each case otherwise than as set forth or contemplated in the Pricing Prospectus; and, since the
respective dates as of which information is given in the Registration Statement and the Pricing
Prospectus, there has not been any change in the partners’ capital or members’ equity (as the case
may be) or long-term debt of the Company and Operating LLC, taken together as a whole, or any
material adverse change, or any development involving a prospective material adverse change, in or
affecting the general affairs, management, financial position, partners’ capital or members’ equity
(as the case may be) or results of operations of the Company and Operating LLC, taken together as a
whole, otherwise than as set forth or contemplated in the Pricing Prospectus;
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(vii) The Company and Operating LLC have good and marketable title in fee simple to, or
have valid rights to lease or otherwise use, all material real property and good and marketable
title to all material personal property owned by them, in each case free and clear of all liens,
encumbrances, security interests, equities, charges or claims (“Liens”) except such Liens created
in connection with (1) the Second Amended and Restated Credit and Guaranty Agreement, dated as of
December 28, 2006, among Coffeyville Resources and the other parties thereto, as amended through
the date hereof, (2) the indenture, dated April 6, 2010, among Coffeyville Resources, Coffeyville
Finance Inc., the guarantors party thereto and Wells Fargo Bank, National Association, as trustee,
related to Coffeyville Resources’ 9.0% First Lien Senior Secured Notes due 2015, and (3) the
indenture, dated April 6, 2010, among Coffeyville Resources, Coffeyville Finance Inc., the
guarantors party thereto and Wells Fargo Bank, National Association, as trustee, related to
Coffeyville Resources’ 10.875% Second Lien Senior Secured Notes due 2017 (collectively, the “Debt
Agreements”), which Liens will be released on or prior to the First Time of Delivery, and such
other Liens as are described in the Pricing Prospectus (including Liens for the benefit of lenders
under the New Credit Facility) or such as would not, individually and in the aggregate, reasonably
be expected to have a Material Adverse Effect;
(viii) The Company has been duly formed and is validly existing in good standing as a
limited partnership under the Delaware Revised Uniform Limited Partnership Act (“Delaware LP Act”)
with full partnership power and authority to own or lease its properties, conduct its business as
described in the Registration Statement and the Pricing Prospectus, and enter into and perform its
obligations under this Agreement and each Transaction Document to which it is a party;
(ix) Managing GP has been duly formed and is validly existing in good standing as a
limited liability company under the Delaware Limited Liability Company Act (the “Delaware LLC Act”)
with full limited liability company power and authority to own or lease its properties, conduct its
business as described in the Registration Statement and the Pricing Prospectus, act as a general
partner of the Company, and enter into and perform its obligations under this Agreement, the
Joinder Agreement and each Transaction Document to which it is a party;
(x) Operating LLC has been duly formed and is validly existing in good standing as a
limited liability company under the Delaware LLC Act with full limited liability company power and
authority to own or lease its properties, conduct its business as described in the Registration
Statement and the Pricing Prospectus, and enter into and perform its obligations under this
Agreement and each Transaction Document to which it is a party;
(xi) Coffeyville Resources has been duly formed and is validly existing in good standing
as a limited liability company under the Delaware LLC Act with full limited liability company power
and authority to own or lease its properties, conduct its business as described in the Registration
Statement and the Pricing Prospectus, act as the sole member of Managing GP, and enter into and
perform
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its obligations under this Agreement and each Transaction Document to which it is a party;
(xii) Each of the Company and Operating LLC is duly registered or qualified as a foreign
limited liability company or limited partnership, as the case may be, for the transaction of
business under the laws of each jurisdiction in which the character of the business conducted by it
or the nature or location of the properties owned or leased by it makes such registration or
qualification necessary, except where the failure to be qualified in any jurisdiction would not,
individually and in the aggregate, reasonably be expected to have a Material Adverse Effect;
(xiii) At or before the First Time of Delivery (or immediately thereafter), Managing GP
will own the sole general partner interest in the Company and will be the managing general partner
of the Company. Such managing general partner interest has been duly authorized and validly issued
in accordance with the Partnership Agreement and such managing general partner interest is fully
paid (to the extent required under the Partnership Agreement). Managing GP owns such managing
general partner interest free and clear of all Liens (except Liens pursuant to the Debt Agreements
or contained in Section 4.6 of the Partnership Agreement);
(xiv) At the First Time of Delivery or any Option Time of Delivery (as defined in Section
4 hereof), as the case may be, the Firm LP Units or the Optional LP Units to be sold by the Company
and the limited partner interests represented thereby, will be duly authorized in accordance with
the Partnership Agreement and, when issued and delivered to the Underwriters against payment
therefor in accordance with the terms hereof, will be validly issued, fully paid (to the extent
required under the Partnership Agreement) and nonassessable (except as such nonassessability may be
affected by Sections 17-303, 17-607 and 17-804 of the Delaware LP Act or as otherwise described in
the Pricing Prospectus under the caption “The Partnership Agreement—Limited Liability”) and conform
in all material respects to the description of the Common Units in the Prospectus. Assuming no
purchase by the Underwriters of any Optional LP Units, at the First Time of Delivery, after giving
effect to the Transactions, Coffeyville Resources will own 53,800,000 Common Units, Managing GP
will own the managing general partner interest of the Company and, other than such Common Units and
managing general partner interest, the Firm LP Units will be the only limited partner interests in
the Company issued and outstanding (other than any Common Units granted to officers and directors
of the Company as described in the Pricing Prospectus);
(xv) The Company owns 100% of the issued and outstanding member interests in Operating
LLC; such member interests have been duly authorized and validly issued in accordance with the
limited liability company agreement of Operating LLC (as the same may be amended or restated at or
prior to the applicable Time of Delivery (as defined in Section 4 hereof), the “Operating LLC
6
Agreement”) and are fully paid (to the extent required under the Operating LLC Agreement) and
nonassessable (except as such nonassessability may be affected by Sections 18-607 and 18-804 of the
Delaware LLC Act); and the Company owns such member interest free and clear of all Liens other than
Liens arising under or in connection with (1) the Debt Agreements, which Liens will be released on
or prior to the First Time of Delivery, and (2) the New Credit Facility;
(xvi) As of the date hereof, Coffeyville Acquisition III LLC (“Coffeyville Acquisition”)
owns 100% of the issued and outstanding member interests in Managing GP and is the sole member of
Managing GP; such member interests have been duly authorized and validly issued in accordance with
the limited liability company agreement of Managing GP (as the same may be amended or restated at
or prior to the applicable Time of Delivery, the “Managing GP LLC Agreement”) and are fully paid
(to the extent required under the Managing GP LLC Agreement) and nonassessable (except as such
nonassessability may be affected by Sections 18-607 and 18-804 of the Delaware LLC Act); and at or
before the First Time of Delivery (or immediately thereafter), Coffeyville Resources will own such
member interests free and clear of all Liens other than those arising under or in connection with
the Debt Agreements;
(xvii) Other than its ownership of the managing general partner interest in the Company,
Managing GP does not own, directly or indirectly, any equity or long-term debt securities of any
corporation, partnership, limited liability company, joint venture, association or other entity.
Other than the Company’s ownership of a 100% member interest in Operating LLC, neither the Company
nor Operating LLC owns, directly or indirectly, any equity or long-term debt securities of any
corporation, partnership, limited liability company, joint venture, association or other entity;
(xviii) Each of the CVR Parties has all requisite power and authority to execute and
deliver this Agreement and perform its respective obligations hereunder. The Company has all
requisite partnership power and authority to issue, sell and deliver the LP Units to be sold by it,
in accordance with and upon the terms and conditions set forth in this Agreement, the Partnership
Agreement, the Registration Statement, the Pricing Prospectus and the Prospectus. At the First
Time of Delivery (or, in the case of Managing GP, immediately thereafter) and any Option Time of
Delivery, all partnership and limited liability company action, as the case may be, required to be
taken by the CVR Parties or any of their members or partners for the authorization, issuance, sale
and delivery of the LP Units and the consummation of the transactions contemplated by this
Agreement (including the Transactions) shall have been validly taken. This Agreement has been duly
and validly authorized, executed and delivered by each of the CVR Parties; and, concurrently with
the First Time of Delivery, the Joinder Agreement will have been duly authorized, executed and
delivered by Managing GP;
7
(xix) The Partnership Agreement has been duly authorized, and, at or before the First Time
of Delivery, will have been duly executed and delivered by each of Managing GP and Coffeyville
Resources, and will be a valid and legally binding agreement of each such party, enforceable
against each such party in accordance with its terms; the Operating LLC Agreement has been duly
authorized, executed and delivered by the Company and is a valid and legally binding agreement of
the Company, enforceable against the Company in accordance with its terms; the Managing GP LLC
Agreement has been duly authorized, executed and delivered by Coffeyville Acquisition and is a
valid and legally binding agreement of Coffeyville Acquisition, enforceable against Coffeyville
Acquisition in accordance with its terms (the Partnership Agreement, the Operating LLC Agreement
and the Managing GP LLC Agreement are referred to herein collectively as the “Operative
Agreements”); provided, that, with respect to each Operative Agreement, the enforceability thereof
may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws relating to or affecting creditors’ rights generally and by general principles of
equity (regardless of whether such enforceability is considered in a proceeding in equity or at
law); and provided further, that the indemnity, contribution and exoneration provisions contained
in any of such Operative Agreements may be limited by applicable laws and public policy;
(xx) Except as described in the Prospectus or, in the case of transfer restrictions, as
set forth in the relevant Operative Agreements, there are no preemptive rights or other rights to
subscribe for or to purchase, nor any restriction upon the voting or transfer of, any partnership
or member interests in any of the CVR Parties. Except as described in the Prospectus, there are no
outstanding options or warrants to purchase any partnership or member interests in any of the
CVR Parties;
(xxi) The issue and sale of the LP Units as herein contemplated and the compliance by the
CVR Parties with this Agreement or the Joinder Agreement, as the case may be, and the consummation
of the transactions herein contemplated, including the Transactions, will not conflict with or
result in a breach or violation of any of the terms or provisions of, or constitute a default
under, any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to
which any of the CVR Parties is a party or by which any of the CVR Parties is bound or to which any
of the property or assets of any of the CVR Parties is subject; nor will such action result in any
violation of the provisions of the Operative Agreements of any of the CVR Parties or any statute or
any order, rule or regulation of any court or governmental agency or body having jurisdiction over
any of the CVR Parties or any of their properties, after giving effect to any consents, approvals,
authorizations, orders, registrations, qualifications, waivers and amendments as have been obtained
or made as of the date of this Agreement; nor does or will such action result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets of any of the CVR Parties
(other than any pledge by Coffeyville Resources of its member
8
interests in Managing
GP in
accordance with the Debt Agreements); and no consent, approval, authorization, order, registration
or qualification of or with any such court or governmental agency or body is required for the issue
and sale of the LP Units or the consummation by any of the CVR Parties of the transactions
contemplated by this Agreement or the Joinder Agreement, including the Transactions, except (i) the
registration under the Act and the Securities Exchange Act of 1934, as amended (the “Exchange
Act”), of the LP Units, (ii) as described in the Pricing Prospectus, (iii) such consents,
approvals, authorizations, registrations or qualifications as may be required under state
securities or Blue Sky laws or the rules and regulations of the Financial Industry Regulatory
Authority (“FINRA”) in connection with the purchase and distribution of the LP Units by the
Underwriters; (iv) filing of any certificate of merger in connection with the merger of CVR Special
GP, LLC, a Delaware limited liability company, with and into Coffeyville Resources; and (v) where
the failure to obtain or make any such consent, approval, authorization, order, registration, or
qualification as would not reasonably be expected, individually and in the aggregate, to have a
Material Adverse Effect or would not materially impair the consummation of the transactions herein
contemplated;
(xxii) There are no contracts, agreements or understandings between any of the CVR Parties
and any person granting such person the right to require the Company to file a registration
statement under the Act with respect to any securities of the Company owned or to be owned by such
person or to require the Company to include such securities in the securities registered pursuant
to the Registration Statement or to have such securities otherwise registered by the Company under
the Act, except as described in the Registration Statement and the Pricing Prospectus;
(xxiii) Neither the Company nor Operating LLC is (a) in violation of its agreement of
limited partnership or limited liability company agreement, as the case may be, or (b) in default
in the performance or observance of any obligation, agreement, covenant or condition contained in
any indenture, mortgage, deed of trust, loan agreement, lease or other agreement or instrument to
which it is a party or by which it or any of its properties may be bound, except with respect to
clause (b) where such default would not, individually and in the aggregate, reasonably be expected
to have a Material Adverse Effect;
(xxiv) The statements set forth in the Pricing Prospectus and Prospectus under the caption
“Description of Our Common Units,” insofar as they purport to constitute a summary of the terms of
the Common Units, as well as under the captions “Certain Relationships and Related Party
Transactions,” “Conflicts of Interest and Fiduciary Duties,” “The Partnership Agreement” and
“Material U.S. Federal Tax Consequences,” insofar as they purport to describe the provisions of the
laws and documents referred to therein, are accurate and fair in all material respects;
9
(xxv) Other than as set forth in the Pricing Prospectus, there are no legal or
governmental proceedings pending to which the Company or Operating LLC is a party or of which any
property of the Company or Operating LLC is the subject which, if determined adversely to the
Company or Operating LLC, would individually or in the aggregate reasonably be expected to have a
Material Adverse Effect or a material adverse effect on the performance of this Agreement or any of
the Transaction Documents or the consummation of any of the transactions (including the
Transactions) contemplated hereby or thereby; and, to the knowledge of the CVR Parties, no such
proceedings are threatened by governmental authorities or by others;
(xxvi) No relationship, direct or indirect, exists between or among the Company on the one
hand, and the directors, managers, officers, members, partners, stockholders, customers or
suppliers of the Company or any CVR Party, on the other hand, that is required to be described in
the Registration Statement, the Pricing Prospectus or the Prospectus that is not so described.
There are no outstanding loans, advances (except normal advances for business expenses in the
ordinary course of business) or guarantees of indebtedness by the Company to or for the benefit of
any of the officers, directors or managers of the Company, Managing GP or Operating LLC or their
respective family members;
(xxvii) Neither the Company nor Operating LLC is and, after giving effect to the offering
and sale of the LP Units and the application of the proceeds thereof, neither of them will be an
“investment company”, as such term is defined in the Investment Company Act of 1940, as amended
(the “Investment Company Act”);
(xxviii) At the time of filing the Initial Registration Statement the Company was not and
is not an “ineligible issuer,” as defined under Rule 405 under the Act;
(xxix) KPMG LLP, who have certified certain financial statements of the Company, are
independent public accountants with respect to the Company as required by the Act and the rules and
regulations of the Commission thereunder and the rules and regulations of the Public Company
Accounting Oversight Board;
(xxx) The Company maintains a system of internal accounting controls sufficient to provide
reasonable assurance that (A) transactions are executed in accordance with management’s general or
specific authorization; (B) transactions are recorded as necessary to permit preparation of
financial statements in conformity with U.S. Generally Accepted Accounting Principles and to
maintain accountability for assets; (C) access to assets is permitted only in accordance with
management’s general or specific authorization; and (D) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and appropriate action is taken with
respect to any differences. None of the CVR Parties is aware of (A) any significant deficiencies
in the design or operation of the Company’s internal controls that could adversely affect the
ability of the Company to record, process, summarize and report financial data in any material
respect, or any material weaknesses in internal controls, or (B) any fraud,
10
whether or not
material, that involves management or other employees who have a significant role in the internal
controls of any of the Company;
(xxxi) Since the date of the latest audited financial statements included in the Pricing
Prospectus, there has been no change in the internal control over financial reporting of the
Company that has materially adversely affected, or is reasonably likely to materially adversely
affect, the internal control over financial reporting of the Company. The Company maintains
“disclosure controls and procedures” (as such term is defined in Rule 13a-15(e) under the Exchange
Act) that comply with the requirements of the Exchange Act; such disclosure controls and procedures
have been designed to ensure that material information relating to the Company is made known to the
principal executive officer and principal financial officer of Managing GP by others within those
entities; and such disclosure controls and procedures are effective;
(xxxii) Except as disclosed in the Pricing Prospectus, the Company and Operating LLC
(A) are in compliance with any and all applicable foreign, Federal, state and local laws and
regulations relating to the protection of human health and safety, the environment or hazardous or
toxic substances or wastes, pollutants or contaminants (“Environmental Laws”), (B) have received
all permits, licenses or other approvals required of them under applicable Environmental Laws to
conduct their respective businesses and (C) are in compliance with all terms and conditions of any
such permit, license or approval, except with respect to clauses (A), (B) and (C) above where such
noncompliance with Environmental Laws, failure to receive required permits, licenses or other
approvals or failure to comply with the terms and conditions of such permits, licenses or approvals
would not, individually and in the aggregate, reasonably be expected to have a Material Adverse
Effect. Except as disclosed in the Pricing Prospectus, there are no costs or liabilities
associated with Environmental Laws (including any capital or operating expenditures required for
clean-up, closure of properties or compliance with Environmental Laws or any permit, license or
approval, any related constraints on operating activities and any potential liabilities to third
parties) which would individually or in the aggregate reasonably be expected to have a Material
Adverse Effect;
(xxxiii) The Company and Operating LLC own, have applied for or possess, or can acquire on
reasonable terms, all material patents, patent rights, licenses, inventions, copyrights, know-how
(including trade secrets and other unpatented and/or unpatentable proprietary or confidential
information, systems or procedures), trademarks, service marks and trade names currently employed
by them in connection with the business now operated by them as described in the Pricing
Prospectus, except where the failure to own or have such legal right to use would not reasonably be
expected to have a Material Adverse Effect; and except as disclosed in the Pricing Prospectus, none
of the CVR Parties has received any notice of infringement of or conflict with asserted rights of
others with respect to any of the foregoing which would individually or in the aggregate, if the
subject of
11
an unfavorable decision, ruling or finding, reasonably be expected to have a Material
Adverse Effect;
(xxxiv) No labor dispute with the employees of the Company or Operating LLC exists, or, to
the knowledge of any of the CVR Parties, is imminent, except for disputes that would not,
individually and in the aggregate, reasonably be expected to have a Material Adverse Effect;
(xxxv) The Company and Operating LLC are insured by insurers against such losses and risks
and in such amounts as are customary in the businesses in which they are engaged; and none of the
CVR Parties has any reason to believe that it will not be able to renew its existing insurance
coverage as and when such coverage expires or to obtain similar coverage from similar insurers as
may be necessary to continue its business at a cost that would not, individually and in the
aggregate, reasonably be expected to have a Material Adverse Effect, except as described in the
Pricing Prospectus;
(xxxvi) The Company and Operating LLC possess all material certificates, authorizations
and permits issued by the appropriate Federal, state or foreign regulatory authorities necessary to
conduct their respective businesses as described in the Pricing Prospectus, and none of the CVR
Parties has received any notice of proceedings relating to the revocation or modification of any
such certificate, authorization or permit which, if the subject of an unfavorable decision, ruling
or finding, would individually or in the aggregate reasonably be expected to have a Material
Adverse Effect;
(xxxvii) Except as would not reasonably be expected to have a Material Adverse Effect, the
Company and Operating LLC have filed all Federal, state, local and foreign tax returns which are
required to be filed through the date hereof, which returns are true and correct in all material
respects or has received timely extensions thereof, and have paid all taxes shown on such returns
and all assessments received by it to the extent that the same are material and have become due.
To the knowledge of the CVR Parties, there are no tax audits or investigations pending against the
Company or Operating LLC which would individually or in the aggregate, if adversely determined,
have a Material Adverse Effect; nor are there any proposed additional tax assessments against the
Company or Operating LLC which would individually or in the aggregate reasonably be expected to
have a Material Adverse Effect;
(xxxviii) Neither the Company nor Operating LLC nor any director, officer, or employee of
either of them or Managing GP, nor, to the knowledge of any of the CVR Parties, any agent,
affiliate or representative of the Company, Operating LLC or Managing GP, has taken or will take
any action in furtherance of an offer, payment, promise to pay, or authorization or approval of the
payment or giving of money, property, gifts or anything else of value, directly or indirectly, to
any “government official” (including any officer or employee of a government or government-owned or
controlled entity or of a public international organization, or any person acting in an official
capacity for or on behalf of any of the foregoing, or
12
any political party or party official or
candidate for political office) to influence official action or secure an improper advantage; and
the Company and Operating LLC have conducted their businesses in compliance with applicable
anti-corruption laws and have instituted and maintain and will continue to maintain policies and
procedures designed to promote and achieve compliance with such laws and with the representation
and warranty contained herein;
(xxxix) The operations of the Company, Managing GP and Operating LLC are and have been
conducted at all times in material compliance with all applicable financial recordkeeping and
reporting requirements, including those of the Bank Secrecy Act, as amended by Title III of the
Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct
Terrorism Act of 2001 (USA PATRIOT Act), and the applicable anti-money laundering statutes of
jurisdictions where the Company, Managing GP and Operating LLC conduct business, the rules and
regulations thereunder and any related or similar rules, regulations or guidelines, issued,
administered or enforced by any governmental agency (collectively, the “Anti-Money Laundering
Laws”), and no action, suit or proceeding by or before any court or governmental agency, authority
or body or any arbitrator involving of them with respect to the Anti-Money Laundering Laws is
pending or, to the best knowledge of any CVR Party, threatened;
(xl) (a) Neither the Company nor Operating LLC, nor any director, officer or employee of
either of them or Managing GP, nor, to the knowledge of any CVR Party, any agent, affiliate or
representative of the Company, Operating LLC or Managing GP, is an individual or entity (“Person”)
that is, or is owned or controlled by a Person that is:
(i) the subject of any sanctions administered or enforced by the U.S.
Department of Treasury’s Office of Foreign Assets Control (“OFAC”) (collectively,
“Sanctions”), nor
(ii) located, organized or resident in a country or territory that is the
subject of Sanctions (including, without limitation, Burma/Myanmar, Cuba, Iran,
North Korea, Sudan and Syria).
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(b)
|
|
Each of the CVR Parties represents and covenants that it will not, directly or
indirectly, use the proceeds of the offering, or lend, contribute or otherwise make
available such proceeds to any subsidiary, joint venture partner or other Person:
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(i) to fund or facilitate any activities or business of or with any Person or
in any country or territory that, at the time of such funding or facilitation, is
the subject of Sanctions; or
(ii) in any other manner that will result in a violation of Sanctions by any
Person (including any Person participating in the offering, whether as underwriter,
advisor, investor or otherwise).
13
(c) Each of the CVR Parties represents that it has not knowingly engaged in, and
is not now knowingly engaged in, any dealings or transactions with any Person, or in any
country or territory, that at the time of the dealing or transaction is or was the subject
of Sanctions;
(xli) A registration statement with respect to the LP Units has been filed on Form 8-A
pursuant to Section 12 of the Exchange Act, which registration statement complies in all material
respects with the applicable requirements of the Exchange Act;
(xlii) The Registration Statement, the Prospectus and any Preliminary Prospectus comply,
and any amendments or supplements thereto will comply, in all material respects, with any
applicable laws or regulations of foreign jurisdictions in which the Prospectus or any Preliminary
Prospectus, as amended or supplemented, if applicable, are distributed in connection with the
Directed Unit Program;
(xliii) No consent, approval, authorization or order of, or qualification with, any
governmental body or agency, other than those obtained, is required in connection with the offering
of the Directed Units in any jurisdiction where the Directed Units are being offered;
(xliv) The Company has not offered, nor have any of the CVR Parties caused Morgan Stanley
to offer, Directed LP Units to any person with the specific intent to unlawfully influence (A) a
customer or supplier of any of the CVR Parties to alter the customer’s or supplier’s level or type
of business with any of the CVR Parties, or (B) a trade journalist or publication to write or
publish favorable information about any of the CVR Parties or their respective products;
(xlv) The Company has not sold or issued any securities that would be integrated with the
offering of the LP Units contemplated by this Agreement pursuant to the Act, the rules and
regulations or interpretations thereof by the Commission;
(xlvi) The financial statements included in the Prospectus and the Pricing Prospectus
present fairly in all material respects the financial position of the Company and its consolidated
subsidiaries as of the dates shown and its results of operations and cash flows for the periods
shown, and such financial statements have been prepared in conformity with generally accepted
accounting principles in the United States applied on a consistent basis. The pro forma financial
statements (including the notes thereto) included in the Prospectus and in the Pricing Prospectus
(A) comply as to form in all material respects with the applicable requirements of Regulation S-X
promulgated under the Act, (B) have been prepared in all material respects in accordance with the
Commission’s rules and guidelines with respect to pro forma financial statements, and (C) have been
properly computed on the bases described therein; the assumptions used in preparing the pro forma
financial statements and other pro forma financial information included in the Prospectus and the
Pricing Prospectus provide a reasonable basis for presenting the significant effects directly
attributable to the
14
transactions or events described therein, the related pro forma adjustments
give appropriate effect to those assumptions, and the pro forma columns therein reflect the proper
application of those adjustments to the corresponding historical financial statement amounts;
(xlvii) Each of the Transaction Documents has been duly authorized and, at or before the
First Time of Delivery (or, in the case of Managing GP, immediately thereafter), will have been
duly executed and delivered by the parties thereto and will constitute a valid and binding
agreement of the parties thereto, enforceable against the parties to such agreements in accordance
with their respective terms, except as the enforcement thereof may be limited by bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium or other similar laws relating to or
affecting creditors’ rights generally, or by general principles of equity (regardless of whether
enforcement is considered in a proceeding in equity or at law);
(xlviii) Each of the Company and Operating LLC has such consents, easements,
rights-of-way, permits or licenses from each person (collectively, “rights-of-way”) as are
necessary to conduct its business in the manner described, and subject to the limitations
contained, in the Pricing Prospectus; other than as set forth, and subject to the limitations
contained, in the Pricing Prospectus, each of the Company and Operating LLC has fulfilled and
performed all its material obligations with respect to such rights-of-way and no event has occurred
that allows, or after notice or lapse of time would allow, revocation or termination thereof or
would result in any impairment of the rights of the holder of any such rights-of-way; and, except
as described in the Pricing Prospectus, none of such rights-of-way contains any restriction that is
materially burdensome to the Company and Operating LLC, taken as a whole; and
(xlix) Operating LLC is not currently prohibited, directly or indirectly, from paying any
dividends to the Company, from making any other distribution on its limited liability company
interests, from repaying to the Company any loans or advances from the Company, or from
transferring any of its property or assets to the Company or any other subsidiary of the Company,
except as described in or contemplated by the Pricing Prospectus.
2. Subject to the terms and conditions herein set forth, (a) the Company agrees to issue
and sell to each of the Underwriters, and each of the Underwriters agrees, severally and not
jointly, to purchase from the Company, at a purchase price per Common Unit of $14.88 (which is
equal to the initial public offering price of $16.00 per Common Unit
less
underwriting discounts
and commissions of $1.12 per Common Unit comprising an underwriting discount of $1.04 per Common
Unit and a structuring fee of $0.08 per Common Unit payable to Morgan Stanley & Co. Incorporated
and Barclays Capital Inc.), the number of Firm LP Units set forth opposite the name of such
Underwriter in Schedule I hereto and (b) in the event and to the extent that the Underwriters shall
exercise the election to purchase Optional LP Units as provided below, the Company agrees to issue
15
and sell to each of the Underwriters, and each of the Underwriters agrees, severally and not
jointly, to purchase from the Company, at the purchase price per Common Unit set forth in
clause (a) of this Section 2, that portion of the number of Optional LP Units as to which such
election shall have been exercised (to be adjusted by you so as to eliminate fractional units)
determined by multiplying such number of Optional LP Units by a fraction, the numerator of which is
the maximum number of Optional LP Units which such Underwriter is entitled to purchase as set forth
opposite the name of such Underwriter in Schedule I hereto and the denominator of which is the
maximum number of Optional LP Units that all of the Underwriters are entitled to purchase
hereunder.
The Company hereby grants to the Underwriters, severally and not jointly, the right to
purchase at their election up to 2,880,000 Optional LP Units, at the purchase price per Common Unit
set forth in the paragraph above, for the sole purpose of covering sales of LP Units in excess of
the number of Firm LP Units. The Representatives may elect to exercise this right on behalf of the
Underwriters in whole or from time to time in part. Any such election to purchase Optional
LP Units may be exercised only by written notice from you to the Company, given within a period of
30 calendar days after the date of this Agreement, setting forth the aggregate number of Optional
LP Units to be purchased and the date on which such Optional LP Units are to be delivered, as
determined by you but in no event earlier than the First Time of Delivery or, unless you and the
Company otherwise agree in writing, earlier than two or later than ten business days after the date
of such notice.
3. Upon the authorization by you of the release of the Firm LP Units, the several
Underwriters propose to offer the Firm LP Units for sale upon the terms and conditions set forth in
the Prospectus.
4. (a) The LP Units to be purchased by each Underwriter hereunder, in definitive form,
and in such authorized denominations and registered in such names as the Representatives may
request upon at least forty-eight hours’ prior notice to the Company shall be delivered by or on
behalf of the Company to the Representatives, through the facilities of The Depository Trust
Company (“DTC”), for the account of such Underwriter, against payment by or on behalf of such
Underwriter of the purchase price therefor by wire transfer of Federal (same-day) funds to the
account specified by the Company to the Representatives at least forty-eight hours in advance. The
time and date of such delivery and payment shall be, with respect to the Firm LP Units, 9:30 a.m.,
New York City time, on April 13, 2011 or such other time and date as the Representatives and the
Company may agree upon in writing, and, with respect to the Optional LP Units, 9:30 a.m., New York
time, on the date specified by the Representatives in the written notice given by the
Representatives of the Underwriters’ election to purchase such Optional LP Units, or such other
time and date as the Representatives and the Company may agree upon in writing. Such time and date
for delivery of the Firm LP Units is herein called the “First Time of Delivery”, such time and date
for delivery of any Optional LP Units, if not the First Time of Delivery, is herein called
16
an
“Option Time of Delivery”, and each such time and date for delivery is herein called a “Time of
Delivery”.
(b) The documents to be delivered at each Time of Delivery by or on behalf of the parties
hereto pursuant to Section 9 hereof, including the cross receipt for the LP Units and any
additional documents requested by the Underwriters pursuant to Section 9(i) hereof, will be
delivered at the offices of Fried, Frank, Harris, Shriver & Jacobson LLP, One New York Plaza, New
York, NY 10004 (the “Closing Location”), and the LP Units will be delivered electronically via the
facilities of DTC, all at such Time of Delivery. A meeting will be held at the Closing Location at
2:00 p.m., New York City time, on the New York Business Day next preceding such Time of Delivery,
at which meeting the final drafts of the documents to be delivered pursuant to the preceding
sentence will be available for review by the parties hereto. For the purposes of this Section 4,
“New York Business Day” shall mean each Monday, Tuesday, Wednesday, Thursday and Friday that is not
a day on which banking institutions in New York City are generally authorized or obligated by law
or executive order to close.
5. The Company agrees with each of the several Underwriters:
(a) To prepare the Prospectus in a form to which you shall not have reasonably objected on
a timely basis and to file such Prospectus pursuant to Rule 424(b) under the Act not later than the
Commission’s close of business on the second business day following the execution and delivery of
this Agreement; to make no further amendment or any supplement to the Registration Statement or the
Prospectus prior to the last Time of Delivery which shall be reasonably disapproved by you promptly
after reasonable notice thereof; to advise you, promptly after it receives notice thereof, of the
time when any amendment to the Registration Statement has been filed or becomes effective or any
amendment or supplement to the Prospectus has been filed and to furnish you with copies thereof; to
file promptly all material required to be filed by the Company with the Commission pursuant to Rule
433(d) under the Act; to advise you, promptly after it receives notice thereof, of the issuance by
the Commission of any stop order or of any order preventing or suspending the use of any
Preliminary Prospectus or other prospectus in respect of the LP Units, of the suspension of the
qualification of the LP Units for offering or sale in any jurisdiction, of the initiation or
threatening of any proceeding for any such purpose, or of any request by the Commission for the
amending or supplementing of the Registration Statement or the Prospectus or for additional
information; and, in the event of the issuance of any stop order or of any order preventing or
suspending the use of any Preliminary Prospectus or other prospectus or suspending any such
qualification, to promptly use its reasonable best efforts to obtain the withdrawal of such order;
(b) Promptly from time to time to take such action as you may reasonably request to
qualify the LP Units for offering and sale under the securities laws of such jurisdictions as you
may request and to comply with such laws so as to permit the continuance of sales and dealings
therein in such
17
jurisdictions for as long as may be necessary to complete the distribution of the
LP Units, provided that in connection therewith the Company shall not be required to qualify as a
foreign partnership or to file a general consent to service of process or subject itself to
taxation for doing business in any jurisdiction;
(c) To furnish the Underwriters prior to 5:00 p.m., New York City time, on the New York
Business Day next succeeding the date of this Agreement and from time to time, with written and
electronic copies of the Prospectus in New York City in such quantities as you may reasonably
request, and, if (i) the Underwriters notify the Company that or (ii) the Company otherwise has
knowledge that the delivery of a prospectus (or in lieu thereof, the notice referred to in Rule
173(a) under the Act) is required at any time prior to the expiration of nine months after the time
of issue of the Prospectus in connection with the offering or sale of the LP Units and if at such
time any event shall have occurred as a result of which the Prospectus as then amended or
supplemented would include an untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements therein, in the light of the circumstances under
which they were made when such Prospectus (or in lieu thereof, the notice referred to in Rule
173(a) under the Act) is delivered, not misleading, or, if for any other reason it shall be
necessary during such same period to amend or supplement the Prospectus in order to comply with the
Act, to notify you and upon your request to prepare and furnish without charge to each Underwriter
and to any dealer in securities as many written and electronic copies as you may from time to time
reasonably request of an amended Prospectus or a supplement to the Prospectus which will correct
such statement or omission or effect such compliance, and in case any Underwriter is required to
deliver a prospectus (or in lieu thereof, the notice referred to in Rule 173(a) under the Act) in
connection with sales of any of the LP Units at any time nine months or more after the time of
issue of the Prospectus, upon your request but at the expense of such Underwriter, to prepare and
deliver to such Underwriter as many written and electronic copies as you may request of an amended
or supplemented Prospectus complying with Section 10(a)(3) of the Act;
(d) To make generally available to its securityholders as soon as practicable, but in any
event not later than sixteen months after the effective date of the Registration Statement (as
defined in Rule 158(c) under the Act), an earnings statement of the Company and its subsidiaries
(which need not be audited) complying with Section 11(a) of the Act and the rules and regulations
of the Commission thereunder (including, at the option of the Company, Rule 158);
(e) During the period commencing on the date hereof and ending 180 days after the date
hereof (the “Lock-Up Period”), not to offer, sell, contract to sell, pledge, grant any option to
purchase, make any short sale or otherwise dispose, except as provided hereunder, of any securities
of the Company that are substantially similar to the LP Units, including but not limited to any
options or warrants to purchase Common Units or any securities that are convertible into or
exchangeable for, or that represent the right to receive, Common Units or any
18
such substantially
similar securities (other than pursuant to employee and/or director equity plans existing on, or
upon the conversion or exchange of convertible or exchangeable securities outstanding as of the
date of this Agreement or as described in the Prospectus), without your prior written consent;
provided
,
however
, that if (1) during the last 17 days of the initial Lock-Up Period, the Company
releases earnings results or announces material news or a material event or (2) prior to the
expiration of the initial Lock-Up Period, the Company announces that it will release earnings
results during the 15-day period following the last day of the initial Lock-Up Period, then in each
case the Lock-Up Period will be automatically extended until the expiration of the 18-day period
beginning on the date of release of the earnings results or the announcement of the material news
or material event, as applicable, unless the Representatives waive, in writing, such extension; the
Company will provide the Representatives and each unitholder subject to the Lock-Up Period pursuant
to the lockup letters described in Section 8(k) with prior notice of any such announcement that
gives rise to an extension of the Lock-up Period;
(f) Until the earlier of three years from the date hereof or the attainment by the Company
of “Well-Known Seasoned Issuer” status as defined under the Act, to furnish to its unitholders as
soon as practicable after the end of each fiscal year an annual report (including a balance sheet
and statements of income, partners’ capital and cash flows of the Company and its consolidated
subsidiaries certified by independent public accountants) and, as soon as practicable after the end
of each of the first three quarters of each fiscal year (beginning with the fiscal quarter ending
after the effective date of the Registration Statement), to make available to its unitholders
consolidated summary financial information of the Company and its subsidiaries for such quarter in
reasonable detail;
provided
,
however
, that the Company will be deemed to have satisfied the
requirements of this paragraph (f) if the Company files with or furnishes to the Commission the
reports, documents or information required by Section 13 or 15(d) of the Exchange Act;
(g) To use the net proceeds received by it from the sale of the LP Units pursuant to this
Agreement in the manner specified in the Pricing Prospectus under the caption “Use of Proceeds”;
(h) To file with the Commission such information on Form 10-Q or Form 10-K as may be
required by Rule 463 under the Act; and
(i) If the Company elects to rely upon Rule 462(b), the Company shall use its commercially
reasonable efforts to file a Rule 462(b) Registration Statement with the Commission in compliance
with Rule 462(b) by 10:00 P.M., Washington, D.C. time, on the date of this Agreement, and the
Company shall at the time of filing either pay to the Commission the filing fee for the Rule 462(b)
Registration Statement or give irrevocable instructions for the payment of such fee pursuant to
Rule 111 under the Act.
19
6. (a) The Company represents and agrees that, without the prior consent of the
Representatives, it has not made and will not make any offer relating to the LP Units that would
constitute a “free writing prospectus” as defined in Rule 405 under the Act; each Underwriter
represents and agrees that, without the prior consent of the Company and the Representatives, it
has not made and will not make any offer relating to the LP Units that would constitute a free
writing prospectus; the Company and the Representatives agree that any such free writing prospectus
the use of which has been consented to by the Company and the Representatives is listed on Schedule
IIB hereto;
(b) The Company has complied and will comply with the requirements of Rule 433 under the
Act applicable to any Issuer Free Writing Prospectus, including timely filing with the Commission
or retention where required and legending; and the Company represents that it has satisfied and
agrees that it will satisfy the conditions under Rule 433 under the Act to avoid a requirement to
file with the Commission any electronic road show; and
(c) The Company agrees that if at any time following issuance of an Issuer Free Writing
Prospectus any event occurred or occurs as a result of which such Issuer Free Writing Prospectus
would conflict with the information in the Registration Statement, the Pricing Prospectus or the
Prospectus or would include an untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements therein, in the light of the circumstances then
prevailing at the time of such issuance, not misleading, the Company will give prompt notice
thereof to the Representatives and, following such notice, if requested by the Representatives,
will prepare and furnish without charge to each Underwriter an Issuer Free Writing Prospectus or
other document that will correct such conflict, statement or omission;
provided
,
however
, that this
covenant shall not apply to any statements or omissions in an Issuer Free Writing Prospectus made
in reliance upon and in conformity with information furnished in writing to the Company by an
Underwriter through the Representatives expressly for use therein.
7. (a) The Company covenants and agrees with the several Underwriters to pay or cause to
be paid the following: (i) the fees, disbursements and expenses of the Company’s counsel and
accountants in connection with the registration of the LP Units under the Act and all other
expenses in connection with the preparation, printing, reproduction and filing of the Registration
Statement, any Preliminary Prospectus, any Issuer Free Writing Prospectus and the Prospectus and
amendments and supplements thereto and the mailing and delivering of copies thereof to the
Underwriters and dealers; (ii) all expenses in connection with the qualification of the LP Units
for offering and sale under state securities laws as provided in Section 5(b) hereof, including the
reasonable fees and disbursements of counsel for the Underwriters in connection with such
qualification and in connection with the blue sky memorandum; (iii) all fees and expenses in
connection with listing the LP Units on the Exchange; (iv) the filing fees incident to, and the
reasonable fees and disbursements of counsel for the
20
Underwriters in connection with, any required
review by FINRA of the terms of the sale of the LP Units (the total amount of fees and
disbursements of counsel for the Underwriters under clauses (ii) and (iv) shall be capped at no
more than $35,000); (v) the cost of preparing unit certificates; (vi) the cost and charges of any
transfer agent or registrar; and (vii) all other costs and expenses incident to the performance of
its obligations hereunder which are not otherwise specifically provided for in this Section 7;
provided
,
however
, that the costs associated with the chartering of an aircraft used by the Company
and the Underwriters to attend meetings with prospective purchasers of the LP Units will be divided
equally between the Company on the one hand and the Underwriters on the other hand, and each of the
Company and the Underwriters will pay for their own costs in connection with meetings with
prospective purchasers. It is understood, however, that the Company shall bear the cost of any
other matters not directly relating to the sale and purchase of the LP Units pursuant to this
Agreement. It is understood, however, that, except as provided in this Section 7, and Sections 9
and 14 hereof, the Underwriters will pay all of their own costs and expenses, including the fees of
their counsel, stock transfer taxes on resale of any of the LP Units by them, and any advertising
expenses connected with any offers they may make.
(b) The Company covenants and agrees with the several Underwriters to pay or cause to be
paid the following: (i) all fees and disbursements of counsel incurred by the Underwriters in
connection with the Directed Unit Program; (ii) all costs and expenses incurred by the
Underwriters
in connection with the printing (or reproduction) and delivery (including postage, air freight
charges and charges for counting and packaging) of copies of the Directed Unit Program material;
and (iii) all stamp duties, similar taxes or duties or other taxes, if any, incurred by the
Underwriters in connection with the Directed Unit Program.
Furthermore, the Company agrees with the several Underwriters that it will comply in all
material respects with all applicable securities and other laws, rules and regulations in each
foreign jurisdiction in which the Directed Units are offered in connection with the Directed Unit
Program, provided that the Representatives give the Company advance notice a reasonable period of
time before making offers of which foreign jurisdictions are involved.
8. The obligations of the Underwriters hereunder, as to the LP Units to be delivered at
each Time of Delivery, shall be subject, in their discretion, to the condition that all
representations and warranties and other statements of the CVR Parties herein are, at and as of
such Time of Delivery, true and correct, the condition that the CVR Parties shall have performed
all of their respective obligations hereunder theretofore to be performed, and the following
additional conditions:
(a) The Prospectus shall have been filed with the Commission pursuant to Rule
424(b) under the Act within the applicable time period
21
prescribed for such filing by the
rules and regulations under the Act and in accordance with Section 5(a) hereof; all
material required to be filed by the Company pursuant to Rule 433(d) under the Act shall
have been filed with the Commission within the applicable time period prescribed for such
filing by Rule 433; if the Company has elected to rely upon Rule 462(b) under the Act, the
Company shall have used commercially reasonable efforts to cause the Rule 462(b)
Registration Statement to have become effective by 10:00 P.M., Washington, D.C. time, on
the date of this Agreement; no stop order suspending the effectiveness of the Registration
Statement or any part thereof shall have been issued and no proceeding for that purpose
shall have been initiated or threatened by the Commission; no stop order suspending or
preventing the use of the Prospectus or any Issuer Free Writing Prospectus shall have been
initiated or threatened by the Commission; and all requests for additional information on
the part of the Commission shall have been complied with to your reasonable satisfaction;
(b) Debevoise & Plimpton LLP, counsel for the Underwriters, shall have furnished
to you such written opinion or opinions, dated such Time of Delivery, in form and substance
satisfactory to you, and such counsel shall have received such papers and information as
they may reasonably request to enable them to pass upon such matters;
(c) Andrews Kurth LLP, counsel for the Underwriters, shall have furnished to you
such written opinion or opinions, dated such Time of Delivery, in form and substance
satisfactory to you, and such counsel shall have received such papers and information as
they may reasonably request to enable them to pass upon such matters;
(d) Fried, Frank, Harris, Shriver & Jacobson LLP, counsel for the Company, shall
have furnished to you their written opinion (a draft of the form of such opinion is
attached as Annex I(a) hereto), dated such Time of Delivery, in form and substance
satisfactory to you;
(e) Vinson & Elkins L.L.P., counsel for the Company, shall have furnished to you
their written opinion (a draft of the form of such opinion is attached as Annex I(b)
hereto), dated such Time of Delivery, in form and substance satisfactory to you;
(f) On the date of the Prospectus and also at each Time of Delivery, KPMG LLP
shall have furnished to you a letter or letters, dated the respective dates of delivery
thereof, in form and substance satisfactory to you;
(g) (i) None of the CVR Parties shall have sustained since the date of the latest
audited financial statements included in the Pricing Prospectus any loss or interference
with its business from fire, explosion, flood or other calamity, whether or not covered by
insurance, or from any labor dispute or court or governmental action, order or decree, in
each case otherwise than as set forth or contemplated in the Pricing Prospectus, and
(ii) since the
22
respective dates as of which information is given in the Pricing Prospectus
there shall not have been any change in the partners’ capital or members’ equity (as the
case may be) or long-term debt of the CVR Parties, taken together as a whole, or any
change, or any development involving a prospective change, in or affecting the general
affairs, management, financial position, partners’ capital or members’ equity (as the case
may be) or results of operations of the CVR Parties, taken together as a whole, otherwise
than as set forth or contemplated in the Pricing Prospectus, the effect of which, in any
such case described in clause (i) or (ii), is in your judgment so material and adverse as
to make it impracticable or inadvisable to proceed with the public offering or the delivery
of the LP Units being delivered at such Time of Delivery on the terms and in the manner
contemplated in the Prospectus;
(h) On or after the Applicable Time (i) no downgrading shall have occurred in the
rating accorded any debt securities or preferred stock of the Company or Operating LLC or
in the corporate rating of Company or Operating LLC by any “nationally recognized
statistical rating organization”, as that term is used in Rule 15c3-1(c)(2)(vi)(F) under
the Exchange Act, and (ii) no such organization shall have publicly announced that it has
under surveillance or review, with possible negative implications, its rating of any debt
securities or preferred stock of the Company or Operating LLC or the corporate rating of
the Company or Operating LLC;
(i) On or after the Applicable Time there shall not have occurred any of the
following: (i) a suspension or material limitation in trading in securities generally on
the Exchange; (ii) a suspension or material limitation in trading in the securities of the
Company on the Exchange; (iii) a general moratorium on commercial banking activities
declared by either Federal or New York State authorities or a material disruption in
commercial banking or securities settlement or clearance services in the United States;
(iv) the outbreak or escalation of hostilities involving the United States or the
declaration by the United States of a national emergency or war; or (v) the occurrence of
any other calamity or crisis or any change in financial, political or economic conditions
in the United States or elsewhere, if the effect of any such event specified in clause (iv)
or (v) in your judgment makes it impracticable or inadvisable to proceed with the public
offering or the delivery of the LP Units being delivered at such Time of Delivery on the
terms and in the manner contemplated in the Prospectus;
(j) The LP Units to be sold at such Time of Delivery shall have been duly listed,
subject to notice of issuance, on the Exchange;
(k) The Company shall have obtained and delivered to the Representatives on behalf
of the Underwriters executed copies of a Lock-up Agreement in a form heretofore furnished
by you from each director and
23
executive officer of each of the Company and Managing GP and
the additional parties named in Schedule III hereto;
(l) The Company shall have complied with the provisions of Section 5(c) hereof
with respect to the furnishing of prospectuses on the second New York Business Day next
succeeding the date of this Agreement;
(m) The Company shall have furnished or caused to be furnished to you at such Time
of Delivery a certificate of the chief executive officer and chief financial officer of the
Company or Managing GP to the effect that the representations and warranties of the CVR
Parties herein are true and correct at and as of such Time of Delivery and that the CVR
Parties have complied with all of the agreements and satisfied all of the conditions on
their respective parts to be performed or satisfied hereunder on or prior to such Time of
Delivery;
(n) Each of the Transactions shall have been consummated in a manner consistent in
all material respects with their description in the Pricing Prospectus (or otherwise shall
be consummated immediately after the closing of the offering);
(o) Concurrently with the First Time of Delivery, the Representatives shall have
received the Joinder Agreement duly executed and delivered by an authorized officer of
Managing GP; and
(p) The Chief Financial Officer of the Company or Managing GP shall have furnished
or caused to be furnished to you at such Time of Delivery a certificate satisfactory to you
as to the operating data for the first quarter ended March 31, 2011 included in the Pricing
Prospectus and the Prospectus.
9. (a) The CVR Parties, jointly and severally, (i) will indemnify and hold harmless each
Underwriter against any losses, claims, damages or liabilities, joint or several, to which such
Underwriter may become subject, under the Act or otherwise, insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) arise out of or are based upon an untrue statement
or alleged untrue statement of a material fact contained in the Registration Statement, any
Preliminary Prospectus, the Pricing Prospectus or the Prospectus, or any amendment or supplement
thereto, any Issuer Free Writing Prospectus or any “issuer information” (in the case of either an
Issuer Free Writing Prospectus or such “issuer information,” taken together with the Pricing
Prospectus) filed or required to be filed pursuant to Rule 433(d) under the Act, or arise out of or
are based upon the omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, and (ii) will reimburse
each Underwriter for any legal or other expenses reasonably incurred by such Underwriter in
connection with investigating or defending any such action or claim as such expenses are
24
incurred;
provided
,
however
, that the CVR Parties shall not be liable in any such case to the extent that any
such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission made in the Registration Statement, any
Preliminary Prospectus, the Pricing Prospectus or the Prospectus, or any amendment or supplement
thereto, or any Issuer Free Writing Prospectus, in reliance upon and in conformity with written
information furnished to the Company by any Underwriter through the Representatives for use
therein.
(b) Each Underwriter will indemnify and hold harmless the CVR Parties against any losses,
claims, damages or liabilities to which the CVR Parties may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon an untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement, any Preliminary Prospectus, the Pricing Prospectus or the
Prospectus, or any amendment or supplement thereto, or any Issuer Free Writing Prospectus, or arise
out of or are based upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading, in each case to
the extent, but only to the extent, that such untrue statement or alleged untrue statement or
omission or alleged omission was made in the Registration Statement, any Preliminary Prospectus,
the Pricing Prospectus or the Prospectus, or any amendment or supplement thereto, or any Issuer
Free Writing Prospectus, in reliance upon and in conformity with written information furnished to
the Company by such Underwriter through the Representatives expressly for use therein; and will
reimburse the CVR Parties for any legal or other expenses reasonably incurred by the CVR Parties in
connection with investigating or defending any such action or claim as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under subsection (a) or (b) above of
notice of the commencement of any action, such indemnified party shall, if a claim in respect
thereof is to be made against the indemnifying party under such subsection, notify the indemnifying
party in writing of the commencement thereof; but the omission so to notify the indemnifying party
shall not relieve it from any liability which it may have to any indemnified party otherwise than
under such subsection. In case any such action shall be brought against any indemnified party and
it shall notify the indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with counsel reasonably
satisfactory to such indemnified party (who shall not, except with the consent of the indemnified
party, be counsel to the indemnifying party), and, after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the indemnifying party shall
not be liable to such indemnified party under such subsection for any legal expenses of other
counsel or any other expenses, in each case subsequently incurred by such indemnified party, in
25
connection with the defense thereof other than reasonable costs of investigation. No indemnifying
party shall, without the written consent of the indemnified party, effect the settlement or
compromise of, or consent to the entry of any judgment with respect to, any pending or threatened
action or claim in respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified party is an actual or potential party to such action or claim)
unless such settlement, compromise or judgment (i) includes an unconditional release of the
indemnified party from all liability arising out of such action or claim and (ii) does not include
a statement as to or an admission of fault, culpability or a failure to act, by or on behalf of any
indemnified party.
(d) If the indemnification provided for in this Section 9 is unavailable to or
insufficient to hold harmless an indemnified party under subsection (a) or (b) above in respect of
any losses, claims, damages or liabilities (or actions in respect thereof) referred to therein,
then each indemnifying party shall contribute to the amount paid or payable by such indemnified
party as a result of such losses, claims, damages or liabilities (or actions in respect thereof) in
such proportion as is appropriate to reflect the relative benefits received by the CVR Parties on
the one hand and the Underwriters on the other from the offering of the LP Units. If, however, the
allocation provided by the immediately preceding sentence is not permitted by applicable law or if
the indemnified party failed to give the notice required under subsection (c) above, then each
indemnifying party shall contribute to such amount paid or payable by such indemnified party in
such proportion as is appropriate to reflect not only such relative benefits but also the relative
fault of the CVR Parties on the one hand and the Underwriters on the other in connection with the
statements or omissions which resulted in such losses, claims, damages or liabilities (or actions
in respect thereof), as well as any other relevant equitable considerations. The relative benefits
received by the CVR Parties on the one hand and the Underwriters on the other shall be deemed to be
in the same proportion as the total net proceeds from the offering (before deducting expenses)
received by the CVR Parties bear to the total underwriting discounts and commissions received by
the Underwriters, in each case as set forth in the table on the cover page of the Prospectus. The
relative fault shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission to state a material
fact relates to information supplied by the CVR Parties on the one hand or the Underwriters on the
other and the parties’ relative intent, knowledge, access to information and opportunity to correct
or prevent such statement or omission. The CVR Parties and the Underwriters agree that it would
not be just and equitable if contribution pursuant to this subsection (d) were determined by
pro
rata
allocation (even if the Underwriters were treated as one entity for such purpose) or by any
other method of allocation which does not take account of the equitable considerations referred to
above in this subsection (d). The amount paid or payable by an indemnified party as a result of
the losses, claims, damages or liabilities (or actions in respect thereof) referred to above in
this subsection (d) shall be deemed to include any legal or other expenses reasonably incurred by
26
such indemnified party in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this subsection (d), no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at which the LP Units
underwritten by it and distributed to the public were offered to the public exceeds the amount of
any damages which such Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 10(f) of the Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent misrepresentation. The
Underwriters’ obligations in this subsection (d) to contribute are several in proportion to their
respective underwriting obligations and not joint. No party shall be liable for contribution under
this subsection (d) except to the extent and under such circumstances as such party would have been
liable for indemnification under this Section 9 if such indemnification were available or
enforceable under applicable law.
(e) The obligations of the CVR Parties under this Section 9 shall be in addition to any
liability which the CVR Parties may otherwise have and shall extend, upon the same terms and
conditions, to each person, if any, who controls any Underwriter within the meaning of the Act and
each broker-dealer affiliate of any Underwriter; and the obligations of the Underwriters under this
Section 9 shall be in addition to any liability which the respective Underwriters may otherwise
have and shall extend, upon the same terms and conditions, to the respective officers and directors
of the CVR Parties (including any person who, with his or her consent, is named in the Registration
Statement as about to become a director of the Company) and to each person, if any, who controls
the CVR Parties within the meaning of the Act.
10. (a) The CVR Parties, jointly and severally, agree to indemnify and hold harmless
Morgan Stanley, each person, if any, who controls Morgan Stanley within the meaning of either
Section 15 of the Act or Section 20 of the Exchange Act and each affiliate of Morgan Stanley within
the meaning of Rule 405 of the Act (the “Morgan Stanley Entities”) from and against any and all
losses, claims, damages and liabilities (including, without limitation, any legal or other expenses
reasonably incurred in connection with defending or investigating any such action or claim) (i)
caused by any untrue statement or alleged untrue statement of a material fact contained in any
material prepared by or with the consent of any of the CVR Parties for distribution to Participants
in connection with the Directed Unit Program or caused by any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the statements therein
not misleading; (ii) caused by the failure of any Participant to pay for and accept delivery of
Directed Units that the Participant agreed to purchase; or (iii) related to, arising out of, or in
connection with the Directed Unit Program, other than losses, claims, damages or liabilities (or
expenses relating thereto) that are finally judicially determined to have resulted from the bad
faith or gross negligence of the Morgan Stanley Entities.
27
(b) In case any proceeding (including any governmental investigation) shall be instituted
involving any Morgan Stanley Entity in respect of which indemnity may be sought pursuant to Section
10(a), the Morgan Stanley Entity seeking indemnity, shall promptly notify the Company in writing
and the Company, upon request of the Morgan Stanley Entity, shall retain counsel reasonably
satisfactory to the Morgan Stanley Entity to represent the Morgan Stanley Entity and any others the
Company may designate in such proceeding and shall pay the fees and disbursements of such counsel
related to such proceeding. In any such proceeding, any Morgan Stanley Entity shall have the right
to retain its own counsel, but the fees and expenses of such counsel shall be at the expense of
such Morgan Stanley Entity unless (i) the Company shall have agreed to the retention of such
counsel or (ii) the named parties to any such proceeding (including any impleaded parties) include
both the Morgan Stanley Entity and any of the CVR Parties and representation of both parties by the
same counsel would be inappropriate due to actual or potential differing interests between them.
None of the CVR Parties, in respect of the legal expenses of the Morgan Stanley Entities in
connection with any proceeding or related proceedings in the same jurisdiction, shall be liable for
the fees and expenses of more than one separate firm (in addition to any local counsel) for all
Morgan Stanley Entities. Any such separate firm for the Morgan Stanley Entities shall be
designated in writing by Morgan Stanley. None of the CVR Parties shall be liable for any
settlement of any proceeding effected without its written consent, but if settled with such consent
or if there be a final judgment for the plaintiff, such CVR Party agrees to indemnify the Morgan
Stanley Entities from and against any loss or liability by reason of such settlement or judgment.
Notwithstanding the foregoing sentence, if at any time a Morgan Stanley Entity shall have requested
any CVR Party to reimburse it for fees and expenses of counsel as contemplated by the second and
third sentences of this paragraph, such CVR Party agrees that it shall be liable for any settlement
of any proceeding effected without its written consent if (i) such settlement is entered into more
than 30 days after receipt by such CVR Party of the aforesaid request and (ii) such CVR Party shall
not have reimbursed the Morgan Stanley Entity in accordance with such request prior to the date of
such settlement. None of the CVR Parties shall effect, without the prior written consent of Morgan
Stanley, any settlement of any pending or threatened proceeding in respect of which any Morgan
Stanley Entity is or could have been a party and indemnity could have been sought hereunder by such
Morgan Stanley Entity, unless such settlement includes an unconditional release of the Morgan
Stanley Entities from all liability on claims that are the subject matter of such proceeding.
(c) To the extent the indemnification provided for in Section 10(a) is unavailable to a
Morgan Stanley Entity or insufficient in respect of any losses, claims, damages or liabilities
referred to therein, then the CVR Parties, jointly and severally, in lieu of indemnifying the
Morgan Stanley Entity thereunder, shall contribute to the amount paid or payable by the Morgan
Stanley Entity as a result of such losses, claims, damages or liabilities (i) in such proportion as
is
28
appropriate to reflect the relative benefits received by the CVR Parties on the one hand and the
Morgan Stanley Entities on the other hand from the offering of the Directed Units or (ii) if the
allocation provided by clause 10(c)(i) above is not permitted by applicable law, in such proportion
as is appropriate to reflect not only the relative benefits referred to in clause 10(c)(i) above
but also the relative fault of any of the CVR Parties on the one hand and of the Morgan Stanley
Entities on the other hand in connection with any statements or omissions that resulted in such
losses, claims, damages or liabilities, as well as any other relevant equitable considerations.
The relative benefits received by the CVR Parties on the one hand and the Morgan Stanley Entities
on the other hand in connection with the offering of the Directed Units shall be deemed to be in
the same respective proportions as the net proceeds from the offering of the Directed Units (before
deducting expenses) and the total underwriting discounts and commissions received by the Morgan
Stanley Entities for the Directed Units, bear to the aggregate public offering price of the
Directed Units. If the loss, claim, damage or liability is caused by an untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a material fact, the
relative fault of the CVR Parties on the one hand and the Morgan Stanley Entities on the other hand
shall be determined by reference to, among other things, whether the untrue or alleged untrue
statement or the omission or alleged omission relates to information supplied by any of the CVR
Parties or by the Morgan Stanley Entities and the parties’ relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
(d) The CVR Parties and the Morgan Stanley Entities agree that it would not be just or
equitable if contribution pursuant to this Section 10 were determined by pro rata allocation (even
if the CVR Parties and the Morgan Stanley Entities were treated as one entity, respectively, for
such purpose) or by any other method of allocation that does not take account of the equitable
considerations referred to in Section 10(c). The amount paid or payable by the Morgan Stanley
Entities as a result of the losses, claims, damages and liabilities referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set forth above, any
legal or other expenses reasonably incurred by the Morgan Stanley Entities in connection with
investigating or defending any such action or claim. Notwithstanding the provisions of this
Section 10, no Morgan Stanley Entity shall be required to contribute any amount in excess of the
amount by which the total price at which the Directed Units distributed to the public were offered
to the public exceeds the amount of any damages that such Morgan Stanley Entity has otherwise been
required to pay. The remedies provided for in this Section 10 are not exclusive and shall not
limit any rights or remedies which may otherwise be available to any indemnified party at law or in
equity.
(e) The indemnity and contribution provisions contained in this Section 10 shall remain
operative and in full force and effect regardless of (i) any termination of this Agreement, (ii)
any investigation made by or on behalf of any
29
Morgan Stanley Entity or any of the CVR Parties,
their officers or directors or any
person controlling such CVR Party and (iii) acceptance of and
payment for any of the Directed Units.
11. In making a claim for indemnification under Section 9 or 10 of this Agreement (other
than for any legal or other expenses reasonably incurred in connection with investigating or
defending any action or claim in accordance with clause (a)(ii) of Section 9 or the first sentence
of Section 10 (“Expense Reimbursement”), as further provided below) or contribution under Section 9
or 10 of this Agreement, by any of the CVR Parties, an indemnified party may proceed against either
(1) all of the CVR Parties jointly or (ii) the Company, Managing GP and Operating LLC jointly, but
may not proceed solely against Coffeyville Resources. Notwithstanding the provisions of Sections 9
and 10 of this Agreement, in making a claim for indemnification under Section 9 or 10 (other than
for an Expense Reimbursement), or contribution under Section 9 or 10, by any of the CVR Parties, as
a precondition to any indemnified party, including any Morgan Stanley Entity, obtaining
indemnification or contribution from Coffeyville Resources for any loss, claim, damage, liability
or expense under Section 9 or 10, such indemnified party shall first obtain a final judgment from a
trial court that such indemnified party is entitled to indemnity or contribution under this
Agreement with respect to such loss, claim, damage, liability or expense (the “Indemnity Final
Judgment”) from the Company, Managing GP, Operating LLC and Coffeyville Resources (or any of them)
and shall seek to satisfy such Indemnity Final Judgment in full from the Company, Managing GP and
Operating LLC by making a written demand upon the Company, Managing GP and Operating LLC for such
satisfaction. If such Indemnity Final Judgment shall remain unsatisfied in whole or in part 45
days following the date of receipt by the Company, Managing GP and Operating LLC of such demand,
any indemnified party shall have the right to take action to satisfy such Indemnity Final Judgment
by making demand directly on Coffeyville Resources (but only if and to the extent the Company,
Managing GP or Operating LLC have not already satisfied such Indemnity Final Judgment, whether by
settlement, release or otherwise). The indemnified parties may exercise this right to first seek
to obtain payment from the Company, Managing GP and Operating LLC and thereafter obtain payment
from Coffeyville Resources without regard to the pursuit by any party of its rights to the appeal
of such Indemnity Final Judgment. The indemnified parties shall, however, be relieved of their
obligation to first obtain an Indemnity Final Judgment, seek to obtain payment from the Company,
Managing GP and Operating LLC with respect to such Indemnity Final Judgment or, having sought such
payment, to wait such 45 days after failure by the Company, Managing GP and Operating LLC to
immediately satisfy any such Final Judgment if (i) the Company, Managing GP or Operating LLC files
a petition for relief under the United States Bankruptcy Code (the “Bankruptcy Code”), (ii) an
order for relief is entered against the Company, Managing GP or Operating LLC in an involuntary
case under the Bankruptcy Code and such order is not dismissed within 60 days
30
after the filing
thereof, (iii) the Company, Managing GP or Operating LLC makes an assignment for the benefit of its
creditors or (iv) any court orders or approves the appointment of a receiver or custodian for the
Company, Managing GP or Operating LLC or a substantial portion of any of their assets and such
appointment is not discharged within 60 days after the effective date thereof. The foregoing
provisions of this paragraph are not intended to require any indemnified party to obtain an
Indemnity Final Judgment against the Company, Managing GP, Operating LLC or Coffeyville Resources
before obtaining any Expense Reimbursement. However, the indemnified parties shall first seek to
obtain Expense Reimbursement in full from the Company, Managing GP and Operating LLC by making a
written demand upon the Company, Managing GP and Operating LLC for such Expense Reimbursement. If
such expenses shall remain unreimbursed in whole or in part 45 days following the date of receipt
by the Company, Managing GP and Operating LLC of such demand, any indemnified party shall have the
right to receive Expense Reimbursement from Coffeyville Resources by making written demand directly
on Coffeyville Resources (but only if and to the extent the Company, Managing GP or Operating LLC
have not already satisfied the demand for such Expense Reimbursement, whether by settlement,
release or otherwise). The indemnified parties shall, however, be relieved of their obligation to
first seek to obtain such Expense Reimbursement in full from the Company, Managing GP and Operating
LLC or, having made written demand therefor, to wait such 45 days after failure by the Company,
Managing GP and Operating LLC to immediately reimburse such expenses if (i) the Company, Managing
GP or Operating LLC files a petition for relief under the Bankruptcy Code, (ii) an order for relief
is entered against the Company, Managing GP or Operating LLC in an involuntary case under the
Bankruptcy Code, (iii) the Company, Managing GP or Operating LLC makes an assignment for the
benefit of its creditors or (iv) any court orders or approves the appointment of a receiver or
custodian for the Company, Managing GP or Operating LLC or a substantial portion of any of their
assets.
12. (a) If any Underwriter shall default in its obligation to purchase the LP Units which
it has agreed to purchase hereunder at a Time of Delivery, you may in your discretion arrange for
you or another party or other parties to purchase such LP Units on the terms contained herein. If
within thirty-six hours after such default by any Underwriter you do not arrange for the purchase
of such LP Units, then the Company shall be entitled to a further period of thirty-six hours within
which to procure another party or other parties satisfactory to you to purchase such LP Units on
such terms. In the event that, within the respective prescribed periods, you notify the Company
that you have so arranged for the purchase of such LP Units, or the Company notifies you that it
has so arranged for the purchase of such LP Units, you or the Company shall have the right to
postpone such Time of Delivery for a period of not more than seven days, in order to effect
whatever changes may thereby be made necessary in the Registration Statement or the Prospectus, or
in any other documents or arrangements, and the Company agrees to file promptly any amendments or
supplements to the Registration
31
Statement or the Prospectus which in your opinion may thereby be
made necessary. The term “Underwriter” as used in this Agreement shall include any person
substituted under this Section 12 with like effect as if such person had originally been a party to
this Agreement with respect to such LP Units.
(b) If, after giving effect to any arrangements for the purchase of the LP Units of a
defaulting Underwriter or Underwriters by you and the Company as provided in subsection (a) above,
the aggregate number of such LP Units which remains unpurchased does not exceed one-eleventh of the
aggregate number of all the LP Units to be purchased at such Time of Delivery, then the Company
shall have the right to require each non-defaulting Underwriter to purchase the number of LP Units
which such Underwriter agreed to purchase hereunder at such Time of Delivery and, in addition, to
require each non-defaulting Underwriter to purchase its
pro rata
share (based on the number of LP
Units which such Underwriter agreed to purchase hereunder) of the LP Units of such defaulting
Underwriter or Underwriters for which such arrangements have not been made; but nothing herein
shall relieve a defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the LP Units of a
defaulting Underwriter or Underwriters by you and the Company as provided in subsection (a) above,
the aggregate number of such LP Units which remains unpurchased exceeds one-eleventh of the
aggregate number of all the LP Units to be purchased at such Time of Delivery, or if the Company
shall not exercise the right described in subsection (b) above to require non-defaulting
Underwriters to purchase LP Units of a defaulting Underwriter or Underwriters, then this Agreement
(or, with respect to any Option Time of Delivery, the obligations of the Underwriters to purchase
and of the Company to sell the Optional LP Units) shall thereupon terminate, without liability on
the part of any non-defaulting Underwriter or the Company, except for the expenses to be borne by
the Company and the Underwriters as provided in Section 7 hereof and the indemnity and contribution
agreements in Section 9 hereof; but nothing herein shall relieve a defaulting Underwriter from
liability for its default.
13. (a) The respective indemnities, agreements, representations, warranties and other
statements of the CVR Parties and the several Underwriters, as set forth in this Agreement or made
by or on behalf of them, respectively, pursuant to this Agreement, shall remain in full force and
effect, regardless of any investigation (or any statement as to the results thereof) made by or on
behalf of any Underwriter or any controlling person of any Underwriter, or the CVR Parties, or any
officer or director or controlling person of any of the CVR Parties, and shall survive delivery of
and payment for the LP Units.
(b) In making a claim for breach by the CVR Parties of any agreement, representation or
warranty contained in this Agreement, any Underwriter may proceed against either (i) all of the CVR
Parties jointly or (ii) the Company, Managing GP and Operating LLC jointly, but may not proceed
solely against Coffeyville Resources. As a precondition to any Underwriter obtaining
32
recovery of
any loss, claim, damage, liability or expense from Coffeyville Resources arising out of, or based
upon or resulting from such breach, such Underwriter shall first obtain a final judgment from a
trial court that such Underwriter is entitled to recovery under this Agreement with respect to such
loss, claim, damage, liability or expense (the “Breach Final Judgment”) from the Company, Managing
GP, Operating LLC and Coffeyville Resources (or any of them) and shall seek to satisfy such Breach
Final Judgment in full from the Company, Managing GP and Operating LLC by making a written demand
upon the Company, Managing GP and Operating LLC for such satisfaction. If such Breach Final
Judgment shall remain unsatisfied in whole or in part 45 days following the date of receipt by the
Company, Managing GP and Operating LLC of such demand, any Underwriter shall have the right to take
action to satisfy such Breach Final Judgment by making demand directly on Coffeyville Resources
(but only if and to the extent the Company, Managing GP or Operating LLC have not already satisfied
such Breach Final Judgment, whether by settlement, release or otherwise). The Underwriters may
exercise this right to first seek to obtain payment from the Company, Managing GP and Operating LLC
and thereafter obtain payment from Coffeyville Resources without regard to the pursuit by any party
of its rights to the appeal of such Breach Final Judgment. The Underwriters shall, however, be
relieved of their obligation to first obtain a Breach Final Judgment, seek to obtain payment from
the Company, Managing GP and Operating LLC with respect to such Breach Final Judgment or, having
sought such payment, to wait such 45 days after failure by the Company, Managing GP and Operating
LLC to immediately satisfy any such Breach Final Judgment if (i) the Company, Managing GP or
Operating LLC files a petition for relief under the Bankruptcy Code, (ii) an order for relief is
entered against the Company, Managing GP or Operating LLC in an involuntary case under the
Bankruptcy Code and such order is not dismissed within 60 days
after the filing thereof, (iii) the
Company, Managing GP or Operating LLC makes an assignment for the benefit of its creditors or (iv)
any court orders or approves the appointment of a receiver or custodian for the Company, Managing
GP or Operating LLC or a substantial portion of any of their assets and such appointment is not
discharged within 60 days after the effective date thereof.
(c) Notwithstanding anything in this Agreement to the contrary, Coffeyville Resources’
aggregate liability pursuant to the indemnity and contribution provisions of Sections 9 and 10
hereof and for any breach by the CVR Parties of any agreement, representation or warranty contained
in this Agreement shall not exceed an amount equal to the sum of (x) (i) the proceeds of the
offering of the Firm Units that the Company distributes to Coffeyville Resources, (ii) the portion
of the term loan under the New Credit Facility that the Company distributes to Coffeyville
Resources and (iii) an amount equal to the total of the Company’s cash and cash equivalents on the
Company’s consolidated balance sheet as of the day immediately preceding the First Time of Delivery
that the Company distributes to Coffeyville Resources, as certified in writing to the
Representatives by the chief financial officer of the Company or Managing GP as
33
of the First Time
of Delivery, and (y) an amount, if any, equal to the purchase price paid by the Underwriters for
Optional LP Units to the extent any of such proceeds are distributed to Coffeyville Resources.
14. If this Agreement shall be terminated pursuant to Section 12 hereof, the CVR Parties
shall not then be under any liability to any Underwriter except as provided in Sections 7 and 9
hereof; but, if for any other reason any LP Units are not delivered by or on behalf of the Company
as provided herein (other than due to the failure to satisfy any of the conditions provided in
clauses (i), (iii), (iv) or (v) of Section 8(i) hereof), the CVR Parties will cause the Company to
reimburse the Underwriters through you for all out-of-pocket expenses approved in writing by you,
including fees and disbursements of counsel, reasonably incurred by the Underwriters in making
preparations for the purchase, sale and delivery of the LP Units not so delivered, but the CVR
Parties shall not then be under any further liability to any Underwriter except as provided in
Sections 7 and 9 hereof.
15. In all dealings hereunder, you, as the Representatives, shall act on behalf of each of
the Underwriters, and the parties hereto shall be entitled to act and rely upon any statement,
request, notice or agreement on behalf of any Underwriter made or given by all of the Underwriters
jointly or by the Representatives on behalf of the Underwriters.
16. All statements, requests, notices and agreements hereunder shall be in writing, and if
to the Underwriters shall be delivered or sent by mail, telex or facsimile transmission to you as
the Representatives to each of (i) Morgan Stanley & Co. Incorporated, Attention Global Capital
Markets Syndicate Desk, 1585 Broadway, New York, New York 10036; (ii) Barclays Capital Inc., 745
Seventh Avenue, New York, New York 10019, Attention: Syndicate Registration (Facsimile:
646-834-8133); and (iii) Goldman, Sachs & Co., 200 West Street, New York, New York 10282,
Attention: Registration Department (Facsimile: 212-902-9316), with a copy, in the case of any
notice pursuant to Section 13 hereof, to the Director of Litigation, Office of the General Counsel,
Barclays Capital Inc., 745 Seventh Avenue, New York, New York 10019; if to Morgan Stanley in
connection with the Directed Unit Program shall be delivered or sent by mail, telex or facsimile
transmission to Morgan Stanley & Co. Incorporated, Attention Global Capital Markets Syndicate Desk,
1585 Broadway, New York, New York 10036; and if to the Company shall be delivered or sent by mail,
telex or facsimile transmission to the address of the Company set forth in the Registration
Statement, Attention: Secretary;
provided
,
however
, that any notice to an Underwriter pursuant to
subsection 9(c) hereof shall be delivered or sent by mail, telex or facsimile transmission to such
Underwriter at its address set forth in its Underwriters’ Questionnaire, or telex constituting such
Questionnaire, which address will be supplied to the Company by you upon request;
provided
,
however
, that notices under subsection 9(c)
shall be in writing, and if to the
Underwriters shall be delivered or sent by mail, telex or facsimile transmission to you as the
Representatives to each of (i) Morgan Stanley & Co. Incorporated, Attention Global Capital Markets
Syndicate Desk, 1585 Broadway, New York, New York
34
10036; (ii) Barclays Capital Inc., 745 Seventh
Avenue, New York, New York 10019, Attention: Syndicate Registration (Facsimile: 646-834-8133); and
(iii) Goldman, Sachs & Co., 200 West Street, New York, New York 10282, Attention: Registration
Department (Facsimile: 212-902-9316). Any such statements, requests, notices or agreements shall
take effect upon receipt thereof.
17. This Agreement shall be binding upon, and inure solely to the benefit of, the
Underwriters and the CVR Parties and, to the extent provided in Sections 9 and 13 hereof, the
officers and directors of the CVR Parties and each person who controls the CVR Parties or any
Underwriter, and their respective heirs, executors, administrators, successors and assigns, and no
other person shall acquire or have any right under or by virtue of this Agreement. No purchaser of
any of the LP Units from any Underwriter shall be deemed a successor or assign by reason merely of
such purchase.
18. Time shall be of the essence of this Agreement. As used herein, the term “business
day” shall mean any day when the Commission’s office in Washington, D.C. is open for business.
19. The CVR Parties acknowledge and agree that (i) the purchase and sale of the LP Units
pursuant to this Agreement is an arm’s-length commercial transaction between the CVR Parties, on
the one hand, and the several Underwriters, on the other; (ii) in connection therewith and with the
process leading to such transaction each Underwriter is acting solely as a principal and not the
agent or fiduciary of any of the CVR Parties; (iii) no Underwriter has assumed an advisory or
fiduciary responsibility in favor of any of the CVR Parties with respect to the offering
contemplated hereby or the process leading thereto (irrespective of whether such Underwriter has
advised or is currently advising any of the CVR Parties on other matters) or any other obligation
to any of the CVR Parties except the obligations expressly set forth in this Agreement; and
(iv) the CVR Parties have consulted their own legal and financial advisors to the extent it deemed
appropriate. The CVR Parties agree that they will not claim that the Underwriters, or any of them,
have rendered advisory services of any nature or respect, or owe a fiduciary or similar duty to any
of the CVR Parties in connection with such transaction or the process leading thereto.
20. This Agreement supersedes all prior agreements and understandings (whether written or
oral) between the CVR Parties and the Underwriters, or any of them, with respect to the subject
matter hereof.
21.
This Agreement shall be governed by and construed in accordance with the laws of the
State of New York.
22. Each of the CVR Parties and each of the Underwriters 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 Agreement or the transactions contemplated hereby,
including the Transactions.
35
23. This Agreement may be executed by any one or more of the parties hereto in any number
of counterparts, each of which shall be deemed to be an original, but all such counterparts shall
together constitute one and the same instrument.
If the foregoing is in accordance with your understanding, please sign and return to us two
counterparts hereof, and upon the acceptance hereof by you, on behalf of each of the Underwriters,
this letter and such acceptance hereof shall constitute a binding agreement among each of the
Underwriters and the CVR Parties. It is understood that your acceptance of this letter on behalf
of each of the Underwriters is pursuant to the authority set forth in a form of Agreement among
Underwriters, the form of which shall be submitted to the Company for examination upon request, but
without warranty on your part as to the authority of the signers thereof.
[
Remainder of this page intentionally left blank]
36
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Very truly yours,
CVR Partners, LP
|
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By:
|
CVR GP, LLC, its Managing General Partner
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By:
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/s/ John J. Lipinski
|
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|
|
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Name:
|
John J. Lipinski
|
|
|
|
|
Title:
|
Chief Executive Officer and President
|
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|
|
|
|
|
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By:
|
CVR Special GP, LLC, its Special General Partner
|
|
|
|
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By:
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/s/ John J. Lipinski
|
|
|
|
|
Name:
|
John J. Lipinski
|
|
|
|
|
Title:
|
Chief Executive Officer and President
|
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|
Coffeyville Resources Nitrogen Fertilizers, LLC
|
|
|
|
By:
|
/s/ John J. Lipinski
|
|
|
|
|
Name:
|
John J. Lipinski
|
|
|
|
|
Title:
|
Chief Executive Officer and President
|
|
|
|
|
|
Coffeyville Resources, LLC
|
|
|
|
By:
|
/s/ John J. Lipinski
|
|
|
|
|
Name:
|
John J. Lipinski
|
|
|
|
|
Title:
|
Chief Executive Officer and President
|
|
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|
|
|
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|
|
|
Accepted as of the date hereof:
Morgan Stanley & Co. Incorporated
|
|
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By:
|
/s/ Kathryn Bergsteinsson
|
|
|
|
|
Name:
|
Kathryn Bergsteinsson
|
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|
|
|
Title:
|
Vice President
|
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|
|
|
|
Barclays Capital Inc.
|
|
|
|
By:
|
/s/ Victoria Hale
|
|
|
|
|
Name:
|
Victoria Hale
|
|
|
|
|
Title:
|
Vice President
|
|
|
|
|
|
Goldman, Sachs & Co.
|
|
|
|
By:
|
/s/ Goldman, Sachs & Co.
|
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(Goldman, Sachs & Co.)
|
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On behalf of each of the Underwriters
SCHEDULE I
|
|
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|
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|
|
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|
|
|
Number of Optional
|
|
|
|
|
|
|
|
|
LP Units to be
|
|
|
|
|
Total Number of
|
|
|
Purchased if
|
|
|
|
|
Firm LP Units to be
|
|
|
Maximum Option
|
|
|
Underwriter
|
|
Purchased
|
|
|
Exercised
|
|
|
Morgan Stanley & Co. Incorporated
|
|
|
6,780,480
|
|
|
|
1,017,072
|
|
|
Barclays Capital Inc.
|
|
|
6,780,480
|
|
|
|
1,017,072
|
|
|
Goldman, Sachs & Co.
|
|
|
4,026,240
|
|
|
|
603,936
|
|
|
Dahlman Rose & Company, LLC
|
|
|
403,200
|
|
|
|
60,480
|
|
|
RBS Securities Inc.
|
|
|
403,200
|
|
|
|
60,480
|
|
|
Simmons & Company International
|
|
|
403,200
|
|
|
|
60,480
|
|
|
SunTrust Robinson Humphrey, Inc.
|
|
|
403,200
|
|
|
|
60,480
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
19,200,000
|
|
|
|
2,880,000
|
|
|
|
|
|
|
|
|
|
SCHEDULE IIA
Initial public offering price per Common Unit $16.00
SCHEDULE IIB
Issuer Free Writing Prospectuses
Electronic road show as filed on Netroadshow.com (the “Electronic Roadshow”) on March 29, 2011.
Schedule III
Persons and Entities Subject to Lock-Up Letters
Coffeyville Resources, LLC
CVR GP, LLC
John J. Lipinski
The Lipinski 2011 Exempt Family Trust
Stanley A. Riemann
Edward Morgan
Edmund S. Gross
Kevan A. Vick
Christopher G. Swanberg
Donna R. Ecton
Scott Lebovitz
George E. Matelich
Frank M. Muller, Jr.
Stanley de J. Osborne
John K. Rowan
Exhibit 3.1
Execution Version
SECOND AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP
OF
CVR PARTNERS, LP
TABLE OF CONTENTS
|
|
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Page
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|
ARTICLE I
DEFINITIONS
|
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|
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Section 1.1 Definitions
|
|
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1
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Section 1.2 Construction
|
|
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13
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|
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ARTICLE II
ORGANIZATION
|
|
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Section 2.1 Formation
|
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13
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Section 2.2 Name
|
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13
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|
Section 2.3 Registered Office; Registered Agent; Principal Office; Other Offices
|
|
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14
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Section 2.4 Purpose and Business
|
|
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14
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Section 2.5 Powers
|
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14
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Section 2.6 Term
|
|
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14
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Section 2.7 Title to Partnership Assets
|
|
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14
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ARTICLE III
RIGHTS OF LIMITED PARTNERS
|
|
|
|
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Section 3.1 Limitation of Liability
|
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15
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Section 3.2 Management of Business
|
|
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15
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Section 3.3 Outside Activities of the Limited Partners
|
|
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15
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|
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Section 3.4 Rights of Limited Partners
|
|
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15
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|
|
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ARTICLE IV
CERTIFICATES; RECORD HOLDERS; TRANSFER OF PARTNERSHIP INTERESTS;
REDEMPTION OF PARTNERSHIP INTERESTS
|
|
|
|
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|
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|
Section 4.1 Certificates
|
|
|
16
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|
Section 4.2 Mutilated, Destroyed, Lost or Stolen Certificates
|
|
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17
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|
Section 4.3 Record Holders
|
|
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17
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Section 4.4 Transfer Generally
|
|
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18
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|
|
Section 4.5 Registration and Transfer of Limited Partner Interests
|
|
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18
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Section 4.6 Transfer of the General Partner Interest
|
|
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19
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Section 4.7 Restrictions on Transfers
|
|
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20
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Section 4.8 Eligibility Certificates; Ineligible Holders
|
|
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20
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|
Section 4.9 Redemption of Partnership Interests of Ineligible Holders
|
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22
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ARTICLE V
CAPITAL CONTRIBUTIONS AND ISSUANCE OF PARTNERSHIP INTERESTS
|
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|
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Section 5.1 Contributions by the General Partner and its Affiliates
|
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23
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i
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Page
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Section 5.2 Interest and Withdrawal
|
|
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24
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Section 5.3 Capital Accounts
|
|
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24
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|
|
Section 5.4 Issuances of Additional Partnership Interests
|
|
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27
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|
|
Section 5.5 Preemptive Right
|
|
|
28
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|
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Section 5.6 Splits and Combinations
|
|
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28
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Section 5.7 Fully Paid and Non-Assessable Nature of Limited Partner Interests
|
|
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28
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Section 5.8 Extinguishment of the IDRs
|
|
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29
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|
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ARTICLE VI
ALLOCATIONS AND DISTRIBUTIONS
|
|
|
|
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|
|
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Section 6.1 Allocations for Capital Account Purposes
|
|
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29
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|
|
Section 6.2 Allocations for Tax Purposes
|
|
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32
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|
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Section 6.3 Distributions to Record Holders
|
|
|
34
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|
|
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ARTICLE VII
MANAGEMENT AND OPERATION OF BUSINESS
|
|
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|
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|
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|
Section 7.1 Management
|
|
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34
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Section 7.2 Certificate of Limited Partnership
|
|
|
36
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|
|
Section 7.3 Restrictions on the General Partner’s Authority
|
|
|
37
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|
|
Section 7.4 Reimbursement of the General Partner
|
|
|
37
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|
|
Section 7.5 Outside Activities
|
|
|
38
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|
|
Section 7.6 Loans from the General Partner; Loans or Contributions from the Partnership or Group Members
|
|
|
39
|
|
|
Section 7.7 Indemnification
|
|
|
40
|
|
|
Section 7.8 Liability of Indemnitees
|
|
|
42
|
|
|
Section 7.9 Resolution of Conflicts of Interest; Standards of Conduct and Modification of Duties
|
|
|
42
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|
|
Section 7.10 Other Matters Concerning the General Partner
|
|
|
44
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|
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Section 7.11 Purchase or Sale of Partnership Interests
|
|
|
44
|
|
|
Section 7.12 Registration Rights of the General Partner and its Affiliates
|
|
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45
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|
|
Section 7.13 Reliance by Third Parties
|
|
|
47
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|
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|
ARTICLE VIII
BOOKS, RECORDS, ACCOUNTING AND REPORTS
|
|
|
|
|
|
|
|
Section 8.1 Records and Accounting
|
|
|
47
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|
|
Section 8.2 Fiscal Year
|
|
|
48
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|
|
Section 8.3 Reports
|
|
|
48
|
|
|
|
ARTICLE IX
TAX MATTERS
|
|
|
|
|
|
|
|
Section 9.1 Tax Returns and Information
|
|
|
48
|
|
|
Section 9.2 Tax Elections
|
|
|
49
|
|
|
Section 9.3 Tax Controversies
|
|
|
49
|
|
|
Section 9.4 Withholding
|
|
|
49
|
|
ii
|
|
|
|
|
|
|
|
|
Page
|
|
ARTICLE X
ADMISSION OF PARTNERS
|
|
|
|
|
|
|
|
Section 10.1 Admission of Limited Partners
|
|
|
49
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|
|
Section 10.2 Admission of Successor General Partner
|
|
|
50
|
|
|
Section 10.3 Amendment of Agreement and Certificate of Limited Partnership
|
|
|
50
|
|
|
|
ARTICLE XI
WITHDRAWAL OR REMOVAL OF PARTNERS
|
|
|
|
|
|
|
|
Section 11.1 Withdrawal of the General Partner
|
|
|
51
|
|
|
Section 11.2 Removal of the General Partner
|
|
|
52
|
|
|
Section 11.3 Interest of Departing General Partner and Successor General Partner
|
|
|
53
|
|
|
Section 11.4 Withdrawal of Limited Partners
|
|
|
54
|
|
|
|
ARTICLE XII
DISSOLUTION AND LIQUIDATION
|
|
|
|
|
|
|
|
Section 12.1 Dissolution
|
|
|
54
|
|
|
Section 12.2 Continuation of the Business of the Partnership After Dissolution
|
|
|
55
|
|
|
Section 12.3 Liquidator
|
|
|
55
|
|
|
Section 12.4 Liquidation
|
|
|
56
|
|
|
Section 12.5 Cancellation of Certificate of Limited Partnership
|
|
|
56
|
|
|
Section 12.6 Return of Contributions
|
|
|
56
|
|
|
Section 12.7 Waiver of Partition
|
|
|
57
|
|
|
Section 12.8 Capital Account Restoration
|
|
|
57
|
|
|
|
ARTICLE XIII
AMENDMENT OF PARTNERSHIP AGREEMENT; MEETINGS; RECORD DATE
|
|
|
|
|
|
|
|
Section 13.1 Amendments to be Adopted Solely by the General Partner
|
|
|
57
|
|
|
Section 13.2 Amendment Procedures
|
|
|
58
|
|
|
Section 13.3 Amendment Requirements
|
|
|
59
|
|
|
Section 13.4 Special Meetings
|
|
|
60
|
|
|
Section 13.5 Notice of a Meeting
|
|
|
60
|
|
|
Section 13.6 Record Date
|
|
|
60
|
|
|
Section 13.7 Adjournment
|
|
|
60
|
|
|
Section 13.8 Waiver of Notice; Approval of Meeting; Approval of Minutes
|
|
|
61
|
|
|
Section 13.9 Quorum and Voting
|
|
|
61
|
|
|
Section 13.10 Conduct of a Meeting
|
|
|
61
|
|
|
Section 13.11 Action Without a Meeting
|
|
|
62
|
|
|
Section 13.12 Right to Vote and Related Matters
|
|
|
62
|
|
|
|
ARTICLE XIV
MERGER
|
|
|
|
|
|
|
|
Section 14.1 Authority
|
|
|
63
|
|
|
Section 14.2 Procedure for Merger or Consolidation
|
|
|
63
|
|
iii
|
|
|
|
|
|
|
|
|
Page
|
|
|
Section 14.3 Approval by Partners of Merger or Consolidation
|
|
|
64
|
|
|
Section 14.4 Certificate of Merger
|
|
|
65
|
|
|
Section 14.5 Amendment of Partnership Agreement
|
|
|
65
|
|
|
Section 14.6 Effect of Merger
|
|
|
65
|
|
|
|
ARTICLE XV
RIGHT TO ACQUIRE LIMITED PARTNER INTERESTS
|
|
|
|
|
|
|
|
Section 15.1 Right to Acquire Limited Partner Interests
|
|
|
66
|
|
|
|
ARTICLE XVI
GENERAL PROVISIONS
|
|
|
|
|
|
|
|
Section 16.1 Addresses and Notices
|
|
|
67
|
|
|
Section 16.2 Further Action
|
|
|
68
|
|
|
Section 16.3 Binding Effect
|
|
|
68
|
|
|
Section 16.4 Integration
|
|
|
68
|
|
|
Section 16.5 Creditors
|
|
|
68
|
|
|
Section 16.6 Waiver
|
|
|
68
|
|
|
Section 16.7 Counterparts
|
|
|
68
|
|
|
Section 16.8 Applicable Law; Forum, Venue and Jurisdiction
|
|
|
69
|
|
|
Section 16.9 Invalidity of Provisions
|
|
|
69
|
|
|
Section 16.10 Consent of Partners
|
|
|
70
|
|
|
Section 16.11 Facsimile Signatures
|
|
|
70
|
|
|
Section 16.12 Third Party Beneficiaries
|
|
|
70
|
|
iv
SECOND AMENDED AND RESTATED AGREEMENT OF LIMITED
PARTNERSHIP OF CVR PARTNERS, LP
THIS SECOND AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF CVR PARTNERS, LP, dated
as of April 13, 2011 and effective as of the Effective Time, is entered into by and among CVR GP,
LLC, a Delaware limited liability company, as the General Partner, and Coffeyville Resources, LLC,
a Delaware limited liability company, as the Organizational Limited Partner, together with any
other Persons who become Partners in the Partnership or parties hereto as provided herein. In
consideration of the covenants, conditions and agreements contained herein, the parties hereto
hereby agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1
Definitions
. The following definitions shall be for all purposes, unless otherwise clearly
indicated to the contrary, applied to the terms used in this Agreement.
“
Adjusted Capital Account
” means the Capital Account maintained for each Partner as of the end
of each taxable period of the Partnership, (a) increased by any amounts that such Partner is
obligated to restore under the standards set by Treasury Regulation Section 1.704-1(b)(2)(ii)(c)
(or is deemed obligated to restore under Treasury Regulation Sections 1.704-2(g)(1) and
1.704-2(i)(5)) and (b) decreased by (i) the amount of all losses and deductions that, as of the end
of such taxable period, are reasonably expected to be allocated to such Partner in subsequent
taxable periods under Sections 704(e)(2) and 706(d) of the Code and Treasury Regulation Section
1.751-1(b)(2)(ii), and (ii) the amount of all distributions that, as of the end of such taxable
period, are reasonably expected to be made to such Partner in subsequent taxable periods in
accordance with the terms of this Agreement or otherwise to the extent they exceed offsetting
increases to such Partner’s Capital Account that are reasonably expected to occur during (or prior
to) the taxable period in which such distributions are reasonably expected to be made (other than
increases as a result of a minimum gain chargeback pursuant to Sections 6.1(b)(i) or 6.1(b)(ii).
The foregoing definition of Adjusted Capital Account is intended to comply with the provisions of
Treasury Regulation Section 1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith.
The “Adjusted Capital Account” of a Partner in respect of any Partnership Interest shall be the
amount that such Adjusted Capital Account would be if such Partnership Interest were the only
interest in the Partnership held by such Partner from and after the date on which such Partnership
Interest was first issued.
“
Adjusted Property
” means any property the Carrying Value of which has been adjusted pursuant
to Sections 5.3(d)(i) or 5.3(d)(ii).
“
Affiliate
” means, with respect to any Person, any other Person that directly or indirectly
through one or more intermediaries controls, is controlled by or is under common control with, the
Person in question. As used herein, the term “control” means the possession, direct or indirect, of
the power to direct or cause the direction of the management and policies of a Person, whether
through ownership of voting securities, by contract or otherwise.
1
“
Agreed Allocation
” means any allocation, other than a Required Allocation, of an item of
income, gain, loss or deduction pursuant to the provisions of Section 6.1, including a Curative
Allocation (if appropriate to the context in which the term “Agreed Allocation” is used).
“
Agreed Value
” of any Contributed Property means the fair market value of such property at the
time of contribution and in the case of an Adjusted Property, the fair market value of such
Adjusted Property on the date of the revaluation event as described in Section 5.3(d), in both
cases as determined by the General Partner.
“
Agreement
” means this Second Amended and Restated Agreement of Limited Partnership of CVR
Partners, LP, as it may be amended, supplemented or restated from time to time.
“
Amended Contribution Agreement
” means the Amended and Restated Contribution Agreement, dated
April 7, 2011, by and among the Partnership, the General Partner, Coffeyville Resources,
Coffeyville Acquisition III, and the Special General Partner, as such agreement may be amended,
restated, modified or replaced from time to time.
“
Associate
” means, when used to indicate a relationship with any Person, (a) any corporation
or organization of which such Person is a director, officer, manager, general partner or managing
member or is, directly or indirectly, the owner of 20% or more of any class of voting stock or
other voting interest; (b) any trust or other estate in which such Person has at least a 20%
beneficial interest or as to which such Person serves as trustee or in a similar fiduciary
capacity; and (c) any relative or spouse of such Person, or any relative of such spouse, who has
the same principal residence as such Person.
“
Board of Directors
” means the board of directors of the General Partner.
“
Book-Tax Disparity
” means with respect to any item of Contributed Property or Adjusted
Property, as of the date of any determination, the difference between the Carrying Value of such
Contributed Property or Adjusted Property and the adjusted basis thereof for U.S. federal income
tax purposes as of such date. A Partner’s share of the Partnership’s Book-Tax Disparities in all of
its Contributed Property and Adjusted Property will be reflected by the difference between such
Partner’s Capital Account balance as maintained pursuant to Section 5.3 and the hypothetical
balance of such Partner’s Capital Account computed as if it had been maintained strictly in
accordance with U.S. federal income tax accounting principles.
“
Business Day
” means Monday through Friday of each week, except that a legal holiday
recognized as such by the government of the United States of America, the State of Kansas or the
State of Texas shall not be regarded as a Business Day.
“
Capital Account
” means the capital account maintained for a Partner pursuant to Section 5.3.
The “Capital Account” of a Partner in respect of a Partnership Interest shall be the amount that
such Capital Account would be if such Partnership Interest were the only interest in the
Partnership held by such Partner from and after the date on which such Partnership Interest was
first issued.
2
“
Capital Contribution
” means any cash, cash equivalents or the Net Agreed Value of Contributed
Property that a Partner contributes to the Partnership or that is contributed to the Partnership on
behalf of a Partner (including, in the case of an underwritten offering of Units, the amount of any
underwriting discounts or commissions).
“
Carrying Value
” means (a) with respect to a Contributed Property or Adjusted Property, the
Agreed Value of such property reduced (but not below zero) by all depreciation, amortization and
cost recovery deductions charged to the Partners’ Capital Accounts in respect of such property, and
(b) with respect to any other Partnership property, the adjusted basis of such property for U.S.
federal income tax purposes, all as of the time of determination. The Carrying Value of any
property shall be adjusted from time to time in accordance with Section 5.3(d), and to reflect
changes, additions or other adjustments to the Carrying Value for dispositions and acquisitions of
Partnership properties, as deemed appropriate by the General Partner.
“
Cause
” means a court of competent jurisdiction has entered a final, non-appealable judgment
finding that the General Partner, as an entity, has materially breached a material provision of
this Agreement or is liable for actual fraud or willful misconduct in its capacity as a general
partner of the Partnership.
“
Certificate
” means a certificate in such form (including global form if permitted by
applicable rules and regulations) as may be adopted by the General Partner, issued by the
Partnership evidencing ownership of one or more Partnership Interests. The initial form of
certificate approved by the General Partner for Common Units is attached as Exhibit A to this
Agreement.
“
Certificate of Limited Partnership
” means the Certificate of Limited Partnership of the
Partnership filed with the Secretary of State of the State of Delaware as referenced in Section
7.2, as such Certificate of Limited Partnership may be amended, supplemented or restated from time
to time.
“
claim
” (as used in Section 7.12(c)) has the meaning assigned to such term in Section 7.12(c).
“
Closing Date
” means the first date on which Common Units are sold by the Partnership to the
Underwriters pursuant to the provisions of the Underwriting Agreement.
“
Closing Price
” means, in respect of any class of Limited Partner Interests, as of the date of
determination, the last sale price on such day, regular way, or in case no such sale takes place on
such day, the average of the closing bid and asked prices on such day, regular way, in either case
as reported in the principal consolidated transaction reporting system with respect to securities
listed or admitted to trading on the principal National Securities Exchange on which the respective
Limited Partner Interests are listed or admitted to trading or, if such Limited Partner Interests
are not listed or admitted to trading on any National Securities Exchange, the last quoted price on
such day or, if not so quoted, the average of the high bid and low asked prices on such day in the
over-the-counter market, as reported by the primary reporting system then in use in relation to
such Limited Partner Interests of such class, or, if on any such day such Limited Partner Interests
of such class are not quoted by any such organization, the average of
3
the closing bid and asked prices on such day as furnished by a professional market maker
making a market in such Limited Partner Interests of such class selected by the General Partner, or
if on any such day no market maker is making a market in such Limited Partner Interests of such
class, the fair value of such Limited Partner Interests on such day as determined by the General
Partner.
“
Code
” means the U.S. Internal Revenue Code of 1986, as amended and in effect from time to
time. Any reference herein to a specific section or sections of the Code shall be deemed to include
a reference to any corresponding provision of any successor law.
“
Coffeyville Acquisition III
” means Coffeyville Acquisition III LLC, a Delaware limited
liability company.
“
Coffeyville Resources
” means Coffeyville Resources, LLC, a Delaware limited liability
company.
“
Combined Interest
” has the meaning assigned to such term in Section 11.3(a).
“
Commission
” means the United States Securities and Exchange Commission.
“
Common Unit
” means a Unit representing, when outstanding, a fractional part of the
Partnership Interests of all Limited Partners, and having the rights and obligations specified with
respect to Common Units in this Agreement.
“
Conflicts Committee
” means a committee of the Board of Directors composed entirely of one or
more directors who are not (a) officers or employees of the General Partner, (b) officers,
directors or employees of any Affiliate of the General Partner or (c) holders of any ownership
interest in the General Partner or any of its Affiliates, including any Group Member, other than
Common Units and other awards that are granted to such director under the Long Term Incentive Plan
and who also meet the independence standards required of directors who serve on an audit committee
of a board of directors established by the Securities Exchange Act and the rules and regulations of
the Commission thereunder and by (i) the National Securities Exchange on which any class of
Partnership Interests are listed or admitted to trading or (ii) if no class of Partnership
Interests is so listed or traded, by the New York Stock Exchange, Inc.
“
Contributed Property
” means each property, in such form as may be permitted by the Delaware
Act, but excluding cash, contributed to the Partnership. Once the Carrying Value of a Contributed
Property is adjusted pursuant to Section 5.3(d), such property shall no longer constitute a
Contributed Property, but shall be deemed an Adjusted Property.
“
Contribution Agreement
” means that certain Contribution, Conveyance and Assumption Agreement,
dated as of October 24, 2007, among the General Partner, the Special General Partner, the
Organizational Limited Partner and the Partnership, together with the additional conveyance
documents and instruments contemplated or referenced thereunder.
“
Credit Agreement
” means the Credit Agreement, dated as of April 13, 2011, among the
Partnership, Goldman Sachs Lending Partners LLC and the other lenders party thereto, as such
agreement may be amended, modified, supplemented, replaced, refinanced or otherwise
4
restructured from time to time, including any refinancing, restructuring or replacement by one
or more other credit agreements, indentures, purchase agreements or other agreements, whether or
not the amount covered thereby is increased or decreased, and with the same or different
counterparties..
“
Curative Allocation
” means any allocation of an item of income, gain, deduction, loss or
credit pursuant to the provisions of Section 6.1(b)(xi).
“
Current Market Price
” means, in respect of any class of Partnership Interests, as of the date
of determination, the average of the daily Closing Prices per Partnership Interest of such class
for the 20 consecutive Trading Days immediately prior to such date.
“
Delaware Act
” means the Delaware Revised Uniform Limited Partnership Act, 6 Del C. Section
17-101,
et seq
., as amended, supplemented or restated from time to time, and any successor to such
statute.
“
Departing General Partner
” means a former General Partner from and after the effective date
of any withdrawal or removal of such former General Partner pursuant to Sections 11.1 or 11.2.
“
Economic Risk of Loss
” has the meaning set forth in Treasury Regulation Section 1.752-2(a).
“
Effective Time
” means the time of completion of the redemption by the Partnership of the
Incentive Distribution Rights pursuant to the Amended Contribution Agreement.
“
Eligibility Certificate
” has the meaning assigned to such term in Section 4.8(b)
.
“
Eligibility Certification
” means a properly completed certificate in such form as may be
specified by the General Partner by which a Partner certifies that he (and if he is a nominee
holding for the account of another Person, that to the best of his knowledge such other Person) is
an Eligible Holder.
“
Eligible Holder
” means a Person that satisfies the eligibility requirements established by
the General Partner for Partners pursuant to Section 4.8.
“
Event of Withdrawal
” has the meaning assigned to such term in Section 11.1(a).
“
Fertilizer Restricted Businesses
” has the meaning assigned to such term in the Omnibus
Agreement.
“
General Partner
” means CVR GP, LLC, a Delaware limited liability company, and its successors
and permitted assigns that are admitted to the Partnership as the general partner of the
Partnership, in their capacity as the general partner of the Partnership.
“
General Partner Interest
” means the non-economic management interest of the General Partner
in the Partnership (in its capacity as general partner without reference to any Limited Partner
Interest), which includes any and all rights, powers and benefits to which the General
5
Partner is entitled as provided in this Agreement, together with all obligations of the
General Partner to comply with the terms and provisions of this Agreement. The General Partner
Interest does not have any rights to ownership or profits or any rights to receive distributions
from operations or the liquidation or winding-up of the Partnership.
“
Gross Liability Value
” means, with respect to any Liability of the Partnership described in
Treasury Regulation Section 1.752-7(b)(3)(i), the amount of cash that a willing assignor would pay
to a willing assignee to assume such Liability in an arm’s-length transaction.
“
Group
” means a Person that with or through any of its Affiliates or Associates has any
contract, arrangement, understanding or relationship for the purpose of acquiring, holding, voting
(except voting pursuant to a revocable proxy or consent given to such Person in response to a proxy
or consent solicitation made to 10 or more Persons), exercising investment power or disposing of
any Partnership Interests with any other Person that beneficially owns, or whose Affiliates or
Associates beneficially own, directly or indirectly, Partnership Interests.
“
Group Member
” means a member of the Partnership Group.
“
Group Member Agreement
” means the partnership agreement of any Group Member, other than the
Partnership, that is a limited or general partnership, the limited liability company agreement of
any Group Member that is a limited liability company, the certificate of incorporation and bylaws
or similar organizational documents of any Group Member that is a corporation, the joint venture
agreement or similar governing document of any Group Member that is a joint venture and the
governing or organizational or similar documents of any other Group Member that is a Person other
than a limited or general partnership, limited liability company, corporation or joint venture, as
such may be amended, supplemented or restated from time to time.
“
Holder
” as used in Section 7.12, has the meaning assigned to such term in Section 7.12(a).
“
Incentive Distribution Rights
” means, prior to their extinguishment pursuant to Section 5.1
hereto, a non-voting Limited Partner Interest which conferred upon the holder thereof the rights
and obligations specifically provided in the original Agreement of Limited Partnership of the
Partnership, as heretofore amended.
“
Indemnified Persons
” has the meaning assigned to such term in Section 7.12(c).
“
Indemnitee
” means (a) the General Partner, (b) any Departing General Partner, (c) any Person
who is or was a director, officer, fiduciary, trustee, manager or managing member of any Group
Member, the General Partner or any Departing General Partner, (d) any Person who is or was a
manager, managing member, director, officer, employee, agent, fiduciary or trustee of any Group
Member, a General Partner, any Departing General Partner or any of their respective Affiliates, (e)
any Person who is or was serving at the request of the General Partner or any Departing General
Partner as a director, officer, fiduciary, trustee, manager or managing member of another Person
owing a fiduciary duty to any Group Member; provided that a Person shall not be an Indemnitee by
reason of providing, on a fee-for-services basis, trustee, fiduciary or custodial services, (f) any
Person who controls or has previously controlled, directly or
6
indirectly, the General Partner and (g) any Person the General Partner designates as an
“Indemnitee” for purposes of this Agreement because such Person’s service, status or relationship
exposes such Person to potential claims, demands, actions, suits or proceedings relating to the
Partnership Group’s business and affairs.
“
Ineligible Holder
” has the meaning assigned to such term in Section 4.8(c)
.
“
Initial Offering
” means the initial offering and sale of Common Units to the public, as
described in the Registration Statement, including the offering and any sale of Common Units
pursuant to the Over-Allotment Option.
“
Limited Partner
” means, unless the context otherwise requires, the Organizational Limited
Partner, each additional Person that becomes a Limited Partner pursuant to the terms of this
Agreement and any Departing General Partner or Special General Partner upon the change of its
status from General Partner or Special General Partner to Limited Partner pursuant to Section 11.3
or Section 5.1(c), in each case in such Person’s capacity as a limited partner of the Partnership.
“
Limited Partner Interest
” means the ownership interest of a Limited Partner in the
Partnership, which may be evidenced by Common Units or other Units or a combination thereof or
interest therein, and includes any and all benefits to which such Limited Partner is entitled as
provided in this Agreement, together with all obligations of such Limited Partner to comply with
the terms and provisions of this Agreement.
“
Liquidation Date
” means (a) in the case of an event giving rise to the dissolution of the
Partnership of the type described in clauses (a) and (b) of the first sentence of Section 12.2, the
date on which the applicable time period during which the Partners have the right to elect to
continue the business of the Partnership has expired without such an election being made, and (b)
in the case of any other event giving rise to the dissolution of the Partnership, the date on which
such event occurs.
“
Liquidator
” means one or more Persons selected by the General Partner to perform the
functions described in Section 12.4 as liquidating trustee of the Partnership within the meaning of
the Delaware Act.
“
Long Term Incentive Plan
” means the CVR Partners, LP 2011 Long-Term Incentive Plan, as it may
be amended, restated or modified from time to time, or any equity compensation plan successor
thereto.
“
Merger Agreement
” has the meaning assigned to such term in Section 14.1.
“
National Securities Exchange
” means an exchange registered with the Commission under Section
6(a) of the Securities Exchange Act (or any successor to such Section) and any other securities
exchange (whether or not registered with the Commission under Section 6(a) of the Securities
Exchange Act (or successor to such Section)) that the General Partner shall designate as a National
Securities Exchange for purposes of this Agreement.
7
“
Net Agreed Value
” means, (a) in the case of any Contributed Property, the Agreed Value of
such property reduced by any liabilities either assumed by the Partnership upon such contribution
or to which such property is subject when contributed and (b) in the case of any property
distributed to a Partner by the Partnership, the Partnership’s Carrying Value of such property (as
adjusted pursuant to Section 5.3(d)(ii)) at the time such property is distributed, reduced by any
liabilities either assumed by such Partner upon such distribution or to which such property is
subject at the time of distribution.
“
Net Income
” means, for any taxable period, the excess, if any, of the Partnership’s items of
income and gain for such taxable period over the Partnership’s items of loss and deduction for such
taxable period. The items included in the calculation of Net Income shall be determined in
accordance with Section 5.3(b) and shall not include any items specially allocated under Section
6.1(b).
“
Net Loss
” means, for any taxable period, the excess, if any, of the Partnership’s items of
loss and deduction for such taxable period over the Partnership’s items of income and for such
taxable period. The items included in the calculation of Net Loss shall be determined in accordance
with Section 5.3(b) and shall not include any items specially allocated under Section 6.1(b).
“
Nonrecourse Built-in Gain
” means with respect to any Contributed Properties or Adjusted
Properties that are subject to a mortgage or pledge securing a Nonrecourse Liability, the amount of
any taxable gain that would be allocated to the Partners pursuant to Section 6.2(b) if such
properties were disposed of in a taxable transaction in full satisfaction of such liabilities and
for no other consideration.
“
Nonrecourse Deductions
” means any and all items of loss, deduction or expenditure (including
any expenditure described in Section 705(a)(2)(B) of the Code) that, in accordance with the
principles of Treasury Regulation Section 1.704-2(b), are attributable to a Nonrecourse Liability.
“
Nonrecourse Liability
” has the meaning set forth in Treasury Regulation Section
1.752-1(a)(2).
“
Notice of Election to Purchase
” has the meaning assigned to such term in Section 15.1(b).
“
Omnibus Agreement
” means that certain Amended and Restated Omnibus Agreement, dated as of
April , 2011, among CVR Energy, Inc., the General Partner and the Partnership, as such may
be amended, supplemented or restated from time to time.
“
Opinion of Counsel
” means a written opinion of counsel (who may be regular counsel to the
Partnership or the General Partner or any of its Affiliates) acceptable to the General Partner.
“
Option Closing Date
” means the date or dates on which any Common Units are sold by the
Partnership to the Underwriters upon exercise of the Over-Allotment Option.
8
“
Organizational Limited Partner
” means Coffeyville Resources, LLC in its capacity as the
organizational limited partner of the Partnership pursuant to this Agreement.
“
Outstanding
” means, with respect to Partnership Interests, all Partnership Interests that are
issued by the Partnership and reflected as outstanding on the Partnership’s books and records as of
the date of determination; provided, however, that if at any time any Person or Group (other than
the General Partner or its Affiliates, including Coffeyville Resources, LLC and CVR Energy, Inc.)
beneficially owns 20% or more of the Outstanding Limited Partner Interests of any class then
Outstanding, none of the Limited Partner Interests owned by such Person or Group shall be entitled
to be voted on any matter and shall not be considered to be Outstanding when sending notices of a
meeting of Limited Partners to vote on any matter (unless otherwise required by law), calculating
required votes, determining the presence of a quorum or for other similar purposes under this
Agreement, except that Limited Partner Interests so owned shall be considered to be Outstanding for
purposes of Section 11.1(b)(iv) (such Partnership Interests shall not, however, be treated as a
separate class of Partnership Interests for purposes of this Agreement or the Delaware Act);
provided, further, that the foregoing limitation on voting of Partnership Interests shall not apply
to (i) any Person or Group who acquired 20% or more of the Outstanding Limited Partner Interests of
any class then Outstanding directly from the General Partner or its Affiliates (other than the
Partnership), (ii) any Person or Group who acquired 20% or more of the Outstanding Limited Partner
Interests of any class then Outstanding directly or indirectly from a Person or Group described in
clause (i) provided that the General Partner shall have notified such Person or Group in writing
that such limitation shall not apply, or (iii) any Person or Group who acquired 20% or more of any
Limited Partner Interests issued by the Partnership provided that the General Partner shall have
notified such Person or Group in writing that such limitation shall not apply.
“
Over-Allotment Option
” means the over-allotment option granted to the Underwriters by the
Partnership pursuant to the Underwriting Agreement.
“
Partner Nonrecourse Debt
” has the meaning given to such term in Treasury Regulation Section
1.704-2(b)(4).
“
Partner Nonrecourse Debt Minimum Gain
” has the meaning given to such term in Treasury
Regulation Section 1.704-2(i)(2).
“
Partner Nonrecourse Deductions
” means any and all items of loss, deduction or expenditure
(including any expenditure described in Section 705(a)(2)(B) of the Code) that, in accordance with
the principles of Treasury Regulation Section 1.704-2(i)(1), are attributable to a Partner
Nonrecourse Debt.
“
Partners
” means the General Partner and the Limited Partners.
“
Partnership
” means CVR Partners, LP, a Delaware limited partnership.
“
Partnership Group
” means the Partnership and its Subsidiaries treated as a single entity.
“
Partnership Interest
” means an interest in the Partnership, which shall include any General
Partner Interest and Limited Partner Interests but shall exclude any options, rights,
9
warrants and appreciation rights relating to an equity interest in the Partnership and, for
the purpose of Section 7.12, shall include any interests into which such Partnership Interests are
convertible or for which such Partnership Interests are exchangeable.
“
Partnership Minimum Gain
” means the amount of “partnership minimum gain” determined in
accordance with the principles of Treasury Regulation Sections 1.704-2(b)(2) and 1.704-2(d).
“
Percentage Interest
” means as of any date of determination (a) as to any Unitholder with
respect to Units, the product obtained by multiplying (i) 100% less the percentage applicable to
clause (b) below by (ii) the quotient obtained by dividing (A) the number of Units held by such
Unitholder, by (B) the total number of all Outstanding Units, and (b) as to the holders of other
Partnership Interests issued by the Partnership in accordance with Section 5.4, the percentage
established (or determined as established) as a part of such issuance. The Percentage Interest with
respect to the General Partner Interest shall at all times be zero.
“
Person
” means an individual or a corporation, limited liability company, partnership, joint
venture, trust, unincorporated organization, association, government agency or political
subdivision thereof or other entity.
“
Pro Rata
” means (a) when used with respect to Units or any class thereof, apportioned equally
among all designated Units in accordance with their relative Percentage Interests and (b) when used
with respect to Partners or Record Holders, apportioned among all Partners or Record Holders in
accordance with their relative Percentage Interests.
“
Purchase Date
” means the date determined by the General Partner as the date for purchase of
all Outstanding Limited Partner Interests of a certain class (other than Limited Partner Interests
owned by the General Partner and its Affiliates) pursuant to Article XV.
“
Quarter
” means, unless the context requires otherwise, a fiscal quarter of the Partnership.
“
Rate Eligibility Trigger
” has the meaning assigned to such term in Section 4.8(a)(i).
“
Recapture Income
” means any gain recognized by the Partnership (computed without regard to
any adjustment required by Section 734 or Section 743 of the Code) upon the disposition of any
property or asset of the Partnership, which gain is characterized as ordinary income because it
represents the recapture of deductions previously taken with respect to such property or asset.
“
Record Date
” means the date established by the General Partner or otherwise in accordance
with this Agreement for determining (a) the identity of the Record Holders entitled to notice of,
or to vote at, any meeting of Limited Partners or entitled to vote by ballot or give approval of
Partnership action in writing without a meeting or entitled to exercise rights in respect of any
lawful action of Limited Partners or (b) the identity of Record Holders entitled to receive any
report or distribution or to participate in any offer.
10
“
Record Holder
” means (a) with respect to Partnership Interests of any class of Partnership
Interests for which a Transfer Agent has been appointed, the Person in whose name a Partnership
Interest of such class is registered on the books of the Transfer Agent as of the opening of
business on a particular Business Day, or (b) with respect to other classes of Partnership
Interests, the Person in whose name any such other Partnership Interest is registered on the books
that the General Partner has caused to be kept as of the opening of business on such Business Day.
“
Redeemable Interests
” means any Partnership Interests for which a redemption notice has been
given, and has not been withdrawn, pursuant to Section 4.9.
“
Registration Statement
” means the Registration Statement on Form S-1 (File No. 333-171270) as
it has been or as it may be amended or supplemented from time to time, filed by the Partnership
with the Commission under the Securities Act to register the offering and sale of the Common Units
in the Initial Offering, including any related registration statement filed pursuant to Rule 462(b)
under the Securities Act.
“
Required Allocations
” means any allocation of an item of income, gain, loss or deduction
pursuant to Sections 6.1(b)(i), 6.1(b)(ii), 6.1(b)(iv), 6.1(b)(v), 6.1(b)(vi), 6.1(b)(vii) or
6.1(b)(ix).
“
Securities Act
” means the Securities Act of 1933, as amended, supplemented or restated from
time to time and any successor to such statute.
“
Securities Exchange Act
” means the Securities Exchange Act of 1934, as amended, supplemented
or restated from time to time and any successor to such statute.
“
Special Approval
” means approval by a majority of the members of the Conflicts Committee.
“
Special General Partner
” means CVR Special GP, LLC, a Delaware limited liability company that
was previously admitted to the Partnership as special general partner of the Partnership, and whose
Special Units were exchanged for Common Units pursuant to the Amended Contribution Agreement.
“
Special General Partner Interest
” means, historically, the management and ownership interest
of the Special General Partner in the Partnership (in its capacity as Special General Partner).
“
Special GP Units
” the 30,303,000 special GP units which represented, prior to their exchange
pursuant to the Amended Contribution Agreement, the Special General Partner Interest.
“
Special LP Units
” the 30,333 special LP units which represented, prior to their exchange
pursuant to the Amended Contribution Agreement, all of the limited partner interests in the
Partnership.
“
Special Units
” means the Special GP Units and the Special LP Units, collectively.
11
“
Subsidiary
” means, with respect to any Person, (a) a corporation of which more than 50% of
the voting power of shares entitled (without regard to the occurrence of any contingency) to vote
in the election of directors or other governing body of such corporation is owned, directly or
indirectly, at the date of determination, by such Person, by one or more Subsidiaries of such
Person or a combination thereof, (b) a partnership (whether general or limited) in which such
Person or a Subsidiary of such Person is, at the date of determination, a general partner of such
partnership, but only if such Person, directly or by one or more Subsidiaries of such Person, or a
combination thereof, controls such partnership, directly or indirectly, at the date of
determination or (c) any other Person in which such Person, one or more Subsidiaries of such
Person, or a combination thereof, directly or indirectly, at the date of determination, has (i) at
least a majority ownership interest or (ii) the power to elect or direct the election of a majority
of the directors or other governing body of such Person.
“
Surviving Business Entity
” has the meaning assigned to such term in Section 14.2(b)(ii).
“
Trading Day
” means, for the purpose of determining the Current Market Price of any class of
Limited Partner Interests, a day on which the principal National Securities Exchange on which such
class of Limited Partner Interests is listed or admitted to trading is open for the transaction of
business or, if Limited Partner Interests of a class are not listed or admitted to trading on any
National Securities Exchange, a day on which banking institutions in New York City generally are
open.
“
transfer
” has the meaning assigned to such term in Section 4.4(a).
“
Transfer Agent
” means such bank, trust company or other Person (including the General Partner
or one of its Affiliates) as may be appointed from time to time by the Partnership to act as
registrar and transfer agent for any class of Partnership Interests; provided that if no Transfer
Agent is specifically designated for any class of Partnership Interests, the General Partner shall
act in such capacity.
“
Underwriter
” means each Person named as an underwriter in the Underwriting Agreement who
purchases Common Units pursuant thereto.
“
Underwriting Agreement
” means that certain Underwriting Agreement dated April 7, 2011, by and
among the representatives of the Underwriters, the Partnership, and the other parties thereto,
providing for the purchase of Common Units by the Underwriters, as supplemented by the Joinder
Agreement, dated April 13, 2011, by the General Partner.
“
Unit
” means a Partnership Interest that is designated as a “Unit” and shall include Common
Units.
“
Unit Majority
” means at least a majority of the Outstanding Common Units.
“
Unitholders
” means the holders of Units.
“
Unrealized Gain
” attributable to any item of Partnership property means, as of any date of
determination, the excess, if any, of (a) the fair market value of such property as of such date
12
(as determined under Section 5.3(d)) over (b) the Carrying Value of such property as of such
date (prior to any adjustment to be made pursuant to Section 5.3(d) as of such date).
“
Unrealized Loss
” attributable to any item of Partnership property means, as of any date of
determination, the excess, if any, of (a) the Carrying Value of such property as of such date
(prior to any adjustment to be made pursuant to Section 5.3(d) as of such date) over (b) the fair
market value of such property as of such date (as determined under Section 5.3(d)).
“
Unrestricted Person
” means each Indemnitee, each Partner and each Person who is or was a
member, partner, director, officer, employee or agent of any Group Member, the General Partner or
any Departing General Partner or any Affiliate of any Group Member, the General Partner or any
Departing General Partner and any Person the General Partner designates as an “Unrestricted Person”
for purposes of this Agreement.
“
U.S. GAAP
” means United States generally accepted accounting principles, as in effect from
time to time, consistently applied.
“
Withdrawal Opinion of Counsel
” has the meaning assigned to such term in Section 11.1(b).
Section 1.2
Construction
. Unless the context requires otherwise: (a) any pronoun used in this Agreement
shall include the corresponding masculine, feminine or neuter forms; (b) references to Articles and
Sections refer to Articles and Sections of this Agreement; (c) the terms “include”, “includes”,
“including” and words of like import shall be deemed to be followed by the words “without
limitation”; and (d) the terms “hereof”, “herein” and “hereunder” refer to this Agreement as a
whole and not to any particular provision of this Agreement. The table of contents and headings
contained in this Agreement are for reference purposes only, and shall not affect in any way the
meaning or interpretation of this Agreement.
ARTICLE II
ORGANIZATION
Section 2.1
Formation
. The General Partner, the Special General Partner and the Organizational Limited
Partner previously formed the Partnership as a limited partnership pursuant to the provisions of
the Delaware Act. The General Partner and the Organizational Limited Partner hereby amend and
restate the original Agreement of Limited Partnership of the Partnership, as heretofore amended, in
its entirety. This amendment and restatement shall become effective on the date of this Agreement.
Except as expressly provided to the contrary in this Agreement, the rights, duties, liabilities and
obligations of the Partners and the administration, dissolution and termination of the Partnership
shall be governed by the Delaware Act.
Section 2.2
Name
. The name of the Partnership shall be “CVR Partners, LP”. The Partnership’s business may be
conducted under any other name or names as determined by the General Partner, including the name of
the General Partner. The words “Limited Partnership,” the letters “LP,” or “Ltd.” or similar words
or letters shall be included in the Partnership’s name where necessary for the purpose of complying
with the laws of any jurisdiction that so requires.
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The General Partner may change the name of the
Partnership at any time and from time to time and shall notify the Partners of such change in the
next regular communication to the Partners.
Section 2.3
Registered Office; Registered Agent; Principal Office; Other Offices
. Unless and until
changed by the General Partner, the registered office of the Partnership in the State of Delaware
shall be located at 1209 Orange Street, Wilmington, Delaware 19801, and the registered agent for
service of process on the Partnership in the State of Delaware at such registered office shall be
The Corporation Trust Company. The principal office of the Partnership shall be located at 2277
Plaza Drive, Suite 500, Sugar Land, Texas 77479 or such other place as the General Partner may from
time to time designate by notice to the Partners. The Partnership may maintain offices at such
other place or places within or outside the State of Delaware as the General Partner determines to
be necessary or appropriate. The address of the General Partner shall be 2277 Plaza Drive, Suite
500, Sugar Land, Texas 77479 or such other place as the General Partner may from time to time
designate by notice to the Partners.
Section 2.4
Purpose and Business
. The purpose and nature of the business to be conducted by the
Partnership shall be to engage directly in, or enter into or form, hold and dispose of any
corporation, partnership, joint venture, limited liability company or other arrangement to engage
indirectly in, any business activity that is approved by the General Partner, in its sole
discretion, and that lawfully may be conducted by a limited partnership organized pursuant to the
Delaware Act and, in connection therewith, to exercise all of the rights and powers conferred upon
the Partnership pursuant to the agreements relating to such business activity, and do anything
necessary or appropriate to the foregoing, including the making of capital contributions or loans
to a Group Member;
provided
, however, that the General Partner shall not cause the Partnership to
engage, directly or indirectly, in any business activity that the General Partner determines would
be reasonably likely to cause the Partnership to be treated as an association taxable as a
corporation or otherwise taxable as an entity for federal income tax purposes. To the fullest
extent permitted by law, the General Partner shall have no duty or obligation to propose or
approve, and may, in its sole discretion, decline to propose or approve, the conduct by the
Partnership of any business.
Section 2.5
Powers
. The Partnership shall be empowered to do any and all acts and things necessary,
appropriate, proper, advisable, incidental to or convenient for the furtherance and accomplishment
of the purposes and business described in Section 2.4 and for the protection and benefit of the
Partnership.
Section 2.6
Term
. The term of the Partnership commenced upon the filing of the Certificate of Limited
Partnership in accordance with the Delaware Act and shall continue until the dissolution of the
Partnership in accordance with the provisions of Article XII. The existence of the Partnership as a
separate legal entity shall continue until the cancellation of the Certificate of Limited
Partnership as provided in the Delaware Act.
Section 2.7
Title to Partnership Assets
. Title to Partnership assets, whether real, personal or mixed and
whether tangible or intangible, shall be deemed to be owned by the Partnership as an entity, and no
Partner, individually or collectively, shall have any ownership interest in such Partnership assets
or any portion thereof. Title to any or all of the Partnership assets may be held in the name of
the Partnership, the General Partner, one or more of its
14
Affiliates or one or more nominees, as the
General Partner may determine. The General Partner hereby declares and warrants that any
Partnership assets for which record title is held in the name of the General Partner or one or more
of its Affiliates or one or more nominees shall be held by the General Partner or such Affiliate or
nominee for the use and benefit of the Partnership in accordance with the provisions of this
Agreement; provided, however, that the General Partner shall use reasonable efforts to cause record
title to such assets (other than those assets in respect of which the General Partner determines
that the expense and difficulty of conveyancing makes transfer of record title to the Partnership
impracticable) to be vested in the Partnership as soon as reasonably practicable; provided,
further, that, prior to the withdrawal or removal of the General Partner or as soon thereafter as
practicable, the General Partner shall use reasonable efforts to effect the transfer of record
title to the Partnership and, prior to any such transfer, will provide for the use of such assets
in a manner satisfactory to the General Partner. All Partnership assets shall be recorded as the
property of the Partnership in its books and records, irrespective of the name in which record
title to such Partnership assets is held.
ARTICLE III
RIGHTS OF LIMITED PARTNERS
Section 3.1
Limitation of Liability
. The Limited Partners shall have no liability under this Agreement
except as expressly provided in this Agreement or the Delaware Act.
Section 3.2
Management of Business
. No Limited Partner, in its capacity as such, shall participate in the
operation, management or control (within the meaning of the Delaware Act) of the Partnership’s
business, transact any business in the Partnership’s name or have the power to sign documents for
or otherwise bind the Partnership. Any action taken by any Affiliate of the General Partner or any
officer, director, employee, manager, member, general partner, agent or trustee of the General
Partner or any of its Affiliates, or any officer, director, employee, manager, member, general
partner, agent or trustee of a Group Member, in its capacity as such, shall not be deemed to be
participation in the control of the business of the Partnership by a limited partner of the
Partnership (within the meaning of Section 17-303(a) of the Delaware Act) and shall not
affect, impair or eliminate the limitations on the liability of the Limited Partners under this
Agreement.
Section 3.3
Outside Activities of the Limited Partners
. Subject to the provisions of Section 7.5 and the
Omnibus Agreement, which shall continue to be applicable to the Persons referred to therein,
regardless of whether such Persons shall also be Limited Partners, each Limited Partner shall be
entitled to and may have any business interests and engage in any business activities in addition
to those relating to the Partnership, including business interests and activities in direct
competition with the Partnership Group. Neither the Partnership nor any of the other Partners shall
have any rights by virtue of this Agreement in any business ventures of any Limited Partner.
Section 3.4
Rights of Limited Partners
.
(a) In addition to other rights provided by this Agreement or by applicable law (other than
Section 17-305(a) of the Delaware Act, the obligations of which are expressly replaced in their
entirety by the provisions below), and except as limited by Section 3.4(b), each Limited
15
Partner shall have the right, for a purpose that is reasonably related, as determined by the General
Partner, to such Limited Partner’s interest as a Limited Partner in the Partnership, upon
reasonable written demand stating the purpose of such demand and at such Limited Partner’s own
expense to obtain:
(i) true and full information regarding the status of the business and financial
condition of the Partnership (provided that the requirements of this Section 3.4(a)(i) shall
be satisfied to the extent the Limited Partner is furnished the Partnership’s most recent
annual report and any subsequent quarterly or periodic reports required to be filed (or
which would be required to be filed) with the Commission pursuant to Section 13 of the
Exchange Act);
(ii) a current list of the name and last known business, residence or mailing address
of each Record Holder;
(iii) a copy of this Agreement and the Certificate of Limited Partnership and all
amendments thereto, together with copies of the executed copies of all powers of attorney
pursuant to which this Agreement, the Certificate of Limited Partnership and all amendments
thereto have been executed;
(iv) true and full information regarding the amount of cash and a description and
statement of the Net Agreed Value of any other Capital Contribution by each Partner and that
each Partner has agreed to contribute in the future, and the date on which each became a
Partner; and
(v) such other information regarding the affairs of the Partnership as the General
Partner determines is just and reasonable.
(b) The General Partner may keep confidential from the Limited Partners, for such period of
time as the General Partner deems reasonable, (i) any information that the General Partner
reasonably believes to be in the nature of trade secrets or (ii) other information the disclosure
of which the General Partner believes (A) is not in the best interests of the Partnership Group,
(B) could damage the Partnership Group or its business or (C) that any Group Member is required by
law or by agreement with any third party to keep confidential (other than agreements with
Affiliates of the Partnership the primary purpose of which is to circumvent the obligations set
forth in this Section 3.4).
ARTICLE IV
CERTIFICATES; RECORD HOLDERS; TRANSFER OF PARTNERSHIP INTERESTS;
REDEMPTION OF PARTNERSHIP INTERESTS
Section 4.1
Certificates
. Notwithstanding anything otherwise to the contrary herein, unless the General
Partner shall determine otherwise in respect of some or all of any or all classes of Partnership
Interests, Partnership Interests shall not be evidenced by certificates. Certificates that may be
issued shall be executed on behalf of the Partnership by the Chairman of the Board, President or
any Executive Vice President or Vice President and the Secretary or any Assistant Secretary of the
General Partner. No Certificate shall be valid for any purpose until it has been countersigned by
the Transfer Agent; provided, however, that if the General Partner
16
elects to cause the Partnership
to issue Partnership Interests of such class in global form, the Certificate shall be valid upon
receipt of a certificate from the Transfer Agent certifying that the Partnership Interests have
been duly registered in accordance with the directions of the Partnership.
Section 4.2
Mutilated, Destroyed, Lost or Stolen Certificates
.
(a) If any mutilated Certificate is surrendered to the Transfer Agent, the appropriate officers
of the General Partner on behalf of the Partnership shall execute, and the Transfer Agent shall
countersign and deliver in exchange therefor, a new
Certificate evidencing the same number and type of Partnership Interests as the Certificate so surrendered.
(b) The appropriate officers of the General Partner on behalf of the Partnership shall execute
and deliver, and the Transfer Agent shall countersign, a new Certificate in place of any
Certificate previously issued if the Record Holder of the Certificate:
(i) makes proof by affidavit, in form and substance satisfactory to the General
Partner, that a previously issued Certificate has been lost, destroyed or stolen;
(ii) requests the issuance of a new Certificate before the General Partner has notice
that the Certificate has been acquired by a purchaser for value in good faith and without
notice of an adverse claim;
(iii) if requested by the General Partner, delivers to the General Partner a bond, in
form and substance satisfactory to the General Partner, with surety or sureties and with
fixed or open penalty as the General Partner may direct, to indemnify the Partnership,
the Partners, the General Partner and the Transfer Agent against any claim that may be made
on account of the alleged loss, destruction or theft of the Certificate; and
(iv) satisfies any other reasonable requirements imposed by the General Partner.
If a Partner fails to notify the General Partner within a reasonable period of time after such
Partner has notice of the loss, destruction or theft of a Certificate, and a transfer of the
Partner Interests represented by the Certificate is registered before the Partnership, the General
Partner or the Transfer Agent receives such notification, the Partner shall be precluded from
making any claim against the Partnership, the General Partner or the Transfer Agent for such
transfer or for a new Certificate.
(c) As a condition to the issuance of any new Certificate under this Section 4.2, the General
Partner may require the payment of a sum sufficient to cover any tax or other governmental charge
that may be imposed in relation thereto and any other expenses (including the fees and expenses of
the Transfer Agent) reasonably connected therewith.
Section 4.3
Record Holders
. The Partnership shall be entitled to recognize the Record Holder as the
Partner with respect to any Partnership Interest and, accordingly, shall not be bound to recognize
any equitable or other claim to, or interest in, such Partnership Interest on the part of any other
Person, regardless of whether the Partnership shall have actual or other notice
17
thereof, except as
otherwise provided by law or any applicable rule, regulation, guideline or requirement of any
National Securities Exchange on which such Partnership Interests are listed or admitted to trading.
Without limiting the foregoing, when a Person (such as a broker, dealer, bank, trust company or
clearing corporation or an agent of any of the foregoing) is acting as nominee, agent or in some
other representative capacity for another Person in acquiring and/or holding Partnership Interests,
as between the Partnership on the one hand, and such other Persons on the other, such
representative Person shall be (a) the Record Holder of such Partnership Interest and (b) bound by
this Agreement and shall have the rights and obligations of a Partner hereunder as, and to the
extent, provided herein.
Section 4.4
Transfer Generally
.
(a) The term “transfer,” when used in this Agreement with respect to a Partnership Interest,
shall mean a transaction (i) by which the General Partner assigns its General Partner Interest to
another Person, and includes a sale, assignment, gift, pledge, grant of security interest,
encumbrance, hypothecation, mortgage, exchange or any other disposition by law or otherwise, or
(ii) by which the holder of a Limited Partner Interest assigns such Limited Partner Interest to
another Person who is or becomes a Limited Partner, and includes a sale, assignment, gift, exchange
or any other disposition by law or otherwise (but not the pledge, grant of security interest,
encumbrance, hypothecation or mortgage), including any transfer upon foreclosure or
other exercise of remedies of any pledge, security interest, encumbrance, hypothecation or
mortgage.
(b) No Partnership Interest shall be transferred, in whole or in part, except in accordance
with the terms and conditions set forth in this Article IV. Any transfer or purported transfer of a
Partnership Interest not made in accordance with this Article IV shall be, to the fullest extent
permitted by law, null and void.
(c) Nothing contained in this Agreement shall be construed to prevent a disposition by any
stockholder, member, partner or other owner of any Partner of any or all of the shares of stock,
membership interests, partnership interests or other ownership interests in such Partner and the
term “transfer” shall not mean any such disposition.
Section 4.5
Registration and Transfer of Limited Partner Interests
.
(a) The General Partner shall keep or cause to be kept on behalf of the Partnership a register
in which, subject to such reasonable regulations as it may prescribe and subject to the provisions
of Section 4.5(b), the Partnership will provide for the registration and transfer of Limited
Partner Interests.
(b) The Partnership shall not recognize any transfer of Limited Partner Interests evidenced by
Certificates until the Certificates evidencing such Limited Partner Interests are surrendered for
registration of transfer. No charge shall be imposed by the General Partner for such transfer;
provided, that as a condition to the issuance of any new Certificate under this Section 4.5, the
General Partner may require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed with respect thereto. Upon surrender of a Certificate for registration
of transfer of any Limited Partner Interests evidenced by a Certificate,
18
and subject to the provisions hereof, the appropriate officers of the General Partner on behalf of the Partnership
shall execute and deliver, and in the case of Certificates evidencing Limited Partner Interests,
the Transfer Agent shall countersign and deliver, in the name of the holder or the designated
transferee or transferees, as required pursuant to the holder’s instructions, one or more new
Certificates evidencing the same aggregate number and type of Limited Partner Interests as was
evidenced by the Certificate so surrendered.
(c) By acceptance of the transfer of any Limited Partner Interests in accordance with this
Section 4.5 and except as provided in Section 4.8, each transferee of a Limited Partner Interest
(including any nominee holder or an agent or representative acquiring such Limited Partner
Interests for the account of another Person) (i) shall be admitted to the Partnership as a Limited
Partner with respect to the Limited Partner Interests so transferred to such Person when any such
transfer or admission is reflected in the books and records of the Partnership and such Limited
Partner becomes the Record Holder of the Limited Partner Interests so transferred, (ii) shall
become bound by the terms of this Agreement, (iii) represents that the transferee has the capacity,
power and authority to enter into this Agreement, and (iv) makes the consents and waivers contained
in this Agreement, all with or without execution of this Agreement. The
transfer of any Limited Partner Interests and the admission of any new Limited Partner shall
not constitute an amendment to this Agreement.
(d) Subject to (i) the foregoing provisions of this Section 4.5, (ii) Section 4.3, (iii)
Section 4.7, (iv) with respect to any class or series of Limited Partner Interests, the provisions
of any statement of designations or amendment of this Agreement establishing such class or series,
(v) any contractual provisions binding on any Limited Partner and (vi) provisions of applicable law
including the Securities Act, Limited Partner Interests shall be freely transferable.
Section 4.6
Transfer of the General Partner Interest
.
(a) Subject to Section 4.6(c) below, prior to March 31, 2021, the General Partner shall not
transfer all or any part of its General Partner Interest to a Person unless such transfer (i) has
been approved by the prior written consent or vote of Partners (excluding the General Partner and
its Affiliates) holding a majority of the Percentage Interests of all Partners (excluding the
Percentage Interests of the General Partner and its Affiliates) or (ii) is of all, but not less
than all, of its General Partner Interest to (A) an Affiliate of the General Partner (other than an
individual) or (B) another Person (other than an individual) in connection with the merger or
consolidation of the General Partner with or into such other Person or the transfer by the General
Partner of all or substantially all of its assets to such other Person.
(b) Subject to Section 4.6(c) below, on or after March 31, 2021, the General Partner may
transfer all or any part of its General Partner Interest without Unitholder approval.
(c) Notwithstanding anything herein to the contrary, no transfer by the General Partner of all
or any part of its General Partner Interest to another Person shall be permitted unless (i) the
transferee agrees to assume the rights and duties of the General Partner under this Agreement and
to be bound by the provisions of this Agreement, (ii) the Partnership receives an Opinion of
Counsel that such transfer would not result in the loss of limited liability under Delaware law of
any Limited Partner or cause the Partnership to be treated as an association
19
taxable as a
corporation or otherwise to be taxed as an entity for U.S. federal income tax purposes (to the
extent not already so treated or taxed) and (iii) such transferee also agrees to purchase all (or
the appropriate portion thereof, if applicable) of the partnership or membership interest of the
General Partner as the general partner or managing member, if any, of each other Group Member. In
the case of a transfer pursuant to and in compliance with this Section 4.6, the transferee or
successor (as the case may be) shall, subject to compliance with the terms of Section 10.2, be
admitted to the Partnership as the General Partner effective immediately prior to the transfer of
the General Partner Interest, and the business of the Partnership shall continue without
dissolution.
Section 4.7
Restrictions on Transfers
.
(a) Notwithstanding the other provisions of this Article IV, no transfer of any Partnership
Interests shall be made if such transfer would (i) violate the then applicable U.S.
federal or state securities laws or rules and regulations of the Commission, any state
securities commission or any other governmental authority with jurisdiction over such transfer,
(ii) terminate the existence or qualification of the Partnership under the laws of the jurisdiction
of its formation, or (iii) cause the Partnership to be treated as an association taxable as a
corporation or otherwise to be taxed as an entity for U.S. federal income tax purposes (to the
extent not already so treated or taxed).
(b) The General Partner may impose restrictions on the transfer of Partnership Interests if
the General Partner determines, with the advice of counsel, that such restrictions are necessary or
advisable to (i) avoid a significant risk of the Partnership becoming taxable as a corporation or
otherwise becoming taxable as an entity for U.S. federal income tax purposes or (ii) preserve the
uniformity of Limited Partner Interests (or any class or classes thereof). The General Partner may
impose such restrictions by amending this Agreement; provided, however, that any amendment that
would result in the delisting or suspension of trading of any class of Limited Partner Interests on
the principal National Securities Exchange on which such class of Limited Partner Interests is then
listed or admitted to trading must be approved, prior to such amendment being effected, by the
holders of at least a majority of the Outstanding Limited Partner Interests of such class.
(c) Nothing contained in this Article IV, or elsewhere in this Agreement, shall preclude the
settlement of any transactions involving Partnership Interests entered into through the facilities
of any National Securities Exchange on which such Partnership Interests are listed or admitted to
trading.
Section 4.8
Eligibility Certificates; Ineligible Holders
.
(a) If at any time the General Partner determines, with the advice of counsel, that
(i) the Partnership’s status as other than as an association taxable as a corporation
for U.S. federal income tax purposes or the failure of the Partnership to be subject to an
entity-level tax for U.S. federal, state or local income tax purposes, coupled with the tax
status (or lack of proof of the U.S. federal income tax status) of one or more Partners, has
or will reasonably likely have a material adverse effect on the maximum
20
applicable rate that
can be charged to customers by Subsidiaries of the Partnership (a “
Rate Eligibility
Trigger
”); or
(ii) any Group Member is subject to any federal, state or local law or regulation that
would create a substantial risk of cancellation or forfeiture of any property in which the
Group Member has an interest based on the nationality, citizenship or other related status
of a Partner (a “
Citizenship Eligibility Trigger
”);
then, the General Partner may adopt such amendments to this Agreement as it determines to be
necessary or advisable to (x) in the case of a Rate Eligibility Trigger, obtain such proof of the
U.S. federal income tax status of the Partners and, to the extent relevant, their beneficial
owners, as the General Partner determines to be necessary to establish those Partners whose U.S.
federal income tax status does not or would not have a material adverse effect on the maximum
applicable rate that can be charged to customers by Subsidiaries of the Partnership or (y) in the
case of a Citizenship Eligibility Trigger, obtain such proof of the nationality, citizenship or
other related status (or, if the General Partner is a nominee holding for the account of another
Person, the nationality, citizenship or other related status of such Person) of the Partner as the
General Partner determines to be necessary to establish and those Partners whose status as a
Partner does not or would not subject any Group Member to a significant risk of cancellation or
forfeiture of any of its properties or interests therein.
(b) Such amendments may include provisions requiring all Partners to certify as to their (and
their beneficial owners’) status as Eligible Holders upon demand and on a regular basis, as
determined by the General Partner, and may require transferees of Units to so certify prior to
being admitted to the Partnership as a Partner (any such required certificate, an “
Eligibility
Certificate
”).
(c) Such amendments may provide that any Partner who fails to furnish to the General Partner
within a reasonable period requested proof of its (and its’ beneficial owners’) status as an
Eligible Holder or if upon receipt of such Eligibility Certificate or other requested information
the General Partner determines that a Partner is not an Eligible Holder (such a Partner, an
“
Ineligible Holder
”), the Partnership Interests owned by such Limited Partner shall be subject to
redemption in accordance with the provisions of Section 4.9. In addition, the General Partner
shall be substituted for all Limited Partners that are Ineligible Holders as the Partner in respect
of the Ineligible Holder’s Partnership Interests.
(d) The General Partner shall, in exercising voting rights in respect of Partnership Interests
held by it on behalf of Ineligible Holders, distribute the votes in the same ratios as the votes of
Partners (including the General Partner and its Affiliates) in respect of Partnership Interests
other than those of Ineligible Holders are cast, either for, against or abstaining as to the
matter.
(e) Upon dissolution of the Partnership, an Ineligible Holder shall have no right to receive a
distribution in kind pursuant to Section 12.4 but shall be entitled to the cash equivalent thereof,
and the Partnership shall provide cash in exchange for an assignment of the Ineligible Holder’s
share of any distribution in kind. Such payment and assignment shall be treated for
21
Partnership
purposes as a purchase by the Partnership from the Ineligible Holder of his Partnership Interest
(representing his right to receive his share of such distribution in kind).
(f) At any time after he can and does certify that he has become an Eligible Holder, an
Ineligible Holder may, upon application to the General Partner, request that with respect to any
Partnership Interests of such Ineligible Holder not redeemed pursuant to Section 4.9, such
Ineligible Holder be admitted as a Partner, and upon approval of the General Partner, such
Ineligible Holder shall be admitted as a Partner and shall no longer constitute an Ineligible
Holder and the General Partner shall cease to be deemed to be the Partner in respect of such
Ineligible Holder’s Partnership Interests.
Section 4.9
Redemption of Partnership Interests of Ineligible Holders
.
(a) If at any time a Partner fails to furnish an Eligibility Certification or other
information requested within a reasonable period of time specified in amendments adopted pursuant
to Section 4.8, or if upon receipt of such Eligibility Certification or other information the
General Partner determines, with the advice of counsel, that a Partner is not an Eligible Holder,
the Partnership may, unless the Partner establishes to the satisfaction of the General Partner that
such Partner is an Eligible Holder or has transferred his Partnership Interests to a Person who is
an Eligible Holder and who furnishes an Eligibility Certification to the General Partner prior to
the date fixed for redemption as provided below, redeem the Partnership Interest of such Partner as
follows:
(i) The General Partner shall, not later than the 30th day before the date fixed for
redemption, give notice of redemption to the Partner, at his last address designated on the
records of the Partnership or the Transfer Agent, as applicable, by registered or certified
mail, postage prepaid. The notice shall be deemed to have been given when so mailed. The
notice shall specify the Redeemable Interests, the date fixed for redemption, the place of
payment, that payment of the redemption price will be made upon redemption of the Redeemable
Interests (or, if later in the case of Redeemable Interests evidenced by Certificates, upon
surrender of the Certificate evidencing the Redeemable Interests) and that on and after the
date fixed for redemption no further allocations or distributions to which the Partner would
otherwise be entitled in respect of the Redeemable Interests will accrue or be made.
(ii) The aggregate redemption price for Redeemable Interests shall be an amount equal
to the Current Market Price (the date of determination of which shall be the date fixed for
redemption) of Partnership Interests of the class to be so redeemed multiplied by the number
of Partnership Interests of each such class included among the Redeemable Interests. The
redemption price shall be paid, as determined by the General Partner, in cash or by delivery
of a promissory note of the Partnership in the principal amount of the redemption price,
bearing interest at the rate of 8% annually and payable in three equal annual installments
of principal together with accrued interest, commencing one year after the redemption date.
(iii) The Partner or his duly authorized representative shall be entitled to receive
the payment for the Redeemable Interests at the place of payment specified in the
22
notice of
redemption on the redemption date (or, if later in the case of Redeemable Interests
evidenced by Certificates, upon surrender by or on behalf of the Partner at the place
specified in the notice of redemption, of the Certificate evidencing the Redeemable
Interests, duly endorsed in blank or accompanied by an assignment duly executed in blank).
(iv) After the redemption date, Redeemable Interests shall no longer constitute issued
and Outstanding Partnership Interests.
(b) The provisions of this Section 4.9 shall also be applicable to Partnership Interests held
by a Partner as nominee of a Person determined to be an Ineligible Holder.
(c) Nothing in this Section 4.9 shall prevent the recipient of a notice of redemption from
transferring his Partnership Interest before the redemption date if such transfer is otherwise
permitted under this Agreement. Upon receipt of notice of such a transfer, the General Partner
shall withdraw the notice of redemption, provided the transferee of such Partnership Interest
certifies to the satisfaction of the General Partner that he is an Eligible Holder. If the
transferee fails to make such certification, such redemption shall be effected from the transferee
on the original redemption date.
ARTICLE V
CAPITAL CONTRIBUTIONS AND ISSUANCE OF PARTNERSHIP INTERESTS
Section 5.1
Contributions by the General Partner and its Affiliates
.
(a) In connection with the formation of the Partnership under the Delaware Act, the General
Partner made an initial Capital Contribution to the Partnership in the amount of $1,000, for a
General Partner Interest in the Partnership and was admitted as the Managing General Partner of the
Partnership, and the Special General Partner and Coffeyville Resources each made an initial Capital
Contribution to the Partnership in the amount of $1,000 and were admitted as the Special General
Partner and Limited Partner, respectively, of the Partnership. Immediately after the close of
business on October 24, 2007, the initial $1,000 contributed by each of the Special General Partner
and Coffeyville Resources was refunded as provided in the Contribution Agreement.
(b) Immediately after the close of business on October 24, 2007 and pursuant to the
Contribution Agreement, Coffeyville Resources conveyed: (i) a portion of its interest in
Coffeyville Resources Nitrogen Fertilizer, LLC to the Partnership on behalf of the General Partner,
as a Capital Contribution in exchange for the issuance to the General Partner of the General
Partner Interest; (ii) a portion of its interest in Coffeyville Resources Nitrogen Fertilizer, LLC
to the Partnership on behalf of the Special General Partner, as a Capital Contribution in exchange
for the issuance to the Special General Partner of Special GP Units; and (iii) the remaining
portion of its interest in Coffeyville Resources Nitrogen Fertilizer, LLC to the Partnership as a
Capital Contribution in exchange for the issuance to Coffeyville Resources of Special LP Units.
(c) Pursuant to the Amended Contribution Agreement, (i) Coffeyville Resources contributed all
of its Special LP Units to the Partnership in exchange for the issuance to
23
Coffeyville Resources of
0.1% of the Sponsor Consideration (as that term is defined in the Amended Contribution Agreement);
(ii) the Special General Partner contributed all of its Special GP Units to the Partnership in
exchange for the issuance to the Special General Partner of 99.9% of the Sponsor Consideration;
(iii) the Partnership repurchased the Incentive Distribution Rights from the General Partner in
exchange for $26.0 million, and the Incentive Distribution Rights are being extinguished hereby;
(iv) the General Partner distributed $26.0 million to Coffeyville
Acquisition III; and (v) the Organizational Limited Partner will purchase the General Partner
from Coffeyville Acquisition III in exchange for $1,000.
Section 5.2
Interest and Withdrawal
. No interest on Capital Contributions shall be paid by the
Partnership. No Partner shall be entitled to the withdrawal or return of its Capital Contribution,
except to the extent, if any, that distributions made pursuant to this Agreement or upon
dissolution of the Partnership may be considered as the withdrawal or return of its Capital
Contribution by law and then only to the extent provided for in this Agreement. Except to the
extent expressly provided in this Agreement, no Partner shall have priority over any other Partner
either as to the return of Capital Contributions or as to profits, losses or distributions. Any
such return shall be a compromise to which all Partners agree within the meaning of Section
17-502(b) of the Delaware Act.
Section 5.3
Capital Accounts
.
(a) The Partnership shall maintain for each Partner (or a beneficial owner of Partnership
Interests held by a nominee in any case in which the nominee has furnished the identity of such
owner to the Partnership in accordance with Section 6031(c) of the Code or any other method
acceptable to the General Partner) owning a Partnership Interest a separate Capital Account with
respect to such Partnership Interest in accordance with the rules of Treasury Regulation Section
1.704-1(b)(2)(iv). Such Capital Account shall be increased by (i) the amount of all Capital
Contributions made to the Partnership with respect to such Partnership Interest and (ii) all items
of Partnership income and gain (including income and gain exempt from tax) computed in accordance
with Section 5.3(b) and allocated with respect to such Partnership Interest pursuant to Section
6.1, and decreased by (x) the amount of cash or Net Agreed Value of all actual and deemed
distributions of cash or property made with respect to such Partnership Interest and (y) all items
of Partnership deduction and loss computed in accordance with Section 5.3(b) and allocated with
respect to such Partnership Interest pursuant to Section 6.1.
(b) For purposes of computing the amount of any item of income, gain, loss or deduction that
is to be allocated pursuant to Article VI and is to be reflected in the Partners’ Capital Accounts,
the determination, recognition and classification of any such item shall be the same as its
determination, recognition and classification for U.S. federal income tax purposes (including any
method of depreciation, cost recovery or amortization used for that purpose), provided, that:
(i) Solely for purposes of this Section 5.3, the Partnership shall be treated as owning
directly its proportionate share (as determined by the General Partner based upon the
provisions of the applicable Group Member Agreement) of all property owned by (x) any other
Group Member that is classified as a partnership or is disregarded for U.S. federal income
tax purposes and (y) any other entity that is classified as a partnership or
24
is disregarded
for U.S. federal income tax purposes of which an entity described in clause (x) of this
Section 5.3(b)(i) is, directly or indirectly, a partner, member or other equity holder.
(ii) All fees and other expenses incurred by the Partnership to promote the sale of (or
to sell) a Partnership Interest that can neither be deducted nor amortized under Section 709
of the Code, if any, shall, for purposes of Capital Account maintenance, be treated as an
item of deduction at the time such fees and other expenses are incurred and shall be
allocated among the Partners pursuant to Section 6.1.
(iii) Except as otherwise provided in Treasury Regulation Section 1.704-1(b)(2)(iv)(m),
the computation of all items of income, gain, loss and deduction shall be made without
regard to any election under Section 754 of the Code that may be made by the Partnership
and, as to those items described in Section 705(a)(1)(B) or 705(a)(2)(B) of the Code,
without regard to the fact that such items are not includable in gross income or are neither
currently deductible nor capitalized for U.S. federal income tax purposes. To the extent an
adjustment to the adjusted tax basis of any Partnership asset pursuant to Section 734(b) or
743(b) of the Code is required, pursuant to Treasury Regulation Section
1.704-1(b)(2)(iv)(m), to be taken into account in determining Capital Accounts, the amount
of such adjustment in the Capital Accounts shall be treated as an item of gain or loss.
(iv) Any income, gain or loss attributable to the taxable disposition of any
Partnership property shall be determined as if the adjusted basis of such property as of
such date of disposition were equal in amount to the Partnership’s Carrying Value with
respect to such property as of such date.
(v) In accordance with the requirements of Section 704(b) of the Code, any deductions
for depreciation, cost recovery or amortization attributable to any Contributed Property
shall be determined as if the adjusted basis of such property on the date it was acquired by
the Partnership were equal to the Agreed Value of such property. Upon an adjustment pursuant
to Section 5.3(d) to the Carrying Value of any Partnership property subject to depreciation,
cost recovery or amortization, any further deductions for such depreciation, cost recovery
or amortization attributable to such property shall be determined (A) under the rules
prescribed by Treasury Regulation Section 1.704-3(d)(2)
as if the adjusted basis of
such property were equal to the Carrying Value of such property immediately following such
adjustment.
(vi) If the Partnership’s adjusted basis in a depreciable or cost recovery property is
reduced for U.S. federal income tax purposes pursuant to Section 50(c)(1) or 50(c)(3) of the
Code, the amount of such reduction shall, solely for purposes hereof, be deemed to be an
additional depreciation or cost recovery deduction in the taxable period such property is
placed in service and shall be allocated among the Partners pursuant to Section 6.1. Any
restoration of such basis pursuant to Section 50(c)(2) of the Code shall, to the extent
possible, be allocated in the same manner to the Partners to whom such deemed deduction was
allocated.
25
(vii) The Gross Liability Value of each Liability of the Partnership described in
Treasury Regulation Section 1.752-7(b)(3)(i) shall be adjusted at such times as provided in
this Agreement for an adjustment to Carrying Values. The amount of any such adjustment
shall be treated for purposes hereof as an item of loss (if the adjustment
increases the Carrying Value of such Liability of the Partnership) or an item of gain
(if the adjustment decreases the Carrying Value of such Liability of the Partnership).
(c) A transferee of a Partnership Interest shall succeed to a pro rata portion of the Capital
Account of the transferor relating to the Partnership Interest so transferred.
(d) (i) In accordance with Treasury Regulation Section 1.704-1(b)(2)(iv)(f), upon an issuance
of additional Partnership Interests for cash or Contributed Property, the issuance of Partnership
Interests as consideration for the provision of services or the conversion of the General Partner’s
(and its Affiliates’) Combined Interest to Common Units pursuant to Section 11.3(b), the Carrying
Value of each Partnership property immediately prior to such issuance shall be adjusted upward or
downward to reflect any Unrealized Gain or Unrealized Loss attributable to such Partnership
property, and any such Unrealized Gain or Unrealized Loss shall be treated, for purposes of
maintaining Capital Accounts, as if it had been recognized on an actual sale of each such property
for an amount equal to its fair market value immediately prior to such issuance and had been
allocated among the Partners at such time pursuant to Section 6.1 in the same manner as any item of
gain or loss actually recognized during such period would have been allocated;
provided
, however,
that in the event of an issuance of Partnership Interests for a de minimis amount of cash or
Contributed Property, or in the event of an issuance of a de minimis amount of Partnership
Interests as consideration for the provision of services, the General Partner may determine that
such adjustments are unnecessary for the proper administration of the Partnership. In determining
such Unrealized Gain or Unrealized Loss, the fair market value of all Partnership assets (including
cash or cash equivalents) immediately prior to the issuance of additional Partnership Interests
shall be determined by the General Partner using such method of valuation as it may adopt. In
making its determination of the fair market values of individual properties, the General Partner
may determine that it is appropriate to first determine an aggregate value for the Partnership,
based on the current trading price of the Common Units, taking fully into account the fair market
value of the Partnership Interests of all Partners at such time, and then allocate such aggregate
value among the individual properties of the Partnership (in such manner as it determines is
appropriate).
(ii) In accordance with Treasury Regulation Section 1.704-1(b)(2)(iv)(f), immediately
prior to any actual or deemed distribution to a Partner of any Partnership property (other
than a distribution of cash that is not in redemption or retirement of a Partnership
Interest), the Carrying Value of all Partnership property shall be adjusted upward or
downward to reflect any Unrealized Gain or Unrealized Loss attributable to such Partnership
property, and any such Unrealized Gain or Unrealized Loss shall be treated, for the purposes
of maintaining Capital Accounts, as if it had been recognized on an actual sale of each such
property immediately prior to such distribution for an amount equal to its fair market
value, and had been allocated to the Partners, at such time, pursuant to Section 6.1 in the
same manner as any item of gain or loss actually recognized during such period would have
been allocated. In determining such Unrealized Gain or Unrealized Loss the fair market value
of all Partnership assets
26
(including cash or cash equivalents) immediately prior to a
distribution shall (A) in the case of an actual distribution that is not made pursuant to
Section 12.4 or in the case of a deemed distribution, be determined in the same manner as
that provided in Section
5.3(d)(i) or (B) in the case of a liquidating distribution pursuant to Section 12.4, be
determined by the Liquidator using such method of valuation as it may adopt.
Section 5.4
Issuances of Additional Partnership Interests
.
(a) The Partnership may issue additional Partnership Interests and options, rights, warrants
and appreciation rights relating to the Partnership Interests for any Partnership purpose at any
time and from time to time to such Persons for such consideration and on such terms and conditions
as the General Partner shall determine, all without the approval of any Partners.
(b) Each additional Partnership Interest authorized to be issued by the Partnership pursuant
to Section 5.4(a) may be issued in one or more classes, or one or more series of any such classes,
with such designations, preferences, rights, powers and duties (which may be senior or junior to
existing classes and series of Partnership Interests), as shall be fixed by the General Partner,
including (i) the right to share in Partnership profits and losses or items thereof; (ii) the right
to share in Partnership distributions; (iii) the rights upon dissolution and liquidation of the
Partnership; (iv) whether, and the terms and conditions upon which, the Partnership may, or shall
be required to, redeem the Partnership Interest (including sinking fund provisions); (v) whether
such Partnership Interest is issued with the privilege of conversion or exchange and, if so, the
terms and conditions of such conversion or exchange; (vi) the terms and conditions upon which each
Partnership Interest will be issued, evidenced by certificates and assigned or transferred; (vii)
the method for determining the Percentage Interest as to such Partnership Interest; and (viii) the
right, if any, of each such Partnership Interest to vote on Partnership matters, including matters
relating to the relative rights, preferences and privileges of such Partnership Interest.
(c) The General Partner shall take all actions that it determines to be necessary or
appropriate in connection with (i) each issuance of Partnership Interests and options, rights,
warrants and appreciation rights relating to Partnership Interests pursuant to this Section 5.4,
(ii) the conversion of the General Partner’s (and its Affiliates’) Combined Interest to Common
Units pursuant to the terms of this Agreement, (iii) reflecting the admission of such additional
Partners in the books and records of the Partnership as the Record Holder of such Partnership
Interests, and (iv) all additional issuances of Partnership Interests. The General Partner shall
determine the relative rights, powers and duties of the holders of the Units or other Partnership
Interests being so issued. The General Partner shall do all things necessary to comply with the
Delaware Act and is authorized and directed to do all things that it determines to be necessary or
appropriate in connection with any future issuance of Partnership Interests or in connection with
the conversion of the General Partner’s (and its Affiliates’) Combined Interest into Common Units
pursuant to the terms of this Agreement, including compliance with any statute, rule, regulation or
guideline of any federal, state or other governmental agency or any National Securities Exchange on
which the Units or other Partnership Interests are listed or admitted to trading.
(d) No fractional Units shall be issued by the Partnership.
27
Section 5.5
Preemptive Right
. Except as provided in this Section 5.5 or as otherwise provided in a separate agreement by
the Partnership, no Person shall have any preemptive, preferential or other similar right with
respect to the issuance of any Partnership Interest, whether unissued, held in the treasury or
hereafter created. The General Partner shall have the right, which it may from time to time assign
in whole or in part to any of its Affiliates, to purchase Partnership Interests from the
Partnership whenever, and on the same terms that, the Partnership issues Partnership Interests to
Persons other than the General Partner and its Affiliates, to the extent necessary to maintain the
Percentage Interests of the General Partner and its Affiliates equal to that which existed
immediately prior to the issuance of such Partnership Interests.
Section 5.6
Splits and Combinations
.
(a) Subject to Section 5.6(d), the Partnership may make a Pro Rata distribution of Partnership
Interests to all Record Holders or may effect a subdivision or combination of Partnership Interests
so long as, after any such event, each Partner shall have the same Percentage Interest in the
Partnership as before such event, and any amounts calculated on a per Unit basis or stated as a
number of Units are proportionately adjusted retroactively to the beginning of the Partnership.
(b) Whenever such a distribution, subdivision or combination of Partnership Interests is
declared, the General Partner shall select a Record Date as of which the distribution, subdivision
or combination shall be effective and shall send notice thereof at least 20 days prior to such
Record Date to each Record Holder as of a date not less than 10 days prior to the date of such
notice. The General Partner also may cause a firm of independent public accountants selected by it
to calculate the number of Partnership Interests to be held by each Record Holder after giving
effect to such distribution, subdivision, combination or reorganization. The General Partner shall
be entitled to rely on any certificate provided by such firm as conclusive evidence of the accuracy
of such calculation.
(c) Promptly following any such distribution, subdivision, or combination, the Partnership may
issue Certificates to the Record Holders of Partnership Interests as of the applicable Record Date
representing the new number of Partnership Interests held by such Record Holders, or the General
Partner may adopt such other procedures that it determines to be necessary or appropriate to
reflect such changes. If any such combination results in a smaller total number of Partnership
Interests Outstanding, the Partnership shall require, as a condition to the delivery to a Record
Holder of any such new Certificate, the surrender of any Certificate held by such Record Holder
immediately prior to such Record Date.
(d) The Partnership shall not issue fractional Units upon any distribution, subdivision or
combination of Partnership Interests. If a distribution, subdivision, combination or reorganization
of Partnership Interests would result in the issuance of fractional Units but for the provisions of
Section 5.4(d) and this Section 5.6(d), each fractional Unit shall be rounded to the nearest whole
Unit (and a 0.5 Unit shall be rounded to the next higher Unit).
Section 5.7
Fully Paid and Non-Assessable Nature of Limited Partner Interests
. All Limited Partner Interests issued pursuant to, and in accordance with the requirements
of, this Article V shall be fully paid and non-assessable Limited Partner Interests in the
Partnership,
28
except as such non-assessability may be affected by Sections 17-607 or 17-804 of the
Delaware Act.
Section 5.8
Extinguishment of the IDRs
.
As of the Effective Time, all outstanding IDRs shall be cancelled by the Partnership and shall
cease to exist pursuant to this Section 5.8.
ARTICLE VI
ALLOCATIONS AND DISTRIBUTIONS
Section 6.1
Allocations for Capital Account Purposes
. For purposes of maintaining the Capital Accounts
and in determining the rights of the Partners among themselves, the Partnership’s items of income,
gain, loss and deduction (computed in accordance with Section 5.3(b)) for each taxable period shall
be allocated among the Partners as provided herein below.
(a)
Net Income and Net Loss
. After giving effect to the special allocations set forth in
Section 6.1(b), Net Income and Net Loss for each taxable period and all items of income, gain, loss
and deduction taken into account in computing Net Income and Net Loss for such taxable period shall
be allocated 100% to all Unitholders, Pro Rata.
(b)
Special Allocations
. Notwithstanding any other provision of this Section 6.1, the
following special allocations shall be made for such taxable period:
(i)
Partnership Minimum Gain Chargeback
. Notwithstanding any other provision of this
Section 6.1, if there is a net decrease in Partnership Minimum Gain during any Partnership
taxable period, each Partner shall be allocated items of Partnership income and gain for
such period (and, if necessary, subsequent periods) in the manner and amounts provided in
Treasury Regulation Sections 1.704-2(f)(6), 1.704-2(g)(2) and 1.704-2(j)(2)(i), or any
successor provision. For purposes of this Section 6.1(b), each Partner’s Adjusted Capital
Account balance shall be determined, and the allocation of income or gain required hereunder
shall be effected, prior to the application of any other allocations pursuant to this
Section 6.1(b) with respect to such taxable period (other than an allocation pursuant to
Sections 6.1(b)(vi) and 6.1(b)(vii)). This Section 6.1(b)(i) is intended to comply with the
Partnership Minimum Gain chargeback requirement in Treasury Regulation Section 1.704-2(f)
and shall be interpreted consistently therewith.
(ii)
Chargeback of Partner Nonrecourse Debt Minimum Gain
. Notwithstanding the other
provisions of this Section 6.1 (other than Section 6.1(b)(i)), except as provided in
Treasury Regulation Section 1.704-2(i)(4), if there is a net decrease in Partner Nonrecourse
Debt Minimum Gain during any Partnership taxable period, any
Partner with a share of Partner Nonrecourse Debt Minimum Gain at the beginning of such
taxable period shall be allocated items of Partnership income and gain for such period (and,
if necessary, subsequent periods) in the manner and amounts provided in Treasury Regulation
Sections 1.704-2(i)(4) and 1.704-2(j)(2)(ii), or any successor
29
provisions. For purposes of
this Section 6.1(b), each Partner’s Adjusted Capital Account balance shall be determined,
and the allocation of income or gain required hereunder shall be effected, prior to the
application of any other allocations pursuant to this Section 6.1(b), other than Section
6.1(b)(i) and other than an allocation pursuant to Sections 6.1(b)(vi) and 6.1(b)(vii), with
respect to such taxable period. This Section 6.1(b)(ii) is intended to comply with the
chargeback of items of income and gain requirement in Treasury Regulation Section
1.704-2(i)(4) and shall be interpreted consistently therewith.
(iii)
Priority Allocations
.
(A) If the amount of cash or the Net Agreed Value of any property distributed
(except cash or property distributed pursuant to Section 12.4) with respect to a
Unit exceeds the amount of cash or the Net Agreed Value of property distributed with
respect to another Unit, each Unitholder receiving such greater cash or property
distribution shall be allocated gross income in an amount equal to the product of
(aa) the amount by which the distribution (on a per Unit basis) to such Unitholder
exceeds the distribution with respect to the Unit receiving the smallest
distribution and (bb) the number of Units owned by the Unitholder receiving the
greater distribution.
(iv)
Qualified Income Offset
. In the event any Partner unexpectedly receives any
adjustments, allocations or distributions described in Treasury Regulation Sections
1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5), or 1.704-1(b)(2)(ii)(d)(6), items of
Partnership gross income and gain shall be specially allocated to such Partner in an amount
and manner sufficient to eliminate, to the extent required by the Treasury Regulations
promulgated under Section 704(b) of the Code, the deficit balance, if any, in its Adjusted
Capital Account created by such adjustments, allocations or distributions as quickly as
possible; provided
,
that an allocation pursuant to this Section 6.1(b)(iv) shall be made
only if and to the extent that such Partner would have a deficit balance in its Adjusted
Capital Account as adjusted after all other allocations provided for in this Section 6.1
have been tentatively made as if this Section 6.1(b)(iv) were not in this Agreement.
(v)
Gross Income Allocations
. In the event any Partner has a deficit balance in its
Capital Account at the end of any taxable period in excess of the sum of (A) the amount such
Partner is required to restore pursuant to the provisions of this Agreement and (B) the
amount such Partner is deemed obligated to restore pursuant to Treasury Regulation Sections
1.704-2(g) and 1.704-2(i)(5), such Partner shall be specially allocated items of Partnership
gross income and gain in the amount of such excess as quickly as possible; provided, that an
allocation pursuant to this Section 6.1(b)(v) shall be made only if and to the extent that
such Partner would have a deficit balance in its Capital Account as so adjusted after all
other allocations provided for in this Section 6.1 have
been tentatively made as if Section 6.1(b)(iv) this Section 6.1(b)(v) were not in this
Agreement.
(vi)
Nonrecourse Deductions
. Nonrecourse Deductions for any taxable period shall be
allocated to the Partners, Pro Rata. If the General Partner determines that the
30
Partnership’s Nonrecourse Deductions should be allocated in a different ratio to satisfy the
safe harbor requirements of the Treasury Regulations promulgated under Section 704(b) of the
Code, the General Partner is authorized, upon notice to the other Partners, to revise the
prescribed ratio to the numerically closest ratio that does satisfy such requirements.
(vii)
Partner Nonrecourse Deductions
. Partner Nonrecourse Deductions for any taxable
period shall be allocated 100% to the Partner that bears the Economic Risk of Loss with
respect to the Partner Nonrecourse Debt to which such Partner Nonrecourse Deductions are
attributable in accordance with Treasury Regulation Section 1.704-2(i). If more than one
Partner bears the Economic Risk of Loss with respect to a Partner Nonrecourse Debt, such
Partner Nonrecourse Deductions attributable thereto shall be allocated between or among such
Partners in accordance with the ratios in which they share such Economic Risk of Loss. This
Section 6.1(b)(vii) is intended to comply with Treasury Regulations Section 1.704-2(i)(1)
and shall be interpreted consistently therewith.
(viii)
Nonrecourse Liabilities
. For purposes of Treasury Regulation Section
1.752-3(a)(3), the Partners agree that Nonrecourse Liabilities of the Partnership in excess
of the sum of (A) the amount of Partnership Minimum Gain and (B) the total amount of
Nonrecourse Built-in Gain shall be allocated among the Partners, Pro Rata.
(ix)
Code Section 754 Adjustments
. To the extent an adjustment to the adjusted tax
basis of any Partnership asset pursuant to Section 734(b) or 743(b) of the Code is required,
pursuant to Treasury Regulation Section 1.704-1(b)(2)(iv)(m), to be taken into account in
determining Capital Accounts, the amount of such adjustment to the Capital Accounts shall be
treated as an item of gain (if the adjustment increases the basis of the asset) or loss (if
the adjustment decreases such basis), and such item of gain or loss shall be specially
allocated to the Partners in a manner consistent with the manner in which their Capital
Accounts are required to be adjusted pursuant to such Section of the Treasury Regulations.
(x)
Economic Uniformity; Changes in Law
. For the proper administration of the
Partnership and for the preservation of uniformity of the Limited Partner Interests (or any
class or classes thereof), the General Partner shall (i) adopt such conventions as it deems
appropriate in determining the amount of depreciation, amortization and cost recovery
deductions; (ii) make special allocations of income, gain, loss or deduction, including
Unrealized Gain or Unrealized Loss; and (iii) amend the provisions of this Agreement as
appropriate (x) to reflect the proposal or promulgation of Treasury Regulations under
Section 704(b) or Section 704(c) of the Code or (y) otherwise to preserve or achieve
uniformity of the Limited Partner Interests (or any class or classes thereof). The General
Partner may adopt such conventions, make such allocations and
make such amendments to this Agreement as provided in this Section 6.1(b)(x) only if
such conventions, allocations or amendments would not have a material adverse effect on the
Partners, the holders of any class or classes of Outstanding Limited Partner Interests or
the Partnership, and if such allocations are consistent with the principles of Section 704
of the Code.
31
(xi)
Curative Allocation
.
(A) Notwithstanding any other provision of this Section 6.1, other than the
Required Allocations, the Required Allocations shall be taken into account in making
the Agreed Allocations so that, to the extent possible, the net amount of items of
gross income, gain, loss and deduction allocated to each Partner pursuant to the
Required Allocations and the Agreed Allocations, together, shall be equal to the net
amount of such items that would have been allocated to each such Partner under the
Agreed Allocations had the Required Allocations and the related Curative Allocation
not otherwise been provided in this Section 6.1. In exercising its discretion under
this Section 6.1(b)(xi)(A), the General Partner may take into account future
Required Allocations that, although not yet made, are likely to offset other
Required Allocations previously made. Allocations pursuant to this Section
6.1(b)(xi)(A) shall only be made with respect to Required Allocations to the extent
the General Partner determines that such allocations will otherwise be inconsistent
with the economic agreement among the Partners.
(B) The General Partner shall, with respect to each taxable period, (1) apply
the provisions of Section 6.1(b)(xi)(A) in whatever order is most likely to minimize
the economic distortions that might otherwise result from the Required Allocations,
and (2) divide all allocations pursuant to Section 6.1(b)(xi)(A) among the Partners
in a manner that is likely to minimize such economic distortions.
Section 6.2
Allocations for Tax Purposes
.
(a) Except as otherwise provided herein, for U.S. federal income tax purposes, each item of
income, gain, loss and deduction shall be allocated among the Partners in the same manner as its
correlative item of “book” income, gain, loss or deduction is allocated pursuant to Section 6.1.
(b) In an attempt to eliminate Book-Tax Disparities attributable to a Contributed Property or
Adjusted Property, items of income, gain, loss, depreciation, amortization and cost recovery
deductions shall be allocated for U.S. federal income tax purposes among the Partners in the manner
provided under Section 704(c) of the Code, and the Treasury Regulations promulgated under Section
704(b) and 704(c) of the Code, as determined appropriate by the General Partner (taking into
account the General Partner’s discretion under Section 6.1(b)(x)); provided that the General
Partner shall apply the principles of Treasury Regulation Section 1.704-3(d) in all events.
(c) The General Partner may determine to depreciate or amortize the portion of an adjustment
under Section 743(b) of the Code attributable to unrealized appreciation in any Adjusted Property
(to the extent of the unamortized Book-Tax Disparity) using a predetermined rate derived from the
depreciation or amortization method and useful life applied to the unamortized Book-Tax Disparity
of such property, despite any inconsistency of such approach with Treasury Regulation Section
1.167(c)-l(a)(6) or any successor regulations thereto. If the General Partner determines that such
reporting position cannot reasonably be taken, the General Partner may adopt depreciation and
amortization conventions under which all purchasers
32
acquiring Limited Partner Interests in the same
month would receive depreciation and amortization deductions, based upon the same applicable rate
as if they had purchased a direct interest in the Partnership’s property. If the General Partner
chooses not to utilize such aggregate method, the General Partner may use any other depreciation
and amortization conventions to preserve the uniformity of the intrinsic tax characteristics of any
Units, so long as such conventions would not have a material adverse effect on the Limited Partners
or Record Holders of any class or classes of Limited Partner Interests.
(d) In accordance with Treasury Regulation Sections 1.1245-1(e) and 1.1250-1(f), any gain
allocated to the Partners upon the sale or other taxable disposition of any Partnership asset
shall, to the extent possible, after taking into account other required allocations of gain
pursuant to this Section 6.2, be characterized as Recapture Income in the same proportions and to
the same extent as such Partners (or their predecessors in interest) have been allocated any
deductions directly or indirectly giving rise to the treatment of such gains as Recapture Income.
(e) All items of income, gain, loss, deduction and credit recognized by the Partnership for
U.S. federal income tax purposes and allocated to the Partners in accordance with the provisions
hereof shall be determined without regard to any election under Section 754 of the Code that may be
made by the Partnership; provided, however, that such allocations, once made, shall be adjusted (in
the manner determined by the General Partner) to take into account those adjustments permitted or
required by Sections 734 and 743 of the Code.
(f) Each item of Partnership income, gain, loss and deduction shall, for U.S. federal income
tax purposes, be determined for each taxable period and prorated on a monthly basis and shall be
allocated to the Partners as of the opening of the National Securities Exchange on which the
Partnership’s Units are listed or admitted to trading on the first Business Day of each month;
provided, however, such items for the period beginning on the Closing Date and ending on the last
day of the month in which the Over-Allotment Option is exercised in full or the expiration of the
Over-Allotment Option occurs shall be allocated to the Partners as of the opening of the National
Securities Exchange on which the Partnership’s Units are listed or admitted to trading on the first
Business Day of the next succeeding month; and provided, further, that gain or loss on a sale or
other disposition of any assets of the Partnership or any other extraordinary item of income, gain,
loss or deduction, as determined by the General Partner, shall be allocated to the Partners as of
the opening of the National Securities Exchange on which the Partnership’s Units are listed or
admitted to trading on the first Business Day of the month in which such item is recognized for
U.S. federal income tax purposes. The General Partner may revise, alter or otherwise modify such
methods of allocation to the extent permitted or required by Section 706 of the Code and the
regulations or rulings promulgated thereunder.
(g) Allocations that would otherwise be made to a Partner under the provisions of this Article
VI shall instead be made to the beneficial owner of Partnership Interests held by a nominee in any
case in which the nominee has furnished the identity of such owner to the Partnership in accordance
with Section 6031(c) of the Code or any other method determined by the General Partner.
33
Section 6.3
Distributions to Record Holders
.
(a) The Board of Directors may adopt a cash distribution policy, which it may change from time
to time without amendment to this Agreement.
(b) The Partnership will make distributions, if any, to Unitholders Pro Rata.
(c) All distributions required to be made under this Agreement shall be made subject to
Sections 17-607 and 17-804 of the Delaware Act.
(d) Notwithstanding Section 6.3(b), in the event of the dissolution and liquidation of the
Partnership, cash shall be applied and distributed solely in accordance with, and subject to the
terms and conditions of, Section 12.4.
(e) Each distribution in respect of a Partnership Interest shall be paid by the Partnership,
directly or through any Transfer Agent or through any other Person or agent, only to the Record
Holder of such Partnership Interest as of the Record Date set for such distribution. Such payment
shall constitute full payment and satisfaction of the Partnership’s liability in respect of such
payment, regardless of any claim of any Person who may have an interest in such payment by reason
of an assignment or otherwise.
ARTICLE VII
MANAGEMENT AND OPERATION OF BUSINESS
Section 7.1
Management
.
(a) The General Partner shall conduct, direct and manage all activities of the Partnership.
Except as otherwise expressly provided in this Agreement, all management powers over the business
and affairs of the Partnership shall be exclusively vested in the General Partner and no other
Partner shall have any management power over the business and affairs of the Partnership. In
addition to the powers now or hereafter granted to a general partner of a limited partnership under
applicable law or that are granted to the General Partner under any other provision of this
Agreement, the General Partner, subject to Section 7.3, shall have full power and authority to do
all things and on such terms as it determines to be necessary or appropriate to conduct the
business of the Partnership, to exercise all powers set forth in Section 2.5 and to effectuate the
purposes set forth in Section 2.4, including the following:
(i) the making of any expenditures, the lending or borrowing of money, the assumption
or guarantee of, or other contracting for, indebtedness and other liabilities, the issuance
of evidences of indebtedness, including indebtedness that is convertible or exchangeable
into Partnership Interests, and the incurring of any other obligations;
(ii) the making of tax, regulatory and other filings, or rendering of periodic or other
reports to governmental or other agencies having jurisdiction over the business or assets of
the Partnership;
(iii) the acquisition, disposition, mortgage, pledge, encumbrance, hypothecation or
exchange of any or all of the assets of the Partnership or the merger or
34
other combination
of the Partnership with or into another Person (the matters described in this clause (iii)
being subject however to any prior approval that may be required by Section 7.3);
(iv) the use of the assets of the Partnership (including cash on hand) for any purpose
consistent with the terms of this Agreement, including the financing of the conduct of the
operations of the Partnership Group; subject to Section 7.6(a) the lending of funds to other
Persons (including other Group Members); the repayment or guarantee of obligations of any
Group Member; and the making of capital contributions to any Group Member;
(v) the negotiation, execution and performance of any contracts, conveyances or other
instruments (including instruments that limit the liability of the Partnership under
contractual arrangements to all or particular assets of the Partnership, with the other
party to the contract to have no recourse against the General Partner or its assets other
than its interest in the Partnership, even if same results in the terms of the transaction
being less favorable to the Partnership than would otherwise be the case);
(vi) the distribution of Partnership cash;
(vii) the selection and dismissal of employees (including employees having titles such
as “chief executive officer,” “president,” “chief financial officer,” “chief operating
officer”, “general counsel,” “vice president,” “secretary” and “treasurer”) and agents,
outside attorneys, accountants, consultants and contractors and the determination of their
compensation and other terms of employment or hiring;
(viii) the maintenance of insurance for the benefit of the Partnership Group, the
Partners and Indemnitees;
(ix) the formation of, or acquisition of an interest in, and the contribution of
property and the making of loans to, any further limited or general partnerships, joint
ventures, corporations, limited liability companies or other Persons (including the
acquisition of interests in, and the contributions of property to, any Group Member from
time to time) subject to the restrictions set forth in Section 2.4;
(x) the control of any matters affecting the rights and obligations of the Partnership,
including the bringing and defending of actions at law or in equity and
otherwise engaging in the conduct of litigation, arbitration or mediation and the
incurring of legal expense and the settlement of claims and litigation;
(xi) the indemnification of any Person against liabilities and contingencies to the
extent permitted by law;
(xii) the entering into of listing agreements with any National Securities Exchange and
the delisting of some or all of the Partnership Interests from, or requesting that trading
be suspended on, any such exchange (subject to any prior approval required under Section
4.7);
35
(xiii) the purchase, sale or other acquisition or disposition of Partnership Interests,
or the issuance of options, rights, warrants and appreciation rights relating to Partnership
Interests;
(xiv) the undertaking of any action in connection with the Partnership’s participation
in the management of any Group Member; and
(xv) the entering into of agreements with any of its Affiliates to render services to a
Group Member or to itself in the discharge of its duties as General Partner of the
Partnership.
(b) Notwithstanding any other provision of this Agreement, any Group Member Agreement, the
Delaware Act or any applicable law, rule or regulation, each of the Limited Partners and each other
Person who may acquire an interest in Partnership Interests or is otherwise bound by this Agreement
hereby (i) approves, ratifies and confirms the execution, delivery and performance by the parties
thereto of this Agreement, the Underwriting Agreement, the Omnibus Agreement, the Credit Agreement
and the other agreements described in or filed as exhibits to the Registration Statement that are
related to the transactions contemplated by the Registration Statement (in each case other than
this Agreement, without giving effect to any amendments, supplements or restatements after the date
hereof); (ii) agrees that the General Partner (on its own or on behalf of the Partnership) is
authorized to execute, deliver and perform the agreements referred to in clause (i) of this
sentence and the other agreements, acts, transactions and matters described in or contemplated by
the Registration Statement on behalf of the Partnership without any further act, approval or vote
of the Partners or the other Persons who may acquire an interest in Partnership Interests or is
otherwise bound by this Agreement; and (iii) agrees that the execution, delivery or performance by
the General Partner, any Group Member or any Affiliate of any of them of this Agreement or any
agreement authorized or permitted under this Agreement (including the exercise by the General
Partner or any Affiliate of the General Partner of the rights accorded pursuant to Article XV)
shall not constitute a breach by the General Partner of any duty that the General Partner may owe
the Partnership or the Partners or any other Persons under this Agreement (or any other agreements)
or of any duty existing at law, in equity or otherwise.
Section 7.2
Certificate of Limited Partnership
. The General Partner has caused the Certificate of Limited
Partnership to be filed with the Secretary of State of the State of Delaware as required by the
Delaware Act. The General
Partner shall use all reasonable efforts to cause to be filed such other certificates or
documents that the General Partner determines to be necessary or appropriate for the formation,
continuation, qualification and operation of a limited partnership (or a partnership in which the
limited partners have limited liability) in the State of Delaware or any other state in which the
Partnership may elect to do business or own property. To the extent the General Partner determines
such action to be necessary or appropriate, the General Partner shall file amendments to and
restatements of the Certificate of Limited Partnership and do all things to maintain the
Partnership as a limited partnership (or a partnership or other entity in which the limited
partners have limited liability) under the laws of the State of Delaware or of any other state in
which the Partnership may elect to do business or own property. Subject to the terms of Section
3.4(a), the General Partner shall not be required, before
36
or after filing, to deliver or mail a
copy of the Certificate of Limited Partnership, any qualification document or any amendment thereto
to any Partner.
Section 7.3
Restrictions on the General Partner’s Authority
. Except as provided in Articles XII and XIV, the General Partner may not sell, exchange or
otherwise dispose of all or substantially all of the assets of the Partnership Group, taken as a
whole, in a single transaction or a series of related transactions without the approval of a Unit
Majority; provided, however, that this provision shall not preclude or limit the General Partner’s
ability to mortgage, pledge, hypothecate or grant a security interest in all or substantially all
of the assets of the Partnership Group and shall not apply to any forced sale of any or all of the
assets of the Partnership Group pursuant to the foreclosure of, or other realization upon, any such
encumbrance.
Section 7.4
Reimbursement of the General Partner
.
(a) Except as provided in this Section 7.4 and elsewhere in this Agreement, the General
Partner shall not be compensated for its services as a general partner or managing member of any
Group Member.
(b) The General Partner shall be reimbursed on a monthly basis, or such other basis as the
General Partner may determine, for (i) all direct and indirect expenses it incurs or payments it
makes on behalf of the Partnership Group (including salary, bonus, incentive compensation and other
amounts paid to any Person including Affiliates of the General Partner to perform services for the
Partnership Group or for the General Partner in the discharge of its duties to the Partnership
Group), and (ii) all other expenses reasonably allocable to the Partnership Group or otherwise
incurred by the General Partner in connection with operating the Partnership Group’s business
(including expenses allocated to the General Partner by its Affiliates). The General Partner shall
determine the expenses that are allocable to the Partnership Group. Reimbursements pursuant to this
Section 7.4 shall be in addition to any reimbursement to the General Partner as a result of
indemnification pursuant to Section 7.7.
(c) The General Partner and its Affiliates may charge any member of the Partnership Group a
management fee to the extent necessary to allow the Partnership Group to reduce the
amount of any state franchise or income tax or any tax based upon the revenues or gross margin
of any member of the Partnership Group if the tax benefit produced by the payment of such
management fee or fees exceeds the amount of such fee or fees.
(d) The General Partner, without the approval of the other Partners (who shall have no right
to vote in respect thereof), may propose and adopt on behalf of the Partnership benefit plans,
programs and practices (including plans, programs and practices involving the issuance of
Partnership Interests or options to purchase or rights, warrants or appreciation rights or phantom
or tracking interests relating to Partnership Interests), or cause the Partnership to issue
Partnership Interests in connection with, or pursuant to, any benefit plan, program or practice
maintained or sponsored by the General Partner or any of its Affiliates, in each case for the
benefit of employees and directors of the General Partner or its Affiliates, any Group Member or
their Affiliates, or any of them, in respect of services performed, directly or indirectly, for the
benefit of the Partnership Group. The Partnership agrees to issue and sell to the General Partner
or any of its Affiliates any Partnership Interests that the General Partner or such Affiliates are
37
obligated to provide to any employees or directors pursuant to any such benefit plans, programs or
practices. Expenses incurred by the General Partner in connection with any such plans, programs and
practices (including the net cost to the General Partner or such Affiliates of Partnership
Interests purchased by the General Partner or such Affiliates, from the Partnership or otherwise,
to fulfill options or awards under such plans, programs and practices) shall be reimbursed in
accordance with Section 7.4(b). Any and all obligations of the General Partner under any benefit
plans, programs or practices adopted by the General Partner as permitted by this Section 7.4(c)
shall constitute obligations of the General Partner hereunder and shall be assumed by any successor
General Partner approved pursuant to Section 11.1 or 11.2 or the transferee of or successor to all
of the General Partner’s General Partner Interest pursuant to Section 4.5(d).
Section 7.5
Outside Activities
.
(a) The General Partner, for so long as it is the General Partner of the Partnership (i)
agrees that its sole business will be to act as a general partner or managing member, as the case
may be, of the Partnership and any other partnership or limited liability company of which the
Partnership is, directly or indirectly, a partner or member and to undertake activities that are
ancillary or related thereto (including being a limited partner in the Partnership) and (ii) shall
not engage in any business or activity or incur any debts or liabilities except in connection with
or incidental to (A) its performance as general partner or managing member, if any, of one or more
Group Members or as described in or contemplated by the Registration Statement, (B) the acquiring,
owning or disposing of debt securities or equity interests in any Group Member, or (C) the
guarantee of, and mortgage, pledge or encumbrance of any or all of its assets in connection with,
any indebtedness of any Affiliate of the General Partner.
(b) The Omnibus Agreement sets forth certain restrictions on the ability of CVR Energy, Inc.
and its controlled Affiliates (other than the Partnership Group) to engage in Fertilizer Restricted
Businesses.
(c) Except as specifically restricted by the Omnibus Agreement, each Unrestricted Person
(other than the General Partner) shall have the right to engage in businesses of every type and
description and other activities for profit and to engage in and possess an interest in other
business ventures of any and every type or description, whether in businesses engaged in or
anticipated to be engaged in by any Group Member, independently or with others, including business
interests and activities in direct competition with the business and activities of any Group
Member, and none of the same shall constitute a breach of this Agreement or any duty otherwise
existing at law, in equity or otherwise, to any Group Member or any Partner.
(d) Notwithstanding anything to the contrary in this Agreement, the doctrine of corporate
opportunity, or any analogous doctrine, shall not apply to any Unrestricted Person (including the
General Partner). Except as specifically provided in the Omnibus Agreement, no Unrestricted Person
(including the General Partner) who acquires knowledge of a potential transaction, agreement,
arrangement or other matter that may be an opportunity for the Partnership shall have any duty to
communicate or offer such opportunity to the Partnership, and such Unrestricted Person (including
the General Partner) shall not be liable to the Partnership, any Partner or any other Person for
breach of any fiduciary or other duty by reason of the fact
38
that such Unrestricted Person
(including the General Partner) pursues or acquires such opportunity for itself, directs such
opportunity to another Person or does not communicate such opportunity or information to the
Partnership.
(e) Subject to the terms of Section 7.5(a), Section 7.5(b), Section 7.5(c) and the Omnibus
Agreement, but otherwise notwithstanding anything to the contrary in this Agreement, (i) the
engaging in competitive activities by any Unrestricted Person (other than the General Partner) in
accordance with the provisions of this Section 7.5 is hereby approved by the Partnership and all
Partners, and (ii) it shall be deemed not to be a breach of any fiduciary duty or any other duty or
obligation of any type whatsoever of the General Partner or of any other Unrestricted Person for
the Unrestricted Person (other than the General Partner) to engage in such business interests and
activities in preference to or to the exclusion of the Partnership and the other Group Members;
provided such Unrestricted Person does not engage in such business or activity as a result of or
using confidential or proprietary information provided by or on behalf of the Partnership to such
Unrestricted Person.
(f) The General Partner and each of its Affiliates may acquire Units or other Partnership
Interests in addition to those acquired on the Closing Date and, except as otherwise expressly
provided in this Agreement, shall be entitled to exercise, at their option, all rights relating to
all Units or other Partnership Interests acquired by them. The term “Affiliates” when used in this
Section 7.5(f) with respect to the General Partner shall not include any Group Member.
(g) Notwithstanding anything in this Agreement to the contrary, nothing herein shall be deemed
to restrict Goldman, Sachs & Co., Kelso & Company, L.P. or their respective Affiliates (other than
the General Partner), or their respective successors and assigns as owners of interests in the
General Partner, from engaging in any banking, brokerage, trading, market making, hedging,
arbitrage, investment advisory, financial advisory, anti-raid advisory, merger advisory, financing,
lending, underwriting, asset management, principal investing, mergers & acquisitions or other
activities conducted in the ordinary course of their or their Affiliates’
business in compliance with applicable law, including without limitation buying and selling
debt securities or equity interests of any other Partner or Group Member, entering into derivatives
transactions regarding or shorting equity interests of any other Partner or Group Member, serving
as a lender, underwriter or market maker or issuing research with respect to debt securities or
equity interests of any Partner or Group Member or acquiring, selling, making investments in or
entering into other transactions or undertaking any opportunities with companies or businesses in
the same or similar lines of business as any Partner or Group Member or any other businesses.
Section 7.6
Loans from the General Partner; Loans or Contributions from the Partnership or
Group Members
.
(a) The General Partner or any of its Affiliates may, but shall be under no obligation to,
lend to any Group Member, and any Group Member may borrow from the General Partner or any of its
Affiliates, funds needed or desired by the Group Member for such periods of time and in such
amounts as the General Partner may determine; provided, however, that in any such case the lending
party may not charge the borrowing party interest at a rate greater than the rate that would be
charged the borrowing party or impose terms less favorable to the borrowing party than
39
would be
charged or imposed on the borrowing party by unrelated lenders on comparable loans made on an arm’s
length basis (without reference to the lending party’s financial abilities or guarantees), all as
determined by the General Partner. The borrowing party shall reimburse the lending party for any
costs (other than any additional interest costs) incurred by the lending party in connection with
the borrowing of such funds. For purposes of this Section 7.6(a) and Section 7.6(b), the term
“Group Member” shall include any Affiliate of a Group Member that is controlled by the Group
Member.
(b) The Partnership may lend or contribute to any Group Member, and any Group Member may
borrow from the Partnership, funds on terms and conditions determined by the General Partner.
(c) No borrowing by any Group Member or the approval thereof by the General Partner shall be
deemed to constitute a breach of any duty, expressed or implied, of the General Partner or its
Affiliates to the Partnership or the Partners by reason of the fact that the purpose or effect of
such borrowing is directly or indirectly to enable distributions to the General Partner or its
Affiliates (including in their capacities, if applicable, as Limited Partners).
Section 7.7
Indemnification
.
(a) To the fullest extent permitted by law but subject to the limitations expressly provided
in this Agreement, all Indemnitees shall be indemnified and held harmless by the Partnership from
and against any and all losses, claims, damages, liabilities, joint or several, expenses (including
legal fees and expenses), judgments, fines, penalties, interest, settlements or other amounts
arising from any and all threatened, pending or completed claims, demands, actions, suits or
proceedings, whether civil, criminal, administrative or investigative, and whether formal or
informal and including appeals, in which any Indemnitee may be involved, or is threatened to be involved, as a party or otherwise, by reason of its status as an Indemnitee
and acting (or refraining to act) in such capacity on behalf of or for the benefit of the
Partnership; provided, that the Indemnitee shall not be indemnified and held harmless if there has
been a final and non-appealable judgment entered by a court of competent jurisdiction determining
that, in respect of the matter for which the Indemnitee is seeking indemnification pursuant to this
Section 7.7, the Indemnitee acted in bad faith or engaged in fraud, willful misconduct or, in the
case of a criminal matter, acted with knowledge that the Indemnitee’s conduct was unlawful. Any
indemnification pursuant to this Section 7.7 shall be made only out of the assets of the
Partnership, it being agreed that the General Partner shall not be personally liable for such
indemnification and shall have no obligation to contribute or loan any monies or property to the
Partnership to enable it to effectuate such indemnification.
(b) To the fullest extent permitted by law, expenses (including legal fees and expenses)
incurred by an Indemnitee who is indemnified pursuant to Section 7.7(a) in appearing at,
participating in or defending any claim, demand, action, suit or proceeding shall, from time to
time, be advanced by the Partnership prior to a final and non-appealable judgment entered by a
court of competent jurisdiction determining that, in respect of the matter for which the Indemnitee
is seeking indemnification pursuant to this Section 7.7, that the Indemnitee is not entitled to be
indemnified upon receipt by the Partnership of any undertaking by or on behalf of
40
the Indemnitee to
repay such amount if it shall be ultimately determined that the Indemnitee is not entitled to be
indemnified as authorized by this Section 7.7.
(c) The indemnification provided by this Section 7.7 shall be in addition to any other rights
to which an Indemnitee may be entitled under any agreement, pursuant to any vote of the holders of
Outstanding Limited Partner Interests, as a matter of law, in equity or otherwise, both as to
actions in the Indemnitee’s capacity as an Indemnitee and as to actions in any other capacity
(including any capacity under the Underwriting Agreement), and shall continue as to an Indemnitee
who has ceased to serve in such capacity and shall inure to the benefit of the heirs, successors,
assigns and administrators of the Indemnitee.
(d) The Partnership may purchase and maintain (or reimburse the General Partner or its
Affiliates for the cost of) insurance, on behalf of the General Partner, its Affiliates, the
Indemnitees and such other Persons as the General Partner shall determine, against any liability
that may be asserted against, or expense that may be incurred by, such Person in connection with
the Partnership’s activities or such Person’s activities on behalf of the Partnership, regardless
of whether the Partnership would have the power to indemnify such Person against such liability
under the provisions of this Agreement. In addition, the Partnership may enter into additional
indemnification agreements with any Indemnitee.
(e) For purposes of this Section 7.7, the Partnership shall be deemed to have requested an
Indemnitee to serve as fiduciary of an employee benefit plan whenever the performance by it of its
duties to the Partnership also imposes duties on, or otherwise involves services by, it to the plan
or participants or beneficiaries of the plan; excise taxes assessed on an Indemnitee with respect
to an employee benefit plan pursuant to applicable law shall constitute “fines” within the meaning
of Section 7.7(a); and action taken or omitted by an Indemnitee with respect to any employee
benefit plan in the performance of its duties for a purpose reasonably believed by it to be in the best interest of the participants and beneficiaries of the plan
shall be deemed to be for a purpose that is in the best interests of the Partnership.
(f) In no event may an Indemnitee subject the Limited Partners to personal liability by reason
of the indemnification provisions set forth in this Agreement.
(g) An Indemnitee shall not be denied indemnification in whole or in part under this Section
7.7 because the Indemnitee had an interest in the transaction with respect to which the
indemnification applies if the transaction was otherwise permitted by the terms of this Agreement.
(h) The provisions of this Section 7.7 are for the benefit of the Indemnitees and their heirs,
successors, assigns, executors and administrators and shall not be deemed to create any rights for
the benefit of any other Persons.
(i) No amendment, modification or repeal of this Section 7.7 or any provision hereof shall in
any manner terminate, reduce or impair the right of any past, present or future Indemnitee to be
indemnified by the Partnership, nor the obligations of the Partnership to indemnify any such
Indemnitee under and in accordance with the provisions of this Section 7.7 as in effect immediately
prior to such amendment, modification or repeal with respect to claims
41
arising from or relating to
matters occurring, in whole or in part, prior to such amendment, modification or repeal, regardless
of when such claims may arise or be asserted.
Section 7.8
Liability of Indemnitees
.
(a) Notwithstanding anything to the contrary set forth in this Agreement, no Indemnitee shall
be liable for monetary damages to the Partnership, the Partners or any other Persons who have
acquired interests in the Partnership Interests, for losses sustained or liabilities incurred as a
result of any act or omission of an Indemnitee unless there has been a final and non-appealable
judgment entered by a court of competent jurisdiction determining that, in respect of the matter in
question, the Indemnitee acted in bad faith or engaged in fraud, willful misconduct or, in the case
of a criminal matter, acted with knowledge that the Indemnitee’s conduct was criminal.
(b) Subject to its obligations and duties as General Partner set forth in Section 7.1(a), the
General Partner may exercise any of the powers granted to it by this Agreement and perform any of
the duties imposed upon it hereunder either directly or by or through its agents, and the General
Partner shall not be responsible for any misconduct or negligence on the part of any such agent
appointed by the General Partner in good faith.
(c) To the extent that, at law or in equity, an Indemnitee has duties (including fiduciary
duties) and liabilities relating thereto to the Partnership or to the Partners, the General Partner
and any other Indemnitee acting in connection with the Partnership’s business or affairs shall not
be liable to the Partnership or to any Partner for its good faith reliance on the provisions of
this Agreement.
(d) Any amendment, modification or repeal of this Section 7.8 or any provision hereof shall be
prospective only and shall not in any way affect the limitations on the liability of the
Indemnitees under this Section 7.8 as in effect immediately prior to such amendment, modification
or repeal with respect to claims arising from or relating to matters occurring, in whole or in
part, prior to such amendment, modification or repeal, regardless of when such claims may arise or
be asserted.
Section 7.9
Resolution of Conflicts of Interest; Standards of Conduct and Modification of
Duties
.
(a) Unless otherwise expressly provided in this Agreement or any Group Member Agreement,
whenever a potential conflict of interest exists or arises between the General Partner or any of
its Affiliates, on the one hand, and the Partnership, any Group Member or any other Partner, on the
other, any resolution or course of action by the General Partner or any of its Affiliates in
respect of such conflict of interest shall be permitted and deemed approved by all Partners, and
shall not constitute a breach of this Agreement, of any Group Member Agreement, of any agreement
contemplated herein or therein, or of any duty hereunder or existing at law, in equity or
otherwise, if the resolution or course of action in respect of such conflict of interest is (i)
approved by Special Approval, (ii) approved by the vote of a majority of the Common Units
(excluding Common Units owned by the General Partner and its Affiliates), (iii) on terms no less
favorable to the Partnership than those generally being provided to or available from unrelated
42
third parties or (iv) fair and reasonable to the Partnership, taking into account the totality of
the relationships between the parties involved (including other transactions that may be
particularly favorable or advantageous to the Partnership). The General Partner shall be authorized
but not required in connection with its resolution of such conflict of interest to seek Special
Approval or Common Unitholder approval of such resolution, and the General Partner may also adopt
a resolution or course of action that has not received Special Approval or Common Unitholder
approval. If Special Approval is sought, then it shall be presumed that, in making its decision,
the Conflicts Committee acted in good faith, and if Special Approval or Common Unitholder approval
is not sought and the Board of Directors determines that the resolution or course of action taken
with respect to a conflict of interest satisfies either of the standards set forth in clauses (iii)
or (iv) above, then it shall be presumed that, in making its decision, the Board of Directors acted
in good faith, and in any proceeding brought by any Partner or by or on behalf of such Partner or
any other Partner or the Partnership challenging such approval, the Person bringing or prosecuting
such proceeding shall have the burden of overcoming such presumption. Notwithstanding anything to
the contrary in this Agreement or any duty otherwise existing at law or equity, the existence of
the conflicts of interest described in the Registration Statement are hereby approved by all
Partners and shall not constitute a breach of this Agreement or of any duty hereunder or existing
at law, in equity or otherwise.
(b) Whenever the General Partner, or any committee of the Board of Directors (including the
Conflicts Committee), makes a determination or takes or declines to take any other action, or any
of its Affiliates causes the General Partner to do so, in its capacity as the general partner of
the Partnership as opposed to in its individual capacity, whether under this Agreement, any Group
Member Agreement or any other agreement contemplated hereby or
otherwise, then, unless another express standard is provided for in this Agreement, the
General Partner, such committee or such Affiliates causing the General Partner to do so, shall make
such determination or take or decline to take such other action in good faith and shall not be
subject to any other or different standards (including fiduciary standards) imposed by this
Agreement, any Group Member Agreement, any other agreement contemplated hereby or under the
Delaware Act or any other law, rule or regulation or at equity. In order for a determination or
other action to be in “good faith” for purposes of this Agreement, the Person or Persons making
such determination or taking or declining to take such other action must believe that the
determination or other action is in the best interests of the Partnership.
(c) Whenever the General Partner makes a determination or takes or declines to take any other
action, or any of its Affiliates causes it to do so, in its individual capacity as opposed to in
its capacity as the general partner of the Partnership, whether under this Agreement, any Group
Member Agreement or any other agreement contemplated hereby or otherwise, then the General Partner,
or such Affiliates causing it to do so, are entitled, to the fullest extent permitted by law, to
make such determination or to take or decline to take such other action free of any duty (including
any fiduciary duty) or obligation whatsoever to the Partnership, any other Partner or any other
Person bound by this Agreement, and the General Partner, or such Affiliates causing it to do so,
shall not, to the fullest extent permitted by law, be required to act in good faith or pursuant to
any other standard imposed by this Agreement, any Group Member Agreement, any other agreement
contemplated hereby or under the Delaware Act or any other law, rule or regulation or at equity. By
way of illustration and not of limitation, whenever the phrases, “at the option of the General
Partner,” “in its sole discretion” or some variation of those phrases, are
43
used in this Agreement,
it indicates that the General Partner is acting in its individual capacity. For the avoidance of
doubt, whenever the General Partner votes or transfers its Partnership Interests, or refrains from
voting or transferring its Partnership Interests, it shall be acting in its individual capacity.
(d) Notwithstanding anything to the contrary in this Agreement, the General Partner and its
Affiliates shall have no duty or obligation, express or implied, to (i) sell or otherwise dispose
of any asset of the Partnership Group other than in the ordinary course of business or (ii) permit
any Group Member to use any facilities or assets of the General Partner and its Affiliates, except
as may be provided in contracts entered into from time to time specifically dealing with such use.
Any determination by the General Partner or any of its Affiliates to enter into such contracts
shall be in its sole discretion.
(e) Except as expressly set forth in this Agreement, neither the General Partner nor any other
Indemnitee shall have any duties or liabilities, including fiduciary duties, to the Partnership or
any Partner and the provisions of this Agreement, to the extent that they restrict, eliminate or
otherwise modify the duties and liabilities, including fiduciary duties, of the General Partner or
any other Indemnitee otherwise existing at law or in equity, are agreed by the Partners to replace
such other duties and liabilities of the General Partner or such other Indemnitee.
(f) The Partners hereby authorize the General Partner, on behalf of the Partnership as a
partner or member of a Group Member, to approve of actions by the general partner or managing
member of such Group Member similar to those actions permitted to be taken by the General Partner
pursuant to this Section 7.9.
Section 7.10
Other Matters Concerning the General Partner
.
(a) The General Partner may rely and shall be protected in acting or refraining from acting
upon any resolution, certificate, statement, instrument, opinion, report, notice, request, consent,
order, bond, debenture or other paper or document believed by it to be genuine and to have been
signed or presented by the proper party or parties.
(b) The General Partner may consult with legal counsel, accountants, appraisers, management
consultants, investment bankers and other consultants and advisers selected by it, and any act
taken or omitted to be taken in reliance upon the advice or opinion (including an Opinion of
Counsel) of such Persons as to matters that the General Partner reasonably believes to be within
such Person’s professional or expert competence shall be conclusively presumed to have been done or
omitted in good faith and in accordance with such advice or opinion.
(c) The General Partner shall have the right, in respect of any of its powers or obligations
hereunder, to act through any of its or the Partnership’s duly authorized officers, a duly
appointed attorney or attorneys-in-fact.
Section 7.11
Purchase or Sale of Partnership Interests
. The General Partner may cause the Partnership to purchase or otherwise acquire Partnership
Interests.
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Section 7.12
Registration Rights of the General Partner and its Affiliates
.
(a) If (i) the General Partner or any of its Affiliates (including for purposes of this
Section 7.12, any Person that is an Affiliate of the General Partner at the date hereof
notwithstanding that it may later cease to be an Affiliate of the General Partner) holds
Partnership Interests that it desires to sell and (ii) Rule 144 of the Securities Act (or any
successor rule or regulation to Rule 144) or another exemption from registration is not available
to enable such holder of Partnership Interests (the “
Holder
”) to dispose of the number of
Partnership Interests it desires to sell at the time it desires to do so without registration under
the Securities Act, then at the option and upon the request of the Holder, the Partnership shall
file with the Commission as promptly as practicable after receiving such request, and use all
commercially reasonable efforts to cause to become effective and remain effective for a period of
not less than six months following its effective date or such shorter period as shall terminate
when all Partnership Interests covered by such registration statement have been sold, a
registration statement under the Securities Act registering the offering and sale of the number of
Partnership Interests specified by the Holder; provided, however, that the aggregate offering price
of any such offering and sale of Partnership Interests covered by such registration statement as
provided for in this Section 7.12(a) shall not be less than $5.0 million; provided further, that
the Partnership shall not be required to effect more than two registrations pursuant to this
Section 7.12(a) in any twelve-month period; and provided further, however that if the General
Partner determines that a postponement of the requested registration would be in the best interests
of the Partnership and its Partners due to a pending transaction, investigation or other event, the
filing of such registration statement or the effectiveness thereof may be deferred for up to six
months, but not thereafter. In connection with any registration pursuant to the immediately
preceding sentence, the Partnership shall (i) promptly prepare and file (A) such documents as may
be necessary to register or qualify the securities subject to such registration under the
securities laws of such states as the Holder shall reasonably request; provided, however, that no
such qualification shall be required in any jurisdiction where, as a result thereof, the
Partnership would become subject to general service of process or to taxation or qualification to
do business as a foreign corporation or partnership doing business in such jurisdiction solely as a
result of such registration, and (B) such documents as may be necessary to apply for listing or to
list the Partnership Interests subject to such registration on such National Securities Exchange as
the Holder shall reasonably request, and (ii) do any and all other acts and things that may be
necessary or appropriate to enable the Holder to consummate a public sale of such Partnership
Interests in such states. Except as set forth in Section 7.12(c), all costs and expenses of any
such registration and offering (other than the underwriting discounts and commissions) shall be
paid by the Partnership, without reimbursement by the Holder.
(b) If the Partnership shall at any time propose to file a registration statement under the
Securities Act for an offering of Partnership Interests for cash (other than an offering relating
solely to a benefit plan), the Partnership shall use all commercially reasonable efforts to include
such number or amount of Partnership Interests held by any Holder in such registration statement as
the Holder shall request; provided, that the Partnership is not required to make any effort or take
any action to so include the Partnership Interests of the Holder once the registration statement
becomes or is declared effective by the Commission, including any registration statement providing
for the offering from time to time of Partnership Interests pursuant to Rule 415 of the Securities
Act. If the proposed offering pursuant to this Section 7.12(b) shall be an
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underwritten offering,
then, in the event that the managing underwriter or managing underwriters of such offering advise
the Partnership and the Holder that in their opinion the inclusion of all or some of the Holder’s
Partnership Interests would adversely and materially affect the timing or success of the offering,
the Partnership shall include in such offering only that number or amount, if any, of Partnership
Interests held by the Holder that, in the opinion of the managing underwriter or managing
underwriters, will not so adversely and materially affect the offering. Except as set forth in
Section 7.12(c), all costs and expenses of any such registration and offering (other than the
underwriting discounts and commissions) shall be paid by the Partnership, without reimbursement by
the Holder.
(c) If underwriters are engaged in connection with any registration referred to in this
Section 7.12, the Partnership shall provide indemnification, representations, covenants, opinions
and other assurance to the underwriters in form and substance reasonably satisfactory to such
underwriters. Further, in addition to and not in limitation of the Partnership’s obligation under
Section 7.7, the Partnership shall, to the fullest extent permitted by law, indemnify and hold
harmless the Holder, its officers, directors and each Person who controls the Holder (within the
meaning of the Securities Act) and any agent thereof (collectively, “
Indemnified Persons
”)
against any losses, claims, demands, actions, causes of action, assessments, damages, liabilities
(joint or several), costs and expenses (including interest, penalties and reasonable attorneys’
fees and disbursements), resulting to, imposed upon, or incurred by the Indemnified Persons,
directly or indirectly, under the Securities Act or otherwise (hereinafter referred to in this
Section 7.12(c) as a “claim” and in the plural as “claims”) based upon, arising out of or resulting from any
untrue statement or alleged untrue statement of any material fact contained in any registration
statement under which any Partnership Interests were registered under the Securities Act or any
state securities or Blue Sky laws, in any preliminary prospectus or issuer free writing prospectus
as defined in Rule 433 of the Securities Act (if used prior to the effective date of such
registration statement), or in any summary or final prospectus or in any amendment or supplement
thereto (if used during the period the Partnership is required to keep the registration statement
current), or arising out of, based upon or resulting from the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the statements made
therein not misleading; provided, however, that the Partnership shall not be liable to any
Indemnified Person to the extent that any such claim arises out of, is based upon or results from
an untrue statement or alleged untrue statement or omission or alleged omission made in such
registration statement, such preliminary, summary or final prospectus or free writing prospectus or
such amendment or supplement, in reliance upon and in conformity with written information furnished
to the Partnership by or on behalf of such Indemnified Person specifically for use in the
preparation thereof.
(d) The provisions of Sections 7.12(a) and 7.12(b) shall continue to be applicable with
respect to the General Partner (and any of the General Partner’s Affiliates) after it ceases to be
the General Partner, during a period of two years subsequent to the effective date of such
cessation and for so long thereafter as is required for the Holder to sell all of the Partnership
Interests with respect to which it has requested during such two-year period inclusion in a
registration statement otherwise filed or that a registration statement be filed; provided,
however, that the Partnership shall not be required to file successive registration statements
covering the same Partnership Interests for which registration was demanded during such two-year
period. The provisions of Section 7.12(c) shall continue in effect thereafter.
46
(e) The rights to cause the Partnership to register Partnership Interests pursuant to this
Section 7.12 may be assigned (but only with all related obligations) by a Holder to a transferee or
assignee of such Partnership Interests, provided (i) the Partnership is, within a reasonable time
after such transfer, furnished with written notice of the name and address of such transferee or
assignee and the Partnership Interests with respect to which such registration rights are being
assigned; and (ii) such transferee or assignee agrees in writing to be bound by and subject to the
terms set forth in this Section 7.12.
(f) Any request to register Partnership Interests pursuant to this Section 7.12 shall (i)
specify the Partnership Interests intended to be offered and sold by the Person making the request,
(ii) express such Person’s present intent to offer such Partnership Interests for distribution,
(iii) describe the nature or method of the proposed offer and sale of Partnership Interests, and
(iv) contain the undertaking of such Person to provide all such information and materials and take
all action as may be required in order to permit the Partnership to comply with all applicable
requirements in connection with the registration of such Partnership Interests.
(g) The Partnership may enter into separate registration rights agreements with the General
Partner or any of its Affiliates.
Section 7.13
Reliance by Third Parties
. Notwithstanding anything to the contrary in this Agreement, any Person dealing with the
Partnership shall be entitled to assume that the General Partner and any officer of the General
Partner authorized by the General Partner to act on behalf of and in the name of the Partnership
has full power and authority to encumber, sell or otherwise use in any manner any and all assets of
the Partnership and to enter into any authorized contracts on behalf of the Partnership, and such
Person shall be entitled to deal with the General Partner or any such officer as if it were the
Partnership’s sole party in interest, both legally and beneficially. Each Partner hereby waives, to
the fullest extent permitted by law, any and all defenses or other remedies that may be available
to such Partner to contest, negate or disaffirm any action of the General Partner or any such
officer in connection with any such dealing. In no event shall any Person dealing with the General
Partner or any such officer or its representatives be obligated to ascertain that the terms of this
Agreement have been complied with or to inquire into the necessity or expedience of any act or
action of the General Partner or any such officer or its representatives. Each and every
certificate, document or other instrument executed on behalf of the Partnership by the General
Partner or its representatives shall be conclusive evidence in favor of any and every Person
relying thereon or claiming thereunder that (a) at the time of the execution and delivery of such
certificate, document or instrument, this Agreement was in full force and effect, (b) the Person
executing and delivering such certificate, document or instrument was duly authorized and empowered
to do so for and on behalf of the Partnership and (c) such certificate, document or instrument was
duly executed and delivered in accordance with the terms and provisions of this Agreement and is
binding upon the Partnership.
ARTICLE VIII
BOOKS, RECORDS, ACCOUNTING AND REPORTS
Section 8.1
Records and Accounting
. The General Partner shall keep or cause to be kept at the principal office of the
Partnership appropriate books and records with respect to the Partnership’s business, including all
books and records necessary to provide to the Partners any
47
information required to be provided
pursuant to Section 3.4(a). Any books and records maintained by or on behalf of the Partnership in
the regular course of its business, including the record of the Record Holders of Units or other
Partnership Interests, books of account and records of Partnership proceedings, may be kept on, or
be in the form of, computer disks, hard drives, magnetic tape, photographs, micrographics or any
other information storage device; provided, that the books and records so maintained are
convertible into clearly legible written form within a reasonable period of time. The books of the
Partnership shall be maintained, for financial reporting purposes, on an accrual basis in
accordance with U.S. GAAP.
Section 8.2
Fiscal Year
. The fiscal year of the Partnership shall be a fiscal year ending December 31.
Section 8.3
Reports
.
(a) As soon as practicable, but in no event later than 105 days after the close of each fiscal
year of the Partnership, the General Partner shall cause to be mailed or made available, by any
reasonable means, to each Record Holder of a Unit or other Partnership Interest as of a date
selected by the General Partner, an annual report containing financial statements of the
Partnership for such fiscal year of the Partnership, presented in accordance with U.S. GAAP,
including a balance sheet and statements of operations, Partnership equity and cash flows, such
statements to be audited by a firm of independent public accountants selected by the General
Partner.
(b) As soon as practicable, but in no event later than 50 days after the close of each Quarter
except the last Quarter of each fiscal year, the General Partner shall cause to be mailed or made
available, by any reasonable means, to each Record Holder of a Unit or other Partnership Interest,
as of a date selected by the General Partner, a report containing unaudited financial statements of
the Partnership and such other information as may be required by applicable law, regulation or rule
of any National Securities Exchange on which the Units are listed or admitted to trading, or as the
General Partner determines to be necessary or appropriate.
(c) The General Partner shall be deemed to have made a report available to each Record Holder
as required by this Section 8.3 if it has either (i) filed such report with the Commission via its
Electronic Data Gathering, Analysis and Retrieval system and such report is publicly available on
such system or (ii) made such report available on any publicly available website maintained by the
Partnership.
ARTICLE IX
TAX MATTERS
Section 9.1
Tax Returns and Information
. The Partnership shall timely file all returns of the Partnership that are required for U.S.
federal, state and local income tax purposes on the basis of the accrual method and the taxable
period or years that it is required by law to adopt, from time to time, as determined by the
General Partner. In the event the Partnership is required to use a taxable period other than a year
ending on December 31, the General Partner shall use reasonable efforts to change the taxable
period of the Partnership to a year ending on December 31. The tax information reasonably required
by Record Holders for federal, state and local
48
income tax reporting purposes with respect to a
taxable period shall be furnished to them within 90 days of the close of the calendar year in which
the Partnership’s taxable period ends. The classification, realization and recognition of income,
gain, losses and deductions and other items shall be on the accrual method of accounting for U.S.
federal income tax purposes.
Section 9.2
Tax Elections
.
(a) The Partnership shall make the election under Section 754 of the Code in accordance with
applicable regulations thereunder, subject to the reservation of the right to seek to revoke any
such election upon the General Partner’s determination that such revocation is in the best
interests of the Partners. Notwithstanding any other provision herein contained, for the purposes
of computing the adjustments under Section 743(b) of the Code, the General Partner shall be
authorized (but not required) to adopt a convention whereby the price paid by a transferee of a
Partnership Interest will be deemed to be the lowest quoted closing price of the Partnership
Interests on any National Securities Exchange on which such Partnership Interests are listed or
admitted to trading during the calendar month in which such transfer is deemed to occur pursuant to
Section 6.2(f) without regard to the actual price paid by such transferee.
(b) Except as otherwise provided herein, the General Partner shall determine whether the
Partnership should make any other elections permitted by the Code.
Section 9.3
Tax Controversies
. Subject to the provisions hereof, the General Partner shall designate the Organizational Limited
Partner, or such other Partner as the General Partner shall designate, as the Tax Matters Partner
(as defined in the Code) and is authorized and required to represent the Partnership (at the
Partnership’s expense) in connection with all examinations of the Partnership’s affairs by tax
authorities, including resulting administrative and judicial proceedings, and to expend Partnership
funds for professional services and costs associated therewith. Each Partner agrees to cooperate
with the Tax Matters Partner and to do or refrain from doing any or all things reasonably required
by the Tax Matters Partner to conduct such proceedings.
Section 9.4
Withholding
. Notwithstanding any other provision of this Agreement, the General Partner is authorized to take
any action that may be required to cause the Partnership and other Group Members to comply with any
withholding requirements established under the Code or any other U.S. federal, state or local law,
including pursuant to Sections 1441, 1442, 1445 and 1446 of the Code. To the extent that the
Partnership is required or elects to withhold and pay over to any taxing authority any amount
resulting from the allocation or distribution of income to any Partner (including by reason of
Section 1446 of the Code), the General Partner may treat the amount withheld as a distribution of
cash pursuant to Section 6.3 in the amount of such withholding from such Partner.
ARTICLE X
ADMISSION OF PARTNERS
Section 10.1
Admission of Limited Partners
.
(a) By acceptance of the transfer of any Limited Partner Interests in accordance with this
Section 10.1 or the issuance of any Limited Partner Interests in accordance herewith, and
49
except as
provided in Section 4.8, each transferee or other recipient of a Limited Partner Interest
(including any nominee holder or an agent or representative acquiring such Limited Partner
Interests for the account of another Person) (i) shall be admitted to the Partnership as a Limited
Partner with respect to the Limited Partner Interests so transferred or issued to such Person when
any such transfer or issuance is reflected in the books and records of the Partnership, (ii) shall
become bound by the terms of, and shall be deemed to have agreed to be bound by, this Agreement,
(iii) shall become the Record Holder of the Limited Partner Interests so transferred or issued,
(iv) represents that the transferee or other recipient has the capacity, power and authority to
enter into this Agreement, and (v) makes the consents, acknowledgments and waivers contained in
this Agreement, all with or without execution of this Agreement. The transfer of any Limited
Partner Interests and/or the admission of any new Limited Partner shall not constitute an amendment
to this Agreement. A Person may become a Record Holder without the consent or approval of any of
the Partners. A Person may not become a Limited Partner without acquiring a Limited Partner
Interest. The rights and obligations of a Person who is an Ineligible Holder shall be determined in
accordance with Section 4.8.
(b) The name and mailing address of each Limited Partner shall be listed on the books and
records of the Partnership maintained for such purpose by the General Partner or the Transfer
Agent. The General Partner shall update its books and records from time to time as necessary to
reflect accurately the information therein (or shall cause the Transfer Agent to do so, as
applicable). A Limited Partner Interest may be represented by a Certificate, as provided in
Section 4.1.
(c) Any transfer of a Limited Partner Interest shall not entitle the transferee to share in
the profits and losses, to receive distributions, to receive allocations of income, gain, loss,
deduction or credit or any similar item or to any other rights to which the transferor was entitled
until the transferee becomes a Limited Partner pursuant to Section 10.1(a).
Section 10.2
Admission of Successor General Partner
. A successor General Partner approved pursuant to Section 11.1 or 11.2 or the transferee of
or successor to all of the General Partner Interest pursuant to Section 4.5(d) who is proposed to
be admitted as a successor General Partner shall be admitted to the Partnership as the General
Partner, effective immediately prior to the withdrawal or removal of the predecessor or
transferring General Partner, pursuant to Section 11.1 or 11.2 or the transfer of the General
Partner Interest pursuant to Section 4.5(d), provided, however, that no such successor shall be
admitted to the Partnership until compliance with the terms of Section 4.5(d) has occurred and such
successor has executed and delivered such other documents or instruments as may be required to effect such admission. Any such successor shall, subject to the terms hereof,
carry on the business of the members of the Partnership Group without dissolution.
Section 10.3
Amendment of Agreement and Certificate of Limited Partnership
. To effect the admission to the Partnership of any Partner, the General Partner shall take
all steps necessary under the Delaware Act to amend the records of the Partnership to reflect such
admission and, if necessary, to prepare as soon as practicable an amendment to this Agreement and,
if required by law, the General Partner shall prepare and file an amendment to the Certificate of
Limited Partnership.
50
ARTICLE XI
WITHDRAWAL OR REMOVAL OF PARTNERS
Section 11.1
Withdrawal of the General Partner
.
(a) The General Partner shall be deemed to have withdrawn
from the Partnership upon the occurrence of any one of the following events (each such event herein
referred to as an “
Event of Withdrawal
”):
(i) The General Partner voluntarily withdraws from the Partnership by giving written
notice to the other Partners;
(ii) The General Partner transfers all of its rights as General Partner pursuant to
Section 4.5(d);
(iii) The General Partner is removed pursuant to Section 11.2;
(iv) The General Partner (A) makes a general assignment for the benefit of creditors;
(B) files a voluntary bankruptcy petition for relief under Chapter 7 of the United States
Bankruptcy Code; (C) files a petition or answer seeking for itself a liquidation,
dissolution or similar relief (but not a reorganization) under any law; (D) files an answer
or other pleading admitting or failing to contest the material allegations of a petition
filed against the General Partner in a proceeding of the type described in clauses (A)
through (C) of this Section 11.1(a)(iv); or (E) seeks, consents to or acquiesces in the
appointment of a trustee (but not a debtor-in-possession), receiver or liquidator of the
General Partner or of all or any substantial part of its properties;
(v) A final and non-appealable order of relief under Chapter 7 of the United States
Bankruptcy Code is entered by a court with appropriate jurisdiction pursuant to a voluntary
or involuntary petition by or against the General Partner; or
(vi) (A) in the event the General Partner is a corporation, a certificate of
dissolution or its equivalent is filed for the General Partner, or 90 days expire after the
date of notice to the General Partner of revocation of its charter without a reinstatement
of its charter, under the laws of its state of incorporation; (B) in the event the General
Partner is a limited liability company or a partnership, the dissolution and commencement of
winding up of the General Partner; (C) in the event the General Partner is acting in such
capacity by virtue of being a trustee of a trust, the termination of the trust; (D) in the
event the General Partner is a natural person, his death or adjudication of incompetency;
and (E) otherwise in the event of the termination of the General Partner.
If an Event of Withdrawal specified in Sections 11.1(a)(iv), 11.1(a)(v), 11.1(a)(vi)(A),
11.1(a)(vi)(B), 11.1(a)(vi)(C) or 11.1(a)(vi)(E) occurs, the withdrawing General Partner shall give
notice to the Partners within 30 days after such occurrence. The Partners hereby agree that only
the Events of Withdrawal described in this Section 11.1 shall result in the withdrawal of the
General Partner from the Partnership.
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(b) Withdrawal of the General Partner from the Partnership upon the occurrence of an Event of
Withdrawal shall not constitute a breach of this Agreement under the following circumstances: (i)
at any time during the period beginning on the Closing Date and ending at 11:59 pm, prevailing
Central Time, on March 31, 2021, the General Partner voluntarily withdraws by giving at least 90
days’ advance notice of its intention to withdraw to the Partners; provided, that prior to the
effective date of such withdrawal, the withdrawal is approved by Unitholders holding at least a
majority of the Outstanding Common Units (excluding Common Units held by the General Partner and
its Affiliates) and the General Partner delivers to the Partnership an Opinion of Counsel
(“
Withdrawal Opinion of Counsel
”) that such withdrawal (following the selection of the
successor General Partner) would not result in the loss of the limited liability of any Limited
Partner under the Delaware Act or cause any Group Member to be treated as an association taxable as
a corporation or otherwise to be taxed as an entity for U.S. federal income tax purposes (to the
extent not previously so treated or taxed); (ii) at any time after 11:59 pm, prevailing Central
Time, on March 31, 2021, the General Partner voluntarily withdraws by giving at least 90 days’
advance notice to the Partners, such withdrawal to take effect on the date specified in such
notice; (iii) at any time that the General Partner ceases to be the General Partner pursuant to
Section 11.1(a)(ii) or is removed pursuant to Section 11.2; or (iv) notwithstanding clause (i) of
this sentence, at any time that the General Partner voluntarily withdraws by giving at least 90
days’ advance notice of its intention to withdraw to the other Partners, such withdrawal to take
effect on the date specified in the notice, if at the time such notice is given one Person and its
Affiliates (other than the General Partner and its Affiliates) own beneficially or of record or
control at least 50% of the Outstanding Units. The withdrawal of the General Partner from the
Partnership upon the occurrence of an Event of Withdrawal shall also constitute the withdrawal of
the General Partner as general partner or managing member, if any, to the extent applicable, of the
other Group Members. If the General Partner gives notice of withdrawal pursuant to Section
11.1(a)(ii), the holders of a Unit Majority, may, prior to the effective date of such withdrawal,
elect a successor General Partner. The Person so elected as successor General Partner shall
automatically become the successor general partner or managing member, to the extent applicable, of
the other Group Members of which the General Partner is a general partner or a managing member. If,
prior to the effective date of the General Partner’s withdrawal, a successor is not selected by the
Partners as provided herein or the Partnership does not receive a Withdrawal Opinion of Counsel,
the Partnership shall be dissolved in accordance with Section 12.1, unless the business of the
Partnership is continued pursuant to Section 12.2. Any successor General Partner elected in
accordance with the terms of this Section 11.1 shall be subject to the provisions of Section 10.2.
Section 11.2
Removal of the General Partner
. The General Partner may be removed if such removal is
approved by the Partners holding at least 66 2/3% of the Outstanding Units (including Units held by
the General Partner and its Affiliates) voting as a single class. Any such action by such holders
for removal of the General Partner must also provide for the election of a successor General
Partner by the Partners holding a majority of the outstanding Common Units (including Common Units
held by the General Partner and its Affiliates). Such removal shall be effective immediately
following the admission of a successor General Partner pursuant to Section 10.2. The removal of the
General Partner shall also automatically constitute the removal of the General Partner as general
partner or managing member, to the extent applicable, of the other Group Members of which the
General Partner is a general partner or a managing member. If a Person is elected as a successor
General Partner in accordance with the terms of this Section
52
11.2, such Person shall, upon
admission pursuant to Section 10.2, automatically become a successor general partner or managing
member, to the extent applicable, of the other Group Members of which the General Partner is a
general partner or a managing member. The right of the Partners to remove the General Partner shall
not exist or be exercised unless the Partnership has received an opinion opining as to the matters
covered by a Withdrawal Opinion of Counsel. Any successor General Partner elected in accordance
with the terms of this Section 11.2 shall be subject to the provisions of Section 10.2.
Section 11.3
Interest of Departing General Partner and Successor General Partner
.
(a) In the event of (i) withdrawal of the General Partner under circumstances where such
withdrawal does not violate this Agreement or (ii) removal of the General Partner by the Partners
under circumstances where Cause does not exist, if the successor General Partner is elected in
accordance with the terms of Section 11.1 or 11.2, the Departing General Partner shall have the
option, exercisable prior to the effective date of the withdrawal or removal of such Departing
General Partner, to require its successor to purchase its General Partner Interest and its or its
Affiliates’ general partner interest (or equivalent interest), if any, in the other Group Members
(collectively, the “
Combined Interest
”) in exchange for an amount in cash equal to the fair
market value of such Combined Interest, such amount to be determined and payable as of the
effective date of its withdrawal or removal. If the General Partner is removed by the Partners
under circumstances where Cause exists or if the General Partner withdraws under circumstances
where such withdrawal violates this Agreement, and if a successor General Partner is elected in
accordance with the terms of Section 11.1 or 11.2 (or if the business of the Partnership is
continued pursuant to Section 12.2 and the successor General Partner is not the former General
Partner), such successor shall have the option, exercisable prior to the effective date of the
departure of such Departing General Partner (or, in the event the business of the Partnership is
continued, prior to the date the business of the Partnership is continued), to purchase the
Combined Interest for such fair market value of such Combined Interest. In either event, the
Departing General Partner shall be entitled to receive all reimbursements due such Departing
General Partner pursuant to Section 7.4, including any employee related liabilities (including
severance liabilities), incurred in connection with the termination of any employees employed by
the Departing General Partner or its Affiliates (other than any Group Member) for the benefit of
the Partnership or the other Group Members.
For purposes of this Section 11.3(a), the fair market value of the Combined Interest shall be
determined by agreement between the Departing General Partner and its successor or, failing
agreement within 30 days after the effective date of such Departing General Partner’s withdrawal or
removal, by an independent investment banking firm or other independent expert selected by the
Departing General Partner and its successor, which, in turn, may rely on other experts, and the
determination of which shall be conclusive as to such matter. If such parties cannot agree upon one
independent investment banking firm or other independent expert within 45 days after the effective
date of such withdrawal or removal, then the Departing General Partner shall designate an
independent investment banking firm or other independent expert, the Departing General Partner’s
successor shall designate an independent investment banking firm or other
independent expert, and such firms or experts shall mutually select a third independent
investment banking firm or independent expert, which third independent investment banking firm or
other independent expert shall determine the fair market value of the Combined Interest.
53
In making
its determination, such third independent investment banking firm or other independent expert may
consider the then current trading price of Units on any National Securities Exchange on which Units
are then listed or admitted to trading, the value of the Partnership’s assets, the rights and
obligations of the Departing General Partner and other factors it may deem relevant.
(b) If the Combined Interest is not purchased in the manner set forth in Section 11.3(a), the
Departing General Partner (or its transferee) shall become a Limited Partner and the Combined
Interest shall be converted into Common Units pursuant to a valuation made by an investment banking
firm or other independent expert selected pursuant to Section 11.3(a), without reduction in such
Partnership Interest (but subject to proportionate dilution by reason of the admission of its
successor). Any successor General Partner shall indemnify the Departing General Partner (or its
transferee) as to all debts and liabilities of the Partnership arising on or after the date on
which the Departing General Partner (or its transferee) becomes a Limited Partner. For purposes of
this Agreement, conversion of the Combined Interest to Common Units will be characterized as if the
Departing General Partner (or its Affiliates) contributed the Combined Interest to the Partnership
in exchange for the newly issued Common Units.
Section 11.4
Withdrawal of Limited Partners
. No Limited Partner shall have any right to withdraw from the
Partnership; provided, however, that when a transferee of a Limited Partner’s Partnership Interest
becomes a Record Holder of the Partnership Interest so transferred, such transferring Limited
Partner shall cease to be a Limited Partner with respect to the Partnership Interest so
transferred.
ARTICLE XII
DISSOLUTION AND LIQUIDATION
Section 12.1
Dissolution
. The Partnership shall not be dissolved by the admission of additional Partners
or by the admission of a successor General Partner in accordance with the terms of this Agreement.
Upon the removal or withdrawal of the General Partner, if a successor General Partner is elected
pursuant to Section 11.1 or 11.2, the Partnership shall not be dissolved and such successor General
Partner shall continue the business of the Partnership. The Partnership shall dissolve, and
(subject to Section 12.2) its affairs shall be wound up, upon:
(a) an Event of Withdrawal of the General Partner as provided in Section 11.1(a) (other than
Section 11.1(a)(ii)), unless a successor is elected and such successor is admitted to the
Partnership pursuant to Section 10.2;
(b) an election to dissolve the Partnership by the General Partner that is approved by the
holders of a Unit Majority;
(c) the entry of a decree of judicial dissolution of the Partnership pursuant to the
provisions of the Delaware Act; or
(d) at any time there are no Limited Partners, unless the Partnership is continued without
dissolution in accordance with the Delaware Act.
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Section 12.2
Continuation of the Business of the Partnership After Dissolution
. Upon (a) an Event of
Withdrawal caused by the withdrawal or removal of the General Partner as provided in Sections
11.1(a)(i) or 11.1(a)(iii) and the failure of the Partners to select a successor to such Departing
General Partner pursuant to Sections 11.1 or 11.2, then within 90 days thereafter, or (b) an event
constituting an Event of Withdrawal as defined in Sections 11.1(a)(iv), 11.1(a)(v) or 11.1(a)(vi),
then, to the maximum extent permitted by law, within 180 days thereafter, a Unit Majority may elect
to continue the business of the Partnership on the same terms and conditions set forth in this
Agreement by appointing as the successor General Partner a Person approved by a Unit Majority.
Unless such an election is made within the applicable time period as set forth above, the
Partnership shall conduct only activities necessary to wind up its affairs. If such an election is
so made, then:
(i) the Partnership shall continue without dissolution unless earlier dissolved in
accordance with this Article XII;
(ii) if the successor General Partner is not the former General Partner, then the
interest of the former General Partner shall be treated in the manner provided in Section
11.3; and
(iii) the successor General Partner shall be admitted to the Partnership as General
Partner, effective as of the Event of Withdrawal, by agreeing in writing to be bound by this
Agreement;
provided, that the right of a Unit Majority to approve a successor General Partner and to continue
the business of the Partnership shall not exist and may not be exercised unless the Partnership has
received an Opinion of Counsel that (x) the exercise of the right would not result in the loss of
the limited liability of any Limited Partner under the Delaware Act and (y) neither the Partnership
nor any successor limited partnership would be treated as an association taxable as a corporation
or otherwise be taxable as an entity for U.S. federal income tax purposes upon the exercise of such
right to continue (to the extent not already so treated or taxed).
Section 12.3
Liquidator
. Upon dissolution of the Partnership, unless the business of the Partnership is
continued pursuant to Section 12.2, the General Partner shall select one or more Persons to act as
Liquidator. The Liquidator (if other than the General Partner) shall be entitled to receive such
compensation for its services as may be approved by holders of at least a majority of the
Outstanding Common Units voting as a single class. The Liquidator (if other than the General
Partner) shall agree not to resign at any time without 15 days’ prior notice and may be removed at
any time, with or without cause, by notice of removal approved by holders of at least a majority of
the Outstanding Common Units. Upon dissolution, removal or resignation of the
Liquidator, a successor and substitute Liquidator (who shall have and succeed to all rights,
powers and duties of the original Liquidator) shall within 30 days thereafter be approved by
holders of at least a majority of the Outstanding Common Units. The right to approve a successor or
substitute Liquidator in the manner provided herein shall be deemed to refer also to any such
successor or substitute Liquidator approved in the manner herein provided. Except as expressly
provided in this Article XII, the Liquidator approved in the manner provided herein shall have and
may exercise, without further authorization or consent of any of the parties hereto, all of the
powers conferred upon the General Partner under the terms of this Agreement (but subject to all
55
of
the applicable limitations, contractual and otherwise, upon the exercise of such powers, other than
the limitation on sale set forth in Section 7.3) necessary or appropriate to carry out the duties
and functions of the Liquidator hereunder for and during the period of time required to complete
the winding up and liquidation of the Partnership as provided for herein.
Section 12.4
Liquidation
. The Liquidator shall proceed to dispose of the assets of the Partnership,
discharge its liabilities, and otherwise wind up its affairs in such manner and over such period as
determined by the Liquidator, subject to Section 17-804 of the Delaware Act and the following:
(a) The assets may be disposed of by public or private sale or by distribution in kind to one
or more Partners on such terms as the Liquidator and such Partner or Partners may agree. If any
property is distributed in kind, the Partner receiving the property shall be deemed for purposes of
Section 12.4(c) to have received cash equal to its fair market value; and contemporaneously
therewith, appropriate cash distributions must be made to the other Partners. The Liquidator may
defer liquidation or distribution of the Partnership’s assets for a reasonable time if it
determines that an immediate sale or distribution of all or some of the Partnership’s assets would
be impractical or would cause undue loss to the Partners. The Liquidator may distribute the
Partnership’s assets, in whole or in part, in kind if it determines that a sale would be
impractical or would cause undue loss to the Partners.
(b) Liabilities of the Partnership include amounts owed to the Liquidator as compensation for
serving in such capacity (subject to the terms of Section 12.3) and amounts to Partners otherwise
than in respect of their distribution rights under Article VI. With respect to any liability that
is contingent, conditional or unmatured or is otherwise not yet due and payable, the Liquidator
shall either settle such claim for such amount as it thinks appropriate or establish a reserve of
cash or other assets to provide for its payment. When paid, any unused portion of the reserve shall
be distributed as additional liquidation proceeds.
(c) All property and all cash in excess of that required to discharge liabilities as provided
in Section 12.4(b) shall be distributed to the Partners in accordance with, and to the extent of,
the positive balances in their respective Capital Accounts, as determined after taking into account
all Capital Account adjustments (other than those made by reason of distributions pursuant to this
Section 12.4(c)) for the taxable period of the Partnership during which the liquidation of the
Partnership occurs (with such date of occurrence being determined pursuant to Treasury Regulation
Section 1.704-1(b)(2)(ii)(g)), and such distribution shall be made by the end of such taxable
period (or, if later, within 90 days after said date of such occurrence).
Section 12.5
Cancellation of Certificate of Limited Partnership
. Upon the completion of the distribution
of Partnership cash and property as provided in Section 12.4 in connection with the liquidation of
the Partnership, the Certificate of Limited Partnership and all qualifications of the Partnership
as a foreign limited partnership in jurisdictions other than the State of Delaware shall be
canceled and such other actions as may be necessary to terminate the Partnership shall be taken.
Section 12.6
Return of Contributions
. The General Partner shall not be personally liable for, and shall
have no obligation to contribute or loan any monies or property to the
56
Partnership to enable it to
effectuate, the return of the Capital Contributions of the Partners or Unitholders, or any portion
thereof, it being expressly understood that any such return shall be made solely from Partnership
assets.
Section 12.7
Waiver of Partition
. To the maximum extent permitted by law, each Partner hereby waives any
right to partition of the Partnership property.
Section 12.8
Capital Account Restoration
. No Limited Partner shall have any obligation to restore any
negative balance in its Capital Account upon liquidation of the Partnership.
ARTICLE XIII
AMENDMENT OF PARTNERSHIP AGREEMENT; MEETINGS; RECORD DATE
Section 13.1
Amendments to be Adopted Solely by the General Partner
. Each Partner agrees that the General
Partner, without the approval of any other Partner, may amend any provision of this Agreement and
execute, swear to, acknowledge, deliver, file and record whatever documents may be required in
connection therewith, to reflect:
(a) a change in the name of the Partnership, the location of the principal place of business
of the Partnership, the registered agent of the Partnership or the registered office of the
Partnership;
(b) admission, substitution, withdrawal or removal of Partners in accordance with this
Agreement;
(c) a change that the General Partner determines to be necessary or appropriate to qualify or
continue the qualification of the Partnership as a limited partnership or a partnership in which
the Limited Partners have limited liability under the laws of any state or to ensure that the Group
Members will not be treated as associations taxable as corporations or otherwise taxed as entities
for U.S. federal income tax purposes;
(d) a change that the General Partner determines (i) does not adversely affect the Partners
(including any particular class of Partnership Interests as compared to other classes of
Partnership Interests) in any material respect, (ii) to be necessary or appropriate to (A) satisfy
any requirements, conditions or guidelines contained in any opinion, directive, order, ruling or
regulation of any federal or state agency or judicial authority or contained in any federal or
state statute (including the Delaware Act) or (B) facilitate the trading of the Units (including
the division of any class or classes of Outstanding Units into different classes to facilitate
uniformity of tax consequences within such classes of Units) or comply with any rule, regulation,
guideline or requirement of any National Securities Exchange on which any class of Partnership
Interests are or will be listed or admitted to trading, (iii) to be necessary or appropriate in
connection with action taken by the General Partner pursuant to Section 5.6 or (iv) is required to
effect the intent expressed in the Registration Statement or the intent of the provisions of this
Agreement or is otherwise contemplated by this Agreement;
(e) a change in the fiscal year or taxable period of the Partnership and any other changes
that the General Partner determines to be necessary or appropriate as a result of a change
57
in the
fiscal year or taxable period of the Partnership including, if the General Partner shall so
determine, a change in the definition of “Quarter” and the dates on which distributions are to be
made by the Partnership;
(f) an amendment that is necessary, in the Opinion of Counsel, to prevent the Partnership, or
the General Partner or CVR Energy, Inc. or their directors, officers, trustees or agents from in
any manner being subjected to the provisions of the Investment Company Act of 1940, as amended, the
Investment Advisers Act of 1940, as amended, or “plan asset” regulations adopted under the Employee
Retirement Income Security Act of 1974, as amended, regardless of whether such are substantially
similar to plan asset regulations currently applied or proposed by the United States Department of
Labor;
(g) an amendment that the General Partner determines to be necessary or appropriate in
connection with the creation, authorization or issuance of any class or series of Partnership
Interests or any options, rights, warrants and appreciation rights relating to an equity interest
in the Partnership pursuant to Section 5.4;
(h) any amendment expressly permitted in this Agreement to be made by the General Partner
acting alone;
(i) an amendment effected, necessitated or contemplated by a Merger Agreement approved in
accordance with Section 14.3;
(j) an amendment that the General Partner determines to be necessary or appropriate to reflect
and account for the formation by the Partnership of, or investment by the Partnership in, any
corporation, partnership, joint venture, limited liability company or other entity, in connection
with the conduct by the Partnership of activities permitted by the terms of Section 2.4;
(k) a merger or conveyance pursuant to Section 14.3(d); or
(l) any other amendments substantially similar to the foregoing.
Section 13.2
Amendment Procedures
. Amendments to this Agreement may be proposed only by the General
Partner. To the fullest extent permitted by law, the General Partner shall have no duty or
obligation to propose or approve any amendment to this Agreement and may decline to do so in its
sole discretion and, in declining to propose or approve an amendment, to the fullest extent
permitted by law shall not be required to act in good faith or pursuant to any other standard
imposed by this Agreement, any Group Member Agreement, any other agreement contemplated hereby or
under the Delaware Act or any other law, rule or regulation or at equity. An amendment shall be
effective upon its approval by the General Partner and a Unit Majority, unless a greater or
different percentage is required under this Agreement or by Delaware law. Each proposed amendment
that requires the approval of Partners holding a specified Percentage Interest shall be set forth
in a writing that contains the text of the proposed amendment. If such an amendment is proposed,
the General Partner shall seek the written approval of Partners holding the specified Percentage
Interest or call a meeting of the Partners to consider and vote on such proposed amendment. The
General Partner shall notify all Record Holders upon final adoption of any such proposed
amendments. The General
58
Partner shall be deemed to have notified all Record Holders as required by
this Section 13.2 if it has either (i) filed such amendment with the Commission via its Electronic
Data Gathering, Analysis and Retrieval system and such amendment is publicly available on such
system or (ii) made such amendment available on any publicly available website maintained by the
Partnership.
Section 13.3
Amendment Requirements
.
(a) Notwithstanding the provisions of Sections 13.1 and 13.2, no provision of this Agreement
that requires a vote or approval of Partners (or a subset of the Partners) holding a specified
Percentage Interest to take any action shall be amended, altered, changed, repealed or rescinded in
any respect that would have the effect of, in the case of any provision of this Agreement other
than Section 11.2 or Section 13.4, reducing such percentage unless such amendment is approved by
the written consent or the affirmative vote of Partners whose aggregate Percentage Interest
constitutes not less than the voting requirement sought to be reduced.
(b) Notwithstanding the provisions of Sections 13.1 and 13.2, no amendment to this Agreement
may (i) enlarge the obligations of any Partner without its consent, unless such shall be deemed to
have occurred as a result of an amendment approved pursuant to Section 13.3(c), or (ii) enlarge the
obligations of, restrict, change or modify in any way any action by or rights of, or reduce in any
way the amounts distributable, reimbursable or otherwise payable to, the General Partner or any of
its Affiliates without its consent, which consent may be given or withheld in its sole discretion.
(c) Except as provided in Section 14.3 or Section 13.1, any amendment that would have a
material adverse effect on the rights or preferences of any class of Partnership Interests in
relation to other classes of Partnership Interests must be approved by the holders of not less than
a majority of the Outstanding Partnership Interests of the class affected. If the General Partner
determines an amendment does not satisfy the requirements of Section 13.1(d)(i) because it
adversely affects one or more classes of Partnership Interests, as compared to other classes of
Partnership Interests, in any material respect, such amendment shall only be required to be
approved by the adversely affected class or classes.
(d) Notwithstanding any other provision of this Agreement, except for amendments pursuant to
Section 13.1 and except as otherwise provided by Section 14.3(b), no amendments shall become
effective without the approval of the holders of at least 90% of the Percentage Interests of all
Partners voting as a single class unless the Partnership obtains an Opinion of Counsel to the
effect that such amendment will not affect the limited liability of any Limited Partner under
applicable partnership law of the state under whose laws the Partnership is organized.
(e) Except as provided in Section 13.1, this Section 13.3 shall only be amended with the
approval of Partners (including the General Partner and its Affiliates) holding at least 90% of the
Percentage Interests of all Partners.
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Section 13.4
Special Meetings
. All acts of Partners to be taken pursuant to this Agreement shall be taken
in the manner provided in this Article XIII. Special meetings of the Partners may be called by the
General Partner or by Limited Partners owning 20% or more of the Outstanding Units of the class or
classes for which a meeting is proposed. Limited Partners shall call a special meeting by
delivering to the General Partner one or more requests in writing stating that the signing Partners
wish to call a special meeting and indicating the general or specific purposes for which the
special meeting is to be called. Within 60 days after receipt of such a call from Partners or
within such greater time as may be reasonably necessary for the Partnership to comply with any
statutes, rules, regulations, listing agreements or similar requirements governing the holding of a
meeting or the solicitation of proxies for use at such a meeting, the General Partner shall send a
notice of the meeting to the Partners either directly or indirectly through the Transfer Agent. A
meeting shall be held at a time and place determined by the General Partner on a date not less than
10 days nor more than 60 days after the mailing of notice of the meeting. Limited Partners shall
not vote on matters that would cause the Limited Partners to be deemed to be taking part in the
management and control of the business and affairs of the Partnership so as to jeopardize the
Limited Partners’ limited liability under the Delaware Act or the law of any other state in which
the Partnership is qualified to do business.
Section 13.5
Notice of a Meeting
. Notice of a meeting called pursuant to Section 13.4 shall be given to
the Record Holders of the class or classes of Partnership Interests for which a meeting is proposed
in writing by mail or other means of written communication in accordance with Section 16.1. The
notice shall be deemed to have been given at the time when deposited in the mail or sent by other
means of written communication.
Section 13.6
Record Date
. For purposes of determining the Partners entitled to notice of or to vote at a meeting of
the Partners or to give approvals without a meeting as provided in Section 13.11 the General
Partner may set a Record Date, which shall not be less than 10 nor more than 60 days before (a) the
date of the meeting (unless such requirement conflicts with any rule, regulation, guideline or
requirement of any National Securities Exchange on which the Partnership Interests are listed or
admitted to trading or U.S. federal securities laws, in which case the rule, regulation, guideline
or requirement of such National Securities Exchange or U.S. federal securities laws shall govern)
or (b) in the event that approvals are sought without a meeting, the date by which Partners are
requested in writing by the General Partner to give such approvals. If the General Partner does
not set a Record Date, then (a) the Record Date for determining the Partners entitled to notice of
or to vote at a meeting of the Partners shall be the close of business on the day next preceding
the day on which notice is given, and (b) the Record Date for determining the Partners entitled to
give approvals without a meeting shall be the date the first written approval is deposited with the
Partnership in care of the General Partner in accordance with Section 13.11.
Section 13.7
Adjournment
. When a meeting is adjourned to another time or place, notice need not be given
of the adjourned meeting and a new Record Date need not be fixed, if the time and place thereof are
announced at the meeting at which the adjournment is taken, unless such adjournment shall be for
more than 45 days. At the adjourned meeting, the Partnership may transact any business which might
have been transacted at the original meeting. If the adjournment is for more than 45 days or if a
new Record Date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be
given in accordance with this Article XIII.
60
Section 13.8
Waiver of Notice; Approval of Meeting; Approval of Minutes
. The transactions of any meeting
of Partners, however called and noticed, and whenever held, shall be as valid as if it had occurred
at a meeting duly held after regular call and notice, if a quorum is present either in person or by
proxy. Attendance of a Partner at a meeting shall constitute a waiver of notice of the meeting,
except (i) when the Partner attends the meeting for the express purpose of objecting, at the
beginning of the meeting, to the transaction of any business because the meeting is not lawfully
called or convened and (ii) that attendance at a meeting is not a waiver of any right to disapprove
the consideration of matters required to be included in the notice of the meeting, but not so
included, if the disapproval is expressly made at the meeting.
Section 13.9
Quorum and Voting
. The holders of a majority, by Percentage Interest, of the Partnership
Interests of the class or classes for which a meeting has been called (including Partnership
Interests deemed owned by the General Partner) represented in person or by proxy shall constitute a
quorum at a meeting of Partners of such class or classes unless any such action by the Partners
requires approval by holders of a greater Percentage Interest, in which case the quorum shall be
such greater Percentage Interest. At any meeting of the Partners duly called and held in accordance
with this Agreement at which a quorum is present, the act of Partners holding Partnership Interests
that in the aggregate represent a majority of the Percentage Interest of those present in
person or by proxy at such meeting shall be deemed to constitute the act of all Partners,
unless a greater or different percentage is required with respect to such action under the
provisions of this Agreement, in which case the act of the Partners holding Partnership Interests
that in the aggregate represent at least such greater or different percentage shall be required;
provided
, however, that if, as a matter of law or amendment to this Agreement, approval by
plurality vote of Partners (or any class thereof) is required to approve any action, no minimum
quorum shall be required. The Partners present at a duly called or held meeting at which a quorum
is present may continue to transact business until adjournment, notwithstanding the withdrawal of
enough Partners to leave less than a quorum, if any action taken (other than adjournment) is
approved by Partners holding the required Percentage Interest specified in this Agreement. In the
absence of a quorum any meeting of Partners may be adjourned from time to time by the affirmative
vote of Partners with at least a majority, by Percentage Interest, of the Partnership Interests
entitled to vote at such meeting (including Partnership Interests deemed owned by the General
Partner) represented either in person or by proxy, but no other business may be transacted, except
as provided in Section 13.7.
Section 13.10
Conduct of a Meeting
. The General Partner shall have full power and authority concerning the
manner of conducting any meeting of the Partners or solicitation of approvals in writing, including
the determination of Persons entitled to vote, the existence of a quorum, the satisfaction of the
requirements of Section 13.4, the conduct of voting, the validity and effect of any proxies and the
determination of any controversies, votes or challenges arising in connection with or during the
meeting or voting. The General Partner shall designate a Person to serve as chairman of any meeting
and shall further designate a Person to take the minutes of any meeting. All minutes shall be kept
with the records of the Partnership maintained by the General Partner. The General Partner may make
such other regulations consistent with applicable law and this Agreement as it may deem advisable
concerning the conduct of any meeting of the Partners or solicitation of approvals in writing,
including regulations in regard to the appointment of proxies, the appointment and duties of
inspectors of votes and approvals, the
61
submission and examination of proxies and other evidence of
the right to vote, and the revocation of approvals in writing.
Section 13.11
Action Without a Meeting
. If authorized by the General Partner, any action that may be taken
at a meeting of the Partners may be taken without a meeting, without a vote and without prior
notice, if an approval in writing setting forth the action so taken is signed by Partners owning
Partnership Interests representing not less than the minimum Percentage Interest that would be
necessary to authorize or take such action at a meeting at which all the Partners were present and
voted (unless such provision conflicts with any rule, regulation, guideline or requirement of any
National Securities Exchange on which Partnership Interests are listed or admitted to trading, in
which case the rule, regulation, guideline or requirement of such National Securities Exchange
shall govern). Prompt notice of the taking of action without a meeting shall be given to the
Partners who have not approved in writing. The General Partner may specify that any written ballot
submitted to Partners for the purpose of taking any action without a meeting shall be returned to
the Partnership within the time period, which shall be not less than 20 days, specified by the
General Partner. If a ballot returned to the Partnership does not vote all of the Partnership
Interests held
by the Partners, the Partnership shall be deemed to have failed to receive a ballot for the
Partnership Interests that were not voted. If approval of the taking of any action by the Partners
is solicited by any Person other than by or on behalf of the General Partner, the written approvals
shall have no force and effect unless and until (a) they are deposited with the Partnership in care
of the General Partner and (b) an Opinion of Counsel is delivered to the General Partner to the
effect that the exercise of such right and the action proposed to be taken with respect to any
particular matter (i) will not cause the Limited Partners to be deemed to be taking part in the
management and control of the business and affairs of the Partnership so as to jeopardize the
Limited Partners’ limited liability, and (ii) is otherwise permissible under the state statutes
then governing the rights, duties and liabilities of the Partnership and the Partners. Nothing
contained in this Section 13.11 shall be deemed to require the General Partner to solicit all
Partners in connection with a matter approved by the requisite percentage of Partnership Interests
acting by written consent without a meeting.
Section 13.12
Right to Vote and Related Matters
.
(a) Only those Record Holders of Partnership Interests on the Record Date set pursuant to
Section 13.6 (and also subject to the limitations contained in the definition of “Outstanding”)
shall be entitled to notice of, and to vote at, a meeting of Partners or to act with respect to
matters as to which the Partners have the right to vote or to act. All references in this Agreement
to votes of, or other acts that may be taken by, the Partners shall be deemed to be references to
the votes or acts of the Record Holders of Partnership Interests.
(b) With respect to Partnership Interests that are held for a Person’s account by another
Person (such as a broker, dealer, bank, trust company or clearing corporation, or an agent of any
of the foregoing), in whose name such Partnership Interests are registered, such other Person
shall, in exercising the voting rights in respect of such Partnership Interests on any matter, and
unless the arrangement between such Persons provides otherwise, vote such Partnership Interests in
favor of, and at the direction of, the Person who is the beneficial owner, and the Partnership
shall be entitled to assume it is so acting without further inquiry. The
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provisions of this Section
13.12(b) (as well as all other provisions of this Agreement) are subject to the provisions of
Section 4.3.
ARTICLE XIV
MERGER
Section 14.1
Authority
. The Partnership may merge or consolidate with or into one or more corporations,
limited liability companies, business trusts or associations, real estate investment trusts, common
law trusts or unincorporated businesses, including a general partnership or limited partnership,
formed under the laws of the State of Delaware or any other state of the United States of America,
pursuant to a written agreement of merger or consolidation (“
Merger Agreement
”) in
accordance with this Article XIV.
Section 14.2
Procedure for Merger or Consolidation
.
(a) Merger or consolidation of the Partnership pursuant to this Article XIV requires the prior
consent of the General Partner, provided, however, that, to the fullest extent permitted by law,
the General Partner shall have no duty or obligation to consent to any merger or consolidation of
the Partnership and may decline to do so free of any fiduciary duty or obligation whatsoever to the
Partnership or any Partner and, in declining to consent to a merger or consolidation, shall not be
required to act in good faith or pursuant to any other standard imposed by this Agreement, any
Group Member Agreement, any other agreement contemplated hereby or under the Delaware Act or any
other law, rule or regulation or at equity.
(b) If the General Partner shall determine to consent to the merger or consolidation, the
General Partner shall approve the Merger Agreement, which shall set forth:
(i) the names and jurisdictions of formation or organization of each of the business
entities proposing to merge or consolidate;
(ii) the name and jurisdiction of formation or organization of the business entity that
is to survive the proposed merger or consolidation (the “
Surviving Business
Entity
”);
(iii) the terms and conditions of the proposed merger or consolidation;
(iv) the manner and basis of exchanging or converting the equity interests of each
constituent business entity for, or into, cash, property or general or limited partner
interests, rights, securities or obligations of the Surviving Business Entity; and (i) if
any general or limited partner interests, securities or rights of any constituent business
entity are not to be exchanged or converted solely for, or into, cash, property or general
or limited partner interests, rights, securities or obligations of the Surviving Business
Entity, the cash, property or general or limited partner interests, rights, securities or
obligations of any limited partnership, corporation, trust or other entity (other than the
Surviving Business Entity) which the holders of such general or limited partner interests,
securities or rights are to receive in exchange for, or upon conversion of their general or
limited partner interests, securities or rights, and (ii) in the case of equity interests
represented by certificates, upon the surrender of such certificates, which cash, property
or general or
63
limited partner interests, rights, securities or obligations of the Surviving
Business Entity or any general or limited partnership, corporation, trust or other entity
(other than the Surviving Business Entity), or evidences thereof, are to be delivered;
(v) a statement of any changes in the constituent documents or the adoption of new
constituent documents (the articles or certificate of incorporation, articles of trust,
declaration of trust, certificate or agreement of limited partnership or other similar
charter or governing document) of the Surviving Business Entity to be effected by such
merger or consolidation;
(vi) the effective time of the merger, which may be the date of the filing of the
certificate of merger pursuant to Section 14.4 or a later date specified in or determinable
in accordance with the Merger Agreement (provided, that if the effective time of the merger
is to be later than the date of the filing of the certificate of merger, the effective time
shall be fixed no later than the time of the filing of the certificate of merger and stated
therein); and
(vii) such other provisions with respect to the proposed merger or consolidation that
the General Partner determines to be necessary or appropriate.
Section 14.3
Approval by Partners of Merger or Consolidation
.
(a) Except as provided in Sections 14.3(d) or 14.3(e), the General Partner, upon its approval
of the Merger Agreement, shall direct that the Merger Agreement be submitted to a vote of Partners,
whether at a special meeting or by written consent, in either case in accordance with the
requirements of Article XIII. A copy or a summary of the Merger Agreement shall be included in or
enclosed with the notice of a special meeting or the written consent.
(b) Except as provided in Sections 14.3(d) or 14.3(e), the Merger Agreement shall be approved
upon receiving the affirmative vote or consent of a Unit Majority unless the Merger Agreement
contains any provision that, if contained in an amendment to this Agreement, the provisions of this
Agreement or the Delaware Act would require for its approval the vote or consent of Partners
holding a greater Percentage Interest or the vote or consent of a specified percentage of any class
of Partners, in which case such greater Percentage Interest or percentage vote or consent shall be
required for approval of the Merger Agreement.
(c) Except as provided in Sections 14.3(d) and 14.3(e), after such approval by vote or consent
of the Partners, and at any time prior to the filing of the certificate of merger pursuant to
Section 14.4, the merger or consolidation may be abandoned pursuant to provisions therefor, if any,
set forth in the Merger Agreement.
(d) Notwithstanding anything else contained in this Article XIV or in this Agreement, the
General Partner is permitted, without Partner approval, to convert the Partnership or any Group
Member into a new limited liability entity, to merge the Partnership or any Group Member into, or
convey all of the Partnership’s assets to, another limited liability entity that shall be newly
formed and shall have no assets, liabilities or operations at the time of such conversion, merger
or conveyance other than those it receives from the Partnership or other Group Member if (i) the
General Partner has received an Opinion of Counsel that the conversion, merger or
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conveyance, as
the case may be, would not result in the loss of the limited liability of any Limited Partner or
any Group Member under the Delaware Act or cause the Partnership or any Group Member to be treated
as an association taxable as a corporation or otherwise to be taxed as an entity for U.S. federal
income tax purposes (to the extent not already treated as such), (ii) the sole purpose of such
conversion, merger or conveyance is to effect a mere change in the legal form of the Partnership
into another limited liability entity and (iii) the governing instruments of the new entity provide
the Partners with the same rights and obligations as are herein contained.
(e) Additionally, notwithstanding anything else contained in this Article XIV or in this
Agreement, the General Partner is permitted, without Partner approval, to merge or consolidate the
Partnership with or into another entity if (A) the General Partner has received an Opinion of
Counsel that the merger or consolidation, as the case may be, would not result in the loss of the
limited liability under the Delaware Act of any Limited Partner or cause the Partnership to be
treated as an association taxable as a corporation or otherwise to be taxed as an entity for U.S.
federal income tax purposes (to the extent not already treated as such), (B) the merger or
consolidation would not result in an amendment to this Agreement, other than any amendments that
could be adopted pursuant to Section 13.1, (C) the Partnership is the Surviving Business Entity in
such merger or consolidation, (D) each Partnership Interest outstanding immediately prior to the
effective date of the merger or consolidation is to be an identical Partnership Interest of the
Partnership after the effective date of the merger or consolidation, and (E) the number of
Partnership Interests to be issued by the Partnership in such merger or consolidation does not
exceed 20% of the Partnership Interests Outstanding immediately prior to the effective date of such
merger or consolidation.
Section 14.4
Certificate of Merger
. Upon the required approval by the General Partner and the Partners of
a Merger Agreement, a certificate of merger shall be executed and filed with the Secretary of State
of the State of Delaware in conformity with the requirements of the Delaware Act.
Section 14.5
Amendment of Partnership Agreement
. Pursuant to Section 17-211(g) of the Delaware Act, an
agreement of merger or consolidation approved in accordance with this Article XIV may (a) effect
any amendment to this Agreement or (b) effect the adoption of a new partnership agreement for the
Partnership if it is the Surviving Business Entity. Any such amendment or adoption made pursuant
to this Section 14.5 shall be effective at the effective time or date of the merger or
consolidation.
Section 14.6
Effect of Merger
.
(a) At the effective time of the certificate of merger:
(i) all of the rights, privileges and powers of each of the business entities that has
merged or consolidated, and all property, real, personal and mixed, and all debts due to any
of those business entities and all other things and causes of action belonging to each of
those business entities, shall be vested in the Surviving Business Entity and after the
merger or consolidation shall be the property of the Surviving Business Entity to the extent
they were of each constituent business entity;
65
(ii) the title to any real property vested by deed or otherwise in any of those
constituent business entities shall not revert and is not in any way impaired because of the
merger or consolidation;
(iii) all rights of creditors and all liens on or security interests in property of any
of those constituent business entities shall be preserved unimpaired; and
(iv) all debts, liabilities and duties of those constituent business entities shall
attach to the Surviving Business Entity and may be enforced against it to the same extent as
if the debts, liabilities and duties had been incurred or contracted by it.
(b) A merger or consolidation effected pursuant to this Article shall not be deemed to result
in a transfer or assignment of assets or liabilities from one entity to another.
ARTICLE XV
RIGHT TO ACQUIRE LIMITED PARTNER INTERESTS
Section 15.1
Right to Acquire Limited Partner Interests
.
(a) Notwithstanding any other provision of this Agreement, if at any time the General Partner
and its Affiliates hold more than % of the total Limited Partner Interests of any class then
Outstanding, the General Partner shall then have the right, which right it may assign and transfer
in whole or in part to the Partnership or any Affiliate of the General Partner, exercisable in its
sole discretion, to purchase all, but not less than all, of such Limited Partner Interests of such
class then Outstanding held by Persons other than the General Partner and its Affiliates, at the
greater of (x) the Current Market Price as of the date three days prior to the date that the notice
described in Section 15.1(b) is mailed and (y) the highest price paid by the General Partner or any
of its Affiliates for any such Limited Partner Interest of such class purchased during the 90-day
period preceding the date that the notice described in Section 15.1(b) is mailed.
(b) If the General Partner, any Affiliate of the General Partner or the Partnership elects to
exercise the right to purchase Limited Partner Interests granted pursuant to Section 15.1(a), the
General Partner shall deliver to the Transfer Agent notice of such election to purchase (the
“
Notice of Election to Purchase
”) and shall cause the Transfer Agent to mail a copy of such
Notice of Election to Purchase to the Record Holders of Limited Partner Interests of such class (as
of a Record Date selected by the General Partner) at least 10, but not more than 60, days prior to
the Purchase Date. Such Notice of Election to Purchase shall also be published for a period of at
least three consecutive days in at least two daily newspapers of general circulation printed in the
English language and circulated in the Borough of Manhattan, New York. The Notice of Election to
Purchase shall specify the Purchase Date and the price (determined in accordance with Section
15.1(a)) at which Limited Partner Interests will be purchased and state that the General Partner,
its Affiliate or the Partnership, as the case may be, elects to purchase such Limited Partner
Interests, upon surrender of Certificates representing such Limited Partner Interests in exchange
for payment (in the case of Limited Partner Interests evidenced by Certificates), at such office or
offices of the Transfer Agent as the Transfer Agent may specify, or as may be required by any
National Securities Exchange on which such Limited Partner
66
Interests are listed or admitted to
trading. Any such Notice of Election to Purchase mailed to a Record Holder of Limited Partner
Interests at his address as reflected in the records of the Transfer Agent shall be conclusively
presumed to have been given regardless of whether the owner receives such notice. On or prior to
the Purchase Date, the General Partner, its Affiliate or the Partnership, as the case may be, shall
deposit with the Transfer Agent cash in an amount sufficient to pay the aggregate purchase price of
all of such Limited Partner Interests to be purchased in accordance with this Section 15.1. If the
Notice of Election to Purchase shall have been duly given as aforesaid at least 10 days prior to
the Purchase Date, and if on or prior to the Purchase Date the deposit described in the preceding
sentence has been made for the benefit of the holders of Limited Partner Interests subject to
purchase as provided herein, then from and after the Purchase Date, notwithstanding that any
Certificate shall not have been surrendered for purchase, all rights of the holders of such Limited
Partner Interests (including any rights pursuant
to Articles IV, V, VI, and XII) shall thereupon cease, except the right to receive the
purchase price (determined in accordance with Section 15.1(a)) for Limited Partner Interests
therefor, without interest, upon surrender to the Transfer Agent of the Certificates representing
such Limited Partner Interests (in the case of Limited Partner Interests evidenced by
Certificates), and such Limited Partner Interests shall thereupon be deemed to be transferred to
the General Partner, its Affiliate or the Partnership, as the case may be, on the record books of
the Transfer Agent and the Partnership, and the General Partner or any Affiliate of the General
Partner, or the Partnership, as the case may be, shall be deemed to be the owner of all such
Limited Partner Interests from and after the Purchase Date and shall have all rights as the owner
of such Limited Partner Interests (including all rights as owner of such Limited Partner Interests
pursuant to Articles IV, V, VI, and XII).
ARTICLE XVI
GENERAL PROVISIONS
Section 16.1
Addresses and Notices
. Any notice, demand, request, report or proxy materials
required or permitted to be given or made to a Partner under this Agreement shall be in writing and
shall be deemed given or made when delivered in person or when sent by first class United States
mail or by other means of written communication to the Partner at the address described below.
Any notice, payment or report to be given or made to a Partner hereunder shall be deemed
conclusively to have been given or made, and the obligation to give such notice or report or to
make such payment shall be deemed conclusively to have been fully satisfied, upon sending of such
notice, payment or report to the Record Holder of such Partnership Interests at his address as
shown on the records of the Transfer Agent or as otherwise shown on the records of the Partnership,
regardless of any claim of any Person who may have an interest in such Partnership Interests by
reason of any assignment or otherwise.
Notwithstanding the foregoing, if (i) a Partner shall consent to receiving notices, demands,
requests, reports or proxy materials via electronic mail or by the Internet or (ii) the rules of
the Commission shall permit any report or proxy materials to be delivered electronically or made
available via the Internet, any such notice, demand, request, report or proxy materials shall be
deemed given or made when delivered or made available via such mode of delivery.
67
An affidavit or certificate of making of any notice, payment or report in accordance with the
provisions of this Section 16.1 executed by the General Partner, the Transfer Agent or the mailing
organization shall be prima facie evidence of the giving or making of such notice, payment or
report. If any notice, payment or report given or made in accordance with the provisions of this
Section 16.1 is returned marked to indicate that such notice, payment or report was unable to be
delivered, such notice, payment or report and, in the case of notices, payments or reports returned
by the United States Postal Service (or other physical mail delivery mail service outside the
United States of America), any subsequent notices, payments and reports shall be deemed to have
been duly given or made without further mailing (until such time as such Record Holder or another
Person notifies the Transfer Agent or the Partnership of a change in his address) or other delivery
if they are available for the Partner at the principal office of the
Partnership for a period of one year from the date of the giving or making of such notice,
payment or report to the other Partners. Any notice to the Partnership shall be deemed given if
received by the General Partner at the principal office of the Partnership designated pursuant to
Section 2.3. The General Partner may rely and shall be protected in relying on any notice or other
document from a Partner or other Person if believed by it to be genuine.
The terms “in writing,” “written communications,” “written notice” and words of similar import
shall be deemed satisfied under this Agreement by use of e-mail and other forms of electronic
communication.
Section 16.2
Further Action
. The parties shall execute and deliver all documents, provide all
information and take or refrain from taking action as may be necessary or appropriate to achieve
the purposes of this Agreement.
Section 16.3
Binding Effect
. This Agreement shall be binding upon and inure to the benefit of
the parties hereto and their heirs, executors, administrators, successors, legal representatives
and permitted assigns.
Section 16.4
Integration
. This Agreement constitutes the entire agreement among the parties
hereto pertaining to the subject matter hereof and supersedes all prior agreements and
understandings pertaining thereto.
Section 16.5
Creditors
. None of the provisions of this Agreement shall be for the benefit of,
or shall be enforceable by, any creditor of the Partnership.
Section 16.6
Waiver
. No failure by any party to insist upon the strict performance of any
covenant, duty, agreement or condition of this Agreement or to exercise any right or remedy
consequent upon a breach thereof shall constitute waiver of any such breach of any other covenant,
duty, agreement or condition.
Section 16.7
Counterparts
. This Agreement may be executed in counterparts, all of which
together shall constitute an agreement binding on all the parties hereto, notwithstanding that all
such parties are not signatories to the original or the same counterpart. Each party shall become
bound by this Agreement immediately upon affixing its signature hereto or, in the case of a Person
acquiring a Partnership Interest, pursuant to Section 10.1(a) without execution hereof.
68
Section 16.8
Applicable Law; Forum, Venue and Jurisdiction
.
(a) This Agreement shall be construed in accordance with and governed by the laws of the State
of Delaware, without regard to the principles of conflicts of law.
(b) Each of the Partners and each Person holding any beneficial interest in the Partnership
(whether through a broker, dealer, bank, trust company or clearing corporation or an agent of any
of the foregoing or otherwise):
(i) irrevocably agrees that any claims, suits, actions or proceedings (A) arising out
of or relating in any way to this Agreement (including any claims, suits or actions to
interpret, apply or enforce the provisions of this Agreement or the duties, obligations or
liabilities among Partners or of Partners to the Partnership, or the rights or powers of, or
restrictions on, the Partners or the Partnership), (B) brought in a derivative manner on
behalf of the Partnership, (C) asserting a claim of breach of a fiduciary duty owed by any
director, officer, or other employee of the Partnership or the General Partner, or owed by
the General Partner, to the Partnership or the Partners, (D) asserting a claim arising
pursuant to any provision of the Delaware Act or (E) asserting a claim governed by the
internal affairs doctrine shall be exclusively brought in the Court of Chancery of the State
of Delaware, in each case regardless of whether such claims, suits, actions or proceedings
sound in contract, tort, fraud or otherwise, are based on common law, statutory, equitable,
legal or other grounds, or are derivative or direct claims;
(ii) irrevocably submits to the exclusive jurisdiction of the Court of Chancery of the
State of Delaware in connection with any such claim, suit, action or proceeding; and
(iii) agrees not to, and waives any right to, assert in any such claim, suit, action or
proceeding that (A) it is not personally subject to the jurisdiction of the Court of
Chancery of the State of Delaware or of any other court to which proceedings in the Court of
Chancery of the State of Delaware may be appealed, (B) such claim, suit, action or
proceeding is brought in an inconvenient forum, or (C) the venue of such claim, suit, action
or proceeding is improper, (iv) expressly waives any requirement for the posting of a bond
by a party bringing such claim, suit, action or proceeding, and (v) consents to process
being served in any such claim, suit, action or proceeding by mailing, certified mail,
return receipt requested, a copy thereof to such party at the address in effect for notices
hereunder, and agrees that such services shall constitute good and sufficient service of
process and notice thereof; provided, nothing in clause (v) hereof shall affect or limit any
right to serve process in any other manner permitted by law.
Section 16.9
Invalidity of Provisions
. If any provision or part of a provision of this
Agreement is or becomes, for any reason, invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions and part thereof contained herein
shall not be affected thereby, and this Agreement shall, to the fullest extent permitted by law, be
reformed and construed as if such
invalid, illegal or unenforceable provision, or part of a provision, had never been contained
herein, and such provision or part reformed so that it would be valid, legal and enforceable to the
maximum extent possible.
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Section 16.10
Consent of Partners
. Each Partner hereby expressly consents and agrees that,
whenever in this Agreement it is specified that an action may be taken upon the affirmative vote or
consent of less than all of the Partners, such action may be so taken upon the concurrence of less
than all of the Partners and each Partner shall be bound by the results of such action.
Section 16.11
Facsimile Signatures
. The use of facsimile signatures affixed in the name and
on behalf of the transfer agent and registrar of the Partnership on Certificates representing Units
is expressly permitted by this Agreement.
Section 16.12
Third Party Beneficiaries
. Each Partner agrees that (a) any Indemnitee shall be
entitled to assert rights and remedies hereunder as a third-party beneficiary hereto with respect
to those provisions of this Agreement affording a right, benefit or privilege to such Indemnitee,
(b) any Unrestricted Person shall be entitled to assert rights and remedies hereunder as a
third-party beneficiary hereto with respect to those provisions of this Agreement affording a
right, benefit or privilege to such Unrestricted Person and (c) Goldman, Sachs & Co., Kelso &
Company, L.P. and their respective Affiliates and successors and assigns shall be entitled to
assert rights and remedies hereunder as a third-party beneficiary hereto with respect to Section
7.5(g).
[
REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first
written above.
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GENERAL PARTNER:
CVR GP, LLC
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By:
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/s/ Edward A. Morgan
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Name:
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Edward A. Morgan
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Title:
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Chief Financial Officer and Treasurer
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LIMITED PARTNER:
COFFEYVILLE RESOURCES, LLC
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By:
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/s/ Edward A. Morgan
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Name:
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Edward A. Morgan
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Title:
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Chief Financial Officer and Treasurer
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Second Amended and Restated Partnership Agreement
of
CVR Partners, LP
EXHIBIT A
to the Second Amended and Restated
Agreement of Limited Partnership of
CVR Partners, LP
Certificate Evidencing Common Units
Representing Limited Partner Interests in
CVR Partners, LP
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No.
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__________ Common Units
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In accordance with Section 4.1 of the Second Amended and Restated Agreement of Limited Partnership
of CVR Partners, LP, as amended, supplemented or restated from time to time (the “
Partnership
Agreement
”), CVR Partners, LP, a Delaware limited partnership (the “
Partnership
”), hereby certifies
that _______________________ (the “
Holder
”) is the registered owner of ________ Common Units
representing limited partner interests in the Partnership (the “
Common Units
”) transferable on the
books of the Partnership, in person or by duly authorized attorney, upon surrender of this
Certificate properly endorsed. The rights, preferences and limitations of the Common Units are set
forth in, and this Certificate and the Common Units represented hereby are issued and shall in all
respects be subject to the terms and provisions of, the Partnership Agreement. Copies of the
Partnership Agreement are on file at, and will be furnished without charge on delivery of written
request to the Partnership at, the principal office of the Partnership located at 2277 Plaza Drive,
Suite 500, Sugar Land, Texas 77479. Capitalized terms used herein but not defined shall have the
meanings given them in the Partnership Agreement.
THE HOLDER OF THIS SECURITY ACKNOWLEDGES FOR THE BENEFIT OF CVR PARTNERS, LP THAT THIS
SECURITY MAY NOT BE SOLD, OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED IF SUCH TRANSFER WOULD
(A) VIOLATE THE THEN APPLICABLE FEDERAL OR STATE SECURITIES LAWS OR RULES AND REGULATIONS OF THE
SECURITIES AND EXCHANGE COMMISSION, ANY STATE SECURITIES COMMISSION OR ANY OTHER GOVERNMENTAL
AUTHORITY WITH JURISDICTION OVER SUCH TRANSFER, (B) TERMINATE THE EXISTENCE OR QUALIFICATION OF CVR
PARTNERS, LP UNDER THE LAWS OF THE STATE OF DELAWARE, OR (C) CAUSE CVR PARTNERS, LP TO BE TREATED
AS AN ASSOCIATION TAXABLE AS A CORPORATION OR OTHERWISE TO BE TAXED AS AN ENTITY FOR U.S. FEDERAL
INCOME TAX PURPOSES (TO THE EXTENT NOT ALREADY SO TREATED OR TAXED). CVR GP LLC, THE GENERAL
PARTNER OF CVR PARTNERS, LP, MAY IMPOSE ADDITIONAL RESTRICTIONS ON THE TRANSFER OF THIS SECURITY IF
IT RECEIVES AN OPINION OF COUNSEL THAT SUCH RESTRICTIONS ARE NECESSARY TO AVOID A SIGNIFICANT RISK
OF CVR PARTNERS, LP BECOMING TAXABLE AS A CORPORATION OR OTHERWISE BECOMING TAXABLE AS AN ENTITY
FOR U.S. FEDERAL INCOME TAX PURPOSES. THE RESTRICTIONS SET FORTH ABOVE SHALL NOT PRECLUDE THE
SETTLEMENT OF ANY TRANSACTIONS INVOLVING THIS SECURITY ENTERED INTO THROUGH THE FACILITIES OF ANY
NATIONAL SECURITIES EXCHANGE ON WHICH THIS SECURITY IS LISTED OR ADMITTED TO TRADING.
A-1
The Holder, by accepting this Certificate, is deemed to have (i) requested admission as, and
agreed to become, a Limited Partner and to have agreed to comply with and be bound by and to have
executed the Partnership Agreement, (ii) represented and warranted that the Holder has all right,
power and authority and, if an individual, the capacity necessary to enter into the Partnership
Agreement and (iii) made the waivers and given the consents and approvals contained in the
Partnership Agreement.
This Certificate shall not be valid for any purpose unless it has been countersigned and
registered by the Transfer Agent and Registrar. This Certificate shall be governed by and
construed in accordance with the laws of the State of Delaware.
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Dated:__________________________
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CVR Partners, LP
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Countersigned and Registered by:
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By:
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CVR GP LLC
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[Transfer Agent],
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By:
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As Transfer Agent and Registrar
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Name:
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Title:
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By:
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Name:
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Title:
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A-2
[
Reverse of Certificate
]
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this Certificate,
shall be construed as follows according to applicable laws or regulations:
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TEN COM
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as tenants in common
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TEN ENT
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as tenants by the entireties
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JT TEN
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-
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as joint tenants with right of survivorship and not as tenants in common
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UNIF GIFT/TRANSFERS MIN ACT
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__________ Custodian _________
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(Cust) (Minor)
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Under Uniform Gifts/Transfers to CD Minors Act
(State)
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Additional abbreviations, though not in the above list, may also be used.
ASSIGNMENT OF COMMON UNITS OF
CVR PARTNERS, LP
FOR VALUE RECEIVED, _________ hereby assigns, conveys, sells and transfers unto
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(Please print or typewrite name and
address of assignee)
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(Please insert Social Security
or other identifying number of
assignee)
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____________ Common Units representing limited partner interests evidenced by
this Certificate, subject to the Partnership Agreement, and does hereby
irrevocably constitute and appoint ___________ as its attorney-in-fact with
full power of substitution to transfer the same on the books of CVR Partners,
LP
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Date: ________________________
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NOTE: The signature to any
endorsement hereon must
correspond with the name as
written upon the face of this
Certificate in every
particular. without
alteration, enlargement or
change.
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THE SIGNATURE(S) MUST BE
GUARANTEED BY AN ELIGIBLE
GUARANTOR INSTITUTION (BANKS,
STOCKBROKERS, SAVINGS AND
LOAN ASSOCIATIONS AND CREDIT
UNIONS WITH MEMBERSHIP IN AN
APPROVED SIGNATURE GUARANTEE
MEDALLION PROGRAM), PURSUANT
TO S.E.C. RULE 17Ad-15
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(Signature)
(Signature)
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No transfer of the Common Units evidenced hereby will be registered on the
books of the Partnership, unless the Certificate evidencing the Common Units
to be transferred is surrendered for registration or transfer.
A-3
