UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 2054
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
ALLIANCE RESOURCE PARTNERS, L.P.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 73-1564280
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
1717 SOUTH BOULDER AVENUE
TULSA, OKLAHOMA 74119
(918) 295-7600
(ADDRESS, INCLUDING ZIP CODE, OF PRINCIPAL EXECUTIVE OFFICES)
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ALLIANCE RESOURCE MANAGEMENT GP, LLC LONG-TERM INCENTIVE PLAN
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
DEFERRED COMPENSATION PLAN FOR DIRECTORS
(FULL TITLES OF THE PLANS)
THOMAS L. PEARSON
SENIOR VICE PRESIDENT - LAW AND ADMINISTRATION,
GENERAL COUNSEL AND SECRETARY
1717 SOUTH BOULDER AVENUE
TULSA, OKLAHOMA 74119
(918) 295-7600
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE)
COPY TO:
G. MICHAEL O'LEARY
WILLIAM J. COOPER
ANDREWS & KURTH
MAYOR DAY CALDWELL & KEETON
L.L.P.
600 TRAVIS, SUITE 4200
HOUSTON, TEXAS 77002
====================================================================================================================
PROPOSED
MAXIMUM PROPOSED MAXIMUM
OFFERING PRICE AGGREGATE AMOUNT OF
AMOUNT TO BE PER COMMON UNIT OFFERING PRICE REGISTRATION
TITLE OF SECURITIES TO BE REGISTERED REGISTERED (1) (2) (2) FEE (2)
--------------------------------------------------------------------------------------------------------------------
Common Units representing limited 730,000 Common Units(3) $24.02 $17,534,600 $1,614
partner interests in the Registrant
("Common Units")
====================================================================================================================
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(1) The number of Common Units registered hereby is subject to adjustment to
prevent dilution resulting from Common Unit splits, Common Unit dividends
or similar transaction.
(2) Estimated solely for the purpose of calculating the amount of the
registration fee pursuant to Rule 457(h) under the Securities Act, based
upon the average of the high and low price per Common Unit on the Nasdaq
National Market on March 28, 2002, as reported in The Wall Street Journal
on March 29, 2002.
(3) Of such 730,000 Common Units, 600,000 Common Units are registered hereby
for issuance pursuant to the Long-Term Incentive Plan, 80,000 Common Units
are registered hereby for issuance pursuant to the Supplemental Executive
Retirement Plan and 50,000 Common Units are registered hereby for issuance
pursuant to the Deferred Compensation Plan for Directors.
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
The document(s) containing the information specified in Part I of Form S-8 will be sent or given to participants as specified by Rule 428(b)(1) of the Securities Act of 1933, as amended (the "Securities Act"). Such documents need not be filed with the Securities and Exchange Commission (the "Commission"), either as a part of this Registration Statement or as prospectuses or prospectus supplements pursuant to Rule 424. These documents and the documents incorporated herein by reference pursuant to Item 3 of Part II of this Registration Statement, taken together, constitute a prospectus that meets the requirements of Section 10(a) of the Securities Act (the "Prospectus").
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
Alliance Resource Partners, L.P. (the "Partnership") incorporates herein by reference the following documents as of their respective dates as filed with the Commission (File No. 0-26823):
(a) the Partnership's Annual Report on Form 10-K for the year ended December 31, 2000, filed March 27, 2001 and amended 10-K/A, filed on March 29, 2002;
(b) the Partnership's Quarterly Reports on Form 10-Q for the three months ended March 31, 2001, and for the three and six month periods ended June 30, 2001 and the three and nine month periods ended September 30, 2001, filed May 10, 2001, August 9, 2001 and November 13, 2001, respectively and the amended Quarterly Reports on Form 10-Q/A for each of these periods, filed on March 29, 2002; and
(c) the description of the Partnership's Common Units contained in its Registration Statement on Form 8-A filed July 26, 1999.
All documents filed by the Partnership pursuant to Section 13(a),
13(c), 14 and 15(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), subsequent to the date of this Registration Statement and prior
to the filing of a post-effective amendment, which indicates that all securities
offered hereby have been sold or which deregisters all such securities then
remaining unsold, shall be deemed to be incorporated by reference herein and to
be a part hereof from the date of filing of such documents. Any statement
contained herein or in a document incorporated or deemed to be incorporated
herein by reference shall be deemed to be modified or superseded for purposes of
the Registration Statement and the Prospectus to the extent that a statement
contained herein or in any subsequently filed document which also is, or is
deemed to be, incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of the Registration
Statement or the Prospectus. Copies of such documents are not required to be
filed with the Commission as part of this Registration Statement.
ITEM 4. DESCRIPTION OF SECURITIES.
The information required by Item 4 is not applicable to this Registration Statement since the class of securities to be offered is registered under Section 12 of the Exchange Act.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
None.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 17-108 of the Delaware Revised Uniform Limited Partnership Act empowers a Delaware limited partnership to indemnify and hold harmless any partner or other person from and against all claims and demands whatsoever.
Section 7.7(a) of the First Amended and Restated Agreement of Limited Partnership of the Partnership (the "Partnership Agreement") provides that to the fullest extent permitted by law, all Indemnitees (as defined below) 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 claims, demands, actions, suits or proceedings, whether civil, criminal, administrative or investigative, 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; provided, that in each case the Indemnitee acted in good faith and in a manner that such Indemnitee reasonably believed to be in, or (in the case of a Person other than a General Partner) not opposed to, the best interests of the Partnership and, with respect to any criminal proceeding, had no reasonable cause to believe its conduct was unlawful. Further, no indemnification pursuant to Section 7.7 shall be available to the General Partners with respect to their obligations incurred pursuant to the contribution and assumption agreement among the General Partners, the Partnership Group and certain other parties (other than obligations incurred by the General Partners on behalf of the Partnership Group). The Partnership Agreement defines an Indemnitee as: (i) the managing general partner of the Partnership (the "Managing General Partner") and the special general partner of the Partnership (each a "General Partner," and together, the "General Partners"), (ii) any former General Partner (a "Departing Partner"), (iii) any individual, corporation, limited liability company, partnership, joint venture, trust, unincorporated organization, association, government agency or political subdivision thereof or other entity (collectively, a "Person") who is or was directly or indirectly an affiliate of a General Partner or any Departing Partner, (iv) any Person who is a current or former member, partner, officer, director, employee, agent or trustee of the Partnership, Alliance Resource Operating Partners, L.P., Alliance Coal, LLC and any subsidiary of any such entity (collectively, the "Partnership Group"), a General Partner or any Departing Partner or any affiliate of any member of the Partnership Group (a "Group Member") and (v) any Person who is or was serving at the request of a General Partner, any Departing Partner or any such affiliate as an officer, director, employee, member, partner, agent, fiduciary or trustee of another Person.
Section 7.7(b) of the Partnership Agreement also states that 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 defending any claim, demand, action, suit or proceeding, shall, from time to time, be advanced by the Partnership prior to the final disposition of such claim, demand, action, suit or proceeding upon receipt by the Partnership of any undertaking by or on behalf of the Indemnitee to repay such amount if it shall be determined that the Indemnitee is not entitled to be indemnified as authorized by Section 7.7(a).
Section 7.7(g) of the Partnership Agreement states that an Indemnitee shall not be denied indemnification in whole or in part under Section 7.7 because the Indemnitee has an interest in the transaction with respect to which the indemnification applies if the transaction was otherwise permitted by the terms of the Partnership Agreement.
Section 7.8(a) of the Partnership Agreement provides that, notwithstanding anything to the contrary set forth in the Partnership Agreement, no Indemnitee shall be liable for monetary damages to the Partnership, the limited partners of the Partnership, the assignees or any other Persons who have acquired securities of the Partnership, for losses sustained or liabilities incurred as a result of any act or omission if such Indemnitee acted in good faith.
Section 7.8(b) of the Partnership Agreement states that the Managing General Partner, subject to its obligations and duties as Managing General Partner set forth in Section 7.1(a) of the Partnership Agreement, may exercise any of the powers granted to it by the Partnership Agreement and perform any of the duties imposed upon it hereunder either directly or by or through its agents, and the Managing General Partner shall not be responsible for any misconduct or negligence on the part of any such agent appointed by the Managing General Partner in good faith.
Additionally, Section 7.8(c) provides that, 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 Partners 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 the Partnership Agreement. The provisions of the Partnership Agreement, to the extent that they restrict or otherwise modify the duties and liabilities of an Indemnitee otherwise existing at law or in equity, are agreed by the partners to replace such other duties and liabilities of such Indemnitee.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
The information required by Item 7 is not applicable to this Registration Statement.
ITEM 8. EXHIBITS.
Exhibit
Number Description
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4.1 First Amended and Restated Agreement of Limited Partnership of Alliance
Resource Partners, L.P. (incorporated by reference to Exhibit 3.1 to
the Partnership's Annual Report on Form 10-K for the year ended
December 31, 1999).
4.2 Form of Common Unit Certificate (incorporated by reference to Exhibit A
to the First Amended and Restated Agreement of Limited Partnership of
Alliance Resource Partners, L.P.).
*5.1 Opinion of Andrews & Kurth L.L.P. as to the validity of the securities
being registered.
*23.1 Consent of Deloitte & Touche LLP related to Form 10-K, as amended on
Form 10-K/A, for the year ended December 31, 2000.
*23.2 Consent of Andrews & Kurth L.L.P. (included in Exhibit 5.1).
24.1 Power of Attorney (set forth on the signature page contained in Part II
of this Registration Statement).
99.1 Alliance Resource Management GP, LLC Long-Term Incentive Plan
(incorporated by reference to Exhibit 10.11 to the Partnership's Annual
Report on Form 10-K for the year ended December 31, 1999).
*99.2 Alliance Resource Management GP, LLC Supplemental Executive Retirement
Plan
*99.3 Alliance Resource Management GP, LLC Deferred Compensation Plan for
Directors
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* Filed herewith
ITEM 9. UNDERTAKINGS.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by
Section 10(a)(3) of the Securities Act;
(ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement.
Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20 percent change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement;
(iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement:
Provided, however, that paragraphs (a) (1)(i) and (a)(1)(ii) do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed with or furnished to the Commission by the registrant pursuant to Section 13 or Section 15(d) of the Exchange Act that are incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.
(b) The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act, each filing of the registrant's annual report pursuant to Section 13(a) or Section 15(d) of the Exchange Act (and, where applicable, each filing of an employee benefit plan's annual report pursuant to Section 15(d) of the Exchange Act) that is incorporated by reference in this registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the provisions described in Item 6 of this Registration Statement, or otherwise, the registrant has been advised that in the opinion of the Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-8 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Tulsa, State of Oklahoma, on March 29, 2002.
ALLIANCE RESOURCE PARTNERS, L.P.
(Registrant)
By: Alliance Resource Management GP, LLC,
its Managing General Partner
By: /s/ JOSEPH W. CRAFT, III
--------------------------------------
Joseph W. Craft, III
President, Chief Executive Officer
and Director
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POWER OF ATTORNEY
Each person whose individual signature appears below hereby authorizes Joseph W. Craft, III and Thomas L. Pearson, and each of them as attorneys-in-fact with full power of substitution, to execute in the name and on behalf of such person, individually and in each capacity stated below, and to file, any and all amendments to this Registration Statement, including any and all post-effective amendments.
Pursuant to the requirements of the Securities Act this Registration Statement has been signed by the following persons in the capacities and on the dates as indicated.
SIGNATURE TITLE DATE
--------- ----- ----
/s/ JOSEPH W. CRAFT, III President, Chief Executive March 29, 2002
----------------------------- Officer and Director
Joseph W. Craft, III (Principal Executive Officer)
/s/ MICHAEL L. GREENWOOD Senior Vice President - Chief March 29, 2002
----------------------------- Financial Officer and
Michael L. Greenwood Treasurer (Principal Financial
and Accounting Officer)
/s/ JOHN J. MACWILLIAMS Director March 29, 2002
-----------------------------
John J. MacWilliams
/s/ PRESTON R. MILLER, JR. Director March 29, 2002
-----------------------------
Preston R. Miller, Jr.
/s/ JOHN P. NEAFSEY Director March 29, 2002
-----------------------------
John P. Neafsey
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SIGNATURE TITLE DATE
--------- ----- ----
/s/ JOHN H. ROBINSON Director March 29, 2002
-----------------------------
John H. Robinson
/s/ ROBERT G. SACHSE Executive Vice President March 29, 2002
----------------------------- and Director
Robert G. Sachse
/s/ PAUL R. TREGURTHA Director March 29, 2002
-----------------------------
Paul R. Tregurtha
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INDEX TO EXHIBITS
Exhibit
Number Description
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4.1 First Amended and Restated Agreement of Limited Partnership of Alliance
Resource Partners, L.P. (incorporated by reference to Exhibit 3.1 to
the Partnership's Annual Report on Form 10-K for the year ended
December 31, 1999).
4.2 Form of Common Unit Certificate (incorporated by reference to Exhibit A
to the First Amended and Restated Agreement of Limited Partnership of
Alliance Resource Partners, L.P.).
*5.1 Opinion of Andrews & Kurth L.L.P. as to the validity of the securities
being registered.
*23.1 Consent of Deloitte & Touche LLP related to Form 10-K, as amended on
Form 10-K/A, for the year ended December 31, 2000.
*23.2 Consent of Andrews & Kurth L.L.P. (included in Exhibit 5.1).
24.1 Power of Attorney (set forth on the signature page contained in Part II
of this Registration Statement).
99.1 Alliance Resource Management GP, LLC Long-Term Incentive Plan
(incorporated by reference to Exhibit 10.11 to the Partnership's Annual
Report on Form 10-K for the year ended December 31, 1999).
*99.2 Alliance Resource Management GP, LLC Supplemental Executive Retirement
Plan
*99.3 Alliance Resource Management GP, LLC Deferred Compensation Plan for
Directors
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* Filed herewith
EXHIBIT 5.1
DRAFT
Andrews & Kurth
Mayor Day Caldwell & Keeton
L.L.P.
600 Travis, Suite 4200
Houston, Texas 77002
April 1, 2002
Alliance Resource Partners, L.P.
1717 South Boulder Avenue
Tulsa, Oklahoma 74119
Gentlemen:
We have acted as counsel to Alliance Resource Partners, L.P. a Delaware limited partnership (the "Partnership") and Alliance Resource Management GP, LLC, a Delaware limited liability company and the managing general partner of the Partnership (the "General Partner"), in connection with the preparation of the Partnership's Registration Statement on Form S-8 (the "Registration Statement") filed by the Partnership under the Securities Act of 1933, as amended (the "Securities Act"), with respect to the offering and sale of an aggregate of up to 730,000 common units representing limited partnership interests in the Partnership (the "Common Units") in connection with the Alliance Resource Management GP, LLC Long-Term Incentive Plan (the "LTIP"), the Supplemental Executive Retirement Plan (the "SERP") and the Deferred Compensation Plan for Directors (the "DCPD").
As the basis for the opinions hereinafter expressed, we have examined
such statutes, regulations and such other corporate records and documents and
certificates of public officials and officers and representatives of the General
Partner as we have deemed necessary for the purposes of these opinions. In
rendering the opinions expressed below, we have assumed and have not verified
(i) the genuineness of the signatures on all documents that we have examined,
(ii) the legal capacity of all natural persons, (iii) the authenticity of all
documents supplied to us as originals, and (iv) the conformity to the authentic
originals of all documents supplied to us as certified or photostatic or faxed
copies.
Based upon the foregoing, and subject to the limitations and assumptions set forth herein, and having due regard for such legal considerations as we deem relevant, we are of the opinion that:
1. The Partnership has been duly formed and is validly existing as a limited partnership under the Delaware Revised Uniform Limited Partnership Act (the "Delaware Act").
2. The Common Units will, when issued and paid for in accordance with the terms of the Plan, be duly authorized, validly issued, fully paid and nonassessable, except as such nonassessability may be affected by the matters described below:
o If a court were to determine that the existence or exercise of the right provided under the Second Amended and Restated Agreement of Limited Partnership of the Partnership (the "Partnership Agreement") by the holders of Common Units and subordinated units (the "Limited Partners") of the Partnership as a group (i) to remove or replace the General Partner, (ii) to approve certain amendments to the Partnership Agreement or (iii) to take certain other actions under the Partnership Agreement constitutes "participation in the control" of the Partnership's business for the purposes of the Delaware Act, then the Limited Partners could be held personally liable for the
Partnership's obligations under the laws of Delaware, to the same extent as the General Partner with respect to persons who transact business with the Partnership reasonably believing, based on the conduct of any of the Limited Partners, that such Limited Partner is a general partner;
o Section 17-607 of the Delaware Act provides that a limited partner who receives a distribution and knew at the time of the distribution that it was made in violation of the Delaware Act shall be liable to the limited partnership for three years for the amount of the distribution; and
o Limitations on the liability of limited partners for the obligations of a limited partner have not been clearly established in many jurisdictions. If a court were to determine that the Partnership was, by virtue of its limited partner interest in Alliance Resource Operating Partners, L.P. or otherwise, conducting business in any state without compliance with the applicable limited partnership statute, then the Limited Partners could be held personally liable for the Partnership's obligations under the law of that jurisdiction to the same extent as the General Partner under the circumstances.
In rendering the opinion set forth in Paragraph 1, we have relied solely upon certificates of good standing dated as of a recent date hereof. The foregoing opinion is based on and is limited to the Revised Uniform Limited Partnership Act of the State of Delaware and the relevant federal laws of the United States of America, and we render no opinion with respect to the laws of any other jurisdiction.
We hereby consent to the filing of this opinion with the Securities and Exchange Commission as Exhibit 5.1 to the Registration Statement. In giving this consent we do not admit that we are "experts" under the Securities Act of 1933, as amended, or the rules and regulations of the Securities and Exchange Commission issued thereunder. This opinion is rendered solely for your benefit and may not be relied upon in any manner by any other person or entity without our express written consent.
Very truly yours,
/s/ ANDREWS & KURTH
MAYOR, DAY, CALDWELL & KEETON LLP
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EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of Alliance Resource Partners, L.P. on Form S-8 of our report dated January 24, 2001, appearing in the Annual Report on Form 10-K as amended on Form 10-K/A, of Alliance Resource Partners, L.P. for the year ended December 31, 2000.
/s/ DELOITTE & TOUCHE LLP Tulsa, Oklahoma March 29, 2002 |
EXHIBIT 99.2
ALLIANCE RESOURCE MANAGEMENT GP, LLC
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
EFFECTIVE AS OF JANUARY 1, 1997
AMENDED AND RESTATED AS OF JANUARY 1, 2001
1. INTENT AND EFFECTIVE DATE
1.1. Intent. This Supplemental Executive Retirement Plan (the "Plan") is adopted by Alliance Resource Management GP, LLC (the "Company") for the purpose of retaining certain officers and key employees of a Participating Company by providing such individuals the deferred compensation benefits described herein. In conjunction with the Company's Profit Sharing and Savings Plan, the intent of this Plan is to provide each Participant with retirement benefits that are comparable in value to those that a retirement program like MAPCO Inc.'s Pension Plan and Supplemental Executive Retirement Plan (in effect in 1996) would have provided, concomitantly with the goal of aligning each Participant's supplemental retirement benefits under the Plan with the interests of the holders of Common Units of Alliance Resource Partners, L.P. (the "Partnership"). While the Company reserves the right to terminate the Plan, the Company intends to maintain the Plan indefinitely.
1.2. Effective Date. This Plan is effective as of January 1, 1997.
2. DEFINITIONS.
2.1. Account means the notional or ledger account established on behalf of each Participant pursuant to Section 4.4 for record-keeping purposes to reflect the Allocations, the Phantom Units, the interest and the distributions to be credited under this Plan.
2.2. Allocation shall have the meaning set forth in Section 4.1.
2.3. Allocation Percentage means, with respect to each Participant, the percentage listed in Appendix A, which may be amended from time to time by the Compensation Committee subject to the terms of any applicable Employment Agreement.
2.4. Common Units means the Common Units of the Partnership.
2.5. Company means Alliance Resource Management GP, LLC, a Delaware limited liability company.
2.6. Compensation means the base salary or wages paid to a Participant for the performance of services during the calendar year preceding the year in which an Allocation is being made, including all cash bonuses under any short-term or long-term incentive compensation plan (and excluding any noncash, stock, stock equivalent or stock-based compensation), salary or bonus reduction amounts contributed to any tax-qualified retirement plan or cafeteria plan maintained by a Participating Company, salary or bonus reduction amounts deferred under any deferred compensation plan or deferred compensation option at Participant's election, holiday and vacation pay, severance pay, and any payments to a Participant under the off-time benefits plan or the short-term or long-term disability plans of a Participating Company, but excluding payments or reimbursements of business or personal expenses, transportation allowances, insurance premiums, taxable fringe benefits, and all other extraordinary compensation, or amounts contributed, other than amounts representing the Participant's salary or bonus reduction amounts, by a Participating Company to any tax-qualified plan, deferred compensation plan, including this Plan, or welfare plan.
2.7 Compensation Committee means the committee appointed by the Board of Directors of the Company, which has been delegated the authority to administer this Plan and to perform certain other functions, including functions relating to the compensation of officers and key employees of a Participating Company.
2.8 Employment Agreement means the employment agreement (if any) in effect at the relevant time between a Participant and a Participating Company.
2.9. Exchange Act means the Securities Exchange Act of 1934, as amended.
2.10. Fair Market Value means, as applied to any applicable date, the average closing sale price (or if unavailable, the last reported bid price) of a Common Unit for the ten trading days immediately preceding such date, as reported on the NASDAQ National Market System or on such other exchange or bulletin board on which the Common Units are traded. The Compensation Committee may direct the Plan Administrator to use the quoted closing sale price or closing bid price as may reported by The Wall Street Journal, Bloomberg Financial Markets or other reporting service as approved by the Compensation Committee.
2.11. Organic Change shall have the meaning set forth in Section 4.7. herein.
2.12. Participant means those officers and key employees who are listed in Appendix A. The Compensation Committee may designate, in its sole discretion, additional officers and key employees who are eligible to participate in the Plan, and may declare any such person who may remain in the employ of a Participating Company no longer eligible to receive future Allocations under the Plan for future
Plan years (if permitted under the applicable Employment Agreement), provided that such Participant shall continue to be fully vested in the notional balance of cash (if any) and Phantom Units in his Account and be entitled to receive credits for interest and distributions thereon.
2.13. Participating Company means the Company, the Partnership, Alliance Resource Operating Partners, L.P., a Delaware limited partnership, Alliance Coal, LLC, a Delaware limited liability company, and any other direct or indirect Subsidiary of the Partnership.
2.14. Partnership means Alliance Resource Partners, L.P., a Delaware limited partnership.
2.15. Phantom Unit means a notional Common Unit. A Participant shall not possess any rights of a holder of Common Units with respect to a Phantom Unit except as expressly provided herein.
2.16. Plan Administrator means the Company and any entity (or individual) to which the Company has delegated administrative responsibility with respect to the Plan.
2.17. Plan Year means a calendar year ending on December 31.
2.18 PSSP Supplemental Contribution means the contributions made under the Profit Sharing and Savings Plan of the Company on behalf of a Participant, other than Pre-Tax Contributions, Matching Contributions and Profit-Sharing Contributions (as those terms are defined in such plan).
2.19. SEC means the Securities and Exchange Commission.
2.20. Securities Act means the Securities Act of 1933, as amended.
2.21. Subsidiary shall mean any corporation, partnership, limited liability company, business trust, joint venture or other entity that (a) is owned directly or indirectly by the Partnership, or (b) in the discretion of the Compensation Committee, makes a substantial contribution of its results of operations to the Partnership.
3. VESTING.
A Participant's rights to the amount credited to his Account shall become fully vested and nonforfeitable on the date the Account is so credited or otherwise adjusted in accordance with Section 4 herein.
4. ALLOCATIONS.
4.1. Allocation Amount. A Participant who is employed on the last business day of December by a Participating Company shall be entitled to an allocation ("Allocation") for the Plan Year that includes such date, equal to the Participant's Compensation for such year multiplied by his Allocation Percentage, less his PSSP Supplemental Contribution.
4.2. Interest on Notional Cash Balance Through 2000. The notional cash balance in a Participant's Account shall be credited with interest at the annual rate of eight percent (8%) at the end of each Plan Year before Allocations are made with respect to that Plan Year, beginning with the Plan Year commencing on January 1, 1998 and ending the earlier of: (a) the year in which the full amount credited to the Participant's Account is paid (with interest credit to be pro rated over his last Plan Year (on the basis of a 360 day year)); or (b) December 31, 2000.
4.3. Adjustments to Allocations and Interest. As of January 1 of each year beginning with January 1, 1998, the Compensation Committee may review, in good faith, the Allocation Percentage set forth in Appendix A and the interest rate set forth in Section 4.2, and may adjust, in its reasonable judgment, those amounts to the extent necessary or appropriate to reflect the intent of this Plan. Any adjustments made by the Compensation Committee shall be based on the recommendations of an independent actuary and shall be binding on all Participants.
4.4. Accounts. An Account shall be established for each Participant to record the Allocations and interest to be credited to the Participant. Such Account shall be credited as of January 1 of each Plan Year, beginning with January 1, 1998, to reflect first the interest and distributions accrued for the prior Plan Year, and then the Allocation to be credited for the prior Plan Year.
4.5. Election. Each Participant employed by a Participating Company on January 1, 2001, shall have the one-time right to elect, by written notice delivered to the Plan Administrator using the form of Election Notice attached hereto as Appendix B no later than February 1, 2000, to cause his entire notional cash balance in his Account at January 1, 2000 (following Allocations and credits of interest from the prior Plan Year) to be invested in Phantom Units at the Fair Market Value of a Common Unit determined as of February 1, 2000. To the extent such an investment would lead to investment in a fractional Phantom Unit, such fractional Phantom Unit shall be rounded up to a whole Phantom Unit and be immediately credited to the Participant's Account. If a Participant fails to elect to invest his entire notional cash balance in his Account at February 1, 2000 in Phantom Units, such notional cash balance shall continue in his Account and shall be credited with interest on an annual basis (with interest credit to be pro rated
over his last Plan Year (on the basis of a 360 day year)) at the rate set forth in Section 4.2 (and as may be adjusted pursuant to Section 4.3.).
4.6. Allocations Commencing On January 1, 2001; Distributions. All Allocations made to a Participant's account for each Plan Year commencing with the year 2001 Plan Year shall be immediately invested in Phantom Units, at the Fair Market Value of a Common Unit as of January 1 immediately following such Plan Year. Distributions declared and paid by the Partnership on Common Units shall be credited to the Phantom Units held in a Participant's Account so long as such Participant was employed by a Participating Company on the record date of such distribution. The notional cash value of each such distribution shall be immediately invested in Phantom Units at the Fair Market Value of a Common Unit as of the payment date of such distribution. To the extent any investment in a Phantom Unit (whether from an Allocation or a credit of distribution or otherwise) would lead to an investment in a fractional Phantom Unit, such fractional Phantom Unit shall be rounded up to a whole Phantom Unit and be immediately credited to the Participant's Account.
4.7. Reorganization, Reclassification, Consolidation, Merger, or Sale. Any recapitalization, reorganization, reclassification, split of Common Units, distribution or dividend of securities on Common Units, consolidation or merger of the Partnership, or sale of all or substantially all of the Partnership's assets or other similar transaction which is effected in such a way that holders of Common Units are entitled to receive (either directly or upon subsequent liquidation) cash, securities or assets with respect to or in exchange for Common Units is referred to herein as an "Organic Change." Upon the occurrence of an Organic Change, the Compensation Committee shall, in its sole discretion (and upon the advice of financial advisors as may be retained by the Compensation Committee), immediately adjust the notional balance of Phantom Units in each Participant's Account to equitably credit the fair value of the change in the Common Units and/or the distributions (of cash, securities or other assets) received or economic enhancement realized by the holders of the Common Units.
5. TERMINATION OF PARTICIPANT'S EMPLOYMENT.
5.1. Additional Allocation. Notwithstanding any other provision of the Plan to the contrary, a Participant shall be entitled to receive an Allocation for the Plan Year in which his employment with the Company is terminated on the occurrence of any of the following events:
(a) the Participant's employment with a Participating Company is terminated other than for "cause" or reasonably equivalent term as defined in his Employment Agreement;
(b) the Participant terminates employment with a Participating Company for "good reason" or reasonably equivalent term as defined in his Employment Agreement;
(c) a "Change of Control" of the Company or the Partnership occurs as defined in his Employment Agreement and, as a result, a Participant's employment with all Participating Companies is terminated (whether voluntary or involuntary);
(d) death of the Participant;
(e) attaining retirement age of 65 years for any Participant; and
(f) incurring a total and permanent disability, which shall be deemed to occur if a Participant is eligible to receive benefits under the terms of the long-term disability program maintained by the Participating Company that employs the Participant.
This Allocation for the relevant Plan Year in which the Participant's termination occurs shall equal the Participant's Compensation for such Plan Year (including any severance amount, if applicable) multiplied by his Allocation Percentage, less his PSSP Supplemental Contribution.
5.2. Crediting of Additional Allocation. Upon the occurrence of any one (but only one) of the events of termination described in Section 5.1, the Account of the affected Participant shall be credited with the additional Allocation immediately. For purposes of the calculation of the additional Allocation amount, in the event of any occurrences described in Section 5.1(a) through (c) above, all severance payments (regardless of when paid and actually received by the Participant), shall be included in Compensation for the Plan Year in which the actual termination of employment occurs.
5.3. Non-Duplication of Benefits. Upon the occurrence of more than one event described in Section 5.1, the affected Participant shall be credited with only one additional Allocation, based on the event that occurs first.
5.4. Termination For Other Reasons. If a Participant's employment is terminated for any reason not specified in Section 5.1 or for no reason, he shall be entitled to payment of the notional balance in his Account at the time of such termination as provided in Section 6 herein, without any Allocation to his Account for the Plan Year in which his employment is terminated.
6. PAYMENT OF BENEFITS.
6.1. Time of Payment. Payment to a Participant (or his beneficiary) of the notional amount credited to his Account shall begin as soon as practicable following
termination of his employment and, in no event, more than thirty (30) days following the date on which the Participant ceases to be employed by a Participating Company for any reason.
6.2. Form of Payment; Common Units. Payment shall be in cash (subject to applicable withholding) or in Common Units (subject to applicable withholding) as determined by the Compensation Committee in its sole discretion, provided that if payment is made in Common Units the Partnership shall first have filed and registered this Plan on Form S-8 with the SEC prior to such payment, such that all Common Units issued to a Participant (or his beneficiary) pursuant to this Plan be freely tradable under the Securities Act, subject only to the volume limitations set forth in Rule 144(k) promulgated under the Securities Act as may be applicable to former affiliates of the Partnership. The Partnership shall maintain a current prospectus, if required, under Form S-8 until such Participant either has sold or may sell all of his Common Units without restriction as to the volume of trading under Rule 144(e). If payment is to be made in Common Units, the Company shall cause the Partnership to issue that number of Common Units equivalent to the notional number of Phantom Units held in the Participant's Account. If the Participant's Account is also credited with a notional cash balance, the Compensation Committee in its sole discretion may cause the Partnership to issue to the Participant (or his beneficiary) that number of Common Units having a Fair Market Value as of the date of issuance equivalent to the notional cash balance of the Participant's Account, with cash paid in lieu of a fractional Common Unit.
6.3. Deferral of Payment. If payment shall be in cash, a Participant may elect to have the amount credited to his Account paid in a single sum, or in substantially equal annual installments over a period not to exceed fifteen (15) years. An election must be made not later than thirty (30) days prior to the date the Participant first becomes eligible to receive payment of benefits.
6.4. Death. Any benefits due under this Plan to a Participant upon his death shall be paid to the Participant's beneficiary. A Participant may designate a beneficiary (which may be other than a natural person) to receive all benefits which may be payable at the Participant's death by completing the form furnished by the Plan Administrator. A Participant may change the beneficiary designation at any time without notice to any beneficiary, but such change shall not be effective until it is received by the Plan Administrator. If a Participant fails to file a proper beneficiary designation form with the Plan Administrator, or if the designated beneficiary predeceases the Participant, any benefits which may be payable upon the Participant's death shall be paid in a single sum to the Participant's surviving spouse, if any, or otherwise to the Participant's estate.
7. AMENDMENT AND TERMINATION.
7.1. Right to Amend/Terminate. The Compensation Committee reserves the right to amend the Plan and to terminate the Plan at any time; provided, however, that no amendment or termination shall have the affect, directly or indirectly, of modifying or reducing a Participant's benefits, or any rights to benefits, that have accrued as of the date of the amendment or termination, without the written consent of the Participant.
8. ADMINISTRATION OF PLAN.
8.1. Administration. The Plan Administrator may delegate responsibility for the day-to-day administration and operation of the Plan to the Compensation Committee and to employees of the Company or any Participating Company. The Plan Administrator (or the entity or individual to which administrative authority has been delegated) shall have the authority to interpret and construe any and all provisions of the Plan. Any determination made by the Plan Administrator (or the entity or individual to which administrative authority has been delegated) shall be final and conclusive.
8.2. Indemnification. Neither any Participating Company, nor the Board of Directors, or any member of any committee thereof, of any Participating Company, nor any employee of any Participating Company shall be liable for any act, omission, interpretation, construction or determination made in connection with the Plan in good faith; and the members of the Board of Directors, and the employees, of any Participating Company shall be entitled to indemnification and reimbursement by the Company to the maximum extent permitted by law in respect of any claim, loss, damage or expense (including counsel's fees) arising from their acts, omission and conduct in their official capacity with respect to the Plan.
8.3. Exempt Plan. It is the intention of the Board of Directors of the Company, as the managing general partner of the Partnership, that all notional credits of Phantom Units to any Participant's Account as provided under the terms of this Plan, and any issuance of Common Units to a Participant (or his beneficiary) in lieu of cash payments under this Plan upon his termination of employment with a Participating Company, be deemed transactions which are exempt from the provisions of Section 16(b) of the Exchange Act, as provided under Rule 16b-3(d)(1) promulgated under the Exchange Act.
9. GENERAL PROVISIONS.
9.1. Unfunded Benefit. Benefits payable under the Plan to any person shall be paid directly by the Participating Company which employs such Participant. If a Participant is employed by more than one Participating Company, benefits shall be paid by the Participating Company that receives the greatest share of the Participant's services. Nothing contained in this Plan, and no action taken pursuant
to the provisions of this Plan, shall create or be construed to create a trust or separate fund of any kind, or a fiduciary relationship between any Participating Company and any Employee, any beneficiary or any other person. Any funds representing amounts credited to a Participant's Account hereunder shall at all times remain the property of the Participating Company which employs such Participant, and such funds shall continue to be a part of the general funds of such Participating Company. To the extent that any person acquires a right to receive payments under this Plan from a Participating Company, such right shall be no greater than the right of an unsecured general creditor of such Participating Company.
9.2. Non-Guarantee of Employment. Nothing contained in this Plan shall be construed as a contract of employment between a Participating Company and a Participant, and nothing in this Plan shall confer upon any Participant any right to continued employment with a Participating Company, or to interfere with the right of a Participating Company to discharge a Participant, with or without cause.
9.3. Interests Not Transferable. Except as to withholding of any tax under the laws of the United States or any state or locality, no benefits under the Plan shall be subject in any manner to alienation, sale, transfer, assignment, pledge, attachment or other legal process, or encumbrance of any kind, and any attempt to do so shall be void.
9.4. Facility of Payment. Any amounts payable hereunder to any person under legal disability or who, in the judgment of the Plan Administrator, is unable to properly manage his financial affairs, may be paid to the legal representative of such person, or may be applied for the benefit of such person in any manner which the Plan Administrator may select, and the Plan Administrator and each Participating Company shall be relieved of any further liability for payment of such amounts.
9.5. Tax Withholding. A Participating Company may deduct from any payments otherwise due under this Plan to a Participant (or beneficiary) amounts required by law to be withheld for purposes of federal, state or local taxes.
9.6. Gender and Number. Words in the masculine gender shall include the feminine gender, the plural shall include the singular and the singular shall include the plural.
9.7. Controlling Law. To the extent not superseded by federal law, the law of the State of New York shall be controlling in all matters relating to the Plan.
IN WITNESS WHEREOF, and as conclusive evidence of the adoption of the foregoing instrument comprising the Plan, Alliance Resource Management GP, LLC
has caused its corporate seal to be affixed hereto and these presents to be duly executed in its name and behalf by its proper officers thereunder authorized this 1st day of February, 2001.
ALLIANCE RESOURCE MANAGEMENT GP, LLC
By: /s/ Thomas L. Pearson
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Title: Sr. Vice President - Law and Administration
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EXHIBIT 99.3
ALLIANCE RESOURCE MANAGEMENT GP, LLC
DEFERRED COMPENSATION PLAN FOR DIRECTORS
EFFECTIVE AS DECEMBER 1, 1999
AMENDED AND RESTATED AS OF MARCH 15, 2000
TABLE OF CONTENTS
Page
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Section 1 Definitions ............................................ 2
Section 2 Administration ......................................... 3
Section 3 Participants ........................................... 3
Section 4 Benefits ............................................... 3
Section 5 General Provisions ..................................... 5
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ALLIANCE RESOURCE MANAGEMENT GP, LLC
DEFERRED COMPENSATION PLAN FOR DIRECTORS
EFFECTIVE AS OF DECEMBER 1, 1999
AMENDED AND RESTATED AS OF MARCH 15 2000
PREAMBLE
WHEREAS, in order to help Alliance Resource Management GP, LLC (the "Company") attract and retain highly qualified individuals to serve as members of the Company's Board of Directors, the Company desires to adopt a nonqualified deferred compensation plan that would permit them to defer all or part of their fees paid under the Company's Directors' Compensation Program;
NOW, THEREFORE, the Company does hereby adopt the Alliance Resource Management GP, LLC Deferred Compensation Plan for Directors (the "Plan") as set forth herein, effective as of December 1, 1999.
1. DEFINITIONS.
For purposes of the Plan, the following terms shall have the meanings indicated:
1.1 Account means a notional account as defined in Section 4.2.
1.2 Beneficiary means the person(s) designated by a Participant, on a form provided by and filed with the Company, to receive benefits from the Plan in the event of his or her death. A Participant may change his or her beneficiary designation at any time. If no designated Beneficiary survives the Participant, the Beneficiary shall be the Participant's surviving spouse or, if none, his or her estate.
1.3 Board means the Board of Directors of the Company.
1.4 Committee means the Compensation Committee of the Board appointed Pursuant to Section 2.1 to administer the Plan.
1.5 Common Units means the common units of the Partnership.
1.6 Compensation means, with respect to a Plan Year, the Participant's annual retainer for such Plan Year under the Company's Directors' Compensation Program.
1.7 Director means a member of the Board who is not also an employee of the Company; provided, any director who waives his compensation will not be eligible to participate in the Plan until such waiver is revoked or rescinded in a written notice provided to the Company.
1.8 Exchange Act means the Securities Exchange Act of 1934, as amended.
1.9 Fair Market Value means, as applied to any applicable date, the average closing sale price (or if unavailable the last reported bid price) of a Common Unit for the ten trading days immediately preceding such date, as reported on the NASDAQ National Market System or on such other exchange or bulletin board on which the Common Units are traded. The Compensation Committee may direct the Plan Administrator to use the quoted closing sale price or closing bid price as may reported by The Wall Street Journal, Bloomberg Financial Markets or other reporting service as approved by the Compensation Committee.
1.10 Participant means each Director who elects to participate in the Plan in accordance with Section 3.
1.11 Partnership means Alliance Resource Partners, L.P.
1.12 Phantom Unit means a notional Common Unit. A Participant shall not possess any rights of a common unitholder of the Partnership with respect to a Phantom Unit except as expressly provided herein.
1.13 Plan Year means the calendar year.
1.14 SEC means the Securities and Exchange Commission.
1.15 Securities Act means the Securities Act of 1933, as amended.
1.16 Termination means a Participant's ceasing for any reason to be a member of the Board.
2. ADMINISTRATION
2.1 Committee. The Plan shall be administered by the Compensation Committee of the Board (the "Committee") consisting of such members of the Board as the Board shall designate. The Committee shall have the complete authority and power to interpret the Plan, prescribe, amend and rescind rules relating to its administration, determine the eligible members of the Board, determine a Participant's (or Beneficiary's) right to a payment and the amount of such payment, and to take all other actions necessary or desirable for the administration of the Plan. All actions and decisions of the Committee shall be final and binding upon all Participants and Beneficiaries.
3. PARTICIPANTS
3.1 Participants. Each Plan Year each member of the Board who is a Director for Such year shall be eligible to be a Participant with respect to that Plan Year.
4. BENEFITS
4.1 Voluntary Deferrals. Before each Plan Year (or, with respect to an individual who first becomes a Director during a Plan Year, within 30 days of the date on which he or she becomes a Director and with respect to Compensation earned after such election), each Director may elect to have the payment of all or a portion of his or her Compensation for that Plan Year
(or, if applicable, the remainder of the Plan Year) deferred until his or her Termination. The election shall be irrevocable and shall be made on a form approved by the Committee and the deferrals shall be taken ratably from the Compensation payable on January 1, April 1, July 1, and October 1 (as applicable). A Participant's deferral election shall apply only to Compensation earned during that Plan Year or partial Plan Year, as the case may be. If a Director has not made a deferral election with respect to a Plan Year, the Compensation payable to him or her for that Plan Year shall be paid in accordance with the Company's normal practices.
4.2 Accounts. The Company shall establish a ledger or notional account (the "Account") for each Director who has elected to defer payment of all or part of his or her Compensation under the Plan for the purpose of reflecting the Company's obligation to pay the deferred Compensation as specified pursuant to the Plan.
4.3 Investment of Accounts. A Participant's Account shall be credited with the number of Phantom Units equal to the number of Common Units of Compensation deferred by the Participant for which the Participant has made a deferral election. In addition, the Account shall be credited periodically with phantom (notional) distributions (i.e., minimum quarterly distributions) and any other distributions with respect to the Phantom Units then credited to the Account that are equal to the distributions then made with respect to Common Units (so long as the Participant was a Director of the Company on the record date for such distribution), which amount shall be credited as being reinvested in additional Phantom Units on such applicable dates. All credits and debits to an Account shall be made based on the then Fair Market Value per unit of the Common Units. Fractional Phantom Units shall be rounded up to a whole Unit on a credit, and rounded down to zero on a debit.
4.4 Payment of Accounts. Upon a Participant's Termination, the Company
shall pay to such Participant (or to his or her Beneficiary in case of the
Participant's death) (a) that number of Common Units equal to the number of
Phantom Units then credited to the Account, (b) an amount of cash equal to the
then Fair Market Value of the Phantom Units credited to his or her Account, or
(c) any combination thereof as determined by the Committee in its discretion. If
payment is made in Common Units, the Partnership shall first have filed and
registered this Plan on Form S-8 with the SEC prior to such payment, such that
all Common Units issued to a Participant (or his beneficiary) pursuant to this
Plan be freely tradable under the Securities Act, subject only to the volume
limitations set forth in Rule 144(k) promulgated under the Securities Act as may
be applicable to former affiliates of the Partnership. The Partnership shall
maintain a current prospectus, if required, under Form S-8 until such
Participant either has sold or may sell all of his Common Units without
restriction as to the volume of trading under Rule 144(e).
Payment of Accounts shall or be made as soon as reasonably practical following the Participant's Termination.
4.5 Reorganization, Reclassification, Consolidation, Merger, or Sale. Any recapitalization, reorganization, reclassification, split of Common Units, distribution or dividend of securities on Common Units, consolidation or merger of the Partnership, or sale of all or substantially all of the Partnership's assets or other similar transaction which is effected in such a way that holders of Common Units are entitled to receive (either directly or upon subsequent liquidation) cash, securities or assets with respect to or in exchange for Common Units is
referred to herein as an "Organic Change." Upon the occurrence of an Organic Change, the Compensation Committee shall in its sole discretion (and upon the advice of financial advisors as may be retained by the Compensation Committee) immediately adjust the notional balance of Phantom Units in each Participant's Account to equitably credit the fair value of the change in the Common Units and/or the distributions (of cash, securities or other assets) received or economic enhancement realized by the holders of the Common Units.
4.6 Financial Hardship. The Committee may accelerate the payment of all or part of a Participant's Account upon its determination that the Participant has incurred a "severe financial hardship" resulting from a sudden and unexpected illness or accident of such person or of a dependent, a loss of such person's property due to casualty, or other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the reasonable control of such person. The Committee, in making its determination of severe financial hardship may consider such factors and require such information as it deems appropriate, but, in any case, payment may not be made to the extent that such hardship is or may be relieved (i) through reimbursement or compensation by insurance or otherwise or (ii) by liquidation of such person's assets, to the extent liquidation of such assets will not itself cause severe financial hardship.
5. GENERAL PROVISIONS
5.1 Unfunded Obligation. The amounts to be paid to Participants pursuant to this Plan are unfunded obligations of the Company. The Company is not required to segregate any monies from its general funds, to create any trusts, or to make any special deposits with respect to this obligation. Title to and beneficial ownership of any investments, including trust investments, which the Company may make to fulfill this obligation shall at all times remain in the Company. Any investments and the creation or maintenance of any trust or notional accounts shall not create or constitute a trust or a fiduciary relationship between the Committee or the Company (on one hand) and a Participant (on the other hand), or otherwise create any vested or beneficial interest in any Participant or his or her Beneficiary or his or her creditors in any assets of the Company whatsoever. The Participants (and Beneficiaries) shall have no claim against the Company for any changes in the value of any Accounts and shall be general unsecured creditors of the Company with respect to any payment due under this Plan.
5.2 Incapacity of Participant or Beneficiary. If the Committee finds that any Participant or Beneficiary to whom a payment is payable under the Plan is unable to care for his or her affairs because of illness or accident or is under a legal disability, any payment due (unless a prior claim therefore shall have been made by a duly appointed legal representative) at the discretion of the Committee, may be paid to the spouse, child, parent or brother or sister of such Participant or Beneficiary or to any person whom the Committee has determined has incurred expense for such Participant or Beneficiary. Any such payment shall be a complete discharge of the obligations of the Company under the provisions of the Plan.
5.3 Nonassignment. The right of a Participant or Beneficiary to the payment of any amounts under the Plan may not be assigned (unless to a qualified charitable organization or immediate family member), transferred, pledged or encumbered in any manner nor shall such right or other interests be subject to attachment, garnishment, execution or other legal process.
5.4 Termination and Amendment. The Board may from time to time amend, suspend or terminate the Plan, in whole or in part, and if the Plan is suspended or terminated, the Board may reinstate any or all of its provisions. The Committee may also amend the Plan; provided, however, it may not suspend or terminate the Plan, or substantially increase the obligations of the Company under the Plan or expand the classification of employees who are eligible to participate in the Plan. No amendment, suspension or termination of the Plan may impair the right of a Participant or his or her Beneficiary to receive the benefit accrued hereunder prior to the effective date of such amendment, suspension or termination.
5.5 Exempt Plan. It is the intention of the Board of Directors of the Company, as the managing general partner of the Partnership, that all notional credits of Phantom Units to any Participant's Account as provided under the terms of this Plan, and any issuance of Common Units to a Participant (or his beneficiary) in lieu of cash payments under this Plan upon his termination of employment with a Participating Company, be deemed transactions which are exempt from the provisions of Section 16(b) of the Exchange Act, as provided under Rule 16b-3(d)(1) promulgated under the Exchange Act.
5.6 Applicable Law. Except to the extent preempted by applicable federal law, the Plan shall be construed and governed in accordance with the laws of the State of Delaware.
IN WITNESS WHEREOF, and as conclusive evidence of the adoption of the foregoing instrument comprising the Plan, Alliance Resource, Management GP, LLC has caused its corporate seal to be affixed hereto and these presents to be duly executed in its name and behalf by its proper officers thereunder authorized this 15th day of March, 2000.
ALLIANCE RESOURCE MANAGEMENT GP, LLC
(seal) By: /s/ THOMAS L. PEARSON
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Title: Sr. Vice President-
Law and Administration
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