EXHIBIT 1.1
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
5,699,900 COMMON UNITS
REPRESENTING LIMITED PARTNER INTERESTS
Underwriting Agreement
January 25, 2006
Goldman, Sachs & Co.
Deutsche Bank Securities Inc.
Raymond James & Associates, Inc.
Petrie Parkman & Co., Inc.
c/o Goldman, Sachs & Co.,
85 Broad Street
New York, New York 10004
Ladies and Gentlemen:
Calumet Specialty Products Partners, L.P., a Delaware limited partnership (the
Partnership
or the
MLP
), proposes, subject to the terms and conditions stated herein, to issue and sell to
the Underwriters named in Schedule I hereto (the
Underwriters
) an aggregate of 5,699,900 common
units representing limited partner interests in the Partnership (
Common Units
) and, at the
election of the Underwriters, up to 854,985 additional Common Units. The aggregate of 5,699,900
Common Units is herein called the
Firm Units
and the aggregate of 854,985 additional Common Units
is herein called the
Optional Units
. The Firm Units and the Optional Units that the Underwriters
elect to purchase pursuant to Section 2 hereof are herein collectively called the
Units.
As part
of the public offering of the Units contemplated hereby (the
Offering
), the Underwriters have
agreed to reserve out of the Firm Units up to 645,000 Common Units for sale to certain officers,
employees and directors of the MLP and the General Partner (as defined below) and their affiliates
and certain family members (collectively, the
Participants
), as set forth in the Prospectus (as
defined in Section 1) under the caption Underwriting (the
Directed Unit Program
).
The Partnership was formed to acquire, own and operate certain refineries, a terminal and
certain storage facilities for specialty hydrocarbon and fuel products in Louisiana and Illinois
held by Calumet Lubricants Co., Limited Partnership, an Indiana limited partnership (
Calumet
),
and certain of its subsidiaries, as described more particularly in the Prospectus. At each Time of
Delivery (as defined in Section 4), the Partnership will operate its business through Calumet and
its subsidiaries. Calumet LP GP, LLC, a Delaware limited liability company (the
OLP GP
), will be
the general partner of Calumet. Calumet Operating, LLC, a Delaware limited liability company (the
Operating Company
or the
OLLC
), will be the sole member of the OLP GP and the sole limited
partner of Calumet. Calumet GP, LLC, a Delaware limited liability company (the
General Partner
),
is the general partner of the Partnership. Calumet, the OLP GP, the General Partner, the
Partnership and the Operating Company are hereinafter referred to collectively as the
Calumet
Parties
. The General
Partner, the Partnership, the Operating Company, Calumet, the OLP GP and the Operating
Subsidiaries (as defined below) are hereinafter referred to collectively as the
Partnership
Entities
.
Furthermore, as of the date hereof:
(a) The Heritage Group, an Indiana general partnership (
Heritage
), owns a 56.7% limited
partner interest in Calumet, and affiliates of Heritage own an 85% interest in Calumet,
Incorporated, an Indiana corporation (
Calumet Inc.
);
(b) Fred M. Fehsenfeld, Jr. and certain associated trusts (collectively,
Fehsenfeld
), own a
12.5% limited partner interest in Calumet;
(c) The Grube Family, Indiana residents, and certain of their affiliates and associated trusts
(collectively,
Grube
), own a 20.8% limited partner interest in Calumet and a 15% interest in
Calumet Inc.;
(d) Calumet Inc. owns a 10% general partner interest in Calumet;
(e) Calumet holds all assets related to its refineries located in Princeton, Louisiana and
Cotton Valley, Louisiana, its terminal located in Burnham, Illinois and certain
distribution-related assets (the
Contributed Assets
); and
(f) Calumet Shreveport, LLC, an Indiana limited liability company (
Calumet Shreveport
),
through its ownership of Calumet Shreveport Lubricants & Waxes, LLC, an Indiana limited liability
company (
Shreveport Lubes
), and Calumet Shreveport Fuels, LLC, an Indiana limited liability
company (
Shreveport Fuels
), holds all assets related to Calumets refinery in Shreveport,
Louisiana (the
Shreveport Assets
). Shreveport Lubes, Shreveport Fuels, Calumet Pennsylvania LLC,
a Delaware limited liability company (
Newco
), Calumet Holding, LLC, a Delaware limited liability
company (
Holding
), and Calumet Sales Company Incorporated, a Delaware corporation (
Reseller
),
are wholly owned subsidiaries of Calumet.
Prior to the date hereof, Calumet and its subsidiaries entered into Credit Agreements dated as
of December 9, 2005 and related documents (collectively, the
Credit Agreements
) providing for two
$225 million credit facilities.
On or prior to the First Time of Delivery (as defined herein), the parties thereto will enter
into a Contribution, Conveyance and Assumption Agreement (the
Contribution Agreement
) pursuant to
which the following transactions will occur:
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a)
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Calumet will convey its non-MLP Pennsylvania assets to Newco as a capital
contribution;
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b)
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Calumet will convey (a) its interest in Newco and (b) its interest in Calumet
Shreveport Packaging, LLC to Holding as a capital contribution and distribute the
interest in Holding to the owners of Calumet in proportion to their ownership in
Calumet;
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c)
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Calumet Inc. will convey its general partner interest in Calumet to the OLP GP
as a capital contribution;
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d)
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Heritage, Fehsenfeld and Grube and (collectively, the
GP Owners
) will convey
a limited partner interest in Calumet (the
Interest
) to the General Partner equal in
value to 2% of the equity value of the Partnership immediately after closing as a
capital contribution in the following proportion:
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The Heritage Group
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55.1
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%
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Fehsenfeld
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12.5
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%
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Grube
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32.4
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%
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and Fehsenfeld will contribute an amount of cash to the General Partner to increase
its interest in the General Partner to 19%.
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e)
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The General Partner will contribute the Interest to the Partnership in exchange
for (a) a continuation of its 2% general partner interest in the Partnership and (b)
all of the Incentive Distribution Rights (as defined in the Partnership Agreement (as
defined herein)) (the
Incentive Distribution Rights
);
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f)
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Heritage, Grube and Fehsenfeld will contribute their remaining limited partner
interests in Calumet to the Partnership in exchange for an aggregate of (a) 5,169,129
Common Units, and (b) 11,723,599 subordinated units representing subordinated limited
partner interests in the Partnership (
Subordinated Units
);
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g)
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Calumet Inc. will contribute its interest in the OLP GP to the Partnership in
exchange for (a) 591,886 Common Units and (b) 1,342,401 Subordinated Units; and
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h)
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The public offering of the Firm Units contemplated hereby (the
Offering
) will
be consummated;
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i)
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The Partnership will convey its limited partner interest in Calumet and its
interest in the OLP GP to the Operating Company as a capital contribution;
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j)
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The Partnership will use the proceeds of the Offering to (a) pay expenses
associated with the transactions contemplated by this Agreement and (b) repay
borrowings under the Credit Agreements; and
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k)
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Messrs. Fred M. Fehsenfeld, Sr., Mac Fehsenfeld and Frank Fehsenfeld (the
Fehsenfeld Investors
) will purchase an aggregate 750,100 Common Units (the
Fehsenfeld Units
) directly from the Partnership pursuant to the Registration
Statement (as defined in Section 1(a) hereof) and a purchase and sale agreement by and
between the Fehsenfeld Investors, the Partnership and the General Partner (the
Fehsenfeld Purchase Agreement
).
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The Fehsenfeld Units sold directly by the Partnership referenced in clause (k) above are
sometimes herein referred to as the
Non-Underwritten Units
. None of the Underwriters are acting
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as underwriter, placement agent or otherwise in connection with the sale of the Fehsenfeld
Units by the Partnership, and the Fehsenfeld Units are not part of the underwritten Offering. The
sale of such Non-Underwritten Units directly by the Partnership is herein referred to as the
Non-Underwritten Sale
. The Underwriters will receive no commission or discount on, and shall not
participate in the offer, sale or distribution of, the Non-Underwritten Units.
The transactions described directly above in clauses (a)-(k) are referred to as the
Transactions
. In connection with the Transactions, the parties to the Transactions entered or
will enter into various bills of sale, assignments, conveyances, articles of conversion,
contribution agreements and related documents (collectively with the Contribution Agreement, the
Contribution Documents
). Calumet Shreveport, Shreveport Fuels and Shreveport Lubes are
hereinafter referred to collectively as the
Operating LLCs.
Calumet, the Operating LLCs and
Reseller are hereinafter referred to collectively as the
Operating Subsidiaries
.
1.
Representations, Warranties and Agreements of the Calumet Parties
. The Calumet
Parties, jointly and severally, represent and warrant to, and agree with, each of the Underwriters
that:
(a)
Registration
. A registration statement on Form S-1 (File No. 333-128880) (the
Initial
Registration Statement
) in respect of the Units has been filed with the Securities and Exchange
Commission (the
Commission
or the
SEC
); 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 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 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 dated
January 13, 2006 relating to the Units that was included in the Registration Statement immediately
prior to the Applicable Time (as defined below) 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 Units is hereinafter called an
Issuer Free Writing Prospectus
). For purposes
of this Agreement,
Applicable Time
means 5:40 p.m. (New York City time) on the date of this
Agreement.
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(b)
No Stop Order.
No order preventing or suspending the use of any Preliminary Prospectus or
any Issuer Free Writing Prospectus has been issued and no proceeding for that purpose has been
initiated or threatened by the Commission.
(c)
No Material Misstatements or Omissions in Registration Statement or Prospectus
. The
Registration Statement conforms, and any further amendments or supplements to the Registration
Statement will, when they become effective, 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, 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. The Prospectus and any supplement or amendment thereto will conform, when filed with
the Commission under Rule 424(b), in all material respects to the requirements of the Act and the
rules and regulations of the Commission thereunder, and will not contain an untrue statement of a
material fact or omit to state a material fact necessary to make the statements therein, in light
of the circumstances under which they were made, not misleading. Notwithstanding the foregoing,
the representation and warranty in this Section 1(c) shall not apply to any statements or omissions
made in reliance upon and in conformity with written information furnished to the Partnership by an
Underwriter through Goldman, Sachs & Co. expressly for use therein.
(d)
No Material Misstatements or Omissions in Pricing Disclosure Package.
The Pricing
Prospectus, as supplemented by those Issuer Free Writing Prospectuses and other documents, if any,
listed in Schedule II(A) hereto, taken together (collectively, the
Pricing Disclosure Package
),
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 light of the circumstances
under which they were made, not misleading; and each Issuer Free Writing Prospectus listed in
Schedule II(A) or Schedule II(B) 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 Disclosure Package 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 light of the circumstances
under which they were made, not misleading. Each of the statements made by the Partnership in the
Pricing Prospectus, and to be made in the Prospectus and any further amendments or supplements to
the Registration Statement or Prospectus within the coverage of Rule 175(b) of the rules and
regulations under the Act, including (but not limited to) any projections of results of operations
or statements with respect to future available cash or future cash distributions of the Partnership
or the anticipated ratio of taxable income to distributions, was made or will be made with a
reasonable basis and in good faith. Notwithstanding the foregoing, the representation and warranty
in this Section 1(d) shall not apply to any statements or omissions made in the Registration
Statement, the Prospectus or the Pricing Prospectus or any Issuer Free Writing Prospectus in
reliance upon and in conformity with information furnished in writing to the Partnership by an
Underwriter through Goldman, Sachs & Co. expressly for use therein.
(e)
Formation and Qualification of the Partnership, Calumet, the General Partner, the OLP GP,
the Operating Company, the Operating LLCs and Reseller
. At or before the First Time of Delivery:
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(i) Each of the Partnership and Calumet has been duly formed and is validly existing in good
standing as a limited partnership under the Delaware Revised Uniform Limited Partnership Act (the
Delaware LP Act
) and the Indiana Uniform Limited Partnership Act (the
Indiana Act
),
respectively, with full partnership power and authority necessary to enter into this Agreement, to
own or lease its properties to be owned or leased at the First Time of Delivery, to assume the
liabilities assumed by it pursuant to the Contribution Documents and to conduct its business to be
conducted at the First Time of Delivery, in each case in all material respects as described in the
Registration Statement and the Pricing Prospectus.
(ii) Each of the General Partner, the OLP GP and the Operating Company 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 enter into this Agreement, to own or lease its properties to be owned or leased at the
First Time of Delivery, to assume the liabilities assumed by it pursuant to the Contribution
Documents and to conduct its business to be conducted at the First Time of Delivery, and in the
case of the General Partner and the OLP GP, to act as the general partner of the Partnership and
Calumet, respectively, in each case in all material respects as described in the Pricing
Prospectus.
(iii) Each of the Operating LLCs has been duly formed and is validly existing in good standing
as a limited liability company under the Indiana Business Flexibility Act (the
Indiana LLC Act
)
with full limited liability company power and authority to own or lease its properties to be owned
or leased at the First Time of Delivery, to assume the liabilities assumed by it pursuant to the
Contribution Documents and to conduct its business to be conducted at the First Time of Delivery,
in each case in all material respects as described in the Pricing Prospectus.
(iv) Reseller has been duly incorporated and is validly existing in good standing under the
Delaware General Corporation Law (the
DGCL
) with full corporate power and authority to own or
lease its properties to be owned or leased at the First Time of Delivery, to assume the liabilities
assumed by it pursuant to the Contribution Documents, and to conduct its business to be conducted
at the First Time of Delivery, in each case in all material respects as described in the Pricing
Prospectus.
(f)
Foreign Qualifications of the Partnership Entities.
Each of the Partnership Entities is,
or at the First Time of Delivery will be, duly registered or qualified as a foreign limited
partnership, limited liability company or corporation, 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 so to register or qualify would not (i) have a
material adverse effect on the condition (financial or otherwise), business, prospects or results
of operations of the Partnership Entities taken as a whole (a
Material Adverse Effect
), or (ii)
subject the limited partners of the Partnership to any material liability or disability.
(g)
Ownership of the General Partner Interest in the Partnership
. At each Time of Delivery,
after giving effect to the Transactions, the General Partner will be the sole general partner of
the Partnership with a 2.0% general partner interest in the Partnership; such general partner
interest will be duly authorized and validly issued in accordance with the partnership agreement of
the Partnership (as the same may be amended or restated at or prior to any Time of Delivery, the
Partnership
6
Agreement
); and the General Partner will own such general partner interest free and clear of
all liens, encumbrances (except restrictions on transferability as described in the Prospectus),
security interests, charges or claims.
(h)
Ownership of Sponsor Units, Fehsenfeld Units and Incentive Distribution Rights
. At the
First Time of Delivery, after giving effect to the Transactions, (i) Heritage will own 3,269,033
Common Units and 7,414,176 Subordinated Units; (ii) Fehsenfeld will own 720,127 Common Units and
1,633,250 Subordinated Units; (iii) Grube will own 1,179,969 Common Units and 2,676,173
Subordinated Units, and (iv) Calumet Inc. will own 591,886 Common Units and 1,342,401 Subordinated
Units (collectively, the
Sponsor Units
); (v) the Fehsenfeld Investors will own the Fehsenfeld
Units; and (vi) the General Partner will own all of the Incentive Distribution Rights; and all of
such Sponsor Units, the Fehsenfeld Units and Incentive Distribution Rights and the limited partner
interests represented thereby will be duly authorized and validly issued in accordance with the
Partnership Agreement, and will be fully paid (to the extent required under the Partnership
Agreement) and nonassessable (except as such nonassessability may be affected by matters described
in the Pricing Prospectus under the caption The Partnership Agreement Limited Liability); and
each of Heritage, Fehsenfeld, Grube and Calumet Inc. will own such Sponsor Units, and the General
Partner will own the Incentive Distribution Rights, free and clear of all liens, encumbrances
(except restrictions on transferability as described in the Prospectus), security interests,
charges or claims.
(i)
Valid Issuance of the Units
. At the First Time of Delivery, there will be issued to the
Underwriters the Firm Units (assuming no purchase by the Underwriters of Optional Units); at the
First Time of Delivery or the Second Time of Delivery, as the case may be, the Firm Units or the
Optional Units, as the case may be, and the limited partner interests represented thereby will be
duly authorized by 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 matters described in the Pricing Prospectus under the caption
The Partnership Agreement Limited Liability); and other than the Sponsor Units, the Fehsenfeld
Units and the Incentive Distribution Rights, the Units will be the only limited partner interests
of the Partnership issued and outstanding at either Time of Delivery.
(j)
Ownership of the Membership Interest in Operating Company
. At each Time of Delivery,
after giving effect to the Transactions, the Partnership will own a 100% membership interest in the
Operating Company; such membership interest will have been duly authorized and validly issued in
accordance with the limited liability company agreement of the Operating Company (as the same may
be amended or restated at or prior to each Time of Delivery, the
Operating Company Agreement
) and
will be fully paid (to the extent required under the Operating Company Agreement) and nonassessable
(except as such nonassessability may be affected by Section 18-607 of the Delaware LLC Act); and
the Partnership will own such membership interest free and clear of all liens, encumbrances (except
restrictions on transferability as described in the Pricing Prospectus), security interests,
charges or claims, other than those arising under the Credit Agreements.
(k)
Ownership of the Membership Interests in the OLP GP
. At each Time of Delivery, after
giving effect to the Transactions, the Operating Company will own a 100% membership interest in the
OLP GP; such membership interest will have been duly authorized and validly issued in accordance
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with the limited liability company agreement of the OLP GP (as the same may be amended or restated
at or prior to each Time of Delivery, the
OLP GP Agreement
) and will be fully paid (to the extent
required under the OLP GP Agreement) and nonassessable (except as such nonassessability may be
affected by Section 18-607 of the Delaware LLC Act); and the Operating Company will own such
membership interest free and clear of all liens, encumbrances (except restrictions on
transferability as described in the Pricing Prospectus), security interests, charges or claims,
other than those arising under the Credit Agreements.
(l)
Ownership of the General Partner Interest in Calumet.
At each Time of Delivery, after
giving effect to the Transactions, the OLP GP will be the sole general partner of Calumet with a
10% general partner interest in Calumet; such general partner interest will be duly authorized and
validly issued in accordance with the partnership agreement of Calumet (as the same may be amended
or restated at or prior to each Time of Delivery, the
Calumet Agreement
); and the OLP GP will own
such general partner interest free and clear of all liens, encumbrances (except restrictions on
transferability as described in the Pricing Prospectus), security interests, charges or claims,
other than those arising under the Credit Agreements.
(m)
Ownership of the Limited Partner Interest in Calumet.
At each Time of Delivery, after
giving effect to the Transactions, the Operating Company will be the sole limited partner of
Calumet with a 90% limited partner interest in Calumet; such limited partner interest will have
been duly authorized and validly issued in accordance with the Calumet Agreement and will be fully
paid (to the extent required under the Calumet Agreement) and nonassessable (except as such
nonassessability may be affected by IC 23-16-2-2 in the Indiana Act); and the Operating Company
will own such limited partner interest free and clear of all liens, encumbrances, security
interests, charges or claims, other than those arising under the Credit Agreements.
(n)
Ownership of the Membership Interests in the General Partner
. At each Time of Delivery,
after giving effect to the Transactions, Heritage, Grube and Fehsenfeld will own a 51%, 30% and 19%
membership interest in the General Partner, respectively; such membership interests will have been
duly authorized and validly issued in accordance with the limited liability company agreement of
the General Partner (as the same may be amended or restated at or prior to each Time of Delivery,
the
General Partner Agreement
) and will be fully paid (to the extent required under the General
Partner Agreement) and nonassessable (except as such nonassessability may be affected by Section
18-607 of the Delaware LLC Act); and Heritage, Grube and Fehsenfeld will own such membership
interests free and clear of all liens, encumbrances (except restrictions on transferability
contained in the General Partner Agreement), security interests, charges or claims.
(o)
Ownership of Calumet Shreveport.
At each Time of Delivery, after giving effect to the
Transactions, Calumet will own a 100% membership interest in Calumet Shreveport; such membership
interests will be duly authorized and validly issued in accordance with the respective limited
liability company agreements of Calumet Shreveport (as the same may be amended or restated at or
prior to each Time of Delivery, the
Calumet Shreveport Agreement
) and will be fully paid (to the
extent required under the Calumet Shreveport Agreement) and nonassessable (except as such
nonassessability may be affected by IC 23-18-5-1(c) in the Indiana LLC Act); and Calumet will own
such membership interests free and clear of all liens, encumbrances, security interests, charges or
claims, other than those arising under the Credit Agreements.
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(p)
Ownership of Shreveport Lubes and Shreveport Fuels.
At each Time of Delivery, after
giving effect to the Transactions, Calumet Shreveport will own a 100% membership interest in each
of Shreveport Lubes and Shreveport Fuels; such membership interests will be duly authorized and
validly issued in accordance with the respective limited liability company agreements of Shreveport
Lubes and Shreveport Fuels (as the same may be amended or restated at or prior to each Time of
Delivery, the
Shreveport Subsidiary Agreements
) and will be fully paid (to the extent required
under the Shreveport Subsidiary Agreements) and nonassessable (except as such nonassessability may
be affected by IC 23-18-5-1(c) in the Indiana LLC Act); and Calumet Shreveport will own such
membership interests free and clear of all liens, encumbrances, security interests, charges or
claims, other than those arising under the Credit Agreements.
(q)
Ownership of Reseller
. At each Time of Delivery, after giving effect to the Transactions,
Calumet will own 100% of the capital stock of Reseller; such capital stock will be duly authorized
and validly issued in accordance with the charter and bylaws of Reseller (as the same may be
amended or restated at or prior to each Time of Delivery, the
Reseller Charter Documents
) and
will be fully paid and nonassessable; and Calumet will own such capital stock free and clear of all
liens, encumbrances, security interests, charges or claims, other than those arising under the
Credit Agreements.
(r)
No Other Subsidiaries
. At each Time of Delivery, after giving effect to the Transactions,
other than the Partnerships ownership of its 100% membership interest in the Operating Company,
the Operating Companys ownership of its 90% limited partner interest in Calumet and 100%
membership interest in the OLP GP, the OLP GPs ownership of its 10% general partner interest in
Calumet, Calumets ownership of its 100% equity interest in Reseller and its 100% membership in
Calumet Shreveport, and Calumet Shreveports 100% membership interest in each of the Shreveport
Subsidiaries, none of the Partnership, the Operating Company, the OLP GP or the Operating
Subsidiaries will own, directly or indirectly, any equity or long-term debt securities of any
corporation, partnership, limited liability company, joint venture, association or other entity.
(s)
No Preemptive Rights, Registration Rights or Options
. Except as described in the Pricing
Prospectus, and except for restrictions on transfer of units of the General Partner contained in
the General Partner Agreement, there are no options, warrants, preemptive rights or other rights to
subscribe for or to purchase, nor any restriction upon the voting or transfer of, any partnership
or membership interests in any Partnership Entity, in each case pursuant to the Partnership
Agreement, the Operating Company Agreement, the General Partner Agreement, the OLP GP Agreement,
the Calumet Agreement, the Calumet Shreveport Agreement, the Shreveport Subsidiary Agreements and
the Reseller Charter Documents (all such agreements, collectively, the
Organizational Agreements
)
or the certificates of limited partnership or formation and other organizational documents of the
Partnership Entities (collectively with the Organizational Agreements, the
Organizational
Documents
) or any other agreement or instrument to which any of such entities is a party or by
which any one of them may be bound. Neither the filing of the Registration Statement nor the
offering or sale of the Units as contemplated by this Agreement gives rise to any rights for or
relating to the registration of any Units or other securities of the Partnership, other than (i) as
described in the Pricing Prospectus and the Partnership Agreement and (ii) as have been waived.
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(t)
Authority and Authorization
. The Partnership has all requisite power and authority to
issue, sell and deliver (i) the Units, in accordance with and upon the terms and conditions set
forth in
this Agreement and the Partnership Agreement, (ii) the Fehsenfeld Units, in accordance with an
upon the terms and conditions set forth in the Fehsenfeld Purchase Agreement and the Partnership
Agreement, and (iii) the Sponsor Units and Incentive Distribution Rights, in accordance with and
upon the terms and conditions set forth in the Contribution Agreement and the Partnership
Agreement. At each Time of Delivery, all corporate, partnership and limited liability company
action, as the case may be, required to be taken by the Partnership Entities or any of their
stockholders, members or partners for the authorization, issuance, sale and delivery of the Units,
the Fehsenfeld Units, the Sponsor Units and Incentive Distribution Rights, the execution and
delivery by the Partnership Entities of the Operative Agreements (as defined in Section 1(v)
hereof) and the consummation of the transactions (including the Transactions) contemplated by this
Agreement and the Operative Agreements, shall have been validly taken.
(u)
Due Execution and Delivery of Underwriting Agreement
. This Agreement has been duly
executed and delivered by each of the Calumet Parties.
(v)
Enforceability of Other Agreements
. At or before the First Time of Delivery:
(i) The Partnership Agreement will have been duly authorized, executed and delivered by the
General Partner, Heritage, Calumet Inc., Fehsenfeld and Grube as the Organizational Limited
Partners and will be a valid and legally binding agreement of the General Partner, Heritage,
Calumet Inc., Fehsenfeld and Grube as the Organizational Limited Partners, enforceable against the
General Partner, Heritage, Calumet Inc., Fehsenfeld and Grube as the Organizational Limited
Partners in accordance with its terms;
(ii) The Operating Company Agreement will have been duly authorized, executed and delivered by
the Partnership and will be a valid and legally binding agreement of the Partnership, enforceable
against the Partnership in accordance with its terms;
(iii) The OLP GP Agreement will have been duly authorized, executed and delivered by the
Operating Company and will be a valid and legally binding agreement of the Operating Company,
enforceable against the Operating Company in accordance with its terms;
(iv) The General Partner Agreement will have been duly authorized, executed and delivered by
Heritage, Grube and Fehsenfeld and will be a valid and legally binding agreement of Heritage, Grube
and Fehsenfeld, enforceable against Heritage, Grube and Fehsenfeld in accordance with its terms;
(v) Each of the Shreveport Subsidiary Agreements will be duly authorized, executed and
delivered by Calumet Shreveport and will be a valid and legally binding agreement of Calumet
Shreveport, enforceable against Calumet Shreveport in accordance with its terms;
(vi) The Calumet Shreveport Agreement will be duly authorized, executed and delivered by
Calumet and will be valid and legally binding agreements of Calumet, enforceable against Calumet in
accordance with its terms;
10
(vii) The Calumet Agreement will be duly authorized, executed and delivered by the OLP GP and
the Partnership and will be a valid and legally binding agreement of the OLP GP and the
Partnership, enforceable against the OLP GP and the Partnership in accordance with its terms;
(viii) Each of the Contribution Documents will have been duly authorized, executed and
delivered by the parties thereto and will be valid and legally binding agreements of the parties
thereto enforceable against such parties in accordance with their respective terms;
(ix) An omnibus agreement dated as of the First Time of Delivery (the
Omnibus Agreement
)
will have been duly authorized, executed and delivered by each of the parties thereto and will be a
valid and legally binding agreement of each of them enforceable against each of them in accordance
with its terms;
(x) The Fehsenfeld Purchase Agreement will have been duly authorized, executed and delivered
by the Partnership, the General Partner and the Fehsenfeld Investors and will be a valid and
legally binding agreement of the parties thereto enforceable against each of them in accordance
with its terms; and
(xi) The Credit Agreements will have been duly authorized, executed and delivered by each of
the parties thereto and will be valid and legally binding agreements of each of them enforceable
against each of them in accordance with its terms;
provided that, with respect to each agreement described in this Section 1(v), 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); provided, further, that the indemnity and contribution provisions contained therein may be
limited by applicable laws or public policy. The Organizational Agreements, the Contribution
Documents, the Omnibus Agreement, the Fehsenfeld Purchase Agreement and the Credit Agreements are
herein collectively referred to as the
Operative Agreements
.
(w)
No Conflicts
. None of the offering, issuance and sale by the Partnership of the Units,
the execution, delivery and performance of this Agreement or the Operative Agreements by the
Partnership Entities which are parties hereto or thereto, or the consummation of the transactions
contemplated hereby and thereby (including the Transactions) (i) conflicts or will conflict with or
constitutes or will constitute a violation of the Organizational Documents, (ii) conflicts or will
conflict with or constitutes or will constitute a breach or violation of, or a default under (or an
event which, with notice or lapse of time or both, would constitute such a default), any indenture,
mortgage, deed of trust, loan agreement, lease or other agreement or instrument to which any of the
Partnership Entities is a party or by which any of them or any of their respective properties may
be bound or subject, (iii) violates or will violate any statute, law or regulation or any order,
rule, judgment, decree or injunction of any court or governmental agency or body having
jurisdiction over any of the Partnership Entities or any of their properties or (iv) results or
will result in the creation or imposition of any lien, charge or encumbrance upon any property or
assets of any of the Partnership Entities, which conflicts, breaches, violations or defaults, in
the case of clauses (ii), (iii) or (iv), would, individually or in the
11
aggregate, have a Material
Adverse Effect or would materially impair the ability of any of the Partnership Entities to
perform their obligations under this Agreement or the Operative Documents.
(x)
No Consents
. No consent, approval, authorization, order, registration, filing or
qualification (
consent
) of or with any court, governmental agency or body having jurisdiction
over the Partnership Entities or their respective properties or assets is required for the
offering, issuance and sale by the Partnership of the Units, the execution, delivery and
performance of this Agreement and the Operative Agreements by the Partnership Entities party
thereto, or the consummation by the Partnership Entities of the transactions contemplated by this
Agreement and the Operative Agreements (including the Transactions), except (i) for such consents
required under the Securities Act, the Securities Exchange Act of 1934, as amended (the
Exchange
Act
), (ii) for such consents required under state securities or Blue Sky laws in connection with
the purchase and distribution of the Units by the Underwriters, (iii) for such consents which have
been, or prior to the First Time of Delivery will be, obtained, (iv) for such consents which, if
not obtained, would not, individually or in the aggregate, have a Material Adverse Effect and (v)
as disclosed in the Pricing Prospectus.
(y)
No Default
. None of the Partnership Entities is in (i) violation of its certificate or
agreement of limited partnership, limited liability company agreement, certificate or articles of
incorporation or bylaws or other organizational documents, (ii) violation of any law, statute,
ordinance, administrative or governmental rule or regulation applicable to it or of any decree of
any court or governmental agency or body having jurisdiction over it or (iii) breach, default (or
an event which, with notice or lapse of time or both, would constitute such a default) or violation
in the performance of any material obligation, agreement, covenant or condition contained in any
bond, debenture, note or any other evidence of indebtedness or in any agreement, indenture, lease
or other instrument to which it is a party or by which it or any of its properties may be bound,
which breach, default or violation, in the case of clauses (ii) and (iii), would, if continued,
have a Material Adverse Effect, or could materially impair the ability of any of the Partnership
Entities to perform their obligations under this Agreement or the Operative Agreements. To the
knowledge of the Calumet Parties, no third party to any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which any of the Partnership Entities is a party or
by which any of them is bound or to which any of their properties is subject, is in default under
any such agreement, which breach, default or violation would, if continued, have a Material Adverse
Effect.
(z)
Conformity of Securities to Description in the Pricing Prospectus and the Prospectus
. The
Units, when issued and delivered in accordance with the terms of the Partnership Agreement against
payment therefor as provided herein, and the Sponsor Units, the Fehsenfeld Units and the Incentive
Distribution Rights, when issued and delivered in accordance with the terms of the Partnership
Agreement, will conform in all material respects to the descriptions thereof contained in the
Prospectus.
(aa)
Investment Company
. None of the Partnership Entities is now, and after giving effect to
the offering and sale of the Units and the application of the proceeds thereof will be, an
investment company or a company controlled by an investment company as such terms are defined
in the Investment Company Act of 1940, as amended (the
Investment Company Act
).
12
(bb)
Independent Public Accountants
. Ernst & Young LLP, who have certified certain audited
financial statements of Calumet, the Partnership and the General Partner included in the
Registration Statement, the Pricing Prospectus and the Prospectus (or any amendment or
supplement thereto) is an independent registered public accounting firm with respect to such
entities as required by the Act and the rules and regulations of the Commission thereunder.
(cc)
Financial Statements
. At September 30, 2005, the Partnership would have had, on the
consolidated pro forma basis indicated in the Prospectus (and any amendment or supplement thereto),
a capitalization as set forth therein. The historical financial statements (including the related
notes and supporting schedules) included in the Registration Statement, the Pricing Prospectus or
the Prospectus (and any amendment or supplement thereto) present fairly in all material respects
the financial position, results of operations and cash flows of the entities purported to be shown
thereby on the basis stated therein at the respective dates or for the respective periods to which
they apply and have been prepared in accordance with generally accepted accounting principles
consistently applied throughout the periods involved, except to the extent disclosed therein. The
selected historical and pro forma financial information set forth in the Registration Statement,
the Pricing Prospectus and the Prospectus (and any amendment or supplement thereto) under the
caption Selected Historical and Pro Forma Financial and Operating Data is accurately presented in
all material respects and prepared on a basis consistent with the audited and unaudited historical
consolidated financial statements and pro forma financial statements from which it has been
derived. The pro forma financial statements of the Partnership included in the Registration
Statement, the Pricing Prospectus and the Prospectus (and any amendment or supplement thereto) have
been prepared in all material respects in accordance with the applicable accounting requirements of
Article 11 of Regulation S-X of the Commission; the assumptions used in the preparation of such pro
forma financial statements are, in the opinion of the management of the Calumet Parties,
reasonable; and the pro forma adjustments reflected in such pro forma financial statements have
been properly applied to the historical amounts in compilation of such pro forma financial
statements.
(dd)
Sarbanes-Oxley Act of 2002
. The Partnership is in compliance in all material respects
with all applicable provisions of the Sarbanes-Oxley Act of 2002, the Rules and Regulations
thereunder and the rules of the National Association of Securities Dealers Automated Quotations
National Market System (
NASDAQ
) that are effective and applicable to the Partnership.
(ee)
Sufficiency of Transferred Assets Under the Contribution Documents
. The Contribution
Documents will be legally sufficient to transfer or convey to the Operating Subsidiaries all
properties not already held by them that are, individually or in the aggregate, required to enable
the Operating Subsidiaries to conduct their operations in all material respects as contemplated by
the Pricing Prospectus, subject to the conditions, reservations, encumbrances and limitations
contained in the Contribution Documents and those set forth in the Pricing Prospectus. The
Operating Subsidiaries, as the case may be, upon execution and delivery of the Contribution
Documents, will succeed in all material respects to the business, assets, properties, liabilities
and operations reflected by the pro forma financial statements of the Partnership, except as
disclosed in the Pricing Prospectus and the Contribution Documents.
(ff)
No Material Changes
. None of the Partnership Entities has sustained since the date of
the latest audited financial statements included in the Pricing Prospectus any material loss or
13
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, investigation,
order or decree, otherwise than as set forth or contemplated in the Pricing Prospectus; and, since
the respective dates as
of which information is given in the Pricing Prospectus, there has not been any change in the
capitalization or long-term debt of any of the Partnership Entities 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, members equity, or results of
operations of any of the Partnership Entities, taken as a whole, otherwise than as set forth or
contemplated in the Pricing Prospectus.
(gg)
Title to Real Property
. At each Time of Delivery, the Operating Company and the
Operating Subsidiaries, as the case may be, will have good and indefeasible title to all real
property (save and except rights-of-way (as defined in subsection (hh) below)) and good title to
all personal property owned by them, in each case free and clear of all (i) liens and security
interests except liens or security interests securing indebtedness incurred, assumed or agreed to
by the Operating Company, Calumet or any of the Operating Subsidiaries specifically listed in any
of the Contribution Documents or (ii) other claims and other encumbrances (other than liens or
security interests) except, in each case, (1) as described, and subject to the limitations
contained, in the Pricing Prospectus or (2) such as do not materially affect the value of such
property and do not materially interfere with the use of such properties taken as a whole as they
have been used in the past and are proposed to be used in the future, provided that, with respect
to any real property and buildings held under lease by the Operating Company, Calumet and the
Operating Subsidiaries, such real property and buildings are held under valid and subsisting and
enforceable leases with such exceptions as do not materially interfere with the use of the
properties of the Partnership Entities taken as a whole as they have been used in the past and are
proposed to be used in the future.
(hh)
Rights-of-Way
. At each Time of Delivery, each of the Partnership Entities will have 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, except for (i) qualifications, reservations
and encumbrances as may be set forth in the Pricing Prospectus which are not reasonably expected to
have a material adverse effect upon the ability of the Partnership Entities, taken as a whole, to
conduct their businesses in all material respects as currently conducted and as contemplated by the
Prospectus to be conducted and (ii) such rights-of-way that, if not obtained, would not have,
individually or in the aggregate, a material adverse effect upon the ability of the Partnership
Entities, taken as a whole, to conduct their businesses in all material respects as currently
conducted and as contemplated by the Pricing Prospectus to be conducted; other than as set forth,
and subject to the limitations contained, in the Pricing Prospectus, each of the Partnership
Entities has, or at each Time of Delivery will have, 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, except for such revocations,
terminations and impairments that would not have a Material Adverse Effect upon the ability of the
Partnership Entities, taken as a whole, to conduct their businesses in all material respects as
currently conducted and as contemplated by the Prospectus to be conducted; and, except as described
in the Pricing Prospectus, none of such rights-of-way contains any restriction that is materially
burdensome to the Partnership Entities, taken as a whole.
14
(ii)
Permits
. Each of the Partnership Entities has, or at each Time of Delivery, will have
such permits, consents, licenses, franchises, certificates and authorizations of governmental or
regulatory authorities (
permits
) as are necessary to own its properties and to conduct its
business in the manner described in the Pricing Prospectus, subject to such qualifications as may
be set forth in the Pricing Prospectus and except for such permits which, if not obtained, would
not, individually or in the aggregate, have a Material Adverse Effect; each of the Partnership
Entities has, or at each Time of Delivery will have, fulfilled and performed all its material
obligations with respect to such permits which are due to have been fulfilled and performed by such
date and no event has occurred which allows, or after notice or lapse of time would allow,
revocation or termination thereof or results in any impairment of the rights of the holder of any
such permit, except for such revocations, terminations and impairments that would not, individually
or in the aggregate, have a Material Adverse Effect.
(jj)
Books and Records
. The Partnership (i) makes and keeps books, records and accounts,
which, in reasonable detail, accurately and fairly reflect the transactions and dispositions of
assets and (ii) maintains systems of internal accounting controls sufficient to provide reasonable
assurances that (A) transactions are executed in accordance with managements general or specific
authorization; (B) transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles and to maintain
accountability for assets; (C) access to assets is permitted only in accordance with managements
general or specific authorization; and (D) the recorded accountability for assets is compared with
existing assets at reasonable intervals and appropriate action is taken with respect to any
differences.
(kk)
Tax Returns
. Each of the Partnership Entities has filed (or has obtained extensions with
respect to) all material federal, state and foreign income and franchise tax returns required to be
filed through the date hereof, which returns are complete and correct in all material respects, and
has timely paid all taxes shown to be due pursuant to such returns, other than those (i) which, if
not paid, would not have a Material Adverse Effect, or (ii) which are being contested in good faith
and for which adequate reserves have been established in accordance with generally accepted
accounting principles.
(ll)
Environmental Matters
. Except as described in the Pricing Prospectus, the Partnership
Entities (i) 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 and the environment or
imposing liability or standards of conduct concerning any Hazardous Material (as hereinafter
defined) (
Environmental Laws
), (ii) have received all permits required of them under applicable
Environmental Laws to conduct their respective businesses as they are currently being operated,
(iii) are in compliance with all terms and conditions of any such permits, and (iv) to the
knowledge of the Calumet Parties, do not have any liability in connection with the release into the
environment of any Hazardous Material, except where such noncompliance with Environmental Laws,
failure to receive required permits, failure to comply with the terms and conditions of such
permits or liability in connection with such releases, would not, individually or in the aggregate,
have a Material Adverse Effect. The term
Hazardous Material
means (A) any hazardous substance
as defined in the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as
amended, (B) any hazardous waste as defined in the Resource Conservation and Recovery Act, as
amended, (C) any petroleum or petroleum product, (D) any polychlorinated biphenyl and (E) any
pollutant or contaminant or hazardous, dangerous or toxic chemical, material, waste or substance
regulated under or within the meaning of any other Environmental Law.
15
(mm)
No Labor Dispute.
No labor dispute with the employees of the Partnership Entities
exists, or, to the knowledge of the Calumet Parties, is imminent that is reasonably likely to
result in a Material Adverse Effect.
(nn)
Insurance
. The Partnership Entities maintain, or are entitled to the benefits of,
insurance covering their properties, operations, personnel and businesses against such losses and
risks as are reasonably adequate to protect them and their businesses. None of the Partnership
Entities has received notice from any insurer or agent of such insurer that substantial capital
improvements or other expenditures will have to be made in order to continue such insurance, and
all such insurance is outstanding and duly in force on the date hereof and will be outstanding and
duly in force on each Time of Delivery.
(oo)
Legal Proceedings or Contracts Required to be Described or Filed.
Other than as set
forth in the Registration Statement and the Pricing Prospectus, there are no legal or governmental
proceedings pending or, to the knowledge of the Calumet Parties, threatened against any of the
Calumet Parties or to which any of the Partnership Entities is a party or of which any property of
any of the Partnership Entities is the subject that is required to be described in the Registration
Statement or the Pricing Prospectus but are not described as required; and there are no agreements,
contracts, indentures, leases or other instruments that are required to be described in the
Registration Statement or the Prospectus or to be filed as exhibits to the Registration Statement
that are not described or filed as required by the Act.
(pp)
Private Placement
. The sale and issuance of the Sponsor Units to Calumet Inc., Heritage,
Fehsenfeld and Grube and the Incentive Distribution Rights to the General Partner pursuant to the
Partnership Agreement are exempt from the registration requirements of the Act and the securities
laws of any state having jurisdiction with respect thereto, and none of the Partnership Entities
has taken or will take any action that would cause the loss of such exemption.
(qq)
Trading
. The Units have been approved for trading and quotation on the NASDAQ National
Market.
(rr)
Directed Unit Sales.
None of the Units distributed in connection with the Directed Unit
Program will be offered or sold outside of the United States. None of the Partnership Entities has
offered, or caused the Underwriters to offer, Units to any person pursuant to the Directed Unit
Program with the specific intent to unlawfully influence (i) a customer or supplier of the
Partnership Entities to alter the customers or suppliers level or type of business with the
Partnership Entities, or (ii) a trade journalist or publication to write or publish favorable
information about the Partnership Entities or their products or services.
(ss)
Not Ineligible Issuer.
At the time of filing the Initial Registration Statement, the
Partnership was not and is not an ineligible issuer, as defined in Rule 405 under the Act.
2. Subject to the terms and conditions herein set forth, (a) the Partnership agrees to issue
and sell to each of the Underwriters, and each of the Underwriters agrees, severally and not
jointly, to purchase from the Partnership, at a purchase price per unit of $20.1025, the number of
Firm Units set forth opposite the name of such Underwriter in Schedule I hereto and (b) in the
event and to the extent
16
that the Underwriters shall exercise the election to purchase Optional Units as provided
below, the Partnership agrees to issue and sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Partnership, at the purchase
price per unit set forth in clause (a) of this Section 2, that portion of the number of Optional
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 Units by a fraction, the
numerator of which is the maximum number of Optional 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 Units that all of the Underwriters are
entitled to purchase hereunder.
The Partnership hereby grants to the Underwriters the right to purchase at their election up
to an aggregate of 854,985 Optional Units, at the purchase price per unit set forth in the
paragraph above, for the sole purpose of covering sales of units in excess of the number of Firm
Units. Any such election to purchase Optional Units may be exercised only by written notice from
you to the Partnership, given within a period of 30 calendar days after the date of this Agreement,
setting forth the aggregate number of Optional Units to be purchased and the date on which such
Optional Units are to be delivered, as determined by you but in no event earlier than the First
Time of Delivery (as defined in Section 4 hereof) or, unless you and the Partnership otherwise
agree in writing, earlier than two or later than ten business days after the date of such notice.
3.
Offering of Units by the Underwriters.
Upon the authorization by you of the release of the
Firm Units, the several Underwriters propose to offer the Firm Units for sale upon the terms and
conditions set forth in the Prospectus.
4.
Delivery and Payment for the Units.
(a) The Units to be purchased by each Underwriter
hereunder, in book entry form, and in such authorized denominations and registered in such names as
Goldman, Sachs & Co. may request upon at least forty-eight hours prior notice to the Partnership,
shall be delivered by or on behalf of the Partnership to Goldman, Sachs & Co., 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 Partnership to Goldman, Sachs & Co. at
least forty-eight hours in advance. The Partnership will cause the certificates representing the
Units to be made available for checking and packaging at least twenty-four hours prior to the Time
of Delivery (as defined below) with respect thereto at the office of DTC or its designated
custodian (the
Designated Office
). The time and date of such delivery and payment shall be, with
respect to the Firm Units, 9:30 a.m., New York City time, on January 31, 2006 or such other time
and date as Goldman, Sachs & Co. and the Partnership may agree upon in writing, and, with respect
to the Optional Units, 9:30 a.m., New York time, on the date specified by Goldman, Sachs & Co. in
the written notice given by Goldman, Sachs & Co. of the Underwriters election to purchase such
Optional Units, or such other time and date as Goldman, Sachs & Co. and the Partnership may agree
upon in writing. Such time and date for delivery of the Firm Units is herein called the
First
Time of Delivery
, such time and date for delivery of the Optional Units, if not the First Time of
Delivery, is herein called the
Second 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 8 hereof, including the cross receipt for the Units and any additional
17
documents requested by the Underwriters pursuant to Section 8(n) hereof, will be delivered at
the offices of Vinson & Elkins L.L.P., 1001 Fannin, Houston, Texas 77002 (the
Closing Location
),
and the Units will be delivered at the Designated Office, all at such Time of Delivery. A meeting
will be held at the Closing Location at 2:00 p.m., Houston 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 which is not a day on which banking institutions in New York are generally
authorized or obligated by law or executive order to close.
5.
Further Agreements of the Calumet Parties
. Each of the Calumet Parties agrees with each of
the Underwriters:
(a)
Preparation of Prospectus and Registration Statement
. To prepare the Prospectus in a form
approved by you and to file such Prospectus pursuant to Rule 424(b) under the Act not later than
the Commissions close of business on the second business day following the execution and delivery
of this Agreement, or, if applicable, such earlier time as may be required by Rule 430A(a)(3) under
the Act; to make no further amendment or any supplement to the Registration Statement or Prospectus
which shall be disapproved by you promptly after reasonable notice thereof; to file promptly all
material required to be filed by the Partnership with the Commission pursuant to Rule 433(d) under
the Act; 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 supplement to the
Prospectus or any amended Prospectus has been filed and to furnish you with copies thereof; to file
promptly all reports and any definitive proxy or information statements required to be filed by the
Partnership with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the Securities
Exchange Act of 1934, as amended, or the rules and regulations of the Commission thereunder,
subsequent to the date of the Prospectus and for so long as the delivery of a prospectus (or, in
lieu thereof, the notice referred to in Rule 173(a) under the Act) is required in connection with
the offering of the Units; 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 Units, of the suspension of the
qualification of the 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, promptly to use its best efforts to obtain the withdrawal of such order;
(b)
Qualification of Securities.
Promptly from time to time to take such action as you may
reasonably request to qualify the 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 jurisdictions for as long as may be necessary to complete the
distribution of the Units, provided that in connection therewith the Partnership shall not be
required to qualify as a foreign limited partnership or to file a general consent to service of
process in any jurisdiction;
(c)
Copies of Documents to Underwriters.
Prior to 10:00 A.M., New York City time, on the New
York Business Day next succeeding the date of this Agreement and from time to time, to
18
furnish the Underwriters with written and electronic copies of the Prospectus in New York City
in such quantities as you may reasonably request, and, if 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 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 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 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)
Reports to Unitholders.
To make generally available to its unitholders 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
Partnership and its subsidiaries (which need not be audited) complying with Section 11(a) of the
Act and the rules and regulations thereunder (including, at the option of the Partnership, Rule
158);
(e)
Lock-Up Period.
During the period beginning from the date hereof and continuing to and
including the date 180 days after the date of the Prospectus (the
Lock-Up Period
), not to offer,
sell, hedge, contract to sell, pledge, grant an option to purchase, make any short sale or
otherwise dispose of, except as provided hereunder, any Common Units or any securities of the
Partnership that are substantially similar to the Common Units, including but not limited to any
securities that are convertible into or exchangeable for, or that represent the right to receive,
Common Units or any such substantially similar securities (other than pursuant to employee benefit
plans, qualified unit option plans or other employee compensation plans existing on, or upon the
conversion or exchange of convertible or exchangeable securities outstanding as of, the date of
this Agreement), without your prior written consent;
provided
,
however
, that if (1) during the last
17 days of the Lock-Up Period, the Partnership releases earnings results or announces material news
or a material event or (2) prior to the expiration of the Lock-Up Period, the Partnership announces
that it will release earnings results during the 15-day period following the last day of the
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 Goldman, Sachs & Co.
waives, in writing, such extension; the Partnership will provide the representatives and any
co-managers and each unitholder subject to the Lock-Up Period pursuant to the lockup letters
described in Section 8(l) with prior notice of any such announcement that gives rise to an
extension of the Lock-up Period;
19
(f)
Copies of Public Documents.
During a period of two years from the effective date of the
Registration Statement, to furnish or make available 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, partnership equity and cash flows of the Partnership 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 a consolidated
summary financial information of the Partnership and its subsidiaries for such quarter in
reasonable detail;
(g)
Copies of Reports.
During a period of two years from the effective date of the
Registration Statement, to furnish or make available to you copies of all reports or other
communications (financial or other) furnished to its unitholders, and to deliver to you as soon as
they are available, copies of any reports and financial statements furnished to or filed with the
Commission or any national securities exchange on which any class of securities of the Partnership
is listed;
(h)
Use of Proceeds.
To use the net proceeds received by it from the sale of the Units
pursuant to this Agreement in the manner specified in the Pricing Prospectus and the Prospectus
under the caption Use of Proceeds;
(i)
Rule 463
. 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;
(j)
Rule
462(b)
Registration Statement.
If the Partnership elects to rely upon Rule 462(b),
the Partnership shall 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
Partnership 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(b) under the Act;
(k)
License
. Upon request of any Underwriter, to furnish, or cause to be furnished, to such
Underwriter an electronic version of the Partnerships trademarks, servicemarks and logo for use on
the website, if any, operated by such Underwriter for the purpose of facilitating the on-line
offering of the Units (the
License
);
provided, however
, that the License shall be used solely for
the purpose described above, is granted without any fee and may not be assigned or transferred; and
(l)
No Fiduciary Duty.
That (i) the purchase and sale of the Units pursuant to this Agreement
is an arms-length commercial transaction between the Partnership, 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 the
Partnership or any of the other Partnership Entities, (iii) no Underwriter has assumed an advisory
or fiduciary responsibility in favor of the Partnership or any of the other Partnership Entities
with respect to the offering contemplated hereby or (except as provided in (i) the letter agreement
dated as of January 19, 2006 between Goldman Sachs & Co. and Calumet and (ii) the letter agreement
dated as of January 19, 2006 between Petrie Parkman & Co., Inc. and Calumet) the process leading
thereto (irrespective of whether such Underwriter has advised or is currently advising the
Partnership or any of the other Partnership Entities on other matters) or any other obligation to
the Partnership except the
20
obligations expressly set forth in this Agreement and (iv) each of the Partnership Entities
has consulted its own legal and financial advisors to the extent it deemed appropriate. Each of
the Calumet Parties agrees that it will not claim that the Underwriters, or any of them, has
rendered advisory services of any nature or respect, or owes a fiduciary or similar duty to the
Partnership or any of the other Partnership Entities, in connection with such transaction or
(except as provided in (i) the letter agreement dated as of January 19, 2006 between Goldman Sachs
& Co. and Calumet and (ii) the letter agreement dated as of January 19, 2006 between Petrie Parkman
& Co., Inc. and Calumet) the process leading thereto.
6.
Use of Free Writing Prospectus.
(a)
Free Writing Prospectus.
Each of the Calumet Parties represents and agrees that, without
the prior consent of Goldman, Sachs & Co., it has not made and will not make any offer relating to
the 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 Partnership and
Goldman, Sachs & Co., it has not made and will not make any offer relating to the Units that would
constitute a free writing prospectus; each of the Calumet Parties and the Underwriters each
represent and agree that any such free writing prospectus the use of which has been consented to by
the Partnership and Goldman, Sachs & Co. is listed on Schedule II(A) or Schedule II(B) hereto.
(b)
Use of Issuer Free Writing Prospectus.
Each of the Calumet Parties represents and agrees
that it 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 that it has satisfied and will satisfy the conditions under Rule 433
under the Act to avoid a requirement to file with the Commission any electronic road show.
(c)
Information in Issuer Free Writing Prospectus.
Each of the Calumet Parties represents and
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, not
misleading, to give prompt notice thereof to Goldman, Sachs & Co. and, if requested by Goldman,
Sachs & Co., to 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 representation and warranty 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 Partnership by an Underwriter through Goldman, Sachs & Co. expressly for use
therein.
7.
Expenses
. Each of the Calumet Parties covenants and agrees with one another and with the
several Underwriters that the Partnership will pay or cause to be paid the following: (i) the fees,
disbursements and expenses of the Partnerships counsel and accountants in connection with the
registration of the 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) the cost of printing
or producing any Agreement among Underwriters, this Agreement, the Blue Sky Memorandum, closing
documents
21
(including any compilations thereof) and any other documents in connection with the offering,
purchase, sale and delivery of the Units; (iii) all expenses in connection with the qualification
of the Units for offering and sale under state securities laws as provided in Section 5(b) hereof,
including the fees and disbursements of counsel for the Underwriters in connection with such
qualification and in connection with the Blue Sky survey; (iv) all fees and expenses in connection
with listing the Units on NASDAQ; (v) the filing fees incident to, and the fees and disbursements
of counsel for the Underwriters in connection with, any required review by the National Association
of Securities Dealers, Inc. of the terms of the sale of the Units; (vi) the cost of preparing
certificates for the Units; (vii) the cost and charges of any transfer agent or registrar; and
(viii) all other costs and expenses incident to the performance of its obligations hereunder which
are not otherwise specifically provided for in this Section 7. It is understood, however, that,
except as provided in this Section 7 and Sections 9 and 12 hereof, the Underwriters (i) will pay
all of their own costs and expenses, including the fees of their counsel, stock transfer taxes on
resale of any of the Units by them, and any advertising expenses connected with any offers they may
make, and (ii) will reimburse the Partnership for one-third of the itemized air charter expenses
incurred by the Calumet Parties in connection with the Offering.
8.
Conditions of Underwriters Obligations
. The obligations of the Underwriters hereunder, as
to the 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 Calumet Parties
herein are, at and as of such Time of Delivery, true and correct, the condition that the Calumet
Parties shall have performed all of their 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 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 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 under the Act; if the Partnership has elected to rely
upon Rule 462(b) under the Act, the Rule 462(b) Registration Statement shall 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 a 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) Baker Botts L.L.P., counsel for the Underwriters, shall have furnished to you such written
opinion or opinions, dated such Time of Delivery, with respect to the issuance and sale of the
Units, the Registration Statement and the Prospectus and other related matters as you may
reasonably request, and such counsel shall have received such papers and information as they may
reasonably request to enable them to pass upon such matters;
22
(c) Vinson & Elkins L.L.P., counsel for the Partnership, shall have furnished to you their
written opinion, dated such Time of Delivery, in form and substance satisfactory to you, to the
effect that:
(i) The Partnership has been duly formed and is validly existing in good standing as a limited
partnership under the Delaware LP Act with all necessary limited partnership power and authority to
own or lease its properties, to assume the liabilities being assumed by it pursuant to the
Contribution Documents and to conduct its business, in each case in all material respects as
described in the Registration Statement and the Prospectus. The Partnership is duly registered or
qualified as a foreign limited partnership for the transaction of business under the laws of the
jurisdictions set forth under its name on Annex I to this Agreement.
(ii) Each of the General Partner, the Operating Company and the OLP GP has been duly formed
and is validly existing in good standing as a limited liability company under the Delaware LLC Act
with all necessary limited liability company power and authority to own or lease its properties, to
assume the liabilities being assumed by it pursuant to the Contribution Documents and to conduct
its business, and, in the case of the General Partner and the OLP GP, to serve as the general
partner of the Partnership and Calumet, respectively, in each case in all material respects as
described in the Registration Statement and the Prospectus. Each of the General Partner, the
Operating Company and the OLP GP is duly registered or qualified as a foreign limited liability
company for the transaction of business under the laws of the jurisdictions set forth under its
name on Annex I to this Agreement.
(iii) Reseller has been duly formed and is validly existing in good standing as a corporation
under the DGCL with all necessary corporate power and authority to own or lease its properties, to
assume the liabilities being assumed by it pursuant to the Contribution Documents and to conduct
its business, in each case in all material respects as described in the Registration Statement and
the Prospectus. Reseller is duly registered or qualified as a foreign corporation for the
transaction of business under the laws of the jurisdictions set forth under its name on Annex I to
this Agreement.
(iv) The General Partner is the sole general partner of the Partnership with a 2.0% general
partner interest in the Partnership; such general partner interest has been duly authorized and
validly issued in accordance with the Partnership Agreement; and the General Partner owns its
general partner interest free and clear of all liens, encumbrances (except restrictions on
transferability as described in the Prospectus), security interests, charges or claims (i) in
respect of which a financing statement under the Uniform Commercial Code of the State of Delaware
naming the General Partner as debtor is on file in the office of the Secretary of State of the
State of Delaware or (ii) otherwise known to such counsel, without independent investigation, other
than those created by or arising under the Delaware LP Act.
(v) The Sponsor Units, the Fehsenfeld Units, the Incentive Distribution Rights and the limited
partner interests represented thereby have been duly authorized and validly issued in accordance
with the Partnership Agreement, and are fully paid (to the extent required under the Partnership
Agreement) and nonassessable (except as such nonassessability may be affected by matters described
in the Prospectus under the caption The Partnership Agreement Limited Liability). After giving
effect to the Transactions, Heritage will own 3,269,033 Common Units and 7,414,176 Subordinated
Units; Fehsenfeld will own 720,127 Common Units and 1,633,250 Subordinated Units;
23
Grube will own 1,179,969 Common Units and 2,676,173 Subordinated Units, Calumet Inc. will own
591,886 Common Units and 1,342,401 Subordinated Units and the General Partner will own the
Incentive Distribution Rights, in each case free and clear of all liens, encumbrances (except
restrictions on transferability described in the Prospectus), security interests, charges or claims
(i) in respect of which a financing statement under the Uniform Commercial Code of the State of
Delaware naming Heritage, Fehsenfeld, Grube, Calumet Inc. or the General Partner as debtor is on
file in the office of the Secretary of State of the State of Delaware or (ii) otherwise known to
such counsel, without independent investigation, other than those created by or arising under the
Delaware LP Act.
(vi) The Units to be issued and sold to the Underwriters by the Partnership pursuant to this
Agreement and the limited partner interests represented thereby have been duly authorized by 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 matters described in the Prospectus under the caption The Partnership Agreement Limited
Liability) and other than the Sponsor Units, the Fehsenfeld Units and the Incentive Distribution
Rights, the Units will be the only limited partner interests of the Partnership issued and
outstanding at the First Time of Delivery.
(vii) The Operating Company owns a 100% membership interest in the OLP GP; such membership
interest has been duly authorized and validly issued in accordance with the OLP GP Agreement, and
is fully paid (to the extent required under the OLP GP Agreement) and nonassessable (except as such
nonassessability may be affected by Section 18-607 of the Delaware LLC Act); and the Operating
Company owns such membership interest free and clear of all liens, encumbrances, security
interests, charges or claims (i) in respect of which a financing statement under the Uniform
Commercial Code of the State of Delaware naming the Operating Company as debtor is on file in the
office of the Secretary of State of the State of Delaware or (ii) otherwise known to such counsel,
without independent investigation, other than those created by or arising under the Delaware LLC
Act and those arising in connection with the Credit Agreements.
(viii) The Partnership owns a 100% membership interest in the Operating Company; such
membership interest has been duly authorized and validly issued in accordance with the Operating
Company Agreement, and is fully paid (to the extent required under the Operating Company Agreement)
and nonassessable (except as such nonassessability may be affected by Section 18-607 of the
Delaware LLC Act); and the Partnership owns such membership interest free and clear of all liens,
encumbrances (except restrictions on transferability as described in the Prospectus), security
interests, charges or claims (i) in respect of which a financing statement under the Uniform
Commercial Code of the State of Delaware naming the Partnership as debtor is on file in the office
of the Secretary of State of the State of Delaware or (ii) otherwise known to such counsel, without
independent investigation, other than those created by or arising under the Delaware LLC Act and
those arising in connection with the Credit Agreements.
(ix) Heritage, Grube and Fehsenfeld own a 51%, 30% and 19% membership interest in the General
Partner, respectively; such membership interests have been duly authorized and validly issued in
accordance with the General Partner Agreement, and are fully paid (to the extent required under the
General Partner Agreement) and nonassessable (except as such nonassessability may be
24
affected by Section 18-607 of the Delaware LLC Act); and Heritage, Grube and Fehsenfeld own
such membership interests free and clear of all liens, encumbrances (except restrictions on
transferability set forth in the General Partner Agreement), security interests, charges or claims
(i) in respect of which a financing statement under the Uniform Commercial Code of the State of
Delaware naming Heritage, Grube or Fehsenfeld, as the case may be, as debtor is on file in the
office of the Secretary of State of the State of Delaware or (ii) otherwise known to such counsel,
without independent investigation, other than those created by or arising under the Delaware LLC
Act.
(x) Calumet owns 100% of the capital stock of Reseller; such capital stock has been duly
authorized and validly issued in accordance with the Reseller Charter Documents and is fully paid
and nonassessable; and Calumet owns such capital stock free and clear of all liens, encumbrances,
security interests, charges or claims (i) in respect of which a financing statement under the
Uniform Commercial Code of the State of Delaware naming Calumet as debtor is on file in the office
of the Secretary of State of the State of Delaware or (ii) otherwise known to such counsel, without
independent investigation, other than those created by or arising under the DGCL and those arising
in connection with the Credit Agreements.
(xi) Except as described in the Prospectus, there are no options, warrants, preemptive rights
or other rights to subscribe for or to purchase, nor any restriction upon the voting or transfer
of, any partnership or membership interests in any of the Partnership, the Operating Company, the
OLP GP or Reseller (the
Delaware Partnership Entities
), in each case pursuant to the Partnership
Agreement, the Operating Company Agreement, the OLP GP Agreement and the Reseller Charter Documents
or, to the knowledge of such counsel, any other agreement or instrument listed as an exhibit to the
Registration Statement to which the Delaware Partnership Entities are a party or by which any of
them may be bound. To the knowledge of such counsel, neither the filing of the Registration
Statement nor the offering or sale of the Units as contemplated by this Agreement gives rise to any
rights for or relating to the registration of any Units or other securities of the Partnership
other than (i) as described in the Prospectus and Partnership Agreement and (ii) as have been
waived.
(xii) The Partnership has all necessary partnership power and authority to issue, sell and
deliver (i) the Units, in accordance with and upon the terms and conditions set forth in this
Agreement and the Partnership Agreement and (ii) the Sponsor Units and Incentive Distribution
Rights, in accordance with and upon the terms and conditions set forth in the Contribution
Agreement and the Partnership Agreement.
(xiii) This Agreement has been duly authorized, executed and delivered by each of the Calumet
Parties.
(xiv) Each of the Operative Agreements to which any of the Delaware Partnership Entities is a
party has been duly authorized and validly executed and delivered by each of the Delaware
Partnership Entities party thereto. Assuming due authorization, execution and delivery by each
Partnership Entity other than a Delaware Partnership Entity, each of the Operative Agreements
governed by Delaware law constitutes a valid and legally binding agreement of the Partnership
Entities party thereto, enforceable against each such Partnership Entity in accordance with its
respective terms, subject to (i) applicable bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws relating to or affecting creditors rights generally
and by general principles of equity
25
(regardless of whether such enforceability is considered in a proceeding in equity or at law)
and (ii) public policy, applicable law relating to fiduciary duties and indemnification and
contribution and an implied covenant of good faith and fair dealing.
(xv) None of the offering, issuance and sale by the Partnership of the Units being delivered
at such Time of Delivery, the execution, delivery and performance of this Agreement or the
Operative Agreements (other than any Operative Agreement governed by law other than Delaware law)
by the Partnership Entities which are parties thereto, or the consummation of the transactions
contemplated hereby and thereby (including the Transactions) (i) constitutes or will constitute a
violation of the certificate of limited partnership, agreement of limited partnership, certificate
of formation, limited liability company agreement certificate of incorporation or bylaws, as the
case may be, of any of the Delaware Partnership Entities, (ii) constitutes or will constitute a
breach or violation of, or a default (or an event which, with notice or lapse of time or both,
would constitute such a default), or result in a lien, under any Operative Agreement (other than
the Credit Agreements) or any other agreement filed as an exhibit to the Registration Statement or
any other agreement that the Partnership certifies is material as listed on an exhibit to such
counsels opinion, or (iii) violates or will violate the Delaware LP Act, the Delaware LLC Act, the
DGCL, federal law, or any order, judgment, decree or injunction known to such counsel of any
Delaware or federal court to which any of the Partnership Entities or any of their properties is
subject, which breach, violation, lien or default in the case of clause (ii) or (iii), would
reasonably be expected to have a Material Adverse Effect.
(xvi) No permit, consent, approval, authorization, order, registration, filing or
qualification (
consent
) under the Delaware LP Act, the Delaware LLC Act, the DGCL or federal law
is required for the offering, issuance and sale by the Partnership of the Units, the execution,
delivery and performance of this Agreement and the Operative Agreements by the Partnership Entities
party thereto or the consummation by the Partnership Entities of the transactions contemplated by
this Agreement or the Operative Agreements (including the Transactions), except (i) for such
consents required under the Act, the Exchange Act and state securities or Blue Sky laws, as to
which such counsel need not express any opinion, (ii) for such consents which have been obtained or
made, (iii) for such consents which (A) are of a routine or administrative nature, (B) are not
customarily obtained or made prior to the consummation of transactions such as those contemplated
by this Agreement and the Operative Agreements and (C) are expected in the reasonable judgment of
the General Partner to be obtained or made in the ordinary course of business subsequent to the
consummation of the Transactions, (iv) for such consents which, if not obtained, would not,
individually or in the aggregate, be reasonably expected to have a Material Adverse Effect, and (v)
as disclosed in the Prospectus.
(xvii) The statements set forth in the Registration Statement and the Prospectus under the
captions How We Make Cash Distributions, Managements Discussion and Analysis of Financial
Condition and Results of OperationsLiquidity and Capital ResourcesDebt and Credit Facilities,
Certain Relationships and Related Party Transactions, Conflicts of Interest and Fiduciary
Duties, Description of the Common Units and The Partnership Agreement fairly describe in all
material respects the portions of the documents addressed thereby and, insofar as they purport to
constitute summaries of law or legal conclusions, are accurate in all material respects; the
description of the statutes and regulations set forth in the Registration Statement and the
Prospectus under the captions BusinessEnvironmental Matters and Investment in Calumet Specialty
Products Partners, L.P. by Employee Benefit Plans fairly describe in all material respects the
portions of the
26
statutes and regulations addressed thereby; and the Common Units, the Subordinated Units and
the Incentive Distribution Rights conform in all material respects to the descriptions thereof
contained in the Registration Statement and the Prospectus under the captions SummaryThe
Offering, How We Make Cash Distributions, Description of the Common Units, and The
Partnership Agreement.
(xviii) The opinion of Vinson & Elkins L.L.P. that is filed as Exhibit 8.1 to the Registration
Statement is confirmed, and the Underwriters may rely upon such opinion as if it were addressed to
them.
(xix) The Registration Statement was declared effective under the Act on January 25, 2006; to
the knowledge of such counsel, no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose have been instituted or threatened by
the Commission; and any required filing of the Prospectus pursuant to Rule 424(b) has been made in
the manner and within the time period required by such Rule.
(xx) The Registration Statement and the Prospectus and any further amendments and supplements
thereto made by the Partnership prior to such Time of Delivery (other than the financial
statements, notes or schedules included in the Registration Statement or Prospectus or other
financial data included in the Registration Statement or the Prospectus, as to which such counsel
need not express any opinion) comply as to form in all material respects with the requirements of
the Act and the rules and regulations promulgated thereunder.
(xxi) None of the Partnership Entities is an investment company as such term is defined in
the Investment Company Act.
(xxii) To the knowledge of such counsel, (i) there are no legal or governmental proceedings
pending or threatened against any of the Partnership Entities or to which any of the Partnership
Entities is a party or to which any of their respective properties is subject that are required to
be described in the Registration Statement but are not so described as required and (ii) there are
no agreements, contracts, indentures, leases or other instruments that are required to be described
in the Registration Statement or to be filed as exhibits to the Registration Statement that are not
described or filed as required by the Act.
In addition, such counsel shall state that they have participated in conferences with officers
and other representatives of the Partnership Entities and the independent public accountants of the
Partnership and your representatives, at which the contents of the Registration Statement, the
Pricing Disclosure Package and the Prospectus and related matters were discussed, and although such
counsel has not independently verified, is not passing upon, and is not assuming any responsibility
for the accuracy, completeness or fairness of the statements contained in, the Registration
Statement, the Pricing Disclosure Package and the Prospectus (except to the extent specified in the
foregoing opinion), based on the foregoing, no facts have come to such counsels attention that
lead such counsel to believe that (A) the Registration Statement (other than (i) the financial
statements and related schedules, including the notes thereto and auditors report thereon, and
(ii) the other information of a financial nature included in the Registration Statement as to which
such counsel need not comment), as of its effective date, contained an untrue statement of a
material fact or omitted to state a material fact
27
required to be stated therein or necessary to make the statements therein not misleading, (B)
that the Pricing Disclosure Package, if any (other than (i) the financial statements and related
schedules, including the notes thereto and auditors report thereon, and (ii) the other information
of a financial nature included in the Pricing Disclosure Package as to which such counsel need not
comment), as of the Applicable Time, contained any untrue statement of a material fact or omitted
to state any material fact necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading, except that the price of the Units and
disclosures directly relating thereto and derived therefrom are included on the cover page of the
Prospectus or under the captions Use of Proceeds, Capitalization, Underwriting, Our Cash
Distribution Policy and Restrictions on Distributions-Unaudited Pro Formal Cash Available for
Distribution, or Our Cash Distribution Policy and Restrictions on Distributions-Estimated Cash
Available for Distribution in the Prospectus or in the unaudited pro forma financial information
included therein, or (C) that the Prospectus (other than (i) the financial statements and related
schedules, including the notes thereto and auditors report thereon, and (ii) the other information
of a financial nature included in the Prospectus as to which such counsel need not comment), as of
its issue date and as of such Time of Delivery contained or contains an untrue statement of a
material fact or omitted or omits to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not misleading.
In rendering such opinion, such counsel may (A) rely in respect of matters of fact upon
certificates of officers and employees of the Partnership Entities and upon information obtained
from public officials, (B) assume that all documents submitted to them as originals are authentic,
that all copies submitted to them conform to the originals thereof, and that the signatures on all
documents examined by them are genuine, (C) state that their opinion is limited to federal laws,
the Delaware LP Act, the Delaware LLC Act and the DGCL, (D) with respect to the opinions expressed
in paragraphs (i), (ii) and (iii) above as to the due qualification or registration as a foreign
limited partnership, corporation or limited liability company, as the case may be, of the
Partnership, the Operating Company, the General Partner, the OLP GP and Reseller, state that such
opinions are based upon the opinions of counsel provided pursuant to (d) and (e) below and upon
certificates of foreign qualification or registration provided by the Secretary of State of the
States listed on Annex I to such opinion (each of which shall be dated as of a date not more than
fourteen days prior to such Time of Delivery and shall be provided to you), (E) state that they
express no opinion with respect to the title of any of the Partnership Entities to any of their
respective real or personal property purported to be transferred by the Contribution Documents nor
with respect to the accuracy of descriptions of real or personal property or permits to own or
operate any real or personal property, and assume that the descriptions of interests in property
described in the Contribution Documents are accurate and describe the interests intended to be
conveyed thereby (and that references in the Contribution Documents to other instruments of record
are correct and that such recorded instruments contain legally sufficient property descriptions),
and (F) state that they express no opinion with respect to state or local taxes or tax statutes to
which any of the limited partners of the Partnership or any of the Partnership Entities may be
subject;
28
(d) Barnes & Thornburg LLP, with respect to the State of Indiana, shall have furnished to you
their written opinion, dated such Time of Delivery, in form and substance satisfactory to you, to
the effect that:
(i) Calumet has been duly formed and is validly existing as a limited partnership under the
Indiana Act, with full partnership power and authority to own or lease its properties, to assume
the liabilities assumed by it pursuant to the Contribution Documents and to conduct its business,
in each case in all respects as described in the Registration Statement and the Prospectus.
Calumet is duly registered or qualified as a foreign limited partnership for the transaction of
business under the laws of the jurisdictions set forth under its name on Annex I to this Agreement.
(ii) Each of Calumet Shreveport and the Shreveport Subsidiaries has been duly formed and is
validly existing as a limited liability company under the Indiana LLC Act with all necessary
limited liability company power and authority to own or lease its properties, to assume the
liabilities being assumed by it pursuant to the Contribution Documents and to conduct its business,
in each case in all material respects as described in the Registration Statement and the
Prospectus. Each of Calumet Shreveport and the Shreveport Subsidiaries is duly registered or
qualified as a foreign limited liability company for the transaction of business under the laws of
the jurisdictions set forth under its name on Annex I to this Agreement.
(iii) The OLP GP is the sole general partner of Calumet with a 10% general partner interest in
Calumet; such general partner interest is duly authorized and validly issued in accordance with the
Calumet Agreement; and the OLP GP owns such general partner interest free and clear of all liens,
encumbrances, security interests, charges or claims (i) in respect of which a financing statement
under the Uniform Commercial Code of the State of Indiana naming the OLP GP as debtor is on file in
the office of the Secretary of State of the State of Indiana or (ii) otherwise known to such
counsel, without independent investigation, other than those created by or arising under the
Indiana Act and other than those arising under the Credit Agreements.
(iv) The Operating Company is the sole limited partner of Calumet with a 90% limited partner
interest in Calumet; such limited partner interest has been duly authorized and validly issued in
accordance with the Calumet Agreement and is fully paid (to the extent required under the Calumet
Agreement) and nonassessable (except as such nonassessability may be affected by IC 23-16-6-2 in
the Indiana Act); and the Operating Company owns such limited partner interest free and clear of
all liens, encumbrances, security interests, charges or claims (i) in respect of which a financing
statement under the Uniform Commercial Code of the State of Indiana naming the Operating Company as
debtor is on file in the office of the Secretary of State of the State of Indiana or (ii) otherwise
known to such counsel, without independent investigation, other than those created by or arising
under the Indiana Act and other than those arising under the Credit Agreements.
(v) Calumet owns a 100% membership interest in Calumet Shreveport; such membership interest
has been duly authorized and validly issued in accordance with the Shreveport Agreement and is
fully paid (to the extent required under the Shreveport Agreement) and nonassessable (except as
such nonassessability may be affected by IC 23-18-5-1(c) in the Indiana LLC Act); and Calumet owns
such membership interest free and clear of all liens, encumbrances, security interests, charges or
claims (i) in respect of which a financing statement under the Uniform Commercial Code of
29
the State of Indiana naming Calumet as debtor is on file in the office of the Secretary of
State of the State of Indiana or (ii) otherwise known to such counsel, without independent
investigation, other than those created by or arising under the Indiana LLC Act and other than
those arising under the Credit Agreements.
(vi) Calumet Shreveport owns a 100% membership interest in each of the Shreveport
Subsidiaries; such membership interests have been duly authorized and validly issued in accordance
with the Shreveport Subsidiary Agreements and are fully paid (to the extent required under the
Shreveport Subsidiary Agreements) and nonassessable (except as such nonassessability may be
affected by IC 23-18-5-1(c) in the Indiana LLC Act); and Calumet Shreveport owns such membership
interests free and clear of all liens, encumbrances, security interests, charges or claims (i) in
respect of which a financing statement under the Uniform Commercial Code of the State of Indiana
naming Calumet Shreveport as debtor is on file in the office of the Secretary of State of the State
of Indiana or (ii) otherwise known to such counsel, without independent investigation, other than
those created by or arising under the Indiana LLC Act and other than those arising under the Credit
Agreements.
(vii) The Partnership has been duly qualified or registered as a foreign limited partnership
for the transaction of business under the laws of the State of Indiana. Each of the General
Partner, the Operating Company, the OLP GP and the Operating LLCs has been duly qualified or
registered as a foreign limited liability company for the transaction of business under the laws of
the State of Indiana.
(viii) Except as described in the Prospectus, there are no options, warrants, preemptive
rights or other rights to subscribe for or to purchase, nor any restriction upon the voting or
transfer of, any partnership or membership interests in any of Calumet, Calumet Shreveport or the
Shreveport Subsidiaries (collectively, the
Indiana Partnership Entities
), in each case pursuant
to Calumet Agreement, the Calumet Shreveport Agreement and the Shreveport Subsidiary Agreements or,
to the knowledge of such counsel, any other agreement or instrument to which such entities are a
party or by which any of them may be bound.
(ix) Each of the Operative Agreements to which any of the Indiana Partnership Entities is a
party has been duly authorized and validly executed and delivered by each of the Indiana
Partnership Entities party thereto. Each of the Operative Agreements governed by Indiana law
constitutes a valid and legally binding agreement of the Partnership Entities party thereto,
enforceable against each such Partnership Entity in accordance with its respective terms, subject
to (i) applicable 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 (ii) public policy, applicable law relating to fiduciary duties and indemnification and an
implied covenant of good faith and fair dealing.
(x) None of the offering, issuance and sale by the Partnership of the Units being delivered at
such Time of Delivery, the execution, delivery and performance of this Agreement or the Operative
Agreements by the Partnership Entities which are parties thereto, or the consummation of the
transactions contemplated hereby and thereby (including the Transactions) (i) constitutes or will
constitute a violation of the organizational documents of any of the Indiana Partnership Entities,
(ii) constitutes or will constitute a breach or violation of, or a default (or an event which,
with notice or
30
lapse of time or both, would constitute such a default), or result in a lien, under any
mortgage, deed of trust, loan agreement, lease or other agreement or instrument known to such
counsel to which any of the Partnership Entities or their properties may be bound (other than the
any Operative Agreement or any other agreement filed as an exhibit to the Registration Statement),
or (iii) results or will result in any violation of the Indiana Act, the Indiana LLC Act or the
laws of the State of Indiana, or any order, judgment, decree or injunction known to such counsel of
any Indiana court or governmental agency or body to which any of the Partnership Entities or any of
their properties is subject, which breach, violation, lien or default in the case of clause (ii) or
(iii) would reasonably be expected to have a material adverse effect on the financial condition,
business or results of operations of the Partnership Entities taken as a whole.
(xi) Upon the consummation of the Transactions, (i) the liability of the Partnership for the
liabilities of Calumet arising solely from the status of the Partnership as the sole member of the
limited partner of Calumet will not be governed by the laws of the State of Indiana and (ii) the
liability of the Partnerships unitholders for the liabilities of the Partnership or the Operating
Subsidiaries arising solely from the status of the Partnerships unitholders as limited partners of
the Partnership will not be governed by the laws of the State of Indiana.
(xii) No permit, consent, approval, authorization, order, registration, filing or
qualification (consent) of or with any court, governmental agency or body of the State of Indiana
having jurisdiction over the Partnership Entities or any of their respective properties is required
for the issuance and sale of the Units by the Partnership, or for the conveyance of the properties
located in the State of Indiana purported to be conveyed to the Operating Subsidiaries pursuant to
the Contribution Documents, except (A) for such consents required under the Act, the Exchange Act
and state securities or Blue Sky laws, as to which such counsel need not express any opinion, (B)
for such consents which have been obtained or made, (C) for such consents which (i) are of a
routine or administrative nature, (ii) are not customarily obtained or made prior to the
consummation of transactions such as those contemplated by this Agreement and the Operative
Agreements and (iii) are expected in the reasonable judgment of the General Partner to be obtained
or made in the ordinary course of business subsequent to the consummation of the Transactions, (D)
for such consents which, if not obtained or made, would not, individually or in the aggregate, have
a material adverse effect upon the operations conducted or to be conducted as described in the
Prospectus in the State of Indiana by the Partnership Entities or (E) as disclosed in the
Prospectus.
(xiii) The execution, delivery and performance of the Contribution Documents relating to the
transfer of property in the State of Indiana has not violated and will not violate any statute of
the State of Indiana or any rule, regulation or, to the knowledge of such counsel, any order of any
agency of the State of Indiana having jurisdiction over any of the Partnership Entities or any of
their respective properties, except for any such violations which, individually or in the
aggregate, would not have a material adverse effect on the holders of Units or the operations
conducted in the State of Indiana by the Partnership Entities, taken as a whole.
In rendering such opinion, such counsel may (A) rely in respect of matters of fact upon
certificates of officers and employees of the Partnership Entities and upon information obtained
from public officials, (B) assume that all documents submitted to them as originals are authentic,
and all copies submitted to them conform to the originals thereof, and that the signatures on all
documents
31
examined by them are genuine, (C) state that such opinions are limited to the laws of the
State of Indiana, excepting therefrom municipal and local ordinances and regulations, (D) state
that they express no opinion with respect to (i) state or local taxes or tax statutes to which any
of the limited partners of the Partnership or any of the Partnership Entities may be subject, (ii)
title to any real or personal property, (iii) the accuracy of descriptions or references to real or
personal property or (iv) permits to own or operate any real or personal property, and (E) with
respect to the opinion in paragraph (i) rely upon certificates of foreign qualification provided by
the Secretary of State of Indiana (each of which shall be dated as of the date not more than
fourteen days prior to such Time of Delivery and provided to you.)
In rendering such opinion, such counsel shall state that (A) Vinson & Elkins L.L.P. and Baker
Botts L.L.P. are each authorized to rely upon such opinion letter in connection with the
Transactions as if such opinion letter were addressed and delivered to them on the date hereof and
(B) subject to the foregoing, such opinion letter may be relied upon only by the Underwriters and
its counsel in connection with the Transactions and no other use or distribution of this opinion
letter may be made without such counsels prior written consent;
(e) Cook, Yancey, King & Galloway APLC, with respect to the State of Louisiana, shall have
furnished to you their written opinion, dated such Time of Delivery, in form and substance
satisfactory to you, to the effect that:
(i) Calumet has been duly qualified or registered as a foreign limited partnership for the
transaction of business under the laws of the State of Louisiana. Each of the Operating LLCs has
been duly qualified or registered as a foreign limited liability company for the transaction of
business under the laws of the State of Louisiana. Reseller has been duly qualified or registered
as a foreign corporation for the transaction of business under the laws of the State of Louisiana.
(ii) Upon the consummation of the Transactions, (i) the liability of the Partnership for the
liabilities of Calumet arising solely from the status of the Partnership as the sole member of the
limited partner of Calumet will not be governed by the laws of the State of Louisiana and (ii) the
liability of the Partnerships unitholders for the liabilities of the Partnership or the Operating
Subsidiaries arising solely from the status of the Partnerships unitholders as limited partners of
the Partnership will not be governed by the laws of the State of Louisiana.
(iii) No permit, consent, approval, authorization, order, registration, filing or
qualification (consent) of or with any court, governmental agency or body of the State of
Louisiana having jurisdiction over the Partnership Entities or any of their respective properties
is required for the issuance and sale of the Units by the Partnership, except (A) for such consents
required under the Act, the Exchange Act and state securities or Blue Sky laws, as to which such
counsel need not express any opinion, (B) for such consents which have been obtained or made, (C)
for such consents which (i) are of a routine or administrative nature, (ii) are not customarily
obtained or made prior to the consummation of transactions such as those contemplated by this
Agreement and the Operative Agreements and (iii) are expected in the reasonable judgment of the
General Partner to be obtained or made in the ordinary course of business subsequent to the
consummation of the Transactions, (D) for such consents which, if not obtained or made, would not,
individually or in the aggregate, have a
32
material adverse effect upon the operations conducted or to be conducted as described in the
Prospectus in the State of Louisiana by the Partnership Entities or (E) as disclosed in the
Prospectus.
In rendering such opinion, such counsel may (A) rely in respect of matters of fact upon
certificates of officers and employees of the Partnership Entities and upon information obtained
from public officials, (B) assume that all documents submitted to them as originals are authentic,
and all copies submitted to them conform to the originals thereof, and that the signatures on all
documents examined by them are genuine, (C) state that such opinions are limited to the laws of the
State of Louisiana, excepting therefrom municipal and local ordinances and regulations, (D) state
that they express no opinion with respect to (i) state or local taxes or tax statutes to which any
of the limited partners of the Partnership or any of the Partnership Entities may be subject, (ii)
title to any real or personal property, (iii) the accuracy of descriptions or references to real or
personal property or (iv) permits to own or operate any real or personal property, and (E) with
respect to the opinion in paragraph (i) rely upon certificates of foreign qualification provided by
the Secretary of State of Louisiana (each of which shall be dated as of the date not more than
fourteen days prior to such Time of Delivery and provided to you.)
In rendering such opinion, such counsel shall state that (A) Vinson & Elkins L.L.P. and Baker
Botts L.L.P. are each authorized to rely upon such opinion letter in connection with the
Transactions as if such opinion letter were addressed and delivered to them on the date hereof and
(B) subject to the foregoing, such opinion letter may be relied upon only by the Underwriters and
its counsel in connection with the Transactions and no other use or distribution of this opinion
letter may be made without such counsels prior written consent.
(f) Fulbright & Jaworski L.L.P., special counsel for the Calumet Parties, shall have furnished
to you their written opinion, dated such Time of Delivery, in form and substance satisfactory to
you, to the effect that:
(i) The execution and delivery of this Agreement by the Calumet Parties and the performance by
the Calumet Parties of their obligations under this Agreement and the offering, issuance or sale by
the Partnership of the Units does not violate or constitute a default (or an event which, with
notice or lapse of time or both, would constitute such an event) under the provisions of the Credit
Agreements.
(ii) Each of the Credit Agreements constitutes the legal, valid and binding obligation of the
Partnership Entities party thereto, enforceable against each such Partnership Entity in accordance
with its respective terms, subject to (i) applicable 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 (ii) public policy, applicable law relating to fiduciary duties
and indemnification and an implied covenant of good faith and fair dealing.
In rendering such opinion, such counsel may (A) rely in respect of matters of fact upon
certificates of officers and employees of the Calumet Parties and upon information obtained from
public officials, (B) assume that all documents submitted to them as originals are authentic, that
all copies submitted to them conform to the originals thereof, and that the signatures on all
documents
33
examined by them are genuine and (C) state that such opinions are limited to the laws of the
State of New York, excepting therefrom municipal and local ordinances and regulations.
In rendering such opinion, such counsel shall state that (A) Vinson & Elkins L.L.P. and Baker
Botts L.L.P. are each authorized to rely upon such opinion letter in connection with the
Transactions as if such opinion letter were addressed and delivered to them on the date hereof and
(B) subject to the foregoing, such opinion letter may be relied upon only by the Underwriters and
its counsel in connection with the Transactions and no other use or distribution of this opinion
letter may be made without such counsels prior written consent.
(g) On the date of the Prospectus at a time prior to the execution of this Agreement, at 9:30
a.m., New York City time, on the effective date of any post-effective amendment to the Registration
Statement filed subsequent to the date of this Agreement and also at each Time of Delivery, Ernst &
Young LLP shall have furnished to you a letter or letters, dated the respective dates of delivery
thereof, in form and substance satisfactory to you, to the effect set forth in Annex II hereto (the
executed copy of the letter delivered prior to the execution of this Agreement is attached as Annex
II(a) hereto and a draft of the form of letter to be delivered on the effective date of any
post-effective amendment to the Registration Statement and as of each Time of Delivery is attached
as Annex II(b) hereto);
(h) (i) None of the Partnership Entities shall have sustained since the date of the latest
audited financial statements included in the 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, otherwise than as set forth or
contemplated in the Prospectus, and (ii) since the respective dates as of which information is
given in the Prospectus there shall not have been any change in the capitalization or long-term
debt of any of the Partnership Entities or any change, or any development involving a prospective
change, in or affecting the general affairs, management, financial position, partners equity,
members equity or results of operations of any of the Partnership Entities otherwise than as set
forth or contemplated in the Prospectus, the effect of which, in any such case described in clause
(i) or (ii), is in the judgment of the Underwriters so material and adverse as to make it
impracticable or inadvisable to proceed with the public offering or the delivery of the Units being
delivered at such Time of Delivery on the terms and in the manner contemplated in the Prospectus;
(i) On or after the Applicable Time, (i) no downgrading shall have occurred in the rating
accorded the debt securities of any Partnership Entity by any nationally recognized statistical
rating organization, as that term is defined by the Commission for purposes of Rule 463(g)(2)
under the 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 of the debt
securities of any Partnership Entity;
(j) 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 New York Stock Exchange
or NASDAQ; (ii) a suspension or material limitation in trading in the Partnerships securities on
NASDAQ; (iii) a general moratorium on commercial banking activities declared by Federal, New York
State or Indiana State authorities or a material disruption in commercial banking or securities
settlement or clearance services in the United States; or (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
34
(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 the judgment of Goldman, Sachs & Co. makes it impracticable or inadvisable to
proceed with the public offering or the delivery of the Units being delivered at such Time of
Delivery on the terms and in the manner contemplated in the Prospectus;
(k) The Units to be sold at such Time of Delivery shall have been duly admitted for trading
and quotation on NASDAQ;
(l) The Partnership has obtained and delivered to the Underwriters executed copies of a letter
agreement from each officer and director of the General Partner and from each of the Directed Unit
Participants, substantially to the effect set forth in Subsection 5(e) hereof in form and substance
satisfactory to you;
(m) The Partnership shall have complied with the provisions of Section 5(c) hereof with
respect to the furnishing of prospectuses on the New York Business Day next succeeding the date of
this Agreement;
(n) The Partnership shall have furnished or caused to be furnished to you at such Time of
Delivery certificates of officers of the Calumet Parties satisfactory to you as to the accuracy of
the representations and warranties of the Calumet Parties herein at and as of such Time of
Delivery, as to the performance by the Calumet Parties all of their obligations hereunder to be
performed at or prior to such Time of Delivery, as to the matters set forth in subsections (a) and
(h) of this Section and as to such other matters as you may reasonably request;
(o) The Transactions shall have been consummated.
9.
Indemnification
.
(a) The Calumet Parties, jointly and severally, 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 filed or required to be
filed by 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 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 incurred; provided, however, that each of the Calumet
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 Partnership by any Underwriter through Goldman, Sachs & Co.
expressly for use therein.
35
(b) Each Underwriter will indemnify and hold harmless the Calumet Parties against any losses,
claims, damages or liabilities to which any of the Calumet 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 Partnership by such Underwriter through Goldman, Sachs & Co.
expressly for use therein; and will reimburse the Calumet Parties for any legal or other expenses
reasonably incurred by the Calumet 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 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 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,
36
claims, damages or liabilities (or actions in respect thereof) in such proportion as is
appropriate to reflect the relative benefits received by the Calumet Parties on the one hand and
the Underwriters on the other from the offering of the 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 Calumet
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 Calumet 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 Partnership 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 Calumet 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. Each of the Calumet 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 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 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 11(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.
(e) The obligations of the Calumet Parties under this Section 9 shall be in addition to any
liability which they 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 each officer and director of the
General Partner (including any person who, with his or her consent, is named in the Registration
Statement as about to become a director of the General Partner) and to each person, if any, who
controls any of the Calumet Parties within the meaning of the Act.
37
10.
Underwriters
.
(a) If any Underwriter shall default in its obligation to purchase the 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 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
Units, then the Partnership 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 Units on such terms.
In the event that, within the respective prescribed periods, you notify the Partnership that you
have so arranged for the purchase of such Units, or the Partnership notifies you that it has so
arranged for the purchase of such Units, you or the Partnership 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 Partnership agrees to file promptly any amendments or
supplements to the Registration 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 10 with like effect as if such person had originally been a party to
this Agreement with respect to such Units.
(b) If, after giving effect to any arrangements for the purchase of the Units of a defaulting
Underwriter or Underwriters by you and the Partnership as provided in subsection (a) above, the
aggregate number of such Units which remains unpurchased does not exceed one-eleventh of the
aggregate number of all the Units to be purchased at such Time of Delivery, then the Partnership
shall have the right to require each non-defaulting Underwriter to purchase the number of 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
Units which such Underwriter agreed to purchase hereunder) of the 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 Units of a defaulting
Underwriter or Underwriters by you and the Partnership as provided in subsection (a) above, the
aggregate number of such Units which remains unpurchased exceeds one-eleventh of the aggregate
number of all the Units to be purchased at such Time of Delivery, or if the Partnership shall not
exercise the right described in subsection (b) above to require non-defaulting Underwriters to
purchase Units of a defaulting Underwriter or Underwriters, then this Agreement (or, with respect
to the Second Time of Delivery, the obligations of the Underwriters to purchase and of the
Partnership to sell the Optional Units) shall thereupon terminate, without liability on the part of
any non-defaulting Underwriter or the Partnership, except for the expenses to be borne by the
Partnership and the Underwriters as provided in Sections 7 and 12 hereof and the indemnity and
contribution agreements in Section 9 hereof; but nothing herein shall relieve a defaulting
Underwriter from liability for its default.
11. The respective indemnities, agreements, representations, warranties and other statements
of the Partnership 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
38
Underwriter or any controlling person of any Underwriter, or the Partnership, or any officer
or director or controlling person of the General Partner, and shall survive delivery of and payment
for the Units.
12. If this Agreement shall be terminated pursuant to Section 10 hereof, the Partnership 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 Units are not delivered by or on behalf of the Partnership as
provided herein, the Partnership will 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
Units not so delivered, but the Partnership shall then be under no further liability to any
Underwriter except as provided in Sections 7 and 9 hereof.
13. In all dealings hereunder, you 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 you jointly or by Goldman, Sachs & Co. on behalf of
you as the representatives of the several Underwriters.
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 of the several Underwriters in care of Goldman, Sachs & Co., One New York Plaza,
42nd Floor, New York, New York 10004, Attention: Registration Department; and if to the Partnership
shall be delivered or sent by mail, telex or facsimile transmission to the address of the
Partnership set forth in the Registration Statement, Attention: Secretary; and if to a party to the
lockup letters described in Section 8(l) shall be delivered or sent by mail, telex or facsimile
transmission to the address set forth in such partys lockup letter; provided, however, that
notices under Section 9(c) 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 Partnership by you upon request;
provided, however, that notices under Section 5(e) 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 at Goldman, Sachs & Co., 85 Broad Street, New York, New York 10004, Attention:
Control Room. Any such statements, requests, notices or agreements shall take effect upon receipt
thereof.
14. This Agreement shall be binding upon, and inure solely to the benefit of, the
Underwriters, the Calumet Parties and, to the extent provided in Sections 9 and 11 hereof, the
officers and directors of the General Partner and each person who controls the Partnership 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 Units from any Underwriter shall be deemed a successor or assign by reason merely of
such purchase.
15. This Agreement supersedes all prior agreements and understandings (whether written or
oral) between the Partnership and the Underwriters, or any of them, with respect to the subject
matter hereof; provided that each of (i) the letter agreement dated as of January 19, 2006 between
Goldman Sachs & Co. and Calumet and (ii) the letter agreement dated as of January 19, 2006 between
Petrie Parkman & Co., Inc. and Calumet shall remain in full force and effect in accordance with its
terms.
39
16. Time shall be of the essence of this Agreement. As used herein, the term business day
shall mean any day when the Commissions office in Washington, D.C. is open for business.
17. Each of the Calumet 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.
18. This Agreement shall be governed by and construed in accordance with the laws of the State
of New York.
19. 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.
20. Notwithstanding anything herein to the contrary, the Partnership is authorized, subject to
applicable law, to disclose to any persons any and all aspects of this potential transaction that
are necessary to support any U.S. federal and state income tax treatment and tax structure of the
potential transaction and all materials of any kind (including tax opinions and other tax analyses)
relating to such treatment and structure, without the Underwriters imposing any limitation of any
kind. However, any information relating to the tax treatment and tax structure shall remain
confidential (and the foregoing sentence shall not apply) to the extent necessary to enable any
person to comply with applicable securities laws. For this purpose, tax structure is limited to
any facts that may be relevant to that treatment.
If the foregoing is in accordance with your understanding, please sign and return to us seven
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 each of the Calumet 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 Partnership for examination upon
request, but without warranty on your part as to the authority of the signers thereof.
40
[Signature page follows.]
41
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Very truly yours,
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CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
|
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By:
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Calumet GP, LLC, its general partner
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By:
|
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/s/ R. Patrick Murray, II
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Name: R. Patrick Murray, II
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Title: Vice President and Chief Financial Officer
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CALUMET LUBRICANTS CO., LIMITED PARTNERSHIP
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By: Calumet, Incorporated, its general partner
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By:
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/s/ R. Patrick Murray, II
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Name: R. Patrick Murray, II
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Title: Vice President and Chief Financial Officer
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CALUMET GP, LLC
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By:
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/s/ R. Patrick Murray, II
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Name: R. Patrick Murray, II
|
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Title: Vice President and Chief Financial Officer
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CALUMET OPERATING, LLC
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By: Calumet Specialty Products Partners, L.P., its sole member
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By: Calumet GP, LLC, its general partner
|
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|
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By:
|
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/s/ R. Patrick Murray, II
|
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Name: R. Patrick Murray, II
|
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Title: Vice President and Chief Financial Officer
|
42
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CALUMET LP GP, LLC
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By:
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Calumet, Incorporated, its sole member
|
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By:
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/s/ R. Patrick Murray, II
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Name: R. Patrick Murray, II
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Title: Vice President and Chief Financial Officer
|
43
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Accepted as of the date hereof:
|
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|
|
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|
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Goldman, Sachs & Co.
|
|
|
Deutsche Bank Securities Inc.
|
|
|
Raymond James & Associates, Inc.
|
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|
Petrie Parkman & Co., Inc.
|
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/s/ Goldman, Sachs & Co.
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(Goldman, Sachs & Co.)
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On behalf of each of the Underwriters
|
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|
44
SCHEDULE I
|
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Number of Optional
|
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Units to be
|
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Total Number of
|
|
Purchased if
|
|
|
Firm Units
|
|
Maximum Option
|
Underwriter
|
|
to be Purchased
|
|
Exercised
|
Goldman, Sachs & Co.
|
|
|
3,599,936
|
|
|
|
539,990
|
|
Deutsche Bank Securities Inc.
|
|
|
959,983
|
|
|
|
143,997
|
|
Raymond James & Associates, Inc.
|
|
|
959,983
|
|
|
|
143,997
|
|
Petrie Parkman & Co., Inc.
|
|
|
179,998
|
|
|
|
27,001
|
|
|
|
|
|
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Total
|
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|
5,699,900
|
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|
854,985
|
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SCHEDULE II(A)
Materials Other Than the Pricing Prospectus
That Comprise the Pricing Disclosure Package
None.
SCHEDULE II(B)
Issuer Free Writing Prospectuses Not Included
in the Pricing Disclosure Package
1. The Calumet Specialty Products Partners, L.P. Institutional Electronic Roadshow made available
via Netroadshow at
www.netroadshow.com/custom/gsc
.
2. The Electronic Retail Roadshow for Calumet Specialty Products Partners, L.P. made available via
Netroadshow at
http://www.retailroadshow.com/links/show.asp?c=CLMT5CZ3AR
.
ANNEX I
FOREIGN QUALIFICATIONS
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Calumet Specialty Products Partners, L.P.
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Indiana
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Calumet Operating, LLC
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Indiana
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Calumet LP GP, LLC
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Arkansas
|
California
|
Florida
|
Georgia
|
Illinois
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Indiana
|
Massachusetts
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Mississippi
|
Ohio
|
South Carolina
|
Texas
|
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|
|
|
|
Calumet Lubricants Co., Limited Partnership
|
Arkansas
|
California
|
Connecticut
|
Florida
|
Georgia
|
Illinois
|
Indiana
|
Kentucky
|
Louisiana
|
Massachusetts
|
Mississippi
|
Missouri
|
New Jersey
|
New York
|
Ohio
|
Pennsylvania
|
South Carolina
|
Texas
|
Utah
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|
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Calumet Shreveport, LLC
|
Louisiana
|
|
|
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Calumet Shreveport Lubricants & Waxes, LLC
|
Arkansas
|
California
|
Connecticut
|
Florida
|
Georgia
|
Illinois
|
Indiana
|
Kentucky
|
Louisiana
|
Mississippi
|
Missouri
|
New Jersey
|
Ohio
|
Texas
|
Virginia
|
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|
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|
Calumet Shreveport Fuels, LLC
|
Arkansas
|
Connecticut
|
Georgia
|
Illinois
|
Indiana
|
Kentucky
|
Louisiana
|
Mississippi
|
Missouri
|
Ohio
|
Texas
|
Virginia
|
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Calumet Sales Company Incorporated
|
Louisiana
|
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Calumet GP, LLC
|
Indiana
|
ANNEX II(a)
[Comfort Letter of Ernst & Young LLP]
ANNEX II(b)
[Bring-down Comfort Letter of Ernst & Young LLP]
Exhibit
3.1
FIRST AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP
OF
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
|
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TABLE OF CONTENTS
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ARTICLE I
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DEFINITIONS
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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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21
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ARTICLE II
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ORGANIZATION
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Section 2.1 Formation
|
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21
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Section 2.2 Name
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22
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Section 2.3 Registered Office; Registered Agent; Principal Office; Other Offices
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22
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Section 2.4 Purpose and Business
|
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22
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Section 2.5 Powers
|
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23
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Section 2.6 Power of Attorney
|
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23
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Section 2.7 Term
|
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24
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Section 2.8 Title to Partnership Assets
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24
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ARTICLE III
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RIGHTS OF LIMITED PARTNERS
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Section 3.1 Limitation of Liability
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25
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Section 3.2 Management of Business
|
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25
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Section 3.3 Outside Activities of the Limited Partners
|
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25
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Section 3.4 Rights of Limited Partners
|
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25
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ARTICLE IV
|
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CERTIFICATES; RECORD HOLDERS; TRANSFER OF
PARTNERSHIP INTERESTS; REDEMPTION OF
PARTNERSHIP INTERESTS
|
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|
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Section 4.1 Certificates
|
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26
|
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Section 4.2 Mutilated, Destroyed, Lost or Stolen Certificates
|
|
|
27
|
|
Section 4.3 Record Holders
|
|
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28
|
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Section 4.4 Transfer Generally
|
|
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28
|
|
Section 4.5 Registration and Transfer of Limited Partner Interests
|
|
|
28
|
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Section 4.6 Transfer of the General Partners General Partner Interest
|
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29
|
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Section 4.7 Transfer of Incentive Distribution Rights
|
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30
|
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Section 4.8 Restrictions on Transfers
|
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|
30
|
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Section 4.9 Citizenship Certificates; Non-citizen Assignees
|
|
|
32
|
|
Section 4.10 Redemption of Partnership Interests of Non-citizen Assignees
|
|
|
33
|
|
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
|
|
|
|
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ARTICLE V
|
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|
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CAPITAL CONTRIBUTIONS AND ISSUANCE OF
PARTNERSHIP INTERESTS
|
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Section 5.1 Organizational Contributions
|
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|
35
|
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Section 5.2 Contributions by the General Partner and its Affiliates
|
|
|
35
|
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Section 5.3 Contributions by Initial Limited Partners
|
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36
|
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Section 5.4 Interest and Withdrawal
|
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36
|
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Section 5.5 Capital Accounts
|
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|
37
|
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Section 5.6 Issuances of Additional Partnership Securities
|
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|
40
|
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Section 5.7 Limitations on Issuance of Additional Partnership Securities
|
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|
41
|
|
Section 5.8 Conversion of Subordinated Units
|
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|
45
|
|
Section 5.9 Limited Preemptive Right
|
|
|
45
|
|
Section 5.10 Splits and Combinations
|
|
|
45
|
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Section 5.11 Fully Paid and Non-Assessable Nature of Limited Partner Interests
|
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46
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ARTICLE VI
|
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|
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ALLOCATIONS AND DISTRIBUTIONS
|
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|
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|
|
Section 6.1 Allocations for Capital Account Purposes
|
|
|
46
|
|
Section 6.2 Allocations for Tax Purposes
|
|
|
55
|
|
Section 6.3 Requirement and Characterization of Distributions; Distributions to Record Holders
|
|
|
57
|
|
Section 6.4 Distributions of Available Cash from Operating Surplus
|
|
|
57
|
|
Section 6.5 Distributions of Available Cash from Capital Surplus
|
|
|
60
|
|
Section 6.6 Adjustment of Minimum Quarterly Distribution and Target Distribution Levels
|
|
|
60
|
|
Section 6.7 Special Provisions Relating to the Holders of Subordinated Units
|
|
|
60
|
|
Section 6.8 Special Provisions Relating to the Holders of Incentive Distribution Rights
|
|
|
61
|
|
Section 6.9 Special Provisions Relating to the Fehsenfeld Investors
|
|
|
61
|
|
Section 6.10 Entity-Level Taxation
|
|
|
62
|
|
|
|
|
|
|
ARTICLE VII
|
|
|
|
|
|
|
|
|
|
MANAGEMENT AND OPERATION OF BUSINESS
|
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|
|
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|
|
|
Section 7.1 Management
|
|
|
62
|
|
Section 7.2 Certificate of Limited Partnership
|
|
|
64
|
|
Section 7.3 Restrictions on the General Partners Authority
|
|
|
65
|
|
Section 7.4 Reimbursement of the General Partner
|
|
|
65
|
|
Section 7.5 Outside Activities
|
|
|
66
|
|
Section 7.6 Loans from the General Partner; Loans or Contributions from the Partnership or Group Members
|
|
|
67
|
|
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
ii
|
|
|
|
|
Section 7.7 Indemnification
|
|
|
68
|
|
Section 7.8 Liability of Indemnitees
|
|
|
69
|
|
Section 7.9 Resolution of Conflicts of Interest; Standards of Conduct and
Modification of Duties
|
|
|
70
|
|
Section 7.10 Other Matters Concerning the General Partner
|
|
|
72
|
|
Section 7.11 Purchase or Sale of Partnership Securities
|
|
|
72
|
|
Section 7.12 Registration Rights of the General Partner and its Affiliates
|
|
|
72
|
|
Section 7.13 Reliance by Third Parties
|
|
|
76
|
|
|
|
|
|
|
ARTICLE VIII
|
|
|
|
|
|
|
|
|
|
BOOKS, RECORDS, ACCOUNTING AND REPORTS
|
|
|
|
|
|
|
|
|
|
Section 8.1 Records and Accounting
|
|
|
76
|
|
Section 8.2 Fiscal Year
|
|
|
77
|
|
Section 8.3 Reports
|
|
|
77
|
|
|
|
|
|
|
ARTICLE IX
|
|
|
|
|
|
|
|
|
|
TAX MATTERS
|
|
|
|
|
|
|
|
|
|
Section 9.1 Tax Returns and Information
|
|
|
77
|
|
Section 9.2 Tax Elections
|
|
|
77
|
|
Section 9.3 Tax Controversies
|
|
|
78
|
|
Section 9.4 Withholding
|
|
|
78
|
|
|
|
|
|
|
ARTICLE X
|
|
|
|
|
|
|
|
|
|
ADMISSION OF PARTNERS
|
|
|
|
|
|
|
|
|
|
Section 10.1 Admission of Limited Partners
|
|
|
78
|
|
Section 10.2 Admission of Successor General Partner
|
|
|
79
|
|
Section 10.3 Amendment of Agreement and Certificate of Limited Partnership
|
|
|
79
|
|
|
|
|
|
|
ARTICLE XI
|
|
|
|
|
|
|
|
|
|
WITHDRAWAL OR REMOVAL OF PARTNERS
|
|
|
|
|
|
|
|
|
|
Section 11.1 Withdrawal of the General Partner
|
|
|
80
|
|
Section 11.2 Removal of the General Partner
|
|
|
81
|
|
Section 11.3 Interest of Departing General Partner and Successor General Partner
|
|
|
82
|
|
Section 11.4 Termination of Subordination Period, Conversion of Subordinated Units and
Extinguishment of Cumulative Common Unit Arrearages
|
|
|
83
|
|
Section 11.5 Withdrawal of Limited Partners
|
|
|
84
|
|
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
iii
|
|
|
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|
ARTICLE XII
|
|
|
|
|
|
|
|
|
|
DISSOLUTION AND LIQUIDATION
|
|
|
|
|
|
|
|
|
|
Section 12.1 Dissolution
|
|
|
84
|
|
Section 12.2 Continuation of the Business of the Partnership After Dissolution
|
|
|
84
|
|
Section 12.3 Liquidator
|
|
|
85
|
|
Section 12.4 Liquidation
|
|
|
86
|
|
Section 12.5 Cancellation of Certificate of Limited Partnership
|
|
|
86
|
|
Section 12.6 Return of Contributions
|
|
|
86
|
|
Section 12.7 Waiver of Partition
|
|
|
87
|
|
Section 12.8 Capital Account Restoration
|
|
|
87
|
|
|
|
|
|
|
ARTICLE XIII
|
|
|
|
|
|
|
|
|
|
AMENDMENT OF PARTNERSHIP AGREEMENT;
MEETINGS; RECORD DATE
|
|
|
|
|
|
|
|
|
|
Section 13.1 Amendments to be Adopted Solely by the General Partner
|
|
|
87
|
|
Section 13.2 Amendment Procedures
|
|
|
88
|
|
Section 13.3 Amendment Requirements
|
|
|
89
|
|
Section 13.4 Special Meetings
|
|
|
90
|
|
Section 13.5 Notice of a Meeting
|
|
|
90
|
|
Section 13.6 Record Date
|
|
|
90
|
|
Section 13.7 Adjournment
|
|
|
91
|
|
Section 13.8 Waiver of Notice; Approval of Meeting; Approval of Minutes
|
|
|
91
|
|
Section 13.9 Quorum and Voting
|
|
|
91
|
|
Section 13.10 Conduct of a Meeting
|
|
|
92
|
|
Section 13.11 Action Without a Meeting
|
|
|
92
|
|
Section 13.12 Right to Vote and Related Matters
|
|
|
93
|
|
|
|
|
|
|
ARTICLE XIV
|
|
|
|
|
|
|
|
|
|
MERGER
|
|
|
|
|
|
|
|
|
|
Section 14.1 Authority
|
|
|
93
|
|
Section 14.2 Procedure for Merger or Consolidation
|
|
|
93
|
|
Section 14.3 Approval by Limited Partners of Merger or Consolidation
|
|
|
94
|
|
Section 14.4 Certificate of Merger
|
|
|
95
|
|
Section 14.5 Amendment of Partnership Agreement
|
|
|
95
|
|
Section 14.6 Effect of Merger
|
|
|
96
|
|
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
iv
|
|
|
|
|
ARTICLE XV
|
|
|
|
|
|
|
|
|
|
RIGHT TO ACQUIRE LIMITED PARTNER INTERESTS
|
|
|
|
|
|
|
|
|
|
Section 15.1 Right to Acquire Limited Partner Interests
|
|
|
96
|
|
|
|
|
|
|
ARTICLE XVI
|
|
|
|
|
|
|
|
|
|
GENERAL PROVISIONS
|
|
|
|
|
|
|
|
|
|
Section 16.1 Addresses and Notices
|
|
|
98
|
|
Section 16.2 Further Action
|
|
|
99
|
|
Section 16.3 Binding Effect
|
|
|
99
|
|
Section 16.4 Integration
|
|
|
99
|
|
Section 16.5 Creditors
|
|
|
99
|
|
Section 16.6 Waiver
|
|
|
99
|
|
Section 16.7 Counterparts
|
|
|
99
|
|
Section 16.8 Applicable Law
|
|
|
99
|
|
Section 16.9 Invalidity of Provisions
|
|
|
100
|
|
Section 16.10 Consent of Partners
|
|
|
100
|
|
Section 16.11 Facsimile Signatures
|
|
|
100
|
|
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF CALUMET SPECIALTY
PRODUCTS PARTNERS, L.P.
THIS FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF CALUMET SPECIALTY PRODUCTS
PARTNERS, L.P., dated as of January 31, 2006, is entered into by and between Calumet GP, LLC, a
Delaware limited liability company, as the General Partner, and The Heritage Group, an Indiana
general partnership, Calumet, Incorporated, an Indiana corporation, F. William Grube, Fred M.
Fehsenfeld, Jr., Mildred L. Fehsenfeld Irrevocable Intervivos Trust for the benefit of Fred Mehlert
Fehsenfeld, Jr. and his issue, and Maggie Fehsenfeld Trust Number 106 for the benefit of Fred
Mehlert Fehsenfeld, Jr. and his issue, as the Organizational Limited Partners, 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.
Accretion Test
has the meaning assigned to such term in Section 5.7(g).
Acquisition
means any transaction in which any Group Member acquires (through an asset
acquisition, merger, stock acquisition or other form of investment) control over all or a portion
of the assets, properties or business of another Person for the purpose of increasing the operating
capacity or revenues of the Partnership Group from the operating capacity or revenues of the
Partnership Group existing immediately prior to such transaction.
Additional Book Basis
means the portion of any remaining Carrying Value of an Adjusted
Property that is attributable to positive adjustments made to such Carrying Value as a result of
Book-Up Events. For purposes of determining the extent that Carrying Value constitutes Additional
Book Basis:
(a) Any negative adjustment made to the Carrying Value of an Adjusted Property as a result of
either a Book-Down Event or a Book-Up Event shall first be deemed to offset or decrease that
portion of the Carrying Value of such Adjusted Property that is attributable to any prior positive
adjustments made thereto pursuant to a Book-Up Event or Book-Down Event.
(b) If Carrying Value that constitutes Additional Book Basis is reduced as a result of a
Book-Down Event and the Carrying Value of other property is increased as a result of such Book-Down
Event, an allocable portion of any such increase in Carrying Value shall be treated as Additional
Book Basis;
provided
, that the amount treated as Additional Book Basis
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
pursuant hereto as a result of such Book-Down Event shall not exceed the amount by which the
Aggregate Remaining Net Positive Adjustments after such Book-Down Event exceeds the remaining
Additional Book Basis attributable to all of the Partnerships Adjusted Property after such
Book-Down Event (determined without regard to the application of this clause (b) to such Book-Down
Event).
Additional Book Basis Derivative Items
means any Book Basis Derivative Items that are
computed with reference to Additional Book Basis. To the extent that the Additional Book Basis
attributable to all of the Partnerships Adjusted Property as of the beginning of any taxable
period exceeds the Aggregate Remaining Net Positive Adjustments as of the beginning of such period
(the Excess Additional Book Basis), the Additional Book Basis Derivative Items for such period
shall be reduced by the amount that bears the same ratio to the amount of Additional Book Basis
Derivative Items determined without regard to this sentence as the Excess Additional Book Basis
bears to the Additional Book Basis as of the beginning of such period.
Adjusted Capital Account
means the Capital Account maintained for each Partner as of the end
of each fiscal year 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) 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 fiscal
year, are reasonably expected to be allocated to such Partner in subsequent years 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 fiscal year, are reasonably expected to be
made to such Partner in subsequent years in accordance with the terms of this Agreement or
otherwise to the extent they exceed offsetting increases to such Partners Capital Account that are
reasonably expected to occur during (or prior to) the year in which such distributions are
reasonably expected to be made (other than increases as a result of a minimum gain chargeback
pursuant to Section 6.1(d)(i) or 6.1(d)(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 a General Partner Unit, a Common Unit, a Subordinated Unit or an Incentive Distribution Right or
any other Partnership Interest shall be the amount that such Adjusted Capital Account would be if
such General Partner Unit, Common Unit, Subordinated Unit, Incentive Distribution Right or other
Partnership Interest were the only interest in the Partnership held by such Partner from and after
the date on which such General Partner Unit, Common Unit, Subordinated Unit, Incentive Distribution
Right or other Partnership Interest was first issued.
Adjusted Operating Surplus
means, with respect to any period, Operating Surplus generated
with respect to such period (a) less (i) any net increase in Working Capital Borrowings with
respect to such period and (ii) any net decrease in cash reserves for Operating Expenditures with
respect to such period not relating to an Operating Expenditure made with respect to such period,
and (b) plus (i) any net decrease in Working Capital Borrowings with respect to such period, and
(ii) any net increase in cash reserves for Operating Expenditures with respect to such period
required by any debt instrument for the repayment of principal, interest or premium.
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
2
Adjusted Operating Surplus does not include that portion of Operating Surplus included in
clauses (a)(i) and (a)(ii) of the definition of Operating Surplus.
Adjusted Property
means any property the Carrying Value of which has been adjusted pursuant
to Section 5.5(d)(i) or 5.5(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.
Aggregate Remaining Net Positive Adjustments
means, as of the end of any taxable period, the
sum of the Remaining Net Positive Adjustments of all the Partners.
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 or
other consideration at the time of contribution as determined by the General Partner. The General
Partner shall use such method as it determines to be appropriate to allocate the aggregate Agreed
Value of Contributed Properties contributed to the Partnership in a single or integrated
transaction among each separate property on a basis proportional to the fair market value of each
Contributed Property.
Agreement
means this First Amended and Restated Agreement of Limited Partnership of Calumet
Specialty Products Partners, L.P., as it may be amended, supplemented or restated 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 or partner 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.
Available Cash
means, with respect to any Quarter ending prior to the Liquidation Date:
(a) the sum of (i) all cash and cash equivalents of the Partnership Group on hand at the end
of such Quarter, and (ii) all additional cash and cash equivalents of the Partnership Group on hand
on the date of determination of Available Cash with respect to such Quarter resulting from Working
Capital Borrowings made subsequent to the end of such Quarter, less
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
3
(b) the amount of any cash reserves established by the General Partner to (i) provide for the
proper conduct of the business of the Partnership Group (including reserves for future capital
expenditures and for anticipated future credit needs of the Partnership Group) subsequent to such
Quarter, (ii) comply with applicable law or any loan agreement, security agreement, mortgage, debt
instrument or other agreement or obligation to which any Group Member is a party or by which it is
bound or its assets are subject or (iii) provide funds for distributions under Section 6.4 or 6.5
in respect of any one or more of the next four Quarters;
provided
,
however
, that the General
Partner may not establish cash reserves pursuant to (iii) above if the effect of such reserves
would be that the Partnership is unable to distribute the Minimum Quarterly Distribution on all
Common Units, plus any Cumulative Common Unit Arrearage on all Common Units, with respect to such
Quarter; and, provided further, that disbursements made by a Group Member or cash reserves
established, increased or reduced after the end of such Quarter but on or before the date of
determination of Available Cash with respect to such Quarter shall be deemed to have been made,
established, increased or reduced, for purposes of determining Available Cash, within such Quarter
if the General Partner so determines.
Notwithstanding the foregoing,
Available Cash
with respect to the Quarter in which the
Liquidation Date occurs and any subsequent Quarter shall equal zero.
Board of Directors
means, with respect to the Board of Directors of the General Partner, its
board of directors or managers, as applicable, if a corporation or limited liability company, or if
a limited partnership, the board of directors or board of managers of the general partner of the
General Partner.
Book Basis Derivative Items
means any item of income, deduction, gain or loss included in
the determination of Net Income or Net Loss that is computed with reference to the Carrying Value
of an Adjusted Property (e.g., depreciation, depletion, or gain or loss with respect to an Adjusted
Property).
Book-Down Event
means an event that triggers a negative adjustment to the Capital Accounts
of the Partners pursuant to Section 5.5(d).
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 federal income tax
purposes as of such date. A Partners share of the Partnerships Book-Tax Disparities in all of its
Contributed Property and Adjusted Property will be reflected by the difference between such
Partners Capital Account balance as maintained pursuant to Section 5.5 and the hypothetical
balance of such Partners Capital Account computed as if it had been maintained strictly in
accordance with federal income tax accounting principles.
Book-Up Event
means an event that triggers a positive adjustment to the Capital Accounts of
the Partners pursuant to Section 5.5(d).
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
4
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 or the State of Indiana shall
not be regarded as a Business Day.
Capital Account
means the capital account maintained for a Partner pursuant to Section 5.5.
The
Capital Account
of a Partner in respect of a General Partner Unit, a Common Unit, a
Subordinated Unit, an Incentive Distribution Right or any other Partnership Interest shall be the
amount that such Capital Account would be if such General Partner Unit, Common Unit, Subordinated
Unit, Incentive Distribution Right or other Partnership Interest were the only interest in the
Partnership held by such Partner from and after the date on which such General Partner Unit, Common
Unit, Subordinated Unit, Incentive Distribution Right or other Partnership Interest was first
issued.
Capital Contribution
means any cash, cash equivalents or the Net Agreed Value of Contributed
Property that a Partner contributes to the Partnership.
Capital Improvement
means any (a) addition or improvement to the capital assets owned by any
Group Member or (b) acquisition of existing, or the construction of new, capital assets (including
refineries, pipelines, terminals, docks, truck racks, tankage and other refining, storage and
distribution facilities and related assets), in each case if such addition, improvement,
acquisition or construction is made to increase the operating capacity or revenues of the
Partnership Group from the operating capacity or revenues of the Partnership Group existing
immediately prior to such addition, improvement, acquisition or construction.
Capital Surplus
has the meaning assigned to such term in Section 6.3(a).
Carrying Value
means (a) with respect to a Contributed 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 Contributed Property, and
(b) with respect to any other Partnership property, the adjusted basis of such property for 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 Sections 5.5(d)(i) and 5.5(d)(ii) 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 the General Partner liable for actual fraud or willful misconduct in its capacity as a
general partner of the Partnership.
Certificate
means (a) a certificate (i) substantially in the form of Exhibit A to this
Agreement, (ii) issued in global form in accordance with the rules and regulations of the
Depositary or (iii) in such other form as may be adopted by the General Partner, issued by the
Partnership evidencing ownership of one or more Common Units or (b) a certificate, in such form as
may be adopted by the General Partner, issued by the Partnership evidencing ownership of one or
more other Partnership Securities.
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
5
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.
Citizenship Certification
means a properly completed certificate in such form as may be
specified by the General Partner by which a Limited 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 Citizen.
claim
(as used in Section 7.12(d)) has the meaning assigned to such term in Section 7.12(d).
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
has the meaning assigned to such term in Section 15.1(a).
Code
means the 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.
Combined Interest
has the meaning assigned to such term in Section 11.3(a).
Commenced Commercial Service
and
Commencement of Commercial Service
shall mean the date a
Capital Improvement is first put into service following completion of construction and testing.
Commission
means the United States Securities and Exchange Commission.
Common Unit
means a Unit representing 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. The term Common Unit does not include a Subordinated Unit prior to its conversion
into a Common Unit pursuant to the terms hereof.
Common Unit Arrearage
means, with respect to any Common Unit, whenever issued, as to any
Quarter within the Subordination Period, the excess, if any, of (a) the Minimum Quarterly
Distribution with respect to a Common Unit in respect of such Quarter over (b) the sum of all
Available Cash distributed with respect to a Common Unit in respect of such Quarter pursuant to
Section 6.4(a)(i).
Common Unit Purchase Agreement
means that certain Common Unit Purchase Agreement dated as of
January 25, 2006 among the Fehsenfeld Investors, the General Partner and the Partnership, providing
for the purchase of Fehsenfeld Common Units by the Fehsenfeld Investors.
Conflicts Committee
means a committee of the Board of Directors of the General Partner
composed entirely of two or more directors who are not (a) security holders, officers or
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
6
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 Partnership Group other than Common
Units 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 the National Securities Exchange on which the
Common Units are listed or admitted to trading.
Contributed Property
means each property or other asset, 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 5.5(d), such property shall no longer
constitute a Contributed Property, but shall be deemed an Adjusted Property.
Contribution Agreement
means that certain Contribution and Conveyance Agreement, dated as of
the Closing Date, among the General Partner, the Partnership, the Operating Company and certain
other parties, together with the additional conveyance documents and instruments contemplated or
referenced thereunder, as such may be amended, supplemented or restated from time to time.
Cumulative Common Unit Arrearage
means, with respect to any Common Unit, whenever issued,
and as of the end of any Quarter, the excess, if any, of (a) the sum resulting from adding together
the Common Unit Arrearage as to an Initial Common Unit for each of the Quarters within the
Subordination Period ending on or before the last day of such Quarter over (b) the sum of any
distributions theretofore made pursuant to Section 6.4(a)(ii) and the second sentence of Section
6.5 with respect to an Initial Common Unit (including any distributions to be made in respect of
the last of such Quarters).
Curative Allocation
means any allocation of an item of income, gain, deduction, loss or
credit pursuant to the provisions of Section 6.1(d)(xi).
Current Market Price
has the meaning assigned to such term in Section 15.1(a).
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 Section 11.1 or 11.2.
Depositary
means, with respect to any Units issued in global form, The Depository Trust
Company and its successors and permitted assigns.
Economic Risk of Loss
has the meaning set forth in Treasury Regulation Section 1.752-2(a).
Eligible Citizen
means a Person qualified to own interests in real property in jurisdictions
in which any Group Member does business or proposes to do business from time to
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
7
time, and whose status as a Limited Partner the General Partner determines does not or would
not subject such Group Member to a significant risk of cancellation or forfeiture of any of its
properties or any interest therein.
Estimated Incremental Quarterly Tax Amount
has the meaning assigned to such term in Section
6.10.
Event of Withdrawal
has the meaning assigned to such term in Section 11.1(a).
Fehsenfeld Common Units
has the meaning assigned to such term in Section 5.3(b).
Fehsenfeld Investors
means Fred M. Fehsenfeld Sr., Mac Fehsenfeld and Frank B. Fehsenfeld.
Fehsenfeld Trust I
means the Mildred L. Fehsenfeld irrevocable intervivos trust for the
benefit of Fred Mehlert Fehsenfeld, Jr. and his issue, an Indiana trust.
Fehsenfeld Trust II
means the Maggie Fehsenfeld Trust Number 106 for the benefit of Fred
Mehlert Fehsenfeld, Jr. and his issue, an Indiana trust.
Final Fehsenfeld Common Units
has the meaning assigned to such term in Section 6.1(d)(x)(A).
Final Subordinated Units
has the meaning assigned to such term in Section 6.1(d)(x).
First Liquidation Target Amount
has the meaning assigned to such term in Section
6.1(c)(i)(D).
First Target Distribution
means $0.495 per Unit per Quarter (or, with respect to the period
commencing on the Closing Date and ending on March 31, 2006, it means the product of $0.495
multiplied by a fraction of which the numerator is the number of days in such period, and of which
the denominator is 90), subject to adjustment in accordance with Sections 6.6 and 6.10.
Fully Diluted Basis
means, when calculating the number of Outstanding Units for any period,
a basis that includes, in addition to the Outstanding Units, all Partnership Securities, options,
rights, warrants and appreciation rights relating to an equity interest in the Partnership (a) that
are convertible into or exercisable or exchangeable for Units that are senior to or pari passu with
the Subordinated Units, (b) whose conversion, exercise or exchange price is less than the Current
Market Price on the date of such calculation, (c) that may be converted into or exercised or
exchanged for such Units prior to or during the Quarter immediately following the end of the period
for which the calculation is being made without the satisfaction of any contingency beyond the
control of the holder other than the payment of consideration and the compliance with
administrative mechanics applicable to such conversion, exercise or exchange and (d) that were not
converted into or exercised or exchanged for such Units during the period for which the calculation
is being made;
provided
,
however,
that for purposes of determining the number of Outstanding Units
on a Fully Diluted Basis when calculating whether the Subordination Period has ended or the
Subordinated Units are entitled to convert into Common
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
8
Units pursuant to Section 5.8, such Partnership Securities, options, rights, warrants and
appreciation rights shall be deemed to have been Outstanding Units only for the four Quarters that
comprise the last four Quarters of the measurement period;
provided
, further, that if consideration
will be paid to any Group Member in connection with such conversion, exercise or exchange, the
number of Units to be included in such calculation shall be that number equal to the difference
between (i) the number of Units issuable upon such conversion, exercise or exchange and (ii) the
number of Units that such consideration would purchase at the Current Market Price.
General Partner
means Calumet GP, LLC, a Delaware limited liability company, and its
successors and permitted assigns that are admitted to the Partnership as general partner of the
Partnership, in its capacity as general partner of the Partnership (except as the context otherwise
requires).
General Partner Interest
means the ownership interest of the General Partner in the
Partnership (in its capacity as a general partner without reference to any Limited Partner Interest
held by it), which is evidenced by General Partner Units, and includes any and all benefits to
which the General 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.
General Partner Unit
means a fractional part of the General Partner Interest having the
rights and obligations specified with respect to the General Partner Interest. A General Partner
Unit is not a Unit.
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.
Grube Trust I
means the Janet Krampe Grube grantor retained annuity trust dated January 31,
2002, an Indiana trust.
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
9
Grube Trust II
means the Janet Krampe Grube grantor retained annuity trust dated March 18,
2004, an Indiana trust.
Holder
as used in Section 7.12, has the meaning assigned to such term in Section 7.12(a).
Incentive Distribution Right
means a non-voting Limited Partner Interest issued to the
General Partner in connection with the transfer of all of its interests in Calumet Lubricants Co.,
Limited Partnership to the Partnership pursuant to the Contribution Agreement, which Limited
Partner Interest will confer upon the holder thereof only the rights and obligations specifically
provided in this Agreement with respect to Incentive Distribution Rights (and no other rights
otherwise available to or other obligations of a holder of a Partnership Interest). Notwithstanding
anything in this Agreement to the contrary, the holder of an Incentive Distribution Right shall not
be entitled to vote such Incentive Distribution Right on any Partnership matter except as may
otherwise be required by law.
Incentive Distributions
means any amount of cash distributed to the holders of the Incentive
Distribution Rights pursuant to Sections 6.4(a)(v), (vi) and (vii) and 6.4(b)(iii), (iv) and (v).
Indemnified Persons
has the meaning assigned to such term in Section 7.12(d).
Indemnitee
means (a) the General Partner, (b) any Departing General Partner, (c) any Person
who is or was an Affiliate of the General Partner or any Departing General Partner, (d) any Person
who is or was a member, partner, director, officer, fiduciary or trustee 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, (e) any Person who is or was serving at the request of
the General Partner or any Departing General Partner or any Affiliate of the General Partner or any
Departing General Partner as an officer, director, member, partner, fiduciary or trustee of another
Person; provided that a Person shall not be an Indemnitee by reason of providing, on a
fee-for-services basis, trustee, fiduciary or custodial services, and (f) any Person the General
Partner designates as an Indemnitee for purposes of this Agreement.
Initial Common Units
means the Common Units sold in the Initial Offering.
Initial Limited Partners
means The Heritage Group, Calumet, Incorporated, Fehsenfeld Trust
I, Fehsenfeld Trust II, Fred M. Fehsenfeld, Jr., Janet Krampe Grube, Grube Trust I, Grube Trust II,
the Fehsenfeld Investors, the General Partner (with respect to the Incentive Distribution Rights
received by it pursuant to Section 5.2), and the Underwriters upon the issuance by the Partnership
of Common Units as described in Section 5.3 in connection with the Initial Offering.
Initial Offering
means the initial offering and sale of Common Units to the public, as
described in the Registration Statement.
Initial Unit Price
means (a) with respect to the Common Units and the Subordinated Units,
the initial public offering price per Common Unit at which the Underwriters offered the Common
Units to the public for sale as set forth on the cover page of the prospectus included as
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
10
part of the Registration Statement and first issued at or after the time the Registration
Statement first became effective or (b) with respect to any other class or series of Units, the
price per Unit at which such class or series of Units is initially sold by the Partnership, as
determined by the General Partner, in each case adjusted as the General Partner determines to be
appropriate to give effect to any distribution, subdivision or combination of Units.
Interim Capital Transactions
means the following transactions if they occur prior to the
Liquidation Date: (a) borrowings, refinancings or refundings of indebtedness (other than Working
Capital Borrowings and other than for items purchased on open account in the ordinary course of
business) by any Group Member and sales of debt securities of any Group Member; (b) sales of equity
interests of any Group Member (including the Common Units sold to the Underwriters pursuant to the
exercise of the Over-Allotment Option); and (c) sales or other voluntary or involuntary
dispositions of any assets of any Group Member other than (i) sales or other dispositions of
inventory, accounts receivable and other assets in the ordinary course of business, and (ii) sales
or other dispositions of assets as part of normal retirements or replacements.
Issue Price
means the price at which a Unit is purchased from the Partnership, after taking
into account any sales commission or underwriting discount charged to the Partnership.
Limited Partner
means, unless the context otherwise requires, the Organizational Limited
Partners prior to their withdrawal from the Partnership, each Initial Limited Partner, each
additional Person that becomes a Limited Partner pursuant to the terms of this Agreement and any
Departing General Partner upon the change of its status from General Partner to Limited Partner
pursuant to Section 11.3, in each case, in such Persons capacity as a limited partner of the
Partnership;
provided
,
however
, that when the term Limited Partner is used herein in the context
of any vote or other approval, including Articles XIII and XIV, such term shall not, solely for
such purpose, include any holder of an Incentive Distribution Right (solely with respect to its
Incentive Distribution Rights and not with respect to any other Limited Partner Interest held by
such Person) except as may otherwise be required by law.
Limited Partner Interest
means the ownership interest of a Limited Partner in the
Partnership, which may be evidenced by Common Units, Subordinated Units, Incentive Distribution
Rights or other Partnership Securities 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;
provided
,
however
, that when the term Limited Partner Interest is used herein in
the context of any vote or other approval, including Articles XIII and XIV, such term shall not,
solely for such purpose, include any Incentive Distribution Right except as may otherwise be
required by law.
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 holders of Outstanding Units 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.
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
11
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.
Merger Agreement
has the meaning assigned to such term in Section 14.1.
Minimum Quarterly Distribution
means $0.45 per Unit per Quarter (or with respect to the
period commencing on the Closing Date and ending on March 31, 2006, it means the product of $0.45
multiplied by a fraction of which the numerator is the number of days in such period and of which
the denominator is 90), subject to adjustment in accordance with Sections 6.6 and 6.10.
National Securities Exchange
means an exchange registered with the Commission under Section
6(a) of the Securities Exchange Act, and any successor to such statute, or the Nasdaq National
Market or any successor thereto.
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 Partnerships Carrying Value of such property (as
adjusted pursuant to Section 5.5(d)(ii)) at the time such property is distributed, reduced by any
indebtedness either assumed by such Partner upon such distribution or to which such property is
subject at the time of distribution, in either case, as determined under Section 752 of the Code.
Net Income
means, for any taxable year, the excess, if any, of the Partnerships items of
income and gain (other than those items taken into account in the computation of Net Termination
Gain or Net Termination Loss) for such taxable year over the Partnerships items of loss and
deduction (other than those items taken into account in the computation of Net Termination Gain or
Net Termination Loss) for such taxable year. The items included in the calculation of Net Income
shall be determined in accordance with Section 5.5(b) and shall not include any items specially
allocated under Section 6.1(d);
provided
, that the determination of the items that have been
specially allocated under Section 6.1(d) shall be made as if Section 6.1(d)(xii) were not in this
Agreement.
Net Loss
means, for any taxable year, the excess, if any, of the Partnerships items of loss
and deduction (other than those items taken into account in the computation of Net Termination Gain
or Net Termination Loss) for such taxable year over the Partnerships items of income and gain
(other than those items taken into account in the computation of Net Termination Gain or Net
Termination Loss) for such taxable year. The items included in the calculation of Net Loss shall be
determined in accordance with Section 5.5(b) and shall not include any items specially allocated
under Section 6.1(d);
provided
, that the determination of the items that have been specially
allocated under Section 6.1(d) shall be made as if Section 6.1(d)(xii) were not in this Agreement.
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
12
Net Positive Adjustments
means, with respect to any Partner, the excess, if any, of the
total positive adjustments over the total negative adjustments made to the Capital Account of such
Partner pursuant to Book-Up Events and Book-Down Events.
Net Termination Gain
means, for any taxable year, the sum, if positive, of all items of
income, gain, loss or deduction recognized by the Partnership after the Liquidation Date. The items
included in the determination of Net Termination Gain shall be determined in accordance with
Section 5.5(b) and shall not include any items of income, gain or loss specially allocated under
Section 6.1(d).
Net Termination Loss
means, for any taxable year, the sum, if negative, of all items of
income, gain, loss or deduction recognized by the Partnership after the Liquidation Date. The items
included in the determination of Net Termination Loss shall be determined in accordance with
Section 5.5(b) and shall not include any items of income, gain or loss specially allocated under
Section 6.1(d).
Non-citizen Assignee
means a Person whom the General Partner has determined does not
constitute an Eligible Citizen and as to whose Partnership Interest the General Partner has become
the Limited Partner, pursuant to Section 4.9.
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 Sections 6.2(b)(i)(A),
6.2(b)(ii)(A) and 6.2(b)(iii) 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 Omnibus Agreement, dated as of the Closing Date, among
the General Partner, the Partnership, the Operating Company, The Heritage Group and certain other
parties thereto, as such may be amended, supplemented or restated from time to time.
Operating Company
means Calumet Operating, LLC, a Delaware limited liability company, and
any successors thereto.
Operating Expenditures
means all Partnership Group expenditures, including, but not limited
to, taxes, reimbursements of the General Partner, non-Pro Rata repurchases of Units
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
13
(other than those made with proceeds of an Interim Capital Transaction), repayment of Working
Capital Borrowings, debt service payments and capital expenditures, subject to the following:
(a) payments (including prepayments) of principal of and premium on indebtedness other than
Working Capital Borrowings shall not constitute Operating Expenditures; and
(b) Operating Expenditures shall not include (i) capital expenditures made for Acquisitions or
for Capital Improvements, (ii) payment of transaction expenses (including taxes) relating to
Interim Capital Transactions or (iii) distributions to Partners. Where capital expenditures are
made in part for Acquisitions or for Capital Improvements and in part for other purposes, the
General Partner, with the concurrence of the Conflicts Committee, shall determine the allocation
between the amounts paid for each.
Operating Surplus
means, with respect to any period ending prior to the Liquidation Date, on
a cumulative basis and without duplication,
(a) the sum of (i) $10.0 million, (ii) all cash and cash equivalents of the Partnership Group
on hand as of the close of business on the Closing Date, (iii) all cash receipts of the Partnership
Group for the period beginning on the Closing Date and ending on the last day of such period, but
excluding cash receipts from Interim Capital Transactions (except to the extent specified in
Section 6.5) and (iv) all cash receipts of the Partnership Group (or the Partnerships
proportionate share of cash receipts in the case of Subsidiaries that are not wholly owned) after
the end of such period but on or before the date of determination of Operating Surplus with respect
to such period resulting from Working Capital Borrowings, less
(b) the sum of (i) Operating Expenditures for the period beginning on the Closing Date and
ending on the last day of such period and (ii) the amount of cash reserves established by the
General Partner to provide funds for future Operating Expenditures;
provided
,
however
, that
disbursements made (including contributions to a Group Member or disbursements on behalf of a Group
Member) or cash reserves established, increased or reduced after the end of such period but on or
before the date of determination of Available Cash with respect to such period shall be deemed to
have been made, established, increased or reduced, for purposes of determining Operating Surplus,
within such period if the General Partner so determines.
Notwithstanding the foregoing,
Operating Surplus
with respect to the Quarter in which the
Liquidation Date occurs and any subsequent Quarter shall equal zero.
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.
Organizational Limited Partners
means The Heritage Group, Calumet, Incorporated, F. William
Grube, Fred M. Fehsenfeld, Jr., Fehsenfeld Trust I and Fehsenfeld Trust II, in their capacity as
the organizational limited partners of the Partnership pursuant to this Agreement.
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
14
Outstanding
means, with respect to Partnership Securities, all Partnership Securities that
are issued by the Partnership and reflected as outstanding on the Partnerships 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) beneficially owns 20% or more of the Outstanding
Partnership Securities of any class then Outstanding, all Partnership Securities owned by such
Person or Group shall not 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 Units so owned shall be considered to be Outstanding for
purposes of Section 11.1(b)(iv) (such Units shall not, however, be treated as a separate class of
Partnership Securities for purposes of this Agreement);
provided
, further, that the foregoing
limitation shall not apply to (i) any Person or Group who acquired 20% or more of the Outstanding
Partnership Securities of any class then Outstanding directly from the General Partner or its
Affiliates, (ii) any Person or Group who acquired 20% or more of the Outstanding Partnership
Securities 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
Partnership Securities issued by the Partnership with the prior approval of the Board of Directors.
Over-Allotment Option
means the over-allotment option granted to the Underwriters by the
Partnership pursuant to the Underwriting Agreement.
Parity Units
means Common Units and all other Units of any other class or series that have
the right (i) to receive distributions of Available Cash from Operating Surplus pursuant to each of
subclauses (a)(i) and (a)(ii) of Section 6.4 in the same order of priority with respect to the
participation of Common Units in such distributions or (ii) to participate in allocations of Net
Termination Gain pursuant to Section 6.1(c)(i)(B) in the same order of priority with the Common
Units, in each case regardless of whether the amounts or value so distributed or allocated on each
Parity Unit equals the amount or value so distributed or allocated on each Common Unit. Units
whose participation in such (i) distributions of Available Cash from Operating Surplus and (ii)
allocations of Net Termination Gain are subordinate in order of priority to such distributions and
allocations on Common Units shall not constitute Parity Units even if such Units are convertible
under certain circumstances into Common Units or Parity Units.
Partner Nonrecourse Debt
has the meaning set forth in Treasury Regulation Section
1.704-2(b)(4).
Partner Nonrecourse Debt Minimum Gain
has the meaning set forth 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), are attributable to a Partner Nonrecourse
Debt.
Partners
means the General Partner and the Limited Partners.
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
15
Partnership
means Calumet Specialty Products Partners, L.P., a Delaware limited partnership.
Partnership Group
means the Partnership and its Subsidiaries treated as a single
consolidated entity.
Partnership Interest
means an interest in the Partnership, which shall include the General
Partner Interest and Limited Partner Interests.
Partnership Minimum Gain
means that amount determined in accordance with the principles of
Treasury Regulation Section 1.704-2(d).
Partnership Security
means any class or series of equity interest in the Partnership (but
excluding any options, rights, warrants and appreciation rights relating to an equity interest in
the Partnership), including Common Units, Subordinated Units, General Partner Units and Incentive
Distribution Rights.
Percentage Interest
means as of any date of determination (a) as to the General Partner with
respect to General Partner Units and as to any Unitholder with respect to Units, the product
obtained by multiplying (i) 100% less the percentage applicable to clause (b) by (ii) the quotient
obtained by dividing (A) the number of General Partner Units held by the General Partner or the
number of Units held by such Unitholder, as the case may be, by (B) the total number of all
Outstanding Units and all General Partner Units, and (b) as to the holders of other Partnership
Securities issued by the Partnership in accordance with Section 5.6, the percentage established as
a part of such issuance. The Percentage Interest with respect to an Incentive Distribution Right
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.
Per Unit Capital Amount
means, as of any date of determination, the Capital Account, stated
on a per Unit basis, underlying any Unit held by a Person other than the General Partner or any
Affiliate of the General Partner who holds Units.
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, (b) when used
with respect to Partners or Record Holders, apportioned among all Partners or Record Holders, as
the case may be, in accordance with their relative Percentage Interests and (c) when used with
respect to holders of Incentive Distribution Rights, apportioned equally among all holders of
Incentive Distribution Rights in accordance with the relative number or percentage of Incentive
Distribution Rights held by each such holder.
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.
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
16
Quarter
means, unless the context requires otherwise, a fiscal quarter of the Partnership,
or, with respect to the first fiscal quarter of the Partnership after the Closing Date, the period
commencing on the Closing Date and ending on March 31, 2006.
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.
Record Holder
means the Person in whose name a Common Unit is registered on the books of the
Transfer Agent as of the opening of business on a particular Business Day, or with respect to other
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 4.10.
Registration Statement
means the Registration Statement on Form S-1 (Registration No.
333-128880) 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.
Remaining Basket Amount
has the meaning assigned to such term in Section 5.7(g).
Remaining Net Positive Adjustments
means as of the end of any taxable period, (i) with
respect to the Unitholders holding Common Units or Subordinated Units, the excess of (a) the Net
Positive Adjustments of the Unitholders holding Common Units or Subordinated Units as of the end of
such period over (b) the sum of those Partners Share of Additional Book Basis Derivative Items for
each prior taxable period, (ii) with respect to the General Partner (as holder of the General
Partner Units), the excess of (a) the Net Positive Adjustments of the General Partner as of the end
of such period over (b) the sum of the General Partners Share of Additional Book Basis Derivative
Items with respect to the General Partner Units for each prior taxable period, and (iii) with
respect to the holders of Incentive Distribution Rights, the excess of (a) the Net Positive
Adjustments of the holders of Incentive Distribution Rights as of the end of such period over (b)
the sum of the Share of Additional Book Basis Derivative Items of the holders of the Incentive
Distribution Rights for each prior taxable period.
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
17
Required Allocations
means (a) any limitation imposed on any allocation of Net Losses or Net
Termination Losses under Section 6.1(b) or 6.1(c)(ii) and (b) any allocation of an item of income,
gain, loss or deduction pursuant to Section 6.1(d)(i), 6.1(d)(ii), 6.1(d)(iv), 6.1(d)(vii) or
6.1(d)(ix).
Residual Gain or Residual Loss
means any item of gain or loss, as the case may be, of the
Partnership recognized for federal income tax purposes resulting from a sale, exchange or other
disposition of a Contributed Property or Adjusted Property, to the extent such item of gain or loss
is not allocated pursuant to Section 6.2(b)(i)(A) or 6.2(b)(ii)(A), respectively, to eliminate
Book-Tax Disparities.
Restricted Business
has the meaning assigned to such term in the Omnibus Agreement.
Retained Converted Subordinated Unit
has the meaning assigned to such term in Section
5.5(c)(ii).
Retained Fehsenfeld Common Units
has the meaning assigned to such term in Section
5.5(c)(iii).
Second Liquidation Target Amount
has the meaning assigned to such term in Section
6.1(c)(i)(E).
Second Target Distribution
means $0.563 per Unit per Quarter (or, with respect to the period
commencing on the Closing Date and ending on March 31, 2006, it means the product of $0.563
multiplied by a fraction of which the numerator is equal to the number of days in such period and
of which the denominator is 90), subject to adjustment in accordance with Sections 6.6 and 6.10.
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.
Share of Additional Book Basis Derivative Items
means in connection with any allocation of
Additional Book Basis Derivative Items for any taxable period, (i) with respect to the Unitholders
holding Common Units or Subordinated Units, the amount that bears the same ratio to such Additional
Book Basis Derivative Items as the Unitholders Remaining Net Positive Adjustments as of the end of
such period bears to the Aggregate Remaining Net Positive Adjustments as of that time, (ii) with
respect to the General Partner (as holder of the General Partner Units), the amount that bears the
same ratio to such Additional Book Basis Derivative Items as the General Partners Remaining Net
Positive Adjustments as of the end of such period bears to the Aggregate Remaining Net Positive
Adjustment as of that time, and (iii) with respect to the Partners holding Incentive Distribution
Rights, the amount that bears the same ratio to such Additional Book Basis Derivative Items as the
Remaining Net Positive Adjustments of the Partners holding the Incentive Distribution Rights as of
the end of such period bears to the Aggregate Remaining Net Positive Adjustments as of that time.
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
18
Special Approval
means approval by a majority of the members of the Conflicts Committee.
Subordinated Unit
means a Unit representing a fractional part of the Partnership Interests
of all Limited Partners and having the rights and obligations specified with respect to
Subordinated Units in this Agreement. The term Subordinated Unit does not include a Common Unit
or Parity Unit. A Subordinated Unit that is convertible into a Common Unit or Parity Unit shall
not constitute a Common Unit or Parity Unit until such conversion occurs.
Subordination Period
means the period commencing on the Closing Date and ending on the first
to occur of the following dates:
(a) the first day of any Quarter beginning after December 31, 2010 in respect of which (i) (A)
distributions of Available Cash from Operating Surplus on each of the Outstanding Common Units and
Subordinated Units and any other Outstanding Units that are senior or equal in right of
distribution to the Subordinated Units and the General Partner Units with respect to each of the
three consecutive, non-overlapping four-Quarter periods immediately preceding such date equaled or
exceeded the sum of the Minimum Quarterly Distribution on all Outstanding Common Units and
Subordinated Units and any other Outstanding Units that are senior or equal in right of
distribution to the Subordinated Units and the General Partner Units during such periods and (B)
the Adjusted Operating Surplus for each of the three consecutive, non-overlapping four-Quarter
periods immediately preceding such date equaled or exceeded the sum of the Minimum Quarterly
Distribution on all of the Common Units, Subordinated Units and any other Units that are senior or
equal in right of distribution to the Subordinated Units that were Outstanding during such periods
on a Fully Diluted Basis, and the General Partner Units, with respect to each such period and (ii)
there are no Cumulative Common Unit Arrearages; and
(b) the date on which the General Partner is removed as general partner of the Partnership
upon the requisite vote by holders of Outstanding Units under circumstances where Cause does not
exist and Units held by the General Partner and its Affiliates are not voted in favor of such
removal.
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 or limited
partner of such partnership, but only if more than 50% of the partnership interests of such
partnership (considering all of the partnership interests of the partnership as a single class) 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, or (c) any other Person (other than a
corporation or a partnership) 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.
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Surviving Business Entity
has the meaning assigned to such term in Section 14.2(b).
Third Liquidation Target Amount
has the meaning assigned to such term in Section
6.1(c)(i)(F).
Third Target Distribution
means $0.675 per Unit per Quarter (or, with respect to the period
commencing on the Closing Date and ending on March 31, 2006, it means the product of $0.675
multiplied by a fraction of which the numerator is equal to the number of days in such period and
of which the denominator is 90), subject to adjustment in accordance with Sections 6.6 and 6.10.
Trading Day
has the meaning assigned to such term in Section 15.1(a).
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 shall be appointed from time to time by the General Partner to act as
registrar and transfer agent for the Common Units;
provided
, that if no Transfer Agent is
specifically designated for any other Partnership Securities, the General Partner shall act in such
capacity.
Underwriter
means each Person named as an underwriter in Schedule I to the Underwriting
Agreement who purchases Common Units pursuant thereto.
Underwriting Agreement
means that certain Underwriting Agreement dated as of January 25,
2006 among the Underwriters, the Partnership, the General Partner, the Operating Company and other
parties thereto, providing for the purchase of Common Units by the Underwriters.
Unit
means a Partnership Security that is designated as a Unit and shall include Common
Units and Subordinated Units but shall not include (i) General Partner Units (or the General
Partner Interest represented thereby) or (ii) Incentive Distribution Rights.
Unitholders
means the holders of Units.
Unit Majority
means, during the Subordination Period, at least a majority of the Outstanding
Common Units (excluding Common Units owned by the General Partner and its Affiliates) voting as a
class and at least a majority of the Outstanding Subordinated Units voting as a class, and after
the end of the Subordination Period, at least a majority of the Outstanding Common Units.
Unpaid MQD
has the meaning assigned to such term in Section 6.1(c)(i)(B).
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
(as determined under Section 5.5(d)) over (b) the Carrying Value of such property as of such date
(prior to any adjustment to be made pursuant to Section 5.5(d) as of such date).
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
20
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 5.5(d) as of such date) over (b) the fair
market value of such property as of such date (as determined under Section 5.5(d)).
Unrecovered Initial Unit Price
means at any time, with respect to a Unit, the Initial Unit
Price less the sum of all distributions constituting Capital Surplus theretofore made in respect of
an Initial Common Unit and any distributions of cash (or the Net Agreed Value of any distributions
in kind) in connection with the dissolution and liquidation of the Partnership theretofore made in
respect of an Initial Common Unit, adjusted as the General Partner determines to be appropriate to
give effect to any distribution, subdivision or combination of such Units.
U.S. GAAP
means United States generally accepted accounting principles consistently applied.
Withdrawal Opinion of Counsel
has the meaning assigned to such term in Section 11.1(b).
Working Capital Borrowings
means borrowings used solely for working capital purposes or to
pay distributions to Partners made pursuant to a credit facility or other arrangement to the extent
such borrowings are required to be reduced to a relatively small amount each year (or for the year
in which the Initial Offering is consummated, the 12-month period beginning on the Closing Date)
for an economically meaningful period of time.
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, and the singular form of nouns, pronouns and
verbs shall include the plural and vice versa; (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 and the Organizational Limited Partners have previously formed the
Partnership as a limited partnership pursuant to the provisions of the Delaware Act and hereby
amend and restate the original Agreement of Limited Partnership of Calumet Specialty Products
Partners, L.P. in its entirety. This amendment and restatement shall become effective on the date
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
21
of this Agreement. Except as expressly provided to the contrary in this Agreement, the
rights, duties (including fiduciary duties), liabilities and obligations of the Partners and the
administration, dissolution and termination of the Partnership shall be governed by the Delaware
Act. All Partnership Interests shall constitute personal property of the owner thereof for all
purposes.
Section 2.2
Name.
The name of the Partnership shall be Calumet Specialty Products Partners, L.P. The
Partnerships 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, L.P., Ltd.
or similar words or letters shall be included in the Partnerships name where necessary for the
purpose of complying with the laws of any jurisdiction that so requires. The General Partner may
change the name of the Partnership at any time and from time to time and shall notify the Limited
Partners of such change in the next regular communication to the Limited 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 2780 Waterfront Parkway E. Drive, Suite 200, Indianapolis, Indiana 46214 or
such other place as the General Partner may from time to time designate by notice to the Limited
Partners. The Partnership may maintain offices at such other place or places within or outside the
State of Delaware as the General Partner shall determine necessary or appropriate. The address of
the General Partner shall be 2780 Waterfront Parkway E. Drive, Suite 200, Indianapolis, Indiana
46214 or such other place as the General Partner may from time to time designate by notice to the
Limited 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 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 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 decline to propose or approve, the conduct by the Partnership of any business free
of any fiduciary duty or obligation whatsoever to the Partnership or any Limited Partner and,
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
22
in declining to so propose or approve, 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.
Section 2.5
Powers.
The Partnership shall be empowered to do any and all acts and things necessary or appropriate
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
Power of Attorney.
(a) Each Limited Partner hereby constitutes and appoints the General Partner and, if a
Liquidator shall have been selected pursuant to Section 12.3, the Liquidator (and any successor to
the Liquidator by merger, transfer, assignment, election or otherwise) and each of their authorized
officers and attorneys-in-fact, as the case may be, with full power of substitution, as his true
and lawful agent and attorney-in-fact, with full power and authority in his name, place and stead,
to:
(i) execute, swear to, acknowledge, deliver, file and record in the appropriate public
offices (A) all certificates, documents and other instruments (including this Agreement and
the Certificate of Limited Partnership and all amendments or restatements hereof or thereof)
that the General Partner or the Liquidator determines to be necessary or appropriate to
form, qualify or continue the existence or qualification of the Partnership as a limited
partnership (or a partnership in which the limited partners have limited liability) in the
State of Delaware and in all other jurisdictions in which the Partnership may conduct
business or own property; (B) all certificates, documents and other instruments that the
General Partner or the Liquidator determines to be necessary or appropriate to reflect, in
accordance with its terms, any amendment, change, modification or restatement of this
Agreement; (C) all certificates, documents and other instruments (including conveyances and
a certificate of cancellation) that the General Partner or the Liquidator determines to be
necessary or appropriate to reflect the dissolution and liquidation of the Partnership
pursuant to the terms of this Agreement; (D) all certificates, documents and other
instruments relating to the admission, withdrawal, removal or substitution of any Partner
pursuant to, or other events described in, Article IV, X, XI or XII; (E) all certificates,
documents and other instruments relating to the determination of the rights, preferences and
privileges of any class or series of Partnership Securities issued pursuant to Section 5.6;
and (F) all certificates, documents and other instruments (including agreements and a
certificate of merger) relating to a merger, consolidation or conversion of the Partnership
pursuant to Article XIV; and
(ii) execute, swear to, acknowledge, deliver, file and record all ballots, consents,
approvals, waivers, certificates, documents and other instruments that the General Partner
or the Liquidator determines to be necessary or appropriate to (A) make, evidence, give,
confirm or ratify any vote, consent, approval, agreement or other action that is made or
given by the Partners hereunder or is consistent with the terms of this Agreement or (B)
effectuate the terms or intent of this Agreement;
provided
, that when
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
23
required by Section 13.3 or any other provision of this Agreement that establishes a
percentage of the Limited Partners or of the Limited Partners of any class or series
required to take any action, the General Partner and the Liquidator may exercise the power
of attorney made in this Section 2.6(a)(ii) only after the necessary vote, consent or
approval of the Limited Partners or of the Limited Partners of such class or series, as
applicable.
Nothing contained in this Section 2.6(a) shall be construed as authorizing the General Partner to
amend this Agreement except in accordance with Article XIII or as may be otherwise expressly
provided for in this Agreement.
(b) The foregoing power of attorney is hereby declared to be irrevocable and a power coupled
with an interest, and it shall survive and, to the maximum extent permitted by law, not be affected
by the subsequent death, incompetency, disability, incapacity, dissolution, bankruptcy or
termination of any Limited Partner and the transfer of all or any portion of such Limited Partners
Limited Partner Interest and shall extend to such Limited Partners heirs, successors, assigns and
personal representatives. Each such Limited Partner hereby agrees to be bound by any representation
made by the General Partner or the Liquidator acting in good faith pursuant to such power of
attorney; and each such Limited Partner, to the maximum extent permitted by law, hereby waives any
and all defenses that may be available to contest, negate or disaffirm the action of the General
Partner or the Liquidator taken in good faith under such power of attorney. Each Limited Partner
shall execute and deliver to the General Partner or the Liquidator, within 15 days after receipt of
the request therefor, such further designation, powers of attorney and other instruments as the
General Partner or the Liquidator may request in order to effectuate this Agreement and the
purposes of the Partnership.
Section 2.7
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 in existence 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 2.8
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 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
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
24
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 Partnerships business, transact any
business in the Partnerships 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, any Limited Partner shall be entitled to and may have business interests and
engage in 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, and except as
limited by Section 3.4(b), each Limited Partner shall have the right, for a purpose reasonably
related to such Limited Partners interest as a Limited Partner in the Partnership,
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
25
upon reasonable written demand stating the purpose of such demand, and at such Limited
Partners own expense:
(i) to obtain true and full information regarding the status of the business and
financial condition of the Partnership;
(ii) promptly after its becoming available, to obtain a copy of the Partnerships
federal, state and local income tax returns for each year;
(iii) to obtain a current list of the name and last known business, residence or
mailing address of each Partner;
(iv) to obtain 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;
(v) to obtain 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
(vi) to obtain such other information regarding the affairs of the Partnership as 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 in good faith 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.
Upon the Partnerships issuance of Common Units or Subordinated Units to any Person, the
Partnership shall issue, upon the request of such Person, one or more Certificates in the name of
such Person evidencing the number of such Units being so issued. In addition, (a) upon the General
Partners request, the Partnership shall issue to it one or more Certificates in the name of the
General Partner evidencing its General Partner Units and (b) upon the request of any Person owning
Incentive Distribution Rights or any other Partnership Securities other than Common
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
26
Units or Subordinated Units, the Partnership shall issue to such Person one or more
certificates evidencing such Incentive Distribution Rights or other Partnership Securities other
than Common Units or Subordinated Units. Certificates shall be executed on behalf of the
Partnership by the Chairman of the Board, President or any Executive Vice President, Senior Vice
President or Vice President and the Secretary or any Assistant Secretary of the General Partner. No
Common Unit Certificate shall be valid for any purpose until it has been countersigned by the
Transfer Agent;
provided
,
however
, that if the General Partner elects to issue Common Units in
global form, the Common Unit Certificates shall be valid upon receipt of a certificate from the
Transfer Agent certifying that the Common Units have been duly registered in accordance with the
directions of the Partnership. Subject to the requirements of Section 6.7(b), the Partners holding
Certificates evidencing Subordinated Units may exchange such Certificates for Certificates
evidencing Common Units on or after the date on which such Subordinated Units are converted into
Common Units pursuant to the terms of Section 5.8.
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 Securities 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 Limited Partner fails to notify the General Partner within a reasonable period of time
after he has notice of the loss, destruction or theft of a Certificate, and a transfer of the
Limited Partner Interests represented by the Certificate is registered before the Partnership, the
General Partner or the Transfer Agent receives such notification, the Limited 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.
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
27
(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 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 the Record Holder of such Partnership Interest.
Section 4.4
Transfer Generally.
(a) The term transfer, when used in this Agreement with respect to a Partnership Interest,
shall be deemed to refer to a transaction (i) by which the General Partner assigns its General
Partner Units to another Person or by which a holder of Incentive Distribution Rights assigns its
Incentive Distribution Rights to another Person, and includes a sale, assignment, gift, pledge,
encumbrance, hypothecation, mortgage, exchange or any other disposition by law or otherwise or (ii)
by which the holder of a Limited Partner Interest (other than an Incentive Distribution Right)
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, including
any transfer upon foreclosure of any pledge, 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 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 the General Partner of any or all of the shares of
stock, membership interests, partnership interests or other ownership interests in the General
Partner.
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
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
28
Limited Partner Interests. The Transfer Agent is hereby appointed registrar and transfer agent
for the purpose of registering Common Units and transfers of such Common Units as herein provided.
The Partnership shall not recognize transfers of Certificates evidencing Limited Partner Interests
unless such transfers are effected in the manner described in this Section 4.5. Upon surrender of a
Certificate for registration of transfer of any Limited Partner Interests evidenced by a
Certificate, and subject to the provisions of Section 4.5(b), the appropriate officers of the
General Partner on behalf of the Partnership shall execute and deliver, and in the case of Common
Units, the Transfer Agent shall countersign and deliver, in the name of the holder or the
designated transferee or transferees, as required pursuant to the holders 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.
(b) Except as otherwise provided in Section 4.9, the General Partner shall not recognize any
transfer of Limited Partner Interests 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.
(c) Subject to the (i) foregoing provisions of this Section 4.5, (ii) Section 4.3, (iii)
Section 4.8, (iv) with respect to any class or series of Limited Partner Interests, the provisions
of any statement of designations or an amendment to 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 (other than the Incentive
Distribution Rights) shall be freely transferable.
(d) The General Partner and its Affiliates shall have the right at any time to transfer their
Subordinated Units and Common Units (whether issued upon conversion of the Subordinated Units or
otherwise) to one or more Persons.
Section 4.6
Transfer of the General Partners General Partner Interest.
(a) Subject to Section 4.6(c) below, prior to December 31, 2015, the General Partner shall not
transfer all or any part of its General Partner Interest (represented by General Partner Units) to
a Person unless such transfer (i) has been approved by the prior written consent or vote of the
holders of at least a majority of the Outstanding Common Units (excluding Common Units held by 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 December 31, 2015, the General Partner may at
its option transfer all or any of its General Partner Interest without Unitholder approval.
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
29
(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 taxable as a
corporation or otherwise to be taxed as an entity for 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 immediately prior to the transfer of the General
Partner Interest, and the business of the Partnership shall continue without dissolution.
Section 4.7
Transfer of Incentive Distribution Rights.
Prior to December 31, 2015, a holder of Incentive Distribution Rights may transfer any or all
of the Incentive Distribution Rights held by such holder without any consent of the Unitholders to
(a) an Affiliate of such holder (other than an individual) or (b) another Person (other than an
individual) in connection with (i) the merger or consolidation of such holder of Incentive
Distribution Rights with or into such other Person, (ii) the transfer by such holder of all or
substantially all of its assets to such other Person or (iii) the sale of all the ownership
interests in such holder. Any other transfer of the Incentive Distribution Rights prior to December
31, 2015 shall require the prior approval of holders of at least a majority of the Outstanding
Common Units (excluding Common Units held by the General Partner and its Affiliates). On or after
December 31, 2015, the General Partner or any other holder of Incentive Distribution Rights may
transfer any or all of its Incentive Distribution Rights without Unitholder approval.
Notwithstanding anything herein to the contrary, no transfer of Incentive Distribution Rights to
another Person shall be permitted unless the transferee agrees to be bound by the provisions of
this Agreement. The General Partner and any transferee or transferees of the Incentive
Distribution Rights may agree in a separate instrument as to the General Partners exercise of its
rights with respect to the Incentive Distribution Rights under Section 11.3 hereof.
Section 4.8
Restrictions on Transfers.
(a) Except as provided in Section 4.8(e) below, but 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 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 federal income tax
purposes (to the extent not already so treated or taxed).
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
30
(b) The General Partner may impose restrictions on the transfer of Partnership Interests if it
receives an Opinion of Counsel that such restrictions are necessary to avoid a significant risk of
the Partnership becoming taxable as a corporation or otherwise becoming taxable as an entity for
federal income tax purposes. 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) The transfer of a Subordinated Unit that has converted into a Common Unit shall be subject
to the restrictions imposed by Section 6.7(b).
(d) The transfer of a Fehsenfeld Common Unit shall be subject to the restrictions imposed by
Section 6.9.
(e) 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.
(f) In the event any Partnership Interest (other than a Fehsenfeld Common Unit) is evidenced
in certificated form, each certificate evidencing Partnership Interests shall bear a conspicuous
legend in substantially the following form:
THE HOLDER OF THIS SECURITY ACKNOWLEDGES FOR THE BENEFIT OF THE PARTNERSHIP 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 THE PARTNERSHIP UNDER THE LAWS OF THE STATE OF DELAWARE, OR
(C) CAUSE THE PARTNERSHIP TO BE TREATED AS AN ASSOCIATION TAXABLE AS A CORPORATION OR
OTHERWISE TO BE TAXED AS AN ENTITY FOR FEDERAL INCOME TAX PURPOSES (TO THE EXTENT NOT
ALREADY SO TREATED OR TAXED). CALUMET GP, LLC, THE GENERAL PARTNER OF THE PARTNERSHIP, 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 THE PARTNERSHIP
BECOMING TAXABLE AS A CORPORATION OR OTHERWISE BECOMING TAXABLE AS AN ENTITY FOR 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.
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
31
(g) In the event any Fehsenfeld Common Unit is evidenced in certificated form, each
certificate evidencing such Fehsenfeld Common Units shall bear a conspicuous legend in
substantially the following form:
THE HOLDER OF THIS SECURITY ACKNOWLEDGES FOR THE BENEFIT OF THE PARTNERSHIP 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 THE PARTNERSHIP UNDER THE LAWS OF THE STATE OF DELAWARE, OR
(C) CAUSE THE PARTNERSHIP TO BE TREATED AS AN ASSOCIATION TAXABLE AS A CORPORATION OR
OTHERWISE TO BE TAXED AS AN ENTITY FOR FEDERAL INCOME TAX PURPOSES (TO THE EXTENT NOT
ALREADY SO TREATED OR TAXED). THE HOLDER FURTHER ACKNOWLEDGES THAT THIS SECURITY MAY NOT BE
TRANSFERRED TO A PERSON THAT IS NOT AN AFFILIATE (AS DEFINED IN THE PARTNERSHIP AGREEMENT OF
THE PARTNERSHIP) OF THE HOLDER UNTIL SUCH TIME AS CALUMET GP, LLC, THE GENERAL PARTNER OF
THE PARTNERSHIP, DETERMINES, BASED ON ADVICE OF COUNSEL, THAT THE COMMON UNIT REPRESENTED BY
THIS CERTIFICATE SHOULD HAVE, AS A SUBSTANTIVE MATTER, LIKE INTRINSIC ECONOMIC AND FEDERAL
INCOME TAX CHARACTERISTICS, IN ALL MATERIAL RESPECTS, TO THE INTRINSIC ECONOMIC AND FEDERAL
INCOME TAX CHARACTERISTICS OF A COMMON UNIT ISSUED IN THE INITIAL OFFERING AND SALE OF
COMMON UNITS TO THE PUBLIC, AS DESCRIBED IN THE PARTNERSHIPS REGISTRATION STATEMENT ON FORM
S-1. CALUMET GP, LLC, THE GENERAL PARTNER OF THE PARTNERSHIP, 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 THE PARTNERSHIP BECOMING TAXABLE
AS A CORPORATION OR OTHERWISE BECOMING TAXABLE AS AN ENTITY FOR 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.
Section 4.9
Citizenship Certificates; Non-citizen Assignees.
(a) If any Group Member is or becomes subject to any federal, state or local law or regulation
that the General Partner determines would create a substantial risk of cancellation or
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
32
forfeiture of any property in which the Group Member has an interest based on the nationality,
citizenship or other related status of a Limited Partner, the General Partner may request any
Limited Partner to furnish to the General Partner, within 30 days after receipt of such request, an
executed Citizenship Certification or such other information concerning his nationality,
citizenship or other related status (or, if the Limited Partner is a nominee holding for the
account of another Person, the nationality, citizenship or other related status of such Person) as
the General Partner may request. If a Limited Partner fails to furnish to the General Partner
within the aforementioned 30-day period such Citizenship Certification or other requested
information or if upon receipt of such Citizenship Certification or other requested information the
General Partner determines that a Limited Partner is not an Eligible Citizen, the Limited Partner
Interests owned by such Limited Partner shall be subject to redemption in accordance with the
provisions of Section 4.10. In addition, the General Partner may require that the status of any
such Limited Partner be changed to that of a Non-citizen Assignee and, thereupon, the General
Partner shall be substituted for such Non-citizen Assignee as the Limited Partner in respect of the
Non-citizen Assignees Limited Partner Interests.
(b) The General Partner shall, in exercising voting rights in respect of Limited Partner
Interests held by it on behalf of Non-citizen Assignees, distribute the votes in the same ratios as
the votes of Partners (including the General Partner) in respect of Limited Partner Interests other
than those of Non-citizen Assignees are cast, either for, against or abstaining as to the matter.
(c) Upon dissolution of the Partnership, a Non-citizen Assignee 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 Non-citizen
Assignees share of any distribution in kind. Such payment and assignment shall be treated for
Partnership purposes as a purchase by the Partnership from the Non-citizen Assignee of his Limited
Partner Interest (representing his right to receive his share of such distribution in kind).
(d) At any time after he can and does certify that he has become an Eligible Citizen, a
Non-citizen Assignee may, upon application to the General Partner, request that with respect to any
Limited Partner Interests of such Non-citizen Assignee not redeemed pursuant to Section 4.10, such
Non-citizen Assignee be admitted as a Limited Partner, and upon approval of the General Partner,
such Non-citizen Assignee shall be admitted as a Limited Partner and shall no longer constitute a
Non-citizen Assignee and the General Partner shall cease to be deemed to be the Limited Partner in
respect of the Non-citizen Assignees Limited Partner Interests.
Section 4.10
Redemption of Partnership Interests of Non-citizen Assignees.
(a) If at any time a Limited Partner fails to furnish a Citizenship Certification or other
information requested within the 30-day period specified in Section 4.9(a), or if upon receipt of
such Citizenship Certification or other information the General Partner determines, with the advice
of counsel, that a Limited Partner is not an Eligible Citizen, the Partnership may, unless the
Limited Partner establishes to the satisfaction of the General Partner that such Limited Partner is
an Eligible Citizen or has transferred his Partnership Interests to a Person who is an Eligible
Citizen and who furnishes a Citizenship Certification to the General Partner prior to the date
fixed for redemption as provided below, redeem the Limited Partner Interest of such Limited Partner
as follows:
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
33
(i) The General Partner shall, not later than the 30th day before the date fixed for
redemption, give notice of redemption to the Limited Partner, at his last address designated
on the records of the Partnership or the Transfer Agent, 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 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 Limited 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 Limited Partner Interests of the class to be so redeemed multiplied by the
number of Limited Partner 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 10% annually and payable in three equal
annual installments of principal together with accrued interest, commencing one year after
the redemption date.
(iii) Upon surrender by or on behalf of the Limited 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, the Limited
Partner or his duly authorized representative shall be entitled to receive the payment
therefor.
(iv) After the redemption date, Redeemable Interests shall no longer constitute issued
and Outstanding Limited Partner Interests.
(b) The provisions of this Section 4.10 shall also be applicable to Limited Partner Interests
held by a Limited Partner as nominee of a Person determined to be other than an Eligible Citizen.
(c) Nothing in this Section 4.10 shall prevent the recipient of a notice of redemption from
transferring his Limited Partner 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 Limited Partner Interest
certifies to the satisfaction of the General Partner that he is an Eligible Citizen. If the
transferee fails to make such certification, such redemption shall be effected from the transferee
on the original redemption date.
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
34
ARTICLE V
CAPITAL CONTRIBUTIONS AND ISSUANCE OF PARTNERSHIP INTERESTS
Section 5.1
Organizational Contributions.
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 $20.00, for a 2%
General Partner Interest in the Partnership and has been admitted as the General Partner of the
Partnership, and the Organizational Limited Partners made an aggregate initial Capital Contribution
to the Partnership in the amount of $980.00 for a 98% Limited Partner Interest in the Partnership
and have been admitted as Limited Partners of the Partnership. As of the Closing Date, the
interest of the Organizational Limited Partners shall be redeemed and the initial Capital
Contribution of the Organizational Limited Partners shall thereupon be refunded. Ninety-eight
percent of any interest or other profit that may have resulted from the investment or other use of
such initial Capital Contributions shall be allocated and distributed to the Organizational Limited
Partners, and the balance thereof shall be allocated and distributed to the General Partner.
Section 5.2
Contributions by the General Partner and its Affiliates.
(a) On the Closing Date and pursuant to the Contribution Agreement: (i) the General Partner
shall contribute to the Partnership, as a Capital Contribution, all of its ownership interests in
Calumet Lubricants Co., Limited Partnership in exchange for (A) the 2% General Partner Interest,
subject to all of the rights, privileges and duties of the General Partner under this Agreement and
(B) the Incentive Distribution Rights; (ii) The Heritage Group shall contribute to the Partnership,
as a Capital Contribution, all of its ownership interests in Calumet Lubricants Co., Limited
Partnership in exchange for (A) 3,269,033 Common Units and (B) 7,414,176 Subordinated Units; (iii)
Calumet, Incorporated shall contribute to the Partnership, as a Capital Contribution, all of its
ownership interests in Calumet Lubricants Co., Limited Partnership in exchange for (A) 591,886
Common Units and (B) 1,342,401 Subordinated Units; (iv) Fred M. Fehsenfeld, Jr. shall contribute to
the Partnership, as a Capital Contribution, all of his ownership interests in Calumet Lubricants
Co., Limited Partnership in exchange for (A) 147,973 Common Units and (B) 335,600 Subordinated
Units; (v) Fehsenfeld Trust I shall contribute to the Partnership, as a Capital Contribution, all
of its ownership interests in Calumet Lubricants Co., Limited Partnership in exchange for (A)
286,077 Common Units and (B) 648,825 Subordinated Units; (vi) Fehsenfeld Trust II shall contribute
to the Partnership, as a Capital Contribution, all of its ownership interests in Calumet Lubricants
Co., Limited Partnership in exchange for (A) 286,077 Common Units and (B) 648,825 Subordinated
Units; (vii) Grube Trust I shall contribute to the Partnership, as a Capital Contribution, all of
its ownership interests in Calumet Lubricants Co., Limited Partnership in exchange for (A)
1,020,456 Common Units and (B) 2,314,396 Subordinated Units; (viii) Grube Trust II shall contribute
to the Partnership, as a Capital Contribution, all of its ownership interests in Calumet Lubricants
Co., Limited Partnership in exchange for (A) 147,853 Common Units and (B) 335,332 Subordinated
Units; and (ix) Janet Krampe Grube shall contribute to the Partnership, as a Capital Contribution,
all of her ownership interests in Calumet Lubricants Co., Limited Partnership in exchange for (A)
11,660 Common Units and (B) 26,445 Subordinated Units.
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
35
(b) Upon the issuance of any additional Limited Partner Interests by the Partnership (other
than the Common Units issued in the Initial Offering, the Fehsenfeld Common Units, the Common Units
issued pursuant to the Over-Allotment Option and the Common Units and Subordinated Units issued
pursuant to Section 5.2(a)), the General Partner may, in exchange for a proportionate number of
General Partner Units, make additional Capital Contributions in an amount equal to the product
obtained by multiplying (i) the quotient determined by dividing (A) the General Partners
Percentage Interest by (B) 100 less the General Partners Percentage Interest times (ii) the amount
contributed to the Partnership by the Limited Partners in exchange for such additional Limited
Partner Interests. Except as set forth in Article XII, the General Partner shall not be obligated
to make any additional Capital Contributions to the Partnership.
Section 5.3
Contributions by Initial Limited Partners.
(a) On the Closing Date and pursuant to the Underwriting Agreement, each Underwriter shall
contribute to the Partnership cash in an amount equal to the Issue Price per Initial Common Unit,
multiplied by the number of Common Units specified in the Underwriting Agreement to be purchased by
such Underwriter at the Closing Date. In exchange for such Capital Contributions by the
Underwriters, the Partnership shall issue Common Units to each Underwriter on whose behalf such
Capital Contribution is made in an amount equal to the quotient obtained by dividing (i) the cash
contribution to the Partnership by or on behalf of such Underwriter by (ii) the Issue Price per
Initial Common Unit.
(b) On the Closing Date and pursuant to the Common Unit Purchase Agreement, the Fehsenfeld
Investors shall contribute to the Partnership cash in an amount equal to $14,998,249. In exchange
for such Capital Contribution by the Fehsenfeld Investors, the Partnership shall issue 750,100
Common Units to the Fehsenfeld Investors (the Fehsenfeld Common Units).
(c) Upon the exercise of the Over-Allotment Option, each Underwriter shall contribute to the
Partnership cash in an amount equal to the Issue Price per Initial Common Unit, multiplied by the
number of Common Units to be purchased by such Underwriter at the Option Closing Date. In exchange
for such Capital Contributions by the Underwriters, the Partnership shall issue Common Units to
each Underwriter on whose behalf such Capital Contribution is made in an amount equal to the
quotient obtained by dividing (i) the cash contributions to the Partnership by or on behalf of such
Underwriter by (ii) the Issue Price per Initial Common Unit.
(d) No Limited Partner Interests will be issued or issuable as of or at the Closing Date other
than (i) the Common Units issuable pursuant to subparagraphs (a) and (b) hereof in aggregate number
equal to 6,450,000, (ii) the Option Units as such term is used in the Underwriting Agreement in
an aggregate number up to 854,985 issuable upon exercise of the Over-Allotment Option pursuant to
subparagraph (c) hereof, (iii) the 13,066,000 Subordinated Units issuable to pursuant to Section
5.2 hereof, (iv) the 5,761,015 Common Units issuable pursuant to Section 5.2 hereof, and (v) the
Incentive Distribution Rights.
Section 5.4
Interest and Withdrawal.
No interest shall be paid by the Partnership on Capital Contributions. No Partner shall be
entitled to the withdrawal or return of its Capital Contribution, except to the extent, if any,
that
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
36
distributions made pursuant to this Agreement or upon termination of the Partnership may be
considered as such 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 5.5
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 5.5(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 5.5(b) and allocated with
respect to such Partnership Interest pursuant to Section 6.1. For this purpose, the Capital
Contributions of any Partner pursuant to Sections 5.2(a) and 5.3 shall be equal to the sum of (aa)
the product of the Initial Unit Price and the number of Common Units (other than Fehsenfeld Common
Units), Subordinated Units and General Partner Units received by the Partner on the Closing Date
and (bb) the amount, if any, of cash contributed by the Partner on the Closing Date pursuant to
Section 5.3(b) with respect to the Fehsenfeld Common Units
(b) For purposes of computing the amount of any item of income, gain, loss or deduction which
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 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 5.5, 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 any other
Group Member that is classified as a partnership for federal income tax purposes.
(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.
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
37
(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 which 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 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 Partnerships 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 5.5(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) as if the adjusted
basis of such property were equal to the Carrying Value of such property immediately
following such adjustment and (B) using a rate of depreciation, cost recovery or
amortization derived from the same method and useful life (or, if applicable, the remaining
useful life) as is applied for federal income tax purposes;
provided
,
however
, that, if the
asset has a zero adjusted basis for federal income tax purposes, depreciation, cost recovery
or amortization deductions shall be determined using any method that the General Partner may
adopt.
(vi) If the Partnerships adjusted basis in a depreciable or cost recovery property is
reduced for federal income tax purposes pursuant to Section 48(q)(1) or 48(q)(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 year 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 48(q)(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.
(c) (i) 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.
(ii) Subject to Section 6.7(c), immediately prior to the transfer of a Subordinated
Unit or of a Subordinated Unit that has converted into a Common Unit pursuant to Section 5.8
by a holder thereof (other than a transfer to an Affiliate unless the
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
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General Partner elects to have this subparagraph 5.5(c)(ii) apply), the Capital Account
maintained for such Person with respect to its Subordinated Units or converted Subordinated
Units will (A) first, be allocated to the Subordinated Units or converted Subordinated Units
to be transferred in an amount equal to the product of (x) the number of such Subordinated
Units or converted Subordinated Units to be transferred and (y) the Per Unit Capital Amount
for a Common Unit (other than a Fehsenfeld Common Unit), and (B) second, any remaining
balance in such Capital Account will be retained by the transferor, regardless of whether it
has retained any Subordinated Units or converted Subordinated Units (
Retained Converted
Subordinated Units
). Following any such allocation, the transferors Capital Account, if
any, maintained with respect to the retained Subordinated Units or Retained Converted
Subordinated Units, if any, will have a balance equal to the amount allocated under clause
(B) hereinabove, and the transferees Capital Account established with respect to the
transferred Subordinated Units or converted Subordinated Units will have a balance equal to
the amount allocated under clause (A) hereinabove.
(iii) Subject to Section 6.9, immediately prior to the transfer of a Fehsenfeld Common
Unit (other than a transfer to an Affiliate unless the transferring Unitholder notifies the
General Partner it elects to have this subparagraph 5.5(c)(iii) apply), the Capital Account
maintained for such Person with respect to its Fehsenfeld Common Units will (A) first, be
allocated to the Fehsenfeld Common Units to be transferred in an amount equal to the product
of (x) the number of such Fehsenfeld Common Units to be transferred and (y) the Per Unit
Capital Amount for a Common Unit (other than a Fehsenfeld Common Unit), and (B) second, any
remaining balance in such Capital Account will be retained by the transferor, regardless of
whether it has retained any Fehsenfeld Common Units (
Retained Fehsenfeld Common Units
).
Following any such allocation, the transferors Capital Account, if any, maintained with
respect to the Retained Fehsenfeld Common Units, if any, will have a balance equal to the
amount allocated under clause (B) hereinabove, and the transferees Capital Account
established with respect to the transferred Fehsenfeld Common Units will have a balance
equal to the amount allocated under clause (A) hereinabove.
(d) (i) In accordance with Treasury Regulation Section 1.704-1(b)(2)(iv)(f), on 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 Partners Combined Interest to Common Units pursuant to Section 11.3(b), the
Capital Account of all Partners and 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, as if such
Unrealized Gain or Unrealized Loss had been recognized on an actual sale of each such
property immediately prior to such issuance 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 aggregate cash amount and fair market value of all Partnership
assets (including cash or cash equivalents) immediately prior to the issuance of additional
Partnership Interests shall be determined
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
39
by the General Partner using such method of valuation as it may adopt;
provided
,
however
,
that the General Partner, in arriving at such valuation, must take fully into account the
fair market value of the Partnership Interests of all Partners at such time. The General
Partner shall allocate such aggregate value among the assets of the Partnership (in such
manner as it determines) to arrive at a fair market value for individual properties.
(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 Capital Accounts of all Partners and 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, as if such Unrealized Gain or Unrealized
Loss had been recognized in a sale of 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 aggregate cash amount and fair market value of all Partnership assets
(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 and allocated in the same manner as that provided in
Section 5.5(d)(i) or (B) in the case of a liquidating distribution pursuant to Section 12.4,
be determined and allocated by the Liquidator using such method of valuation as it may
adopt.
Section 5.6
Issuances of Additional Partnership Securities.
(a) Subject to Section 5.7, the Partnership may issue additional Partnership Securities and
options, rights, warrants and appreciation rights relating to the Partnership Securities 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
Limited Partners.
(b) Each additional Partnership Security authorized to be issued by the Partnership pursuant
to Section 5.6(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 to existing
classes and series of Partnership Securities), 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 Security (including sinking fund provisions); (v) whether such Partnership
Security 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 Security will be issued, evidenced by certificates and assigned or transferred; (vii)
the method for determining the Percentage Interest as to such Partnership Security; and (viii) the
right, if any, of each such Partnership Security to vote on Partnership matters, including matters
relating to the relative rights, preferences and privileges of such Partnership Security.
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
40
(c) The General Partner shall take all actions that it determines to be necessary or
appropriate in connection with (i) each issuance of Partnership Securities and options, rights,
warrants and appreciation rights relating to Partnership Securities pursuant to this Section 5.6,
(ii) the conversion of the General Partner Interest (represented by General Partner Units) or any
Incentive Distribution Rights into Units pursuant to the terms of this Agreement, (iii) reflecting
the admission of such additional Limited Partners in the books and records of the Partnership as
the Record Holders of such Limited Partner Interests and (iv) all additional issuances of
Partnership Securities. The General Partner shall determine the relative rights, powers and duties
of the holders of the Units or other Partnership Securities 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 Securities or in connection with the conversion of the General Partner Interest or
any Incentive Distribution Rights into 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
Securities are listed or admitted to trading.
Section 5.7
Limitations on Issuance of Additional Partnership Securities.
Except as otherwise specified in this Section 5.7, the issuance of Partnership Securities
pursuant to Section 5.6 shall be subject to the following restrictions and limitations:
(a) Unless approved by the holders of a Unit Majority, during the Subordination Period, the
Partnership shall not issue (and shall not issue any options, rights, warrants or appreciation
rights relating to) an aggregate of more than 6,533,000 additional Parity Units. In applying this
limitation, there shall be excluded Common Units and other Parity Units issued (i) pursuant to
Sections 5.2(a), 5.2(b) and 5.3(a), (ii) in accordance with Sections 5.7(b), 5.7(d), 5.7(e), 5.7(f)
or 5.7(g), (iii) upon conversion of Subordinated Units pursuant to Section 5.8, (iv) upon
conversion of the General Partner Interest or any Incentive Distribution Rights pursuant to Section
11.3(b), (v) pursuant to the employee benefit plans of the General Partner, the Partnership or any
other Group Member, (vi) upon a conversion or exchange of Parity Units issued after the date hereof
into Common Units or other Parity Units;
provided
that the total amount of Available Cash required
to pay the aggregate Minimum Quarterly Distribution on all Common Units and all Parity Units does
not increase as a result of this conversion or exchange, and (vii) in the event of a combination or
subdivision of Common Units.
(b) Without the prior approval of the Limited Partners, during the Subordination Period, the
Partnership may issue an unlimited number of Parity Units if such issuance occurs (i) in connection
with an Acquisition or Capital Improvement or (ii) within 365 days of, and the net proceeds from
such issuance are used to repay debt incurred in connection with, or to replenish cash reserves to
the extent drawn down in connection with, an Acquisition or Capital Improvement, in each case where
such Acquisition or Capital Improvement involves assets that, if acquired (or in the case of a
Capital Improvement, put into commercial service) by the Partnership as of the date that is one
year prior to the first day of the Quarter in which such Acquisition was consummated or such
Capital Improvement was put into commercial service (One Year Test Period), would have resulted,
in the General Partners determination, in an increase in:
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
41
(A) the amount of Adjusted Operating Surplus generated by the Partnership on a
per-Unit basis (for all Outstanding Units) with respect to the One Year Test Period,
on an estimated pro forma basis (as described below), as compared to
(B) the actual amount of Adjusted Operating Surplus generated by the
Partnership on a per-Unit basis (for all Outstanding Units) with respect to the One
Year Test Period, as adjusted as provided below.
The General Partner shall determine the amount in clause (A) above using such assumptions as it
believes are reasonable. There shall be excluded from the amount in clause (B) above any Operating
Surplus attributable to such Acquisition or Capital Improvement (regardless of whether such
Operating Surplus is positive or negative). The number of Units deemed to be Outstanding for the
purpose of calculating the amount in clause (B) above shall be the weighted average number of Units
Outstanding during the One Year Test Period and shall exclude the Units issued or to be issued in
connection with such Acquisition or Capital Improvement or within 365 days of such Acquisition or
Capital Improvement where the net proceeds from such issuance are used to repay debt incurred, or
to replenish cash reserves to the extent drawn down, in connection with such Acquisition or Capital
Improvement. For the purposes of this Section 5.7(b), the term debt shall be deemed to include
the indebtedness used to extend, refinance, renew, replace or defease debt originally incurred in
connection with an Acquisition or Capital Improvement;
provided
, that, the amount of such
indebtedness does not exceed the principal sum of, plus accrued interest on and any prepayment
penalty with respect to, the indebtedness so extended, refinanced, renewed, replaced or defeased.
(c) Unless approved by the holders of a Unit Majority, during the Subordination Period the
Partnership shall not issue any additional Partnership Securities (or options, rights, warrants or
appreciation rights related thereto) (i) that are entitled in any Quarter to receive in respect of
the Subordination Period any distribution of Available Cash from Operating Surplus before the
Common Units and any Parity Units have received (or amounts have been set aside for payment of) the
Minimum Quarterly Distribution and any Cumulative Common Unit Arrearage for such Quarter or (ii)
that are entitled to allocations in respect of the Subordination Period of Net Termination Gain
before the Common Units and any Parity Units have been allocated Net Termination Gain pursuant to
Section 6.1(c)(i)(B).
(d) Without the prior approval of the Limited Partners, during the Subordination Period the
Partnership may issue additional Partnership Securities (or options, rights, warrants or
appreciation rights related thereto) (i) that are not entitled in any Quarter during the
Subordination Period to receive any distributions of Available Cash from Operating Surplus until
after the Common Units and any Parity Units have received (or amounts have been set aside for
payment of) the Minimum Quarterly Distribution and any Cumulative Common Unit Arrearage for such
Quarter and (ii) that are not entitled to allocations in respect of the Subordination Period of Net
Termination Gain until after the Common Units and Parity Units have been allocated Net Termination
Gain pursuant to Section 6.1(c)(i)(B), even if (A) the amount of Available Cash from Operating
Surplus to which each such Partnership Security is entitled to receive after the Minimum Quarterly
Distribution and any Cumulative Common Unit Arrearage have been paid or set aside for payment on
the Common Units exceeds the Minimum Quarterly Distribution or
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
42
(B) the amount of Net Termination Gain to be allocated to such Partnership Security
after Net Termination Gain has been allocated to any Common Units and Parity Units pursuant to
Section 6.1(c)(i)(B) exceeds the amount of such Net Termination Gain to be allocated to each Common
Unit or Parity Unit.
(e) Without the prior approval of the Limited Partners, during the Subordination Period the
Partnership may issue an unlimited number of Parity Units if the proceeds from such issuance are
used exclusively to repay indebtedness of a Group Member where the aggregate amount of
distributions that would have been paid with respect to such newly issued Parity Units, plus the
related distributions on the General Partner Interest in the Partnership in respect of the
four-Quarter period ending prior to the first day of the Quarter in which the issuance is to be
consummated (assuming such newly issued Parity Units had been Outstanding throughout such period
and that distributions equal to the distributions that were actually paid on the Outstanding Units
during the period were paid on such newly issued Parity Units) would not have exceeded the interest
costs actually incurred during such period on the indebtedness that is to be repaid (or, if such
indebtedness was not outstanding throughout the entire period, would have been incurred had such
indebtedness been outstanding for the entire period). In the event that the Partnership is required
to pay a prepayment penalty in connection with the repayment of such indebtedness, for purposes of
the foregoing test, the number of Parity Units issued to repay such indebtedness shall be deemed
increased by the number of Parity Units that would need to be issued to pay such penalty.
(f) Without the prior approval of the Limited Partners, during the Subordination Period the
Partnership may issue an unlimited number of Parity Units if the net proceeds of such issuance are
used to redeem an equal number of Parity Units at a price per unit equal to the net proceeds per
unit, before expenses, that the Partnership receives from such issuance.
(g) Without the prior approval of the Limited Partners, during the Subordination Period the
Partnership may issue, in connection with Acquisitions that have not been completed or Capital
Improvements that have not Commenced Commercial Service, or both, an amount of Parity Units not to
exceed the number of Parity Units then available for issuance without Unitholder approval pursuant
to Section 5.7(a) (such number of Parity Units then available for issuance, the
Remaining Basket
Amount).
The following shall apply with respect to issuances of Parity Units pursuant to this Section
5.7(g):
(i) With respect to such issuance, the aggregate number of Parity Units to be issued
(including Parity Units to be issued upon the exercise of an underwriters over-allotment or
other similar option) shall be deemed to have been issued from, and charged against, the
Remaining Basket Amount; provided, however, that in considering the Parity Units to be
issued upon the exercise of an underwriters over-allotment or other similar option, only
the number of Parity Units actually issued pursuant to such option on or prior to the
expiration of such option will be deemed to have been issued from, and charged against, the
Remaining Basket Amount.
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
43
(ii) With respect to Parity Units to be issued (including Parity Units to be issued
upon the exercise of an underwriters over-allotment or other similar option) in connection
with an Acquisition that has not been completed:
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(1)
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Such Acquisition shall have been specifically identified in the
prospectus or prospectus supplement filed, or other offering document used, in
connection with the offer and sale of such Parity Units as a proposed
Acquisition for which the net proceeds from the sale of such Parity Units will
be used if such Acquisition is completed.
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(2)
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Upon completion of such Acquisition and application of the net
proceeds received from the sale of such Parity Units to finance such
Acquisition, the provisions of clause (i) above shall not apply and the Parity
Units issued (including Parity Units issued upon the exercise of an
underwriters over-allotment or other similar option) in connection with such
Acquisition shall not be deemed to have been issued from, and charged against,
the Remaining Basket Amount; provided, however, that such Acquisition would
have resulted, on an estimated pro forma basis, in an increase in the amount of
Adjusted Operating Surplus per Unit (such amount shall be calculated as set
forth in Section 5.7(b) and such calculation is referred to in this Section
5.7(g) as the
Accretion Test"
).
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(3)
|
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The Accretion Test in subclause (2) above shall be performed
immediately following completion of such Acquisition and in accordance with
Section 5.7(b).
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(iii) With respect to Parity Units to be issued (including Parity Units to be issued
upon the exercise of an underwriters over-allotment or other similar option) in connection
with a Capital Improvement that has not Commenced Commercial Service:
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(1)
|
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Such Capital Improvement shall have been specifically
identified in the prospectus or prospectus supplement filed, or other offering
document used, in connection with the offer and sale of such Parity Units as a
Capital Improvement for which the net proceeds from the sale of such Parity
Units will used to finance such Capital Improvement.
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(2)
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Upon such Capital Improvement having Commenced Commercial
Service and provided the net proceeds from the sale of such Parity Units have
been used to finance such Capital Improvement, the provisions of clause (i)
above shall not apply and the Parity Units issued (including Parity Units
issued upon the exercise of an underwriters over-allotment or other similar
option) in connection with such Capital Improvement shall not be deemed to have
been issued from, and charged against, the Remaining Basket Amount; provided,
however, that such Capital Improvement meets the Accretion Test.
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CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
44
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(3)
|
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The Accretion Test in clause (2) above shall be performed
immediately following Commencement of Commercial Service and in accordance with
Section 5.7(b).
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(h) No fractional Units shall be issued by the Partnership.
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Section 5.8
|
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Conversion of Subordinated Units.
|
(a) All Subordinated Units shall convert into Common Units on a one-for-one basis on the
second Business Day following the distribution of Available Cash to Partners pursuant to Section
6.3(a) in respect of the final Quarter of the Subordination Period.
(b) Notwithstanding any other provision of this Agreement, all the Subordinated Units will
automatically convert into Common Units on a one-for-one basis as set forth in, and pursuant to the
terms of, Section 11.4.
(c) A Subordinated Unit that has converted into a Common Unit shall be subject to the
provisions of Section 6.7(b).
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Section 5.9
|
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Limited Preemptive Right.
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Except as provided in this Section 5.9 and in Section 5.2, no Person shall have any
preemptive, preferential or other similar right with respect to the issuance of any Partnership
Security, 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 Securities from the Partnership whenever, and on the same terms that, the
Partnership issues Partnership Securities 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
Securities.
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Section 5.10
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Splits and Combinations.
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(a) Subject to Sections 5.10(d), 6.6 and 6.10 (dealing with adjustments of distribution
levels), the Partnership may make a Pro Rata distribution of Partnership Securities to all Record
Holders or may effect a subdivision or combination of Partnership Securities 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 (including any Common Unit Arrearage or
Cumulative Common Unit Arrearage) or stated as a number of Units (including the number of
additional Parity Units remaining to be issued pursuant to Section 5.7 without a Unitholder vote)
are proportionately adjusted.
(b) Whenever such a distribution, subdivision or combination of Partnership Securities 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
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
45
selected by it to calculate the number of Partnership Securities to be held by each Record Holder
after giving effect to such distribution, subdivision or combination. 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 Securities as of the applicable Record Date
representing the new number of Partnership Securities 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
Securities Outstanding, the Partnership shall require, as a condition to the delivery to a Record
Holder of 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 Units. If a distribution, subdivision or combination of Units would result in the
issuance of fractional Units but for the provisions of Section 5.7(h) and this Section 5.10(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).
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Section 5.11
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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,
except as such non-assessability may be affected by Section 17-607 of the Delaware Act.
ARTICLE VI
ALLOCATIONS AND DISTRIBUTIONS
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Section 6.1
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Allocations for Capital Account Purposes.
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For purposes of maintaining the Capital Accounts and in determining the rights of the Partners
among themselves, the Partnerships items of income, gain, loss and deduction (computed in
accordance with Section 5.5(b)) shall be allocated among the Partners in each taxable year (or
portion thereof) as provided herein below.
(a)
Net Income
. After giving effect to the special allocations set forth in Section 6.1(d),
Net Income for each taxable year and all items of income, gain, loss and deduction taken into
account in computing Net Income for such taxable year shall be allocated as follows:
(i) First, 100% to the General Partner, in an amount equal to the aggregate Net Losses
allocated to the General Partner pursuant to Section 6.1(b)(iii) for all previous taxable
years until the aggregate Net Income allocated to the General Partner pursuant to this
Section 6.1(a)(i) for the current taxable year and all previous taxable years is equal to
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
46
the aggregate Net Losses allocated to the General Partner pursuant to Section 6.1(b)(iii)
for all previous taxable years;
(ii) Second, 100% to the General Partner and the Unitholders, in accordance with their
respective Percentage Interests, until the aggregate Net Income allocated to such Partners
pursuant to this Section 6.1(a)(ii) for the current taxable year and all previous taxable
years is equal to the aggregate Net Losses allocated to such Partners pursuant to Section
6.1(b)(ii) for all previous taxable years; and
(iii) Third, the balance, if any, 100% to the General Partner and to the Unitholders,
in accordance with their respective Percentage Interests.
(b)
Net Losses
. After giving effect to the special allocations set forth in Section 6.1(d),
Net Losses for each taxable period and all items of income, gain, loss and deduction taken into
account in computing Net Losses for such taxable period shall be allocated as follows:
(i) First, 100% to the General Partner and the Unitholders, in accordance with their
respective Percentage Interests, until the aggregate Net Losses allocated pursuant to this
Section 6.1(b)(i) for the current taxable year and all previous taxable years is equal to
the aggregate Net Income allocated to such Partners pursuant to Section 6.1(a)(iii) for all
previous taxable years, provided that the Net Losses shall not be allocated pursuant to this
Section 6.1(b)(i) to the extent that such allocation would cause any Unitholder to have a
deficit balance in its Adjusted Capital Account at the end of such taxable year (or increase
any existing deficit balance in its Adjusted Capital Account);
(ii) Second, 100% to the General Partner and the Unitholders, in accordance with their
respective Percentage Interests;
provided
, that Net Losses shall not be allocated pursuant
to this Section 6.1(b)(ii) to the extent that such allocation would cause any Unitholder to
have a deficit balance in its Adjusted Capital Account at the end of such taxable year (or
increase any existing deficit balance in its Adjusted Capital Account); and
(iii) Third, the balance, if any, 100% to the General Partner.
(c)
Net Termination Gains and Losses
. After giving effect to the special allocations set forth
in Section 6.1(d), all items of income, gain, loss and deduction taken into account in computing
Net Termination Gain or Net Termination Loss for such taxable period shall be allocated in the same
manner as such Net Termination Gain or Net Termination Loss is allocated hereunder. All allocations
under this Section 6.1(c) shall be made after Capital Account balances have been adjusted by all
other allocations provided under this Section 6.1 and after all distributions of Available Cash
provided under Sections 6.4 and 6.5 have been made;
provided
,
however
, that solely for purposes of
this Section 6.1(c), Capital Accounts shall not be adjusted for distributions made pursuant to
Section 12.4.
(i) If a Net Termination Gain is recognized (or deemed recognized pursuant to Section
5.5(d)), such Net Termination Gain shall be allocated among the Partners in the following
manner (and the Capital Accounts of the Partners shall be increased by the
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
47
amount so allocated in each of the following subclauses, in the order listed, before an allocation is
made pursuant to the next succeeding subclause):
(A) First, to each Partner having a deficit balance in its Capital Account, in
the proportion that such deficit balance bears to the total deficit balances in the
Capital Accounts of all Partners, until each such Partner has been allocated Net
Termination Gain equal to any such deficit balance in its Capital Account;
(B) Second, (x) to the General Partner in accordance with its Percentage
Interest and (y) to all Unitholders holding Common Units, their Pro Rata share of a
percentage equal to 100% less the General Partners Percentage Interest, until the
Capital Account in respect of each Common Unit then Outstanding is equal to the sum
of (1) its Unrecovered Initial Unit Price, (2) the Minimum Quarterly Distribution
for the Quarter during which the Liquidation Date occurs, reduced by any
distribution pursuant to Section 6.4(a)(i) or (b)(i) with respect to such Common
Unit for such Quarter (the amount determined pursuant to this clause (2) is
hereinafter defined as the Unpaid MQD) and (3) any then existing Cumulative Common
Unit Arrearage;
(C) Third, if such Net Termination Gain is recognized (or is deemed to be
recognized) prior to the conversion of the last Outstanding Subordinated Unit, (x)
to the General Partner in accordance with its Percentage Interest and (y) all
Unitholders holding Subordinated Units, their Pro Rata share of a percentage equal
to 100% less the General Partners Percentage Interest, until the Capital Account in
respect of each Subordinated Unit then Outstanding equals the sum of (1) its
Unrecovered Initial Unit Price, determined for the taxable year (or portion thereof)
to which this allocation of gain relates, and (2) the Minimum Quarterly Distribution
for the Quarter during which the Liquidation Date occurs, reduced by any
distribution pursuant to Section 6.4(a)(iii) with respect to such Subordinated Unit
for such Quarter;
(D) Fourth, 100% to the General Partner and all Unitholders in accordance with
their respective Percentage Interests, until the Capital Account in respect of each
Common Unit then Outstanding is equal to the sum of (1) its Unrecovered Initial Unit
Price, (2) the Unpaid MQD, (3) any then existing Cumulative Common Unit Arrearage,
and (4) the excess of (aa) the First Target Distribution less the Minimum Quarterly
Distribution for each Quarter of the Partnerships existence over (bb) the
cumulative per Unit amount of any distributions of Available Cash that is deemed to
be Operating Surplus made pursuant to Sections 6.4(a)(iv) and 6.4(b)(ii) (the sum of
(1), (2), (3) and (4) is hereinafter defined as the First Liquidation Target
Amount);
(E) Fifth, (x) to the General Partner in accordance with its Percentage
Interest, (y) 13% to the holders of the Incentive Distribution Rights, Pro Rata, and
(z) to all Unitholders, their Pro Rata share of a percentage equal to 100% less the
sum of the percentages applicable to subclause (x) and (y) of this clause (E), until
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
48
the Capital Account in respect of each Common Unit then Outstanding is equal to the
sum of (1) the First Liquidation Target Amount, and (2) the excess of (aa) the
Second Target Distribution less the First Target Distribution for each Quarter of
the Partnerships existence over (bb) the cumulative per Unit amount of any
distributions of Available Cash that is deemed to be Operating Surplus made pursuant
to Sections 6.4(a)(v) and 6.4(b)(iii) (the sum of (1) and (2) is hereinafter defined
as the Second Liquidation Target Amount);
(F) Sixth, (x) to the General Partner in accordance with its Percentage
Interest, (y) 23% to the holders of the Incentive Distribution Rights, Pro Rata, and
(z) to all Unitholders, their Pro Rata share of a percentage equal to 100% less the
sum of the percentages applicable to subclause (x) and (y) of this clause (F), until
the Capital Account in respect of each Common Unit then Outstanding is equal to the
sum of (1) the Second Liquidation Target Amount, and (2) the excess of (aa) the
Third Target Distribution less the Second Target Distribution for each Quarter of
the Partnerships existence over (bb) the cumulative per Unit amount of any
distributions of Available Cash that is deemed to be Operating Surplus made pursuant
to Sections 6.4(a)(vi) and 6.4(b)(iv) (the sum of (1) and (2) is hereinafter defined
as the Third Liquidation Target Amount); and
(G) Finally, (x) to the General Partner in accordance with its Percentage
Interest, (y) 48% to the holders of the Incentive Distribution Rights, Pro Rata, and
(z) to all Unitholders, their Pro Rata share of a percentage equal to 100% less the
sum of the percentages applicable to subclause (x) and (y) of this clause (G).
(ii) If a Net Termination Loss is recognized (or deemed recognized pursuant to Section
5.5(d)), such Net Termination Loss shall be allocated among the Partners in the following
manner:
(A) First, if such Net Termination Loss is recognized (or is deemed to be
recognized) prior to the conversion of the last Outstanding Subordinated Unit, (x)
to the General Partner in accordance with its Percentage Interest and (y) to all
Unitholders holding Subordinated Units, their Pro Rata share of a percentage equal
to 100% less the General Partners Percentage Interest, until the Capital Account in
respect of each Subordinated Unit then Outstanding has been reduced to zero;
(B) Second, (x) to the General Partner in accordance with its Percentage
Interest and (y) to all Unitholders holding Common Units, their Pro Rata share of a
percentage equal to 100% less the General Partners Percentage Interest, until the
Capital Account in respect of each Common Unit then Outstanding has been reduced to
zero; and
(C) Third, the balance, if any, 100% to the General Partner.
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
49
(d)
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(d), each
Partners 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(d) with respect to such taxable period (other than
an allocation pursuant to Sections 6.1(d)(vi) and 6.1(d)(vii)). This Section 6.1(d)(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(d)(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 provisions. For purposes of this Section 6.1(d), each
Partners 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(d), other than Section 6.1(d)(i) and other than an
allocation pursuant to Sections 6.1(d)(vi) and 6.1(d)(vii), with respect to such taxable
period. This Section 6.1(d)(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) to any Unitholder
with respect to its Units for a taxable year is greater (on a per Unit basis) than
the amount of cash or the Net Agreed Value of property distributed to the other
Unitholders with respect to their Units (on a per Unit basis), then (1) 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 (on a
per Unit basis) to the Unitholders receiving the smallest distribution and (bb) the
number of Units owned by the Unitholder receiving the greater distribution; and (2)
the General Partner shall be allocated gross income in an aggregate amount equal to
the product obtained by multiplying (aa) the
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
50
quotient determined by dividing (x) the General Partners Percentage Interest at the time in which the greater cash or
property distribution occurs by (y) the sum of 100 less the General Partners
Percentage Interest at the time in which the greater cash or property distribution
occurs times (bb) the sum of the amounts allocated in clause (1) above.
(B) After the application of Section 6.1(d)(iii)(A), all or any portion of the
remaining items of Partnership gross income or gain for the taxable period, if any,
shall be allocated (1) to the holders of Incentive Distribution Rights, Pro Rata,
until the aggregate amount of such items allocated to the holders of Incentive
Distribution Rights pursuant to this paragraph 6.1(d)(iii)(B) for the current
taxable year and all previous taxable years is equal to the cumulative amount of all
Incentive Distributions made to the holders of Incentive Distribution Rights from
the Closing Date to a date 45 days after the end of the current taxable year; and
(2) to the General Partner an amount equal to the product of (aa) an amount equal to
the quotient determined by dividing (x) the General Partners Percentage Interest by
(y) the sum of 100 less the General Partners Percentage Interest times (bb) the sum
of the amounts allocated in clause (1) above.
(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 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 unless such deficit balance is otherwise eliminated pursuant to Section 6.1(d)(i)
or (ii).
(v)
Gross Income Allocations
. In the event any Partner has a deficit balance in its
Capital Account at the end of any Partnership 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(d)(v) shall be made only if and to
the extent that such Partner would have a deficit balance in its 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(d)(v) were not in this Agreement.
(vi)
Nonrecourse Deductions
. Nonrecourse Deductions for any taxable period shall be
allocated to the Partners in accordance with their respective Percentage Interests. If the
General Partner determines that the Partnerships 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
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
51
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.
(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 in accordance with their
respective Percentage Interests.
(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
.
(A) At the election of the General Partner with respect to any taxable period
prior to the transfer of a Common Unit by a Fehsenfeld Investor, all or a portion of
the remaining items of Partnership gross income or gain for such taxable period,
after taking into account allocations pursuant to Section 6.1(d)(iii), shall be
allocated 100% to each such Partner holding Fehsenfeld Common Units (
Final
Fehsenfeld Common Units
) until each such Partner has been allocated an amount of
gross income or gain that increases the Capital Account maintained with respect to
such Final Fehsenfeld Common Units to an amount equal to the product of (A) the
number of Final Fehsenfeld Common Units held by such Partner and (B) the Per Unit
Capital Amount for a Common Unit (other than a Fehsenfeld Common Unit). The purpose
of this allocation is to establish uniformity between the Capital Accounts
underlying Final Fehsenfeld Common Units and the Capital Accounts underlying Common
Units held by Persons other than the General Partner and its Affiliates immediately
prior to the transfer of such Final Fehsenfeld Common Units. This allocation method
for establishing such economic uniformity will be available to the General Partner
only if the method for allocating the Capital Account maintained with respect to the
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
52
transferred and retained Fehsenfeld Common Units pursuant to Section 5.5(c)(iii)
does not otherwise provide such economic uniformity to the Final Fehsenfeld Common
Units. For purposes of this Section 6.1(d)(x)(A), the term Fehsenfeld Investor
shall include any transferee of a Fehsenfeld Common Unit that is an Affiliate of the
transferor unless the transferor elected to have Section 5.5(c)(iii) apply.
(B) At the election of the General Partner with respect to any taxable period
ending upon, or after, the termination of the Subordination Period, all or a portion
of the remaining items of Partnership gross income or gain for such taxable period,
after taking into account allocations pursuant to Section 6.1(d)(iii) and Section
6.1(d)(x)(A), shall be allocated 100% to each Partner holding Subordinated Units
that are Outstanding as of the termination of the Subordination Period (
Final
Subordinated Units
) in the proportion of the number of Final Subordinated Units
held by such Partner to the total number of Final Subordinated Units then
Outstanding, until each such Partner has been allocated an amount of gross income or
gain that increases the Capital Account maintained with respect to such Final
Subordinated Units to an amount equal to the product of (x) the number of Final
Subordinated Units held by such Partner and (y) the Per Unit Capital Amount for a
Common Unit (other than a Fehsenfeld Common Unit). The purpose of this allocation is
to establish uniformity between the Capital Accounts underlying Final Subordinated
Units and the Capital Accounts underlying Common Units held by Persons other than
the General Partner and its Affiliates immediately prior to the conversion of such
Final Subordinated Units into Common Units. This allocation method for establishing
such economic uniformity will be available to the General Partner only if the method
for allocating the Capital Account maintained with respect to the Subordinated Units
between the transferred and retained Subordinated Units pursuant to Section
5.5(c)(ii) does not otherwise provide such economic uniformity to the Final
Subordinated Units.
(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
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. Notwithstanding the preceding sentence,
Required Allocations relating to (1) Nonrecourse Deductions shall not be taken into
account except to the extent that there has been a decrease in Partnership Minimum
Gain and (2) Partner Nonrecourse Deductions shall not be taken into account except
to the extent that there has been a decrease in Partner Nonrecourse Debt Minimum
Gain.
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
53
Allocations pursuant to this Section 6.1(d)(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. Further, allocations pursuant to this Section 6.1(d)(xi)(A) shall be
deferred with respect to allocations pursuant to clauses (1) and (2) hereof to the
extent the General Partner determines that such allocations are likely to be offset
by subsequent Required Allocations.
(B) The General Partner shall, with respect to each taxable period, (1) apply
the provisions of Section 6.1(d)(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(d)(xi)(A) among the Partners
in a manner that is likely to minimize such economic distortions.
(xii)
Corrective Allocations
. In the event of any allocation of Additional Book Basis
Derivative Items or any Book-Down Event or any recognition of a Net Termination Loss, the
following rules shall apply:
(A) In the case of any allocation of Additional Book Basis Derivative Items
(other than an allocation of Unrealized Gain or Unrealized Loss under Section 5.5(d)
hereof), the General Partner shall allocate additional items of gross income and
gain away from the holders of Incentive Distribution Rights to the Unitholders and
the General Partner, or additional items of deduction and loss away from the
Unitholders and the General Partner to the holders of Incentive Distribution Rights,
to the extent that the Additional Book Basis Derivative Items allocated to the
Unitholders or the General Partner exceed their Share of Additional Book Basis
Derivative Items. For this purpose, the Unitholders and the General Partner shall be
treated as being allocated Additional Book Basis Derivative Items to the extent that
such Additional Book Basis Derivative Items have reduced the amount of income that
would otherwise have been allocated to the Unitholders or the General Partner under
the Partnership Agreement (e.g., Additional Book Basis Derivative Items taken into
account in computing cost of goods sold would reduce the amount of book income
otherwise available for allocation among the Partners). Any allocation made pursuant
to this Section 6.1(d)(xii)(A) shall be made after all of the other Agreed
Allocations have been made as if this Section 6.1(d)(xii) were not in this Agreement
and, to the extent necessary, shall require the reallocation of items that have been
allocated pursuant to such other Agreed Allocations.
(B) In the case of any negative adjustments to the Capital Accounts of the
Partners resulting from a Book-Down Event or from the recognition of a Net
Termination Loss, such negative adjustment (1) shall first be allocated, to the
extent of the Aggregate Remaining Net Positive Adjustments, in such a manner, as
determined by the General Partner, that to the extent possible the aggregate Capital
Accounts of the Partners will equal the amount that would have been the Capital
Account balance of the Partners if no prior Book-Up Events had
occurred, and (2) any negative adjustment in excess of the Aggregate Remaining Net Positive Adjustments
shall be allocated pursuant to Section 6.1(c) hereof.
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
54
(C) In making the allocations required under this Section 6.1(d)(xii), the
General Partner may apply whatever conventions or other methodology it determines
will satisfy the purpose of this Section 6.1(d)(xii).
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Section 6.2
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Allocations for Tax Purposes.
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(a) Except as otherwise provided herein, for 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 federal income tax purposes among the Partners as follows:
(i) (A) In the case of a Contributed Property, such items attributable thereto shall be
allocated among the Partners in the manner provided under Section 704(c) of the Code that
takes into account the variation between the Agreed Value of such property and its adjusted
basis at the time of contribution; and (B) any item of Residual Gain or Residual Loss
attributable to a Contributed Property shall be allocated among the Partners in the same
manner as its correlative item of book gain or loss is allocated pursuant to Section 6.1.
(ii) (A) In the case of an Adjusted Property, such items shall (1) first, be allocated
among the Partners in a manner consistent with the principles of Section 704(c) of the Code
to take into account the Unrealized Gain or Unrealized Loss attributable to such property
and the allocations thereof pursuant to Section 5.5(d)(i) or 5.5(d)(ii), and (2) second, in
the event such property was originally a Contributed Property, be allocated among the
Partners in a manner consistent with Section 6.2(b)(i)(A); and (B) any item of Residual Gain
or Residual Loss attributable to an Adjusted Property shall be allocated among the Partners
in the same manner as its correlative item of book gain or loss is allocated pursuant to
Section 6.1.
(iii) The General Partner shall apply the principles of Treasury Regulation Section
1.704-3(d) to eliminate Book-Tax Disparities.
(c) 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 for federal income tax
purposes of income (including gross income) or deductions; 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).
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
55
The General Partner may adopt such conventions, make such allocations and make such amendments to this Agreement as provided in this
Section 6.2(c) 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 Limited Partner Interests
issued and Outstanding or the Partnership, and if such allocations are consistent with the
principles of Section 704 of the Code.
(d) 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 Partnerships common basis 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 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 Partnerships 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
Limited Partner Interests, so long as such conventions would not have a material adverse effect on
the Limited Partners or the Record Holders of any class or classes of Limited Partner Interests.
(e) 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.
(f) All items of income, gain, loss, deduction and credit recognized by the Partnership for
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.
(g) Each item of Partnership income, gain, loss and deduction, for federal income tax
purposes, shall be determined on an annual basis and prorated on a monthly basis and shall be
allocated to the Partners as of the opening of the New York Stock Exchange 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 Option Closing Date or the expiration of the
Over-Allotment Option occurs shall be allocated to the Partners as of the opening of the New York
Stock Exchange 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 or loss realized and recognized other than in the ordinary course of
business, as determined by the General Partner, shall be allocated to the Partners as of the
opening of the New York Stock Exchange on the first Business Day of the month in which
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
56
such gain or loss is recognized for 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.
(h) Allocations that would otherwise be made to a Limited Partner under the provisions of this
Article VI shall instead be made to the beneficial owner of Limited Partner
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.
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Section 6.3
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Requirement and Characterization of Distributions; Distributions to Record
Holders.
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(a) Within 45 days following the end of each Quarter commencing with the Quarter ending on
March 31, 2006, an amount equal to 100% of Available Cash with respect to such Quarter shall,
subject to Section 17-607 of the Delaware Act, be distributed in accordance with this Article VI by
the Partnership to the Unitholders and the General Partner as of the Record Date selected by the
General Partner. All amounts of Available Cash distributed by the Partnership on any date from any
source shall be deemed to be Operating Surplus until the sum of all amounts of Available Cash
theretofore distributed by the Partnership to the Unitholders and the General Partner pursuant to
Section 6.4 equals the Operating Surplus from the Closing Date through the close of the immediately
preceding Quarter. Any remaining amounts of Available Cash distributed by the Partnership on such
date shall, except as otherwise provided in Section 6.5, be deemed to be Capital Surplus. All
distributions required to be made under this Agreement shall be made subject to Section 17-607 of
the Delaware Act.
(b) Notwithstanding Section 6.3(a), in the event of the dissolution and liquidation of the
Partnership, all receipts received during or after the Quarter in which the Liquidation Date
occurs, other than from borrowings described in (a)(ii) of the definition of Available Cash, shall
be applied and distributed solely in accordance with, and subject to the terms and conditions of,
Section 12.4.
(c) The General Partner may treat taxes paid by the Partnership on behalf of, or amounts
withheld with respect to, all or less than all of the Unitholders and the General Partner, as a
distribution of Available Cash to such Unitholders and the General Partner.
(d) Each distribution in respect of a Partnership Interest shall be paid by the Partnership,
directly or through the 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 Partnerships 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.
Section 6.4
Distributions of Available Cash from Operating Surplus.
(a)
During Subordination Period
. Available Cash with respect to any Quarter within the
Subordination Period that is deemed to be Operating Surplus pursuant to the provisions of
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
57
Section 6.3 or 6.5 shall, subject to Section 17-607 of the Delaware Act, be distributed as follows, except
as otherwise contemplated by Section 5.6 in respect of other Partnership Securities issued pursuant
thereto:
(i) First, (A) to the General Partner in accordance with its Percentage Interest and
(B) to all Unitholders holding Common Units, their Pro Rata share of a percentage equal to
100% less the General Partners Percentage Interest, until there has been
distributed in respect of each Common Unit then Outstanding an amount equal to the
Minimum Quarterly Distribution for such Quarter;
(ii) Second, (A) to the General Partner in accordance with its Percentage Interest and
(B) to all Unitholders holding Common Units, their Pro Rata share of a percentage equal to
100% less the General Partners Percentage Interest, until there has been distributed in
respect of each Common Unit then Outstanding an amount equal to the Cumulative Common Unit
Arrearage existing with respect to such Quarter;
(iii) Third, (A) to the General Partner in accordance with its Percentage Interest and
(B) to all Unitholders holding Subordinated Units, their Pro Rata share of a percentage
equal to 100% less the General Partners Percentage Interest, until there has been
distributed in respect of each Subordinated Unit then Outstanding an amount equal to the
Minimum Quarterly Distribution for such Quarter;
(iv) Fourth, to the General Partner and all Unitholders, in accordance with their
respective Percentage Interests, until there has been distributed in respect of each Unit
then Outstanding an amount equal to the excess of the First Target Distribution over the
Minimum Quarterly Distribution for such Quarter;
(v) Fifth, (A) to the General Partner in accordance with its Percentage Interest; (B)
13% to the holders of the Incentive Distribution Rights, Pro Rata; and (C) to all
Unitholders, their Pro Rata share of a percentage equal to 100% less the sum of the
percentages applicable to subclauses (A) and (B) of this clause (v) until there has been
distributed in respect of each Unit then Outstanding an amount equal to the excess of the
Second Target Distribution over the First Target Distribution for such Quarter;
(vi) Sixth, (A) to the General Partner in accordance with its Percentage Interest, (B)
23% to the holders of the Incentive Distribution Rights, Pro Rata; and (C) to all
Unitholders, their Pro Rata share of a percentage equal to 100% less the sum of the
percentages applicable to subclauses (A) and (B) of this subclause (vi), until there has
been distributed in respect of each Unit then Outstanding an amount equal to the excess of
the Third Target Distribution over the Second Target Distribution for such Quarter; and
(vii) Thereafter, (A) to the General Partner in accordance with its Percentage
Interest; (B) 48% to the holders of the Incentive Distribution Rights, Pro Rata; and (C) to
all Unitholders, their Pro Rata share of a percentage equal to 100% less the sum of the
percentages applicable to subclauses (A) and (B) of this clause (vii);
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
58
provided, however
, if the Minimum Quarterly Distribution, the First Target Distribution, the Second
Target Distribution and the Third Target Distribution have been reduced to zero pursuant to the
second sentence of Section 6.6(a), the distribution of Available Cash that is deemed to be
Operating Surplus with respect to any Quarter will be made solely in accordance with Section
6.4(a)(vii).
(b)
After Subordination Period.
Available Cash with respect to any Quarter after the
Subordination Period that is deemed to be Operating Surplus pursuant to the provisions of
Section 6.3 or 6.5, subject to Section 17-607 of the Delaware Act, shall be distributed as
follows, except as otherwise required by Section 5.6(b) in respect of additional Partnership
Securities issued pursuant thereto:
(i) First, 100% to the General Partner and the Unitholders in accordance with their
respective Percentage Interests, until there has been distributed in respect of each Unit
then Outstanding an amount equal to the Minimum Quarterly Distribution for such Quarter;
(ii) Second, 100% to the General Partner and the Unitholders in accordance with their
respective Percentage Interests, until there has been distributed in respect of each Unit
then Outstanding an amount equal to the excess of the First Target Distribution over the
Minimum Quarterly Distribution for such Quarter;
(iii) Third, (A) to the General Partner in accordance with its Percentage Interest; (B)
13% to the holders of the Incentive Distribution Rights, Pro Rata; and (C) to all
Unitholders, their Pro Rata share of a percentage equal to 100% less the sum of the
percentages applicable to subclauses (A) and (B) of this clause (iii), until there has been
distributed in respect of each Unit then Outstanding an amount equal to the excess of the
Second Target Distribution over the First Target Distribution for such Quarter;
(iv) Fourth, (A) to the General Partner in accordance with its Percentage Interest; (B)
23% to the holders of the Incentive Distribution Rights, Pro Rata; and (C) to all
Unitholders, their Pro Rata share of a percentage equal to 100% less the sum of the
percentages applicable to subclause (A) and (B) of this clause (iv), until there has been
distributed in respect of each Unit then Outstanding an amount equal to the excess of the
Third Target Distribution over the Second Target Distribution for such Quarter; and
(v) Thereafter, (A) to the General Partner in accordance with its Percentage Interest;
(B) 48% to the holders of the Incentive Distribution Rights, Pro Rata; and (C) to all
Unitholders, their Pro Rata share of a percentage equal to 100% less the sum of the
percentages applicable to subclauses (A) and (B) of this clause (v);
provided, however
, if the Minimum Quarterly Distribution, the First Target Distribution, the Second
Target Distribution and the Third Target Distribution have been reduced to zero pursuant to the
second sentence of Section 6.6(a), the distribution of Available Cash that is deemed to be
Operating Surplus with respect to any Quarter will be made solely in accordance with Section
6.4(b)(v).
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
59
Section 6.5
Distributions of Available Cash from Capital Surplus.
Available Cash that is deemed to be Capital Surplus pursuant to the provisions of Section
6.3(a) shall, subject to Section 17-607 of the Delaware Act, be distributed, unless the provisions
of Section 6.3 require otherwise, 100% to the General Partner and the Unitholders in accordance
with their respective Percentage Interests, until a hypothetical holder of a Common Unit acquired
on the Closing Date has received with respect to such Common Unit, during the period since the
Closing Date through such date, distributions of Available Cash that are deemed to be Capital
Surplus in an aggregate amount equal to the Initial Unit Price. Available Cash that is deemed to
be Capital Surplus shall then be distributed (a) to the General Partner in accordance with its
Percentage Interest and (b) to all Unitholders holding Common Units, their Pro Rata share of a
percentage equal to 100% less the General Partners Percentage Interest, until there has been
distributed in respect of each Common Unit then Outstanding an amount equal to the Cumulative
Common Unit Arrearage. Thereafter, all Available Cash shall be distributed as if it were Operating
Surplus and shall be distributed in accordance with Section 6.4.
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Section 6.6
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Adjustment of Minimum Quarterly Distribution and Target Distribution Levels.
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(a) The Minimum Quarterly Distribution, First Target Distribution, Second Target Distribution,
Third Target Distribution, Common Unit Arrearages and Cumulative Common Unit Arrearages shall be
proportionately adjusted in the event of any distribution, combination or subdivision (whether
effected by a distribution payable in Units or otherwise) of Units or other Partnership Securities
in accordance with Section 5.10. In the event of a distribution of Available Cash that is deemed to
be from Capital Surplus, the then applicable Minimum Quarterly Distribution, First Target
Distribution, Second Target Distribution and Third Target Distribution, shall be adjusted
proportionately downward to equal the product obtained by multiplying the otherwise applicable
Minimum Quarterly Distribution, First Target Distribution, Second Target Distribution and Third
Target Distribution, as the case may be, by a fraction of which the numerator is the Unrecovered
Initial Unit Price of the Common Units immediately after giving effect to such distribution and of
which the denominator is the Unrecovered Initial Unit Price of the Common Units immediately prior
to giving effect to such distribution.
(b) The Minimum Quarterly Distribution, First Target Distribution, Second Target Distribution
and Third Target Distribution, shall also be subject to adjustment pursuant to Section 6.10.
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Section 6.7
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Special Provisions Relating to the Holders of Subordinated Units.
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(a) Except with respect to the right to vote on or approve matters requiring the vote or
approval of a percentage of the holders of Outstanding Common Units and the right to participate in
allocations of income, gain, loss and deduction and distributions made with respect to Common
Units, the holder of a Subordinated Unit shall have all of the rights and obligations of a
Unitholder holding Common Units hereunder;
provided
,
however
, that immediately upon the conversion
of Subordinated Units into Common Units pursuant to Section 5.8, the Unitholder holding a
Subordinated Unit shall possess all of the rights and obligations of a Unitholder holding Common
Units hereunder, including the right to vote as a Common Unitholder and the
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
60
right to participate in allocations of income, gain, loss and deduction and distributions made with respect to Common
Units;
provided
,
however
, that such converted Subordinated Units shall remain subject to the
provisions of Sections 5.5(c)(ii), 6.1(d)(x) and 6.7(c).
(b) A Unitholder shall not be permitted to transfer a Subordinated Unit or a Subordinated Unit
that has converted into a Common Unit pursuant to Section 5.8 (other than a transfer to an
Affiliate) if the remaining balance in the transferring Unitholders Capital Account with respect
to the retained Subordinated Units or Retained Converted Subordinated Units would be negative after
giving effect to the allocation under Section 5.5(c)(ii)(B).
(c) A Unitholder holding a Subordinated Unit that has converted into a Common Unit pursuant to
Section 5.8 shall not be issued a Common Unit Certificate pursuant to Section 4.1, and shall not be
permitted to transfer its converted Subordinated Units to a Person that is not an Affiliate of the
holder until such time as the General Partner determines, based on advice of counsel, that a
converted Subordinated Unit should have, as a substantive matter, like intrinsic economic and
federal income tax characteristics, in all material respects, to the intrinsic economic and federal
income tax characteristics of an Initial Common Unit. In connection with the condition imposed by
this Section 6.7(c), the General Partner may take whatever steps are required to provide economic
uniformity to the converted Subordinated Units in preparation for a transfer of such converted
Subordinated Units, including the application of Sections 5.5(c)(ii), 6.1(d)(x) and 6.7(b);
provided
,
however
, that no such steps may be taken that would have a material adverse effect on the
Unitholders holding Common Units (other than a Fehsenfeld Common Unit).
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Section 6.8
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Special Provisions Relating to the Holders of Incentive Distribution Rights.
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Notwithstanding anything to the contrary set forth in this Agreement, the holders of the
Incentive Distribution Rights (a) shall (i) possess the rights and obligations provided in this
Agreement with respect to a Limited Partner pursuant to Articles III and VII and (ii) have a
Capital Account as a Partner pursuant to Section 5.5 and all other provisions related thereto and
(b) shall not (i) be entitled to vote on any matters requiring the approval or vote of the holders
of Outstanding Units, except as provided by law, (ii) be entitled to any distributions other than
as provided in Sections 6.4(a)(v), (vi) and (vii), 6.4(b)(iii), (iv) and (v), and 12.4 or (iii) be
allocated items of income, gain, loss or deduction other than as specified in this Article VI.
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Section 6.9
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Special Provisions Relating to the Fehsenfeld Investors.
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A Unitholder holding a Fehsenfeld Common Unit shall not be issued a Common Unit Certificate
pursuant to Section 4.1, and shall not be permitted to transfer its Fehsenfeld Common Units to a
Person that is not an Affiliate of the holder until such time as the General Partner determines,
based on advice of counsel, that such Fehsenfeld Common Unit should have, as a substantive matter,
like intrinsic economic and federal income tax characteristics, in all material respects, to the
intrinsic economic and federal income tax characteristics of an Initial Common Unit (other than a
Fehsenfeld Common Unit). In connection with the condition imposed by this Section 6.9, the General
Partner may take whatever steps are required to provide economic uniformity to the Fehsenfeld
Common Units in preparation for a transfer of such Fehsenfeld Common Units, including the application of Sections 5.5(c)(iii) and 6.1(d)(x)(A);
provided
,
however
, that no such steps may be
taken that would have a material adverse effect on the Unitholders holding Common Units (other than
a Fehsenfeld Common Unit).
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
61
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Section 2.10
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Entity-Level Taxation.
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If legislation is enacted or the interpretation of existing language is modified by a
governmental taxing authority so that a Group Member is treated as an association taxable as a
corporation or is otherwise subject to an entity-level tax for federal, state or local income tax
purposes, then the General Partner shall estimate for each Quarter the Partnership Groups
aggregate liability (the Estimated Incremental Quarterly Tax Amount) for all such income
taxes that are payable by reason of any such new legislation or interpretation; provided that any
difference between such estimate and the actual tax liability for such Quarter that is owed by
reason of any such new legislation or interpretation shall be taken into account in determining the
Estimated Incremental Quarterly Tax Amount with respect to each Quarter in which any such
difference can be determined. For each such Quarter, the Minimum Quarterly Distribution, First
Target Distribution, Second Target Distribution and Third Target Distribution, shall be the product
obtained by multiplying (a) the amounts therefor that are set out herein prior to the application
of this Section 6.10 times (b) the quotient obtained by dividing (i) Available Cash with respect to
such Quarter by (ii) the sum of Available Cash with respect to such Quarter and the Estimated
Incremental Quarterly Tax Amount for such Quarter, as determined by the General Partner. For
purposes of the foregoing, Available Cash with respect to a Quarter will be deemed reduced by the
Estimated Incremental Quarterly Tax Amount for that Quarter.
ARTICLE
VII
MANAGEMENT AND OPERATION OF BUSINESS
(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 Limited
Partner shall have any management power over the business and affairs of the Partnership. In
addition to the powers now or hereafter granted 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 into Partnership
Securities, and the incurring of any other obligations;
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
62
(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 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 and
Article XIV);
(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 president, 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 relationships (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;
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
63
(xii) the entering into of listing agreements with any National Securities Exchange and
the delisting of some or all of the Limited Partner Interests from, or requesting that
trading be suspended on, any such exchange (subject to any prior approval that may be
required under Section 4.8);
(xiii) unless restricted or prohibited by Section 5.7, the purchase, sale or other
acquisition or disposition of Partnership Securities, or the issuance of additional options,
rights, warrants and appreciation rights relating to Partnership Securities;
(xiv) the undertaking of any action in connection with the Partnerships participation
in 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 Partners and each other Person
who may acquire an interest in Partnership Securities hereby (i) approves, ratifies and confirms
the execution, delivery and performance by the parties thereto of this Agreement and the Group
Member Agreement of each other Group Member, the Underwriting Agreement, the Omnibus Agreement, the
Contribution 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; (ii) agrees that the General Partner (on its own or through any officer 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
Securities; 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 Limited
Partners or any other Persons under this Agreement (or any other agreements) or of any duty stated
or implied by law or equity.
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Section 7.2
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Certificate of Limited Partnership.
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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
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
64
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 or after filing, to deliver or mail a
copy of the Certificate of Limited Partnership, any qualification document or any amendment thereto
to any Limited Partner.
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Section 7.3
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Restrictions on the General Partners Authority.
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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 (including by way of merger,
consolidation, other combination or sale of ownership interests of the Partnerships Subsidiaries)
without the approval of holders of a Unit Majority;
provided
,
however
, that this provision shall
not preclude or limit the General Partners 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. Without the approval of holders of
a Unit Majority, the General Partner shall not, on behalf of the Partnership, except as permitted
under Sections 4.6, 11.1 and 11.2, elect or cause the Partnership to elect a successor general
partner of the Partnership.
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Section 7.4
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Reimbursement of the General Partner.
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(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 allocable to the Partnership Group or otherwise incurred by the
General Partner in connection with operating the Partnership Groups 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) Subject to Section 5.7, the General Partner, without the approval of the Limited Partners
(who shall have no right to vote in respect thereof), may propose and adopt on behalf of the
Partnership employee benefit plans, employee programs and employee practices (including plans,
programs and practices involving the issuance of Partnership Securities or options to purchase or
rights, warrants or appreciation rights relating to Partnership Securities), or cause the
Partnership to issue Partnership Securities in connection with, or pursuant to, any employee
benefit plan, employee program or employee practice maintained or sponsored by the General Partner
or any of its Affiliates, in each case for the benefit of employees of the General Partner
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
65
or its Affiliates, or any Group Member or its 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 Securities that
the General Partner or such Affiliates are obligated to provide to any employees pursuant to any
such employee benefit plans, employee programs or employee 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 Securities purchased by the
General Partner or such Affiliates from the Partnership 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 employee benefit plans, employee programs or employee
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
Partners General Partner Interest (represented by General Partner Units) pursuant to Section 4.6.
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Section 7.5
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Outside Activities.
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(a) After the Closing Date, 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 or (B) the acquiring, owning or disposing of debt or equity securities in
any Group Member.
(b) Except as specifically restricted by the Omnibus Agreement, each Indemnitee (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 expressed or implied by law to any Group Member
or any Partner. None of any Group Member, any Limited Partner or any other Person shall have any
rights by virtue of this Agreement, any Group Member Agreement, or the partnership relationship
established hereby in any business ventures of any Indemnitee.
(c) Subject to the terms of Section 7.5(a), Section 7.5(b) and the Omnibus Agreement, but
otherwise notwithstanding anything to the contrary in this Agreement, (i) the engaging in
competitive activities by any Indemnitees (other than the General Partner) in accordance with the
provisions of this Section 7.5 is hereby approved by the Partnership and all Partners, (ii) it
shall be deemed not to be a breach of any fiduciary duty or any other obligation of any type
whatsoever of the General Partner or of any Indemnitee for the Indemnitees (other than
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
66
the General Partner) to engage in such business interests and activities in preference to or to the exclusion
of the Partnership and (iii) except as set forth in the Omnibus Agreement, the Indemnitees shall
have no obligation hereunder or as a result of any duty expressed or implied by law to present
business opportunities to the Partnership.
(d) The General Partner and each of its Affiliates may acquire Units or other Partnership
Securities in addition to those acquired on the Closing Date and, except as otherwise provided in
this Agreement, shall be entitled to exercise, at their option, all rights relating to all Units or
other Partnership Securities acquired by them. The term Affiliates when used in this Section
7.5(d) with respect to the General Partner shall not include any Group Member.
(e) Notwithstanding anything to the contrary in this Agreement, to the extent that any
provision of this Agreement purports or is interpreted to have the effect of restricting the
fiduciary duties that might otherwise, as a result of Delaware or other applicable law, be owed by
the General Partner to the Partnership and its Limited Partners, or to constitute a waiver or
consent by the Limited Partners to any such restriction, such provisions shall be inapplicable and
have no effect in determining whether the General Partner has complied with its fiduciary duties in
connection with determinations made by it under this Section 7.5.
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Section 7.6
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Loans from the General Partner; Loans or Contributions from the Partnership or
Group Members.
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(a) The General Partner or any of its Affiliates may 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 would be charged or imposed on the borrowing party by
unrelated lenders on comparable loans made on an arms-length basis (without reference to the
lending partys 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. No
Group Member may lend funds to the General Partner or any of its Affiliates (other than another
Group Member).
(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 Limited Partners by reason of the fact that the purpose or
effect of such borrowing is directly or indirectly to (i) enable distributions to the General
Partner or its Affiliates (including in their capacities as Limited Partners) to exceed the General
Partners Percentage Interest of the total amount distributed to all partners or (ii) hasten
the expiration of the Subordination Period or the conversion of any Subordinated Units into Common
Units.
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
67
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Section 7.7
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Indemnification.
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(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 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 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 Indemnitees conduct was unlawful;
provided
, further, no
indemnification pursuant to this Section 7.7 shall be available to the General Partner or its
Affiliates (other than a Group Member) with respect to its or their obligations incurred pursuant
to the Underwriting Agreement, the Omnibus Agreement or the Contribution Agreement (other than
obligations incurred by the General Partner on behalf of the Partnership). 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 defending any claim,
demand, action, suit or proceeding shall, from time to time, be advanced by the Partnership prior
to a determination that the Indemnitee is not entitled to be indemnified 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 in 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 or otherwise, both as to actions in the
Indemnitees 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 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 Partnerships
activities or such Persons 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.
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
68
(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 it 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, their heirs,
successors, assigns 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 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.
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Section 7.8
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Liability of Indemnitees.
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(a) Notwithstanding anything to the contrary set forth in this Agreement, no Indemnitee shall
be liable for monetary damages to the Partnership, the Limited Partners or any other Persons who
have acquired interests in the Partnership Securities, 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 Indemnitees 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.
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(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 Partnerships 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.
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Section 7.9
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Resolution of Conflicts of Interest; Standards of Conduct and Modification of
Duties.
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(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 Partner, on the
other, any resolution or course of action by the General Partner or 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 stated or implied by law or equity, 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 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 of such resolution, and the
General Partner may also adopt a resolution or course of action that has not received Special
Approval. If Special Approval is not sought and the Board of Directors of the General Partner
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 Limited Partner or by or on behalf of such Limited Partner or any other
Limited 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.
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(b) 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 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, or
such Affiliates causing it 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 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 make such determination or to take or
decline to take such other action free of any fiduciary duty or obligation whatsoever to the
Partnership or any Limited Partner, and the General Partner, or such Affiliates causing it to do
so, 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. By way of illustration and not of
limitation, whenever the phrase, at the option of the General Partner, or some variation of that
phrase, is 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 Units, or refrains from voting or transferring its Units, 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 at its option.
(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 Limited 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 Unitholders 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.
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Section 7.10
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Other Matters Concerning the General Partner.
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(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 opinion (including an Opinion of Counsel) of such
Persons as to matters that the General Partner reasonably believes to be within such Persons
professional or expert competence shall be conclusively presumed to have been done or omitted in
good faith and in accordance with such 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 duly authorized officers, a duly appointed attorney or
attorneys-in-fact or the duly authorized officers of the Partnership.
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Section 7.11
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Purchase or Sale of Partnership Securities.
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The General Partner may cause the Partnership to purchase or otherwise acquire Partnership
Securities;
provided
that, except as permitted pursuant to Section 4.10, the General Partner may
not cause any Group Member to purchase Subordinated Units during the Subordination Period. As long
as Partnership Securities are held by any Group Member, such Partnership Securities shall not be
considered Outstanding for any purpose, except as otherwise provided herein. The General Partner or
any Affiliate of the General Partner may also purchase or otherwise acquire and sell or otherwise
dispose of Partnership Securities for its own account, subject to the provisions of Articles IV and
X.
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Section 7.12
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Registration Rights of the General Partner and its Affiliates.
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(a) If (i) the General Partner or any Affiliate of the General Partner (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 Securities 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 Securities (the Holder) to dispose of the number of
Partnership Securities 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
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 Securities 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
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72
Securities specified by the Holder;
provided
,
however
, that the Partnership shall not be
required to effect more than three registrations pursuant to Sections 7.12(a) and 7.12(b); and
provided further, however, that if the Conflicts Committee determines in good faith that the
requested registration would be materially detrimental to the Partnership and its Partners because
such registration would (x) materially interfere with a significant acquisition, reorganization or
other similar transaction involving the Partnership, (y) require premature disclosure of material
information that the Partnership has a bona fide business purpose for preserving as confidential or
(z) render the Partnership unable to comply with requirements under applicable securities laws,
then the Partnership shall have the right to postpone such requested registration for a period of
not more than six months after receipt of the Holders request, such right pursuant to this Section
7.12(a) or Section 7.12(b) not to be utilized more than once in any twelve-month period. Except as
provided in the preceding sentence, the Partnership shall be deemed not to have used all reasonable
efforts to keep the registration statement effective during the applicable period if it voluntarily
takes any action that would result in Holders of Partnership Securities covered thereby not being
able to offer and sell such Partnership Securities at any time during such period, unless such
action is required by applicable law. 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 Securities 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
Securities in such states. Except as set forth in Section 7.12(d), 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 any Holder holds Partnership Securities that it desires to sell and 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 to dispose of the number of Partnership
Securities 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 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
Securities covered by such shelf registration statement have been sold, a shelf registration
statement covering the Partnership Securities specified by the Holder on an appropriate form under
Rule 415 under the Securities Act, or any similar rule that may be adopted by the Commission;
provided, however, that the Partnership shall not be required to effect more than three
registrations pursuant to Section 7.12(a) and this Section 7.12(b); and provided further, however,
that if the Conflicts Committee determines in good faith that any offering under, or the use of any
prospectus forming a part of, the shelf registration statement would be materially detrimental to
the Partnership and its Partners because such offering or use would (x) materially
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interfere with a significant acquisition, reorganization or other similar transaction
involving the Partnership, (y) require premature disclosure of material information that the
Partnership has a bona fide business purpose for preserving as confidential or (z) render the
Partnership unable to comply with requirements under applicable securities laws, then the
Partnership shall have the right to suspend such offering or use for a period of not more than six
months after receipt of the Holders request, such right pursuant to Section 7.12(a) or this
Section 7.12(b) not to be utilized more than once in any twelve-month period. Except as provided
in the preceding sentence, the Partnership shall be deemed not to have used all reasonable efforts
to keep the shelf registration statement effective during the applicable period if it voluntarily
takes any action that would result in Holders of Partnership Securities covered thereby not being
able to offer and sell such Partnership Securities at any time during such period, unless such
action is required by applicable law. In connection with any shelf registration pursuant to this
Section 7.12(b), the Partnership shall (i) promptly prepare and file (A) such documents as may be
necessary to register or qualify the securities subject to such shelf 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 shelf registration, and (B) such documents as may be necessary to apply for listing
or to list the Partnership Securities subject to such shelf 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 Securities in such states. Except as set forth in Section 7.12(d), all costs and
expenses of any such shelf registration and offering (other than the underwriting discounts and
commissions) shall be paid by the Partnership, without reimbursement by the Holder.
(c) If the Partnership shall at any time propose to file a registration statement under the
Securities Act for an offering of equity securities of the Partnership for cash (other than an
offering relating solely to an employee benefit plan), the Partnership shall use all reasonable
efforts to include such number or amount of securities held by the Holder in such registration
statement as the Holder shall request; provided, that the Partnership is not required to make any
effort or take an action to so include the securities of the Holder once the registration statement
is declared effective by the Commission, including any registration statement providing for the
offering from time to time of securities pursuant to Rule 415 of the Securities Act. If the
proposed offering pursuant to this Section 7.12(c) shall be an underwritten offering, then, in the
event that the managing underwriter or managing underwriters of such offering advise the
Partnership and the Holder in writing that in their opinion the inclusion of all or some of the
Holders Partnership Securities would adversely and materially affect the success of the offering,
the Partnership shall include in such offering only that number or amount, if any, of securities
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(d), 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.
(d) If underwriters are engaged in connection with any registration referred to in this
Section 7.12, the Partnership shall provide indemnification, representations, covenants, opinions
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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 Partnerships 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) 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 Indemnified Person may be involved, or is threatened
to be involved, as a party or otherwise, under the Securities Act or otherwise (hereinafter
referred to in this Section 7.12(d) 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 Securities were registered
under the Securities Act or any state securities or Blue Sky laws, in any preliminary prospectus
(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 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.
(e) The provisions of Section 7.12(a), 7.12(b) and 7.12(c) shall continue to be applicable
with respect to the General Partner (and any of the General Partners Affiliates) after it ceases
to be a general partner of the Partnership, 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 Securities 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 Securities for which registration was
demanded during such two-year period. The provisions of Section 7.12(d) shall continue in effect
thereafter.
(f) The rights to cause the Partnership to register Partnership Securities 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 Securities, 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 Securities 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.
(g) Any request to register Partnership Securities pursuant to this Section 7.12 shall (i)
specify the Partnership Securities intended to be offered and sold by the Person making the
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request, (ii) express such Persons present intent to offer such Partnership Securities for
distribution, (iii) describe the nature or method of the proposed offer and sale of Partnership
Securities, 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 Securities.
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
Partnerships sole party in interest, both legally and beneficially. Each Limited Partner hereby
waives any and all defenses or other remedies that may be available against such Person 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 Partnerships business, including all books and
records necessary to provide to the Limited Partners any 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 Securities, books of account and records of Partnership proceedings, may be kept on, or
be in the form of, computer disks, hard drives, punch cards, 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.
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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 120 days after the close of each fiscal
year of the Partnership, the General Partner shall cause to be mailed or made available to each
Record Holder of a Unit 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 90 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 to each Record Holder of a Unit, 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.
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
federal, state and local income tax purposes on the basis of the accrual method and a taxable year
ending December 31 or such other taxable year or years that it is required by law to adopt, from
time to time, as determined by the General Partner. The tax information reasonably required by
Record Holders for federal and state income tax reporting purposes with respect to a taxable year
shall be furnished to them within 90 days of the close of the calendar year in which the
Partnerships taxable year ends. The classification, realization and recognition of income, gain,
losses and deductions and other items shall be on the accrual method of accounting for 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 Partners determination that such revocation is in the best
interests of the Limited 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
Limited Partner Interest will be deemed to be the lowest quoted closing price of
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the Limited Partner Interests on any National Securities Exchange on which such Limited
Partner Interests are listed or admitted to trading during the calendar month in which such
transfer is deemed to occur pursuant to Section 6.2(g) 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 is designated as the Tax Matters Partner
(as defined in the Code) and is authorized and required to represent the Partnership (at the
Partnerships expense) in connection with all examinations of the Partnerships 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 General Partner and to do or refrain from doing any or all things reasonably required by
the General 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 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, but is not required to, 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 Article
IV or the acceptance of any Limited Partner Interests issued pursuant to Article V or pursuant to a
merger or consolidation pursuant to Article XIV, and except as provided in Section 4.9, each
transferee of, or other such Person acquiring, 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, issuance
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, (iv) grants the
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powers of attorney set forth in this Agreement and (v) makes the consents and waivers
contained in this Agreement, all with or without execution of this Agreement by such Person. The
transfer of any Limited Partner Interests and the admission of any new Limited Partner shall not
constitute an amendment to this Agreement. A Person may become a Limited Partner or Record Holder
of a Limited Partner Interest without the consent or approval of any of the Partners. A Person may
not become a Limited Partner without acquiring a Limited Partner Interest and until such Person is
reflected in the books and records of the Partnership as the Record Holder of such Limited Partner
Interest. The rights and obligations of a Person who is a Non-citizen Assignee shall be determined
in accordance with Section 4.9 hereof.
(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 Partnership or the Transfer Agent.
The General Partner shall update the books and records of the Partnership 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 hereof.
(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 (represented by General Partner Units) pursuant to
Section 4.6 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 (represented by General Partner Units) pursuant to Section 4.6,
provided, however, that no such successor shall be admitted to the Partnership until compliance
with the terms of Section 4.6 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 or appropriate 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, and the General Partner may for this purpose, among others,
exercise the power of attorney granted pursuant to Section 2.6.
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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 4.6;
(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)-(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 partnership or a limited liability company, 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 Section 11.1(a)(iv), (v) or (vi)(A), (B), (C) or (E) occurs,
the withdrawing General Partner shall give notice to the Limited 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 12:00 midnight,
prevailing Eastern Time, on December 31, 2015, the General Partner voluntarily withdraws by giving
at least 90 days advance notice of its intention to withdraw to the Limited 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 or any Group Member or cause any Group Member to be treated as an association taxable as a
corporation or otherwise to be taxed as an entity for federal income tax purposes (to the extent
not already so treated or taxed); (ii) at any time after 12:00 midnight, prevailing Eastern Time,
on December 31, 2015, the General Partner voluntarily withdraws by giving at least 90 days advance
notice to the Unitholders, 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 Limited 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 a notice of withdrawal pursuant to Section
11.1(a)(i), 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 Partners withdrawal, a successor is not selected by
the Unitholders 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. 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 Unitholders 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 Unitholders
holding a majority of the outstanding Common Units voting as a class and a majority of the
outstanding Subordinated Units voting as a class (including 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
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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 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 holders of Outstanding Units 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 holders of
Outstanding Units 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 departure of such Departing
General Partner, to require its successor to purchase its General Partner Interest (represented by
General Partner Units) and its general partner interest (or equivalent interest), if any, in the
other Group Members and all of the Incentive Distribution Rights (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 departure. If
the General Partner is removed by the Unitholders 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
of the Departing General Partner. 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 Departing General Partners
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
Partners departure, 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 departure, then the Departing General
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Partner shall designate an independent investment banking firm or other independent expert,
the Departing General Partners 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 of the
Departing General Partner. 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 Partnerships 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 its 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 of the Departing General Partner to Common
Units will be characterized as if the Departing General Partner (or its transferee) contributed its
Combined Interest to the Partnership in exchange for the newly issued Common Units.
(c) 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) and the option described in Section 11.3(a) is
not exercised by the party entitled to do so, the successor General Partner shall, at the effective
date of its admission to the Partnership, contribute to the Partnership cash in the amount equal to
the product of the Percentage Interest of the Departing General Partner and the Net Agreed Value of
the Partnerships assets on such date. In such event, such successor General Partner shall, subject
to the following sentence, be entitled to its Percentage Interest of all Partnership allocations
and distributions to which the Departing General Partner was entitled. In addition, the successor
General Partner shall cause this Agreement to be amended to reflect that, from and after the date
of such successor General Partners admission, the successor General Partners interest in all
Partnership distributions and allocations shall be its Percentage Interest.
Section 11.4
Termination of Subordination Period, Conversion of Subordinated Units and
Extinguishment of Cumulative Common Unit Arrearages.
Notwithstanding any provision of this Agreement, if the General Partner is removed as general
partner of the Partnership under circumstances where Cause does not exist and Units held by the
General Partner and its Affiliates are not voted in favor of such removal, (i) the Subordination
Period will end and all Outstanding Subordinated Units will immediately and automatically convert
into Common Units on a one-for-one basis, (ii) all Cumulative Common Unit Arrearages on the Common
Units will be extinguished and (iii) the General Partner will
have the right to convert its General Partner Interest (represented by General Partner Units)
and its Incentive Distribution Rights into Common Units or to receive cash in exchange therefor.
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Section 11.5
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 Partners Limited Partner Interest becomes a Record Holder of
the Limited Partner Interest so transferred, such transferring Limited Partner shall cease to be a
Limited Partner with respect to the Limited Partner Interest so transferred.
ARTICLE
XII
DISSOLUTION
AND LIQUIDATION
Section 12.1
Dissolution.
The Partnership shall not be dissolved by the admission of additional Limited 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 an Opinion of Counsel is received as
provided in Section 11.1(b) or 11.2 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.
Section 12.2
Continuation of the Business of the Partnership After Dissolution.
Upon (a) dissolution of the Partnership following an Event of Withdrawal caused by the
withdrawal or removal of the General Partner as provided in Section 11.1(a)(i) or (iii) and the
failure of the Partners to select a successor to such Departing General Partner pursuant to Section
11.1 or 11.2, then within 90 days thereafter, or (b) dissolution of the Partnership upon an event
constituting an Event of Withdrawal as defined in Section 11.1(a)(iv), (v) or (vi), then, to the
maximum extent permitted by law, within 180 days thereafter, the holders of 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 a successor General Partner a Person approved by the holders
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of 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 the holders 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 limited liability of any Limited Partner and
(y) neither the Partnership nor any Group Member would be treated as an association taxable
as a corporation or otherwise be taxable as an entity for 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 and Subordinated 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 and Subordinated Units voting as a single class.
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 and Subordinated Units voting as a single class. 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 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.
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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 Partnerships assets for a reasonable time if it
determines that an immediate sale or distribution of all or some of the Partnerships assets would
be impractical or would cause undue loss to the Partners. The Liquidator may distribute the
Partnerships 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 year 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 year
(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 Partnership to enable it to effectuate, the return
of the Capital Contributions of the Limited Partners or Unitholders, or any portion thereof,
it being expressly understood that any such return shall be made solely from Partnership assets.
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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. The General Partner shall be obligated to restore any
negative balance in its Capital Account upon liquidation of its interest in the Partnership by the
end of the taxable year of the Partnership during which such liquidation occurs, or, if later,
within 90 days after the date of such liquidation.
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 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 federal income tax purposes;
(d) a change that the General Partner determines, (i) does not adversely affect the Limited
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,
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guideline or requirement of any National Securities Exchange on which the Units 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 5.10 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 year of the Partnership and any other changes that
the General Partner determines to be necessary or appropriate as a result of a change in the fiscal
year or taxable year 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 its 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) subject to the terms of Section 5.7, an amendment that the General Partner determines to
be necessary or appropriate in connection with the authorization of issuance of any class or series
of Partnership Securities pursuant to Section 5.6;
(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.
Except as provided in Sections 13.1 and 13.3, all amendments to this Agreement shall be made
in accordance with the following requirements. Amendments to this Agreement may be proposed only by
the General Partner; provided, however, that the General Partner shall have no duty or obligation
to propose any amendment to this Agreement and may decline to do so free of any fiduciary duty or
obligation whatsoever to the Partnership or any Limited Partner and, in
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declining to propose 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. A proposed amendment shall be effective upon its
approval by the General Partner and the holders of 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 the holders of a specified percentage of Outstanding Units 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 the requisite percentage of
Outstanding Units or call a meeting of the Unitholders to consider and vote on such proposed
amendment. The General Partner shall notify all Record Holders upon final adoption of any such
proposed amendments.
Section 13.3
Amendment Requirements.
(a) Notwithstanding the provisions of Sections 13.1 and 13.2, no provision of this Agreement
that establishes a percentage of Outstanding Units (including Units deemed owned by the General
Partner) required to take any action shall be amended, altered, changed, repealed or rescinded in
any respect that would have the effect of reducing such voting percentage unless such amendment is
approved by the written consent or the affirmative vote of holders of Outstanding Units whose
aggregate Outstanding Units constitute 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 Limited 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 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 at its option.
(c) Except as provided in Section 14.3, and without limitation of the General Partners
authority to adopt amendments to this Agreement without the approval of any Partners as
contemplated in 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.
(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 Outstanding Units 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 law.
(e) Except as provided in Section 13.1, this Section 13.3 shall only be amended with the
approval of the holders of at least 90% of the Outstanding Units.
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Section 13.4
Special Meetings.
All acts of Limited Partners to be taken pursuant to this Agreement shall be taken in the
manner provided in this Article XIII. Special meetings of the Limited 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 Limited
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 Limited
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 Limited 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 Units 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 Limited Partners entitled to notice of or to vote at a meeting
of the Limited 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 Units are listed or admitted to
trading, in which case the rule, regulation, guideline or requirement of such National Securities
Exchange shall govern) or (b) in the event that approvals are sought without a meeting, the date by
which Limited 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
Limited Partners entitled to notice of or to vote at a meeting of the Limited 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 Limited 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.
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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.
Section 13.8
Waiver of Notice; Approval of Meeting; Approval of Minutes.
The transactions of any meeting of Limited 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 Limited Partner at a meeting
shall constitute a waiver of notice of the meeting, except when the Limited 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 except 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 of the Outstanding Units of the class or classes for which a meeting
has been called (including Outstanding Units deemed owned by the General Partner) represented in
person or by proxy shall constitute a quorum at a meeting of Limited Partners of such class or
classes unless any such action by the Limited Partners requires approval by holders of a greater
percentage of such Units, in which case the quorum shall be such greater percentage. At any meeting
of the Limited Partners duly called and held in accordance with this Agreement at which a quorum is
present, the act of Limited Partners holding Outstanding Units that in the aggregate represent a
majority of the Outstanding Units entitled to vote and be present in person or by proxy at such
meeting shall be deemed to constitute the act of all Limited 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 Limited Partners holding Outstanding Units that in the
aggregate represent at least such greater or different percentage shall be required. The Limited
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 Limited Partners to
leave less than a quorum, if any action taken (other than adjournment) is approved by the required
percentage of Outstanding Units specified in this Agreement (including Outstanding Units deemed
owned by the General Partner). In the absence of a quorum any meeting of Limited Partners may be
adjourned from time to time by the affirmative vote of holders of at least a majority of the
Outstanding Units entitled to vote at such meeting (including Outstanding Units 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.
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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 Limited 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 Limited 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 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 Limited
Partners may be taken without a meeting if an approval in writing setting forth the action so taken
is signed by Limited Partners owning not less than the minimum percentage of the Outstanding Units
(including Units deemed owned by the General Partner) that would be necessary to authorize or take
such action at a meeting at which all the Limited Partners were present and voted (unless such
provision conflicts with any rule, regulation, guideline or requirement of any National Securities
Exchange on which the Units 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 Limited Partners who have not approved in
writing. The General Partner may specify that any written ballot submitted to Limited 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 Units held by the Limited Partners, the
Partnership shall be deemed to have failed to receive a ballot for the Units that were not voted.
If approval of the taking of any action by the Limited 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, (b)
approvals sufficient to take the action proposed are dated as of a date not more than 90 days prior
to the date sufficient approvals are deposited with the Partnership and (c) 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.
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Section 13.12
Right to Vote and Related Matters.
(a) Only those Record Holders of the Units 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 Limited Partners or to act with respect to
matters as to which the holders of the Outstanding Units 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 Outstanding Units
shall be deemed to be references to the votes or acts of the Record Holders of such Outstanding
Units.
(b) With respect to Units that are held for a Persons 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 Units are registered, such other Person shall, in exercising the voting rights
in respect of such Units on any matter, and unless the arrangement between such Persons provides
otherwise, vote such Units 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
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, statutory trusts or associations, real estate investment trusts, common law
trusts or unincorporated businesses, including a partnership (whether general or limited (including
a limited liability 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.
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, any Limited 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. 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:
(a) the names and jurisdictions of formation or organization of each of the business entities
proposing to merge or consolidate;
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(b) 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);
(c) the terms and conditions of the proposed merger or consolidation;
(d) the manner and basis of exchanging or converting the equity securities of each constituent
business entity for, or into, cash, property or 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 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 general or limited partnership, corporation, trust, limited liability company, unincorporated
business or other entity (other than the Surviving Business Entity) which the holders of such
interests, securities or rights are to receive in exchange for, or upon conversion of their
interests, securities or rights, and (ii) in the case of securities represented by certificates,
upon the surrender of such certificates, which cash, property or interests, rights, securities or
obligations of the Surviving Business Entity or any general or limited partnership, corporation,
trust, limited liability company, unincorporated business or other entity (other than the Surviving
Business Entity), or evidences thereof, are to be delivered;
(e) 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;
(f) 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 such certificate of merger, the effective time shall be fixed at a date or
time certain at or prior to the time of the filing of such certificate of merger and stated
therein); and
(g) 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 Limited Partners of Merger or Consolidation.
(a) Except as provided in Sections 14.3(d) and 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 Limited
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) and 14.3(e), the Merger Agreement shall be approved
upon receiving the affirmative vote or consent of the holders of a Unit Majority.
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(c) Except as provided in Sections 14.3(d) and 14.3(e), after such approval by vote or consent
of the Limited 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 Limited 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 Partnerships assets to, another limited liability entity which 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 conveyance,
as the case may be, would not result in the loss of the limited liability 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 federal income tax purposes (to the extent not previously 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 Limited Partners and the General Partner 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 Limited 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 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 federal income tax
purposes (to the extent not previously treated as such), (B) the merger or consolidation would not
result in an amendment to the Partnership 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 Unit outstanding immediately prior to the effective date of the
merger or consolidation is to be an identical Unit of the Partnership after the effective date of
the merger or consolidation, and (E) the number of Partnership Securities to be issued by the
Partnership in such merger or consolidation do not exceed 20% of the Partnership Securities
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 Unitholders 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
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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;
(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 80% 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 at its
option, 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. As used in this
Agreement, (i) Current Market Price as of any date of any class of Limited Partner Interests
means the average of the daily Closing Prices (as hereinafter defined) per Limited Partner Interest
of such class for the 20 consecutive Trading Days (as hereinafter defined) immediately
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prior to such date; (ii) Closing Price for any day means 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, as reported in the principal consolidated transaction
reporting system with respect to securities listed on the principal National Securities Exchange
(other than the Nasdaq National Market) on which such 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 (other than the Nasdaq National Market), 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 Nasdaq National Market or such other system then in
use, or, if on any such day such Limited Partner Interests of such class are not quoted by any such
organization, the average of 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; and (iii) Trading Day means a day on which the principal
National Securities Exchange on which such Limited Partner Interests of any class are listed is
open for the transaction of business or, if Limited Partner Interests of a class are not listed on
any National Securities Exchange, a day on which banking institutions in New York City generally
are open.
(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 published 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, 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 Interests are
listed. 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
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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, 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).
(c) At any time from and after the Purchase Date, a holder of an Outstanding Limited Partner
Interest subject to purchase as provided in this Section 15.1 may surrender his Certificate
evidencing such Limited Partner Interest to the Transfer Agent in exchange for payment of the
amount described in Section 15.1(a), therefor, without interest thereon.
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 Securities 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 Securities by reason of any assignment or otherwise. 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 addressed to a Record Holder at the address of such Record
Holder appearing on the books and records of the Transfer Agent or the Partnership is returned by
the United States Postal Service marked to indicate that the United States Postal Service is unable
to deliver it, such notice, payment or report and 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) 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.
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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
Limited Partner Interest, pursuant to Section 10.1(a) without execution hereof.
Section 16.8
Applicable Law.
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.
CALUMET
SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
99
Section 16.9
Invalidity of Provisions.
If any provision of this Agreement is or becomes invalid, illegal or unenforceable in any
respect, the validity, legality and enforceability of the remaining provisions contained herein
shall not be affected thereby.
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 Common Units is expressly permitted by
this Agreement.
[
REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK.
]
CALUMET
SPECIALTY PRODUCTS PARTNERS, L.P.
FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
100
IN WITNESS WHEREOF,
the parties hereto have executed this Agreement as of the date first
written above.
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GENERAL PARTNER:
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CALUMET GP, LLC
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By:
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/s/ R. Patrick Murray, II
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R. Patrick Murray, II
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Vice President and Chief Financial Officer
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ORGANIZATIONAL LIMITED PARTNERS:
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/s/
F. WILLIAM GRUBE
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F. WILLIAM GRUBE
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/s/ FRED M. FEHSENFELD, JR.
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FRED M. FEHSENFELD, JR.
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THE HERITAGE GROUP
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By:
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/s/ Fred M. Fehsenfeld, Jr.
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Fred M. Fehsenfeld, Jr.
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Chief Executive Officer
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CALUMET, INCORPORATED
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By:
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/s/ R. Patrick Murray, II
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R. Patrick Murray, II
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Vice President and Chief Financial Officer
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MILDRED L. FEHSENFELD IRREVOCABLE INTERVIVOS TRUST
FOR THE BENEFIT OF FRED MEHLERT FEHSENFELD, JR. AND
HIS ISSUE
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By:
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/s/ James C. Fehsenfeld
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James C. Fehsenfeld
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Trustee
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Signature
Page
First Amended and Restated
Agreement of Limited Partnership of
Calumet Specialty Products
Partners, L.P.
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MAGGIE FEHSENFLED TRUST NUMBER 106 FOR THE BENEFIT OF
FRED MEHLERT FEHSENFELD, JR. AND HIS ISSUE
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By:
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/s/ James C. Fehsenfeld
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James C. Fehsenfeld
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Trustee
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LIMITED PARTNERS:
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All Limited Partners now and hereafter admitted as
Limited Partners of the Partnership, pursuant to
powers of attorney now and hereafter executed in
favor of, and granted and delivered to the General
Partner or without execution hereof pursuant to
Section 10.1(a) hereof.
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CALUMET GP, LLC
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By:
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/s/ R. Patrick Murray, II
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R. Patrick Murray, II
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Vice President and Chief Financial Officer
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Signature
Page
First Amended and Restated
Agreement of Limited Partnership of
Calumet Specialty Products
Partners, L.P.
EXHIBIT A
to the First Amended and Restated
Agreement of Limited Partnership of
Calumet Specialty Products Partners, L.P.
Certificate Evidencing Common Units
Representing Limited Partner Interests in
Calumet Specialty Products Partners, L.P.
In accordance with Section 4.1 of the First Amended and Restated Agreement of Limited
Partnership of Calumet Specialty Products Partners, L.P., as amended, supplemented or restated from
time to time (the
Partnership Agreement
), Calumet Specialty Products Partners, L.P., 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 2780 Waterfront Parkway E. Drive, Suite 200, Indianapolis, Indiana
46214. Capitalized terms used herein but not defined shall have the meanings given them in the
Partnership Agreement.
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, (iii) granted the powers of attorney provided for in the Partnership Agreement and (iv)
made the waivers and given the consents and approvals contained in the Partnership Agreement.
THE HOLDER OF THIS SECURITY ACKNOWLEDGES FOR THE BENEFIT OF THE PARTNERSHIP 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 THE
PARTNERSHIP UNDER THE LAWS OF THE STATE OF DELAWARE, OR (C) CAUSE THE PARTNERSHIP TO BE TREATED AS
AN ASSOCIATION TAXABLE AS A CORPORATION OR OTHERWISE TO BE TAXED AS AN ENTITY FOR FEDERAL INCOME
TAX PURPOSES (TO THE EXTENT NOT
1
ALREADY SO TREATED OR TAXED). CALUMET GP, LLC, THE GENERAL PARTNER OF THE PARTNERSHIP, 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 THE PARTNERSHIP
BECOMING TAXABLE AS A CORPORATION OR OTHERWISE BECOMING TAXABLE AS AN ENTITY FOR 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.
This Certificate shall not be valid for any purpose unless it has been countersigned and
registered by the Transfer Agent and Registrar.
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Dated:
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Calumet Specialty Products Partners, L.P.
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Countersigned and Registered by:
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By:
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Calumet GP, LLC,
its General Partner
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By:
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as Transfer Agent and Registrar
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Name:
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By:
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By:
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Authorized Signature
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Secretary
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[
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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UNIF GIFT MIN ACT
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TEN ENT -
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as tenants by the entireties
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Custodian
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(Cust) (Minor)
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JT TEN -
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as joint tenants with right of
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under Uniform Gifts to
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survivorship and not as
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Minors Act
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tenants in common
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(State)
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Additional abbreviations, though not in the above list, may also be used.
ASSIGNMENT OF COMMON UNITS
IN
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
FOR VALUE RECEIVED,
hereby assigns, conveys, sells and transfers unto
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(Please print or typewrite name
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(Please insert Social Security or other
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and address of Assignee)
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identifying number of Assignee)
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2
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
Calumet Specialty Products Partners, L.P.
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Date:
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NOTE:
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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.
3
EXHIBIT
3.2
AMENDED AND RESTATED
LIMITED LIABILITY COMPANY AGREEMENT
OF
CALUMET GP, LLC,
A DELAWARE LIMITED LIABILITY COMPANY
DATED AS OF
January 31, 2006
TABLE OF CONTENTS
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Page
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ARTICLE 1
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DEFINITIONS AND CONSTRUCTION
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1.1
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Definitions
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1
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1.2
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Rules of Construction
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7
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ARTICLE 2
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ORGANIZATION
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2.1
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Formation of the Company
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8
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2.2
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Company Name
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8
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2.3
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Term
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8
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2.4
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Purposes and Powers
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8
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2.5
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Place of Business, Agent and Office of the Company
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8
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2.6
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Title to Company Assets
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9
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ARTICLE 3
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CAPITAL AND CAPITAL ACCOUNTS
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3.1
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Membership Interests and Units
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9
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3.2
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Initial Capital Contributions
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9
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3.3
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Members of the Company at the Effective Date
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9
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3.4
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Transfer of Units and Admission of Substitute Members
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10
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3.5
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Issuance of Additional Units
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10
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3.6
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Subsequent Capital Contributions
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10
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3.7
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Loans to the Company
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10
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3.8
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Capital Accounts
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10
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3.9
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General Provisions Regarding Capital Contributions
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11
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3.10
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Limitation on Liability
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11
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ARTICLE 4
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DISTRIBUTIONS
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4.1
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Distributions of Available Cash
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12
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4.2
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Persons Entitled to Distributions
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12
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4.3
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Limitations on Distributions
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12
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4.4
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Distributions on Dissolution and Winding Up
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12
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4.5
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Withholding of Taxes
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12
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ARTICLE 5
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ALLOCATIONS
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5.1
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Allocations of Profit and Loss
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12
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5.2
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Allocations of Liquidating Gain and Loss
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12
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5.3
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Transfers
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12
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5.4
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Additional Allocations
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13
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5.5
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Income Tax Allocations
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14
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5.6
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Negative Capital Accounts
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15
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ARTICLE 6
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MEETINGS OF MEMBERS
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6.1
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Time and Place
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15
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6.2
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Annual Meeting
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15
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6.3
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Special Meeting
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15
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6.4
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Record Date for Determination of Membership
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15
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6.5
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Notice to Members
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16
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6.6
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Waiver
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16
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6.7
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Quorum
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16
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6.8
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Matters Requiring Member Approval
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16
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6.9
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Voting and Proxies
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17
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6.10
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Action by Consent of the Members
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17
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6.11
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Telephonic Meetings
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18
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ARTICLE 7
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MANAGEMENT
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7.1
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Management of the Companys Affairs
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18
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7.2
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Number; Qualification; Election; Tenure
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18
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7.3
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Notice
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20
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7.4
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Regular Meetings
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20
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7.5
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Special Meetings
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20
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7.6
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Action by Consent of the Board
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20
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7.7
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Telephonic Meetings
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20
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7.8
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Quorum; Voting Requirement
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20
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7.9
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Committees
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20
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7.10
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Vacancies; Increases in the Number of Directors
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21
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7.11
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Removal
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22
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7.12
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Compensation of Directors
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22
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ARTICLE 8
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OFFICERS
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8.1
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Elected Officers
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22
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8.2
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Election and Term of Office
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22
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8.3
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Chairman of the Board
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23
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8.4
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President and Chief Executive Officer
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23
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8.5
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Vice Presidents
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23
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8.6
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Chief Financial Officer and Assistant Treasurers
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23
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8.7
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Secretary and Assistant Secretaries
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23
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8.8
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Removal
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24
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8.9
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Vacancies
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24
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8.10
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Compensation
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24
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8.11
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Powers of Attorney
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24
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8.12
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Delegation of Authority
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24
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ARTICLE 9
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STANDARDS OF CONDUCT, LIABILITY AND INDEMNIFICATION
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9.1
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Standards of Conduct and Fiduciary Duties
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24
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9.2
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Liability and Exculpation
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25
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9.3
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Indemnification
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25
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ii
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ARTICLE 10
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TAXES
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10.1
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Tax Returns
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26
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10.2
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Tax Elections
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26
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10.3
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Tax Matters Member
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27
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ARTICLE 11
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TRANSFERS OF MEMBERSHIP INTERESTS
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11.1
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General Restrictions
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28
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11.2
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Permitted Transferees
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28
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11.3
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Substitute Members
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28
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11.4
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Effect of Admission as a Substitute Member
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29
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11.5
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Consent
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29
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11.6
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Additional Members
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29
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11.7
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Right of Sale
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29
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ARTICLE 12
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NO PREEMPTIVE RIGHTS
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12.1
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No Preemptive Rights
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29
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ARTICLE 13
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BOOKS OF ACCOUNT, RECORDS AND REPORTS
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13.1
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Preparation and Maintenance of Books and Records
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29
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13.2
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Company Documentation Requirements
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30
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13.3
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Fiscal Year
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30
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13.4
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Company Funds
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30
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13.5
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Statements
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30
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ARTICLE 14
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DISSOLUTION AND TERMINATION OF THE COMPANY
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14.1
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Dissolution
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31
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14.2
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Winding Up and Liquidation
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31
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14.3
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No Recourse
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31
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14.4
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No Deficit Contribution Obligation
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32
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ARTICLE 15
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AMENDMENTS; POWER OF ATTORNEY
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15.1
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Amendments Generally
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32
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15.2
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Power of Attorney
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32
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ARTICLE 16
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MISCELLANEOUS
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16.1
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No Registration of Units
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32
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16.2
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Exhibits
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33
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16.3
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Severability
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33
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16.4
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Successors and Assigns
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33
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16.5
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Governing Law
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33
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16.6
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Counterparts
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33
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16.7
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No Third Party Beneficiaries
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33
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16.8
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Notices
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33
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16.9
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Entire Agreement; Interpretation
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34
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iii
Schedules and Exhibits
:
SCHEDULE A Schedule of Members
EXHIBIT A Form of Unit Certificate
iv
AMENDED AND RESTATED
LIMITED LIABILITY COMPANY AGREEMENT
OF
CALUMET GP, LLC,
A DELAWARE LIMITED LIABILITY COMPANY
This AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT (this
Agreement
) of CALUMET
GP, LLC (the
Company
) is made and entered into as of January 31, 2006 (the
Effective Date
), by
and among each Person listed as a member of the Company on the Schedule of Members attached hereto
as
Schedule A
(together with such other holders of Units who may hereafter become members
as provided herein, referred to collectively as the Members, or individually as a Member).
ARTICLE 1
DEFINITIONS AND CONSTRUCTION
1.1
Definitions
. The following definitions shall be applicable to the terms set forth
below as used in this Agreement:
Act
means the Delaware Limited Liability Company Act (Delaware General Corporations Code
Sections 18-101, et seq.), as it may be amended from time to time, and any corresponding provisions
of succeeding law. All references in this Agreement to provisions of the Act shall be deemed to
refer, if applicable, to their successor statutory provisions to the extent appropriate in light of
the context herein in which such references are used.
Adjusted Capital Account
means the Capital Account maintained for each Member as of the end
of each fiscal year of the Company, adjusted as follows:
(a) increased by any amounts that such Member is obligated to restore under the standards set
by Treasury Regulations Section 1.704-1(b)(2)(ii)(c) (or is deemed obligated to restore under
Treasury Regulations Sections 1.704-2(g) 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
fiscal year, are reasonably expected to be allocated to such Member in subsequent years under
Sections 704(e)(2) and 706(d) of the Code and Treasury Regulations Section 1.751-1(b)(2)(ii), and
(ii) the amount of all distributions that, as of the end of such fiscal year, are reasonably
expected to be made to such Member in subsequent years in accordance with the terms of this
Agreement or otherwise to the extent they exceed offsetting increases to such Members Capital
Account that are reasonably expected to occur during (or prior to) the year in which such
distributions are reasonably expected to be made (other than increases as a result of a minimum
gain chargeback pursuant to Sections 5.4(a) or 5.4(b).
1
The foregoing definition of Adjusted Capital Account is intended to comply with the provisions
of Treasury Regulations Section 1.704-1(b)(2)(ii)(d) and shall be interpreted consistently
therewith
Affiliate
means, with respect to any person or entity, any other person or entity that
directly or indirectly controls, or is controlled by, or is under common control with, such first
Person. For the purposes of this definition,
Control
when used with respect to any Person means
the power to direct the management and policies of such Person, directly or indirectly, whether
through the ownership of voting securities, by contract or otherwise; and the terms controlling
and controlled have meanings correlative to the foregoing.
Agreed Allocations
means any allocation, other than a Required Allocation, of an item of
income, gain, deduction or loss pursuant to Article V.
Agreement
has the meaning set forth in the preamble hereof, as the same may be amended from
time to time in accordance with the terms hereof.
Audit Committee
has the meaning set forth in Section 7.9(b).
Available Cash
means, with respect to a fiscal quarter, all cash and cash equivalents of the
Company at the end of such quarter less the amount of cash reserves that is necessary or
appropriate in the reasonable discretion of the Board to (a) provide for the proper conduct of the
business of the Company (including reserves for future capital expenditures and for anticipated
future credit needs of the Company) subsequent to such quarter or (b) comply with applicable law or
any loan agreement, security agreement, mortgage, debt instrument or other agreement or obligation
to which the Company is a party or by which it is bound or its assets or property is subject;
provided
,
however
, that disbursements made by the Partnership to the Company or cash reserves
established, increased or reduced after the expiration of such quarter but on or before the date of
determination of Available Cash with respect to such quarter shall be deemed to have been made,
established, increased or reduced, for purposes of determining Available Cash, during such quarter
if the Board so determines in its reasonable discretion
.
Board
has the meaning set forth in Section 7.1(a).
Business Day
means any day, other than a Saturday, Sunday, or federal or Indiana legal
holiday.
Calumet LP
means Calumet Lubricants Co., Limited Partnership, an Indiana limited
partnership.
Capital Account
means the capital account maintained by the Company with respect to each
Member in accordance with the capital accounting rules described in Article 3.
Capital Account Gross Income
and
Capital Account Deduction
means, respectively, items of
gross income and deduction of the Company determined in accordance with Section 703(a) of the Code
(including all items of income, gain, loss or deduction required to be stated separately pursuant
to Section 703(a)(1) of the Code), with the following adjustments:
2
(a) Any income of the Company that is exempt from federal income tax shall be taken into
account as Capital Account Gross Income;
(b) Any expenditures of the Company described in Section 705(a)(2)(B) of the Code shall be
taken into account as Capital Account Deductions;
(c) In the event the book value of any Company asset as determined for Capital Account
purposes is adjusted pursuant to Section 3.8(b) or Section 3.8(c), the amount of such adjustment
shall be taken into account as an item of Capital Account Gross Income or Capital Account
Deduction; and
(d) With respect to property reflected in the Capital Accounts at a book value different from
its adjusted basis, items of depreciation, amortization and gain or loss shall be computed in the
same manner as such items are computed for federal income tax purposes, except that the computation
shall be made with reference to such propertys book value as determined for purposes of
maintaining the Capital Accounts instead of its adjusted tax basis, in accordance with Treasury
Regulations Section 1.704-1(b)(2)(iv)(g).
Capital Contribution
means the amount of money and/or the fair market value of any property
(net of any liabilities encumbering such property that the Company is considered to assume or take
subject to under Code Section 752) contributed to the capital of the Company by any Member.
Certificate of Formation
means the certificate of formation for the Company as originally
filed in the Office of the Secretary of State of the State of Delaware, as such certificate may be
amended from time to time.
Code
means the Internal Revenue Code of 1986, as amended. All references in this Agreement
to provisions of the Code shall be deemed to refer, if applicable, to their successor statutory
provisions to the extent appropriate in light of the context herein in which such references are
used.
Common Units
has the meaning set forth in the Partnership Agreement.
Company
has the meaning set forth in the preamble hereof.
Company Minimum Gain
means the amount determined in accordance with the principles of
Treasury Regulations Section 1.704-2(d).
Compensation Committee
has the meaning set forth in Section 7.9(c).
Conflicts Committee
has the meaning set forth in Section 7.9(d).
Contribution Agreement
means that certain Contribution, Conveyance and Assumption Agreement,
of even date herewith, among the Company, the Partnership, the Operating Company, Calumet LP, the
OLP GP and certain other parties named therein.
Director
or
Directors
has the meaning set forth in Section 7.2(a).
3
Dissolution Event
has the meaning set forth in Section 14.1.
Economic Risk of Loss
has the meaning set forth in Treasury Regulations Section 1.752-2(a).
Effective Date
has the meaning set forth in the preamble to this Agreement.
Excess Nonrecourse Liabilities
has the meaning set forth in Section 5.4(g).
Exchange Act
means the Securities Exchange Act of 1934, as amended, or any successor
statute.
General Partner Interest
has the meaning set forth in the Partnership Agreement.
Group Member
has the meaning set forth in the Partnership Agreement.
Grube Family Group
has the meaning set forth in Section 7.2(c).
Grube Family Group Transferee
has the meaning set forth in Section 7.2(c).
Incentive Plans
means any plan or arrangement pursuant to which the Company or the
Partnership may compensate its directors, officers, employees, consultants or service providers.
Indemnitee
means (a) any Person who is or was an Affiliate of the Company, (b) any Person
who is or was an officer, Director, fiduciary or trustee of the Company or any Affiliate of the
Company, (c) any Person who is or was serving at the request of the Board as an officer, director,
member, partner, fiduciary or trustee of another Person;
provided
, that a Person shall not be an
Indemnitee by reason of providing, on a fee-for-services basis, trustee, fiduciary or custodial
services; and (d) any Person the Board designates as an Indemnitee for purposes of this
Agreement.
Independent Director
means a Director who is not (a) a security holder, officer or employee
of the Company, (b) an officer, director or employee of any Affiliate of the Company or (c) a
holder of any ownership interest in the Partnership Group other than Common Units and who also
meets the independence standards required of directors who serve on an audit committee of a board
of directors established by the Securities Exchange Act of 1934, as amended, and the rules and
regulations of the Commission thereunder and by the Nasdaq Stock Market or any National Securities
Exchange on which the Common Units are listed.
Limited Partnership Interest
means a limited partnership interest in the Partnership which
refers to all of a limited partners rights and interests in the Partnership in such Persons
capacity as a limited partner thereof, all as provided in the Partnership Agreement and the
Delaware Revised Uniform Limited Partnership Act.
Liquidating Gains
and
Liquidating Losses
means taxable income or loss of the Company as
determined by taking into account only items of Capital Account Gross Income and Capital Account
Deduction that arise from the sale or deemed sale of all or substantially all of the assets of the
Company.
4
Liquidator
has the meaning set forth in Section 14.2.
Member Nonrecourse Debt
has the meaning set forth in Treasury Regulations Section
1.704-2(b)(4).
Member Nonrecourse Debt Minimum Gain
has the meaning set forth in Treasury Regulations
Section 1.704-2(i)(2).
Member Nonrecourse Deductions
means any and all items of loss, deduction or expenditure
(including, without limitation, any expenditure described in Section 705(a)(2)(B) of the Code)
that, in accordance with the principles of Treasury Regulations Section 1.704-2(i), are
attributable to a Member Nonrecourse Debt.
Member
or
Members
shall have the meaning set forth in the preamble hereof.
Membership Interest
means the property interest, as opposed to the personal interest, of a
Member in the Company and as a holder of Units, including rights to distributions (liquidating or
otherwise), allocations, information, all other rights, benefits and privileges enjoyed by that
Member (under the Act, this Agreement or otherwise) by virtue of the Units held by such Member; and
all obligations, duties and liabilities imposed on that Member (under the Act, this Agreement, or
otherwise) by virtue of the Units held by such Member.
Nonrecourse Deductions
means any and all items of loss, deduction or expenditures (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.
Non-Selling Members
is defined in Section 11.7(b).
Nonrecourse Liability
has the meaning set forth in Treasury Regulation Section
1.752-1(a)(2).
Officers
has the meaning set forth in Section 8.1.
OLP GP
means Calumet LP GP, LLC, a Delaware limited liability company.
Operating Company
means Calumet Operating, LLC, a Delaware limited liability company, and
any successor thereto.
Partnership
means Calumet Specialty Products Partners, LP, a Delaware limited partnership,
of which the Company is the general partner.
Partnership Agreement
means the Amended and Restated Agreement of Limited Partnership of the
Partnership, as the same may be amended, supplemented or restated from time to time.
Percentage Interest
means, as of any date of determination as to any Member the quotient
obtained by dividing the number of Units held by such Member by the total number of all outstanding
Units, expressed as a percentage.
5
Permitted Transfer
means:
(a) a Transfer of all or any of its Units by any Member who is a natural person to (i) such
Members spouse, children (including legally adopted children and stepchildren), spouses of
children or grandchildren or spouses of grandchildren; (ii) a trust for the benefit of the Member
and/or any of the Persons described in clause (i); or (iii) a limited partnership or limited
liability company whose sole partners or members, as case may be, are the Member and/or any of the
Persons described in clause (i) or clause (ii);
provided
, that in any of clauses (i), (ii) or
(iii), the Member transferring such Units retains exclusive power to exercise all rights under this
Agreement;
(b) a Transfer of all or any of its Units by any Member to the Company; or
(c) a Transfer of all or any of its Units by a Member to any Affiliate of such Member;
provided, however
, that such transfer shall be a Permitted Transfer only so long as such Units are
held by such Affiliate or are otherwise transferred in another Permitted Transfer.
Provided, however
, that except in the case of a Permitted Transfer pursuant to clause (b)
above, from and after the date on which a Permitted Transfer becomes effective, the Permitted
Transferee of the Units so transferred shall have the same rights, and shall be bound by the same
obligations, under this Agreement as the transferor of such Units and shall be deemed for all
purposes hereunder a Member and such Permitted Transferee shall, as a condition to such Transfer,
agree in writing to be bound by the terms of this Agreement. No Permitted Transfer shall conflict
with or result in any violation of any judgment, order, decree, statute, law, ordinance, rule or
regulation or require the Company, if not currently subject, to become subject, or if currently
subject, to become subject to a greater extent, to any statute, law, ordinance, rule or regulation,
excluding matters of a ministerial nature that are not materially burdensome to the Company.
Permitted Transferee
means any Person who shall have acquired and who shall hold Units
pursuant to a Permitted Transfer.
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 apportioned among all holders of Units in accordance with their relative
Percentage Interests.
Profits
and
Losses
means, for each fiscal year or other period, an amount equal to the
Companys net income or loss for such year or period, determined by taking into account only items
of Capital Account Gross Income and Capital Account Deduction, and excluding Liquidating Gain and
Liquidating Loss.
Required Allocations
means any allocation (or limitation imposed on any allocation) of an
item of income, gain, deduction or loss pursuant to Sections 5.4(a)-(h), such allocations being
directly or indirectly required by the Treasury Regulations promulgated under section 704(b) of the
Code.
6
Securities Act
has the meaning set forth in Section 16.
Selling Member
is defined in Section 11.7(a).
Subordinated Units
has the meaning set forth in the Partnership Agreement.
Tax Matters Member
has the meaning set forth in Section 10.3(a).
The Heritage Group
means The Heritage Group, an Indiana general partnership.
Transfer
(and related words) means any sale, assignment, gift (outright or in trust),
hypothecation, pledge, encumbrance, mortgage, exchange or other disposition, whether voluntary or
involuntary, by operation of law or otherwise, of any Units.
Transferee
means a person who receives Units by means of a Transfer.
Transferor
means a Member whose Units are the subject of a Transfer in whole or in part.
Treasury Regulations
means the federal income tax regulations as promulgated by the U.S.
Treasury Department, as such regulations may be in effect from time to time. All references in this
Agreement to provisions of the Treasury Regulations shall be deemed to refer, if applicable, to
their successor regulatory provisions to the extent appropriate in light of the context herein in
which such references are used.
Unit
has the meaning set forth in Section 3.1
1.2
Rules of Construction
. The following provisions shall be applied wherever appropriate
herein:
(a) terms defined in Section 1.1 have the meanings assigned to them in that Section for
purposes of this Agreement;
(b) herein, hereby, hereunder, hereof, hereto and other equivalent words shall refer
to this Agreement as an entirety and not solely to the particular portion of this Agreement in
which any such word is used;
(c) including means including without limitation and is a term of illustration and not of
limitation;
(d) all definitions set forth herein shall be deemed applicable whether the words defined are
used herein in the singular or the plural;
(e) unless otherwise expressly provided, any term defined herein by reference to any other
document shall be deemed to be amended herein to the extent that such term is subsequently amended
in such document;
(f) references herein to other documents and agreements means such documents and agreements as
amended and restated from time to time;
7
(g) wherever used herein, any pronoun or pronouns shall be deemed to include both the singular
and plural and to cover all genders;
(h) neither this Agreement nor any other agreement, document or instrument referred to herein
or executed and delivered in connection herewith shall be construed against any Person as the
principal draftsperson hereof or thereof;
(i) the section headings appearing in this Agreement are inserted only as a matter of
convenience and in no way define, limit, construe or describe the scope or extent of such Section,
or in any way affect this Agreement; and
(j) any references herein to a particular Section, Article, Exhibit or Schedule (other than in
connection with the Code, the Regulations or the Act) means a Section or Article of, or an Exhibit
or Schedule to, this Agreement unless another agreement is specified.
ARTICLE 2
ORGANIZATION
2.1
Formation of the Company
. Pursuant to and under the Act, the Company was formed as a
Delaware limited liability company under the laws of the State of Delaware by the filing of the
Certificate of Formation with the Office of the Secretary of State of Delaware. The rights and
liabilities of the Members shall be determined pursuant to the Act and this Agreement. To the
extent that the rights or obligations of any Member are different by reason of any provision of
this Agreement than they would be in the absence of such provision, this Agreement shall, to the
extent permitted by the Act, control.
2.2
Company Name
. The name of the Company shall be
Calumet GP, LLC
. The business of the
Company shall be conducted under such name or under such other name or names as the Board may
determine from time to time.
2.3
Term
. The term of the Company commenced on September 27, 2005, which was the date of
filing of the Certificate of Formation and, unless and until the Company is dissolved or merged out
of existence, shall continue indefinitely.
2.4
Purposes and Powers
. The purposes of the Company are to act as the general partner of
the Partnership as described in the Partnership Agreement and to engage in any lawful business or
activity related to the foregoing as the Board shall determine. The Company shall possess and may
exercise all the
powers and privileges granted by the Act, by any other law or by this Agreement, together with any
powers incidental thereto, including such powers and privileges as are necessary or appropriate to
the conduct, promotion or attainment of the business, purposes or activities of the Company.
2.5
Place of Business, Agent and Office of the Company
. The principal business office of
the Company shall be at 2780 Waterfront Parkway E. Drive, Suite 200, Indianapolis, Indiana 46214.
The Board may at any time and from time to time (i) establish a different principal business office
for the Company within or outside of the State of Indiana and (ii) establish such additional
offices of the Company within or outside the State of Indiana as it may from time to time determine
to be necessary or appropriate for the conduct of the
8
Companys or the Partnerships business and
affairs. The Company shall establish a registered office in the State of Delaware, and shall
register as a foreign limited liability company and take such other actions as the Board determines
to be necessary or appropriate to allow the Company to conduct business in such jurisdictions as
the Board determines to be necessary or appropriate. The Company shall designate initial agents
for the service of process in the State of Delaware and such other jurisdictions as the Board
determines to be necessary or appropriate, and shall maintain the names and business addresses of
such agents in the books and records of the Company. The Company may from time to time change the
designation of any such party who is to serve as such agent and may provide for additional agents
for service in such other jurisdictions as the Board determines to be necessary or appropriate.
2.6
Title to Company Assets
. Title to the Companys assets, whether real, personal or
mixed and whether tangible or intangible, shall be deemed to be owned by the Company as an entity,
and no Member, individually or collectively, shall have any ownership interest in such Company
assets or any portion thereof. Title to any or all of the Companys assets may be held in the name
of the Company or one or more of its Affiliates or one or more nominees, as the Board may
determine. All Company assets shall be recorded as the property of the Company in its books and
records, regardless of the name in which record title to such Company assets is held.
ARTICLE 3
CAPITAL AND CAPITAL ACCOUNTS
3.1
Membership Interests and Units
. The Membership Interests in the Company shall be
represented by, a single class of units (
Units
) having the rights, powers and privileges as set
forth in this Agreement. Ownership of Units shall be evidenced by one or more Unit certificates in
the form of
Exhibit A
attached hereto, but the status of a holder of Units as a Member of
the Company shall be exclusively evidenced and determined by entry in the books and records of the
Company.
3.2
Initial Capital Contributions
. On September 29, 2005 in connection with the formation
of the Company, The Heritage Group made an initial Capital Contribution to the Company of $510.00,
Fred M. Fehsenfeld, Jr. made
an initial Capital Contribution to the Company of $190.00 and F. William Grube made an initial
Capital Contribution to the Company of $300.00. Following such initial Capital Contributions and
as described in and set forth in the Contribution Agreement:
(a) the initial cash Capital Contributions of Fred M. Fehsenfeld, Jr., F. William Grube and
The Heritage Group were refunded to each of them; and
(b) The Heritage Group and the other Members set forth on Schedule A hereto made additional
capital contributions to the Company.
3.3
Members of the Company at the Effective Date
.
Schedule A
reflects the Members
ownership of the Units as of the Effective Date.
9
3.4
Transfer of Units and Admission of Substitute Members
. Units may be Transferred and
substitute Members may be admitted to the Company only in accordance with Article 11.
3.5
Issuance of Additional Units
.
(a) Subject to the approval of the holders of at least 75% of the outstanding Units as set
forth in Section 6.8, the Company may issue an unlimited number of additional Units to any Person
at any time for such consideration as the Board deems appropriate.
(b) If any additional Units are issued hereunder to any Person who is not already a Member,
any such Person (and such Persons spouse, as applicable) shall, as a condition to admission as an
additional Member, execute and acknowledge such instruments as the Board determines to be necessary
or appropriate to effect the admission of such Person as an additional Member, including, without
limitation, the written agreement by such Person (and such Persons spouse, as applicable) to
become a party to, and be bound by, the provisions of this Agreement. Upon the admission of any
additional Member, the Schedule of Members attached hereto as
Schedule A
shall be amended
to reflect the admission of such additional Member.
3.6
Subsequent Capital Contributions
. Except as may be required under applicable law, no
Member shall be required to make any subsequent Capital Contribution to the Company.
3.7
Loans to the Company
. Any Member, directly or through an Affiliate, may at any time or
from time to time lend funds to the Company with the consent of the Board. Any such loan shall be
repayable by the Company to the Member (or its Affiliate, if applicable) at such date or dates as
they may agree, and shall bear interest and carry such other terms as they may agree at a fair
market interest rate and terms for similar loans between unaffiliated parties. The Members
expressly agree and acknowledge that nothing in this Section 3.7 shall be deemed to require or
otherwise obligate any Member to make any such loan to the Company. A loan by a Member to the
Company shall not
increase the interest of the lending Member in the capital of the Company and shall not entitle
such Member to any increased share in the Companys capital, Profits or Losses.
3.8
Capital Accounts
.
(a) A Capital Account shall be established for each Member and shall be determined and
maintained in accordance with the provisions of Code Section 704 and the Treasury Regulations
thereunder. In addition to such other adjustments as may be required under this Agreement or
pursuant to such Treasury Regulations, each Members Capital Account shall be (a) increased by (i)
such Members Capital Contribution to the Company, plus (ii) the amount of any Profits and
Liquidating Gains allocated to such Member and items of Capital Account Gross Income specially
allocated to such Member pursuant to Article 5, and (b) decreased by (i) the amount of any Losses
and Liquidating Losses allocated to such Member and items of Capital Account Deduction specially
allocated to such Member pursuant to Article 5, (ii) the amount of any cash or other assets
distributed to such Member by the Company, and (iii) the fair market value, as determined by the
Board, of any property distributed, or deemed hereunder to be distributed, to such Member by the
Company (net of any liabilities that such Member is considered to assume or take subject to under
Code Section 752 upon any such distribution of property).
10
(b) In accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(e), immediately prior to
the actual or deemed distribution of any Company asset in kind, the Capital Accounts of all Members
and the Companys book carrying value of such Company asset shall be adjusted upward or downward to
reflect any unrealized gain or unrealized loss attributable to such Company asset as if such
unrealized gain or unrealized loss had been recognized upon an actual sale of such Company asset
immediately prior to such distribution and had been allocated to the Members at such time pursuant
to Article 5. For purposes of determining such unrealized gain or unrealized loss, the fair market
value, as determined by the Board, of Company assets shall be used.
(c) Upon any event described in Treasury Regulation Section 1.704-1(b)(2)(iv)(f)(5), the Board
may determine to restate the Capital Accounts in connection with a revaluation of the assets of the
Company in order to reflect the manner in which the unrealized income, gain, loss, or deduction
inherent in such property (that has not been reflected in the Capital Accounts previously) would be
allocated among the Members if there were a taxable sale of such assets for their fair market value
as determined by the Board.
(d) Upon any Transfer of Units, the Transferee shall be credited on the Companys books with
the portion of the Transferors Capital Account that corresponds to the Transferred Units.
3.9
General Provisions Regarding Capital Contributions
. Except as otherwise expressly
provided in this Agreement (a) no Member shall have the right to demand or receive a return of its
Capital Contribution, (b) under circumstances requiring hereunder a return of any Capital
Contribution, no Member shall have the right to demand or
receive property other than cash, and (c) no Member shall receive any interest, salary or draw with
respect to its Capital Contribution or its Capital Account. An unrepaid Capital Contribution is not
a liability of the Company or of any Member. No Member shall be required to contribute or to lend
any cash or property to the Company to enable the Company to return the Capital Contribution of any
Member.
3.10
Limitation on Liability
. Except as otherwise required under the Act, the debts,
obligations and liabilities of the Company, whether arising in contract, tort or otherwise, shall
be solely the debts, obligations and liabilities of the Company, and no Member or Assignee shall be
personally liable for or otherwise obligated with respect to any such debt, obligation or liability
of the Company by reason of being a Member or Assignee. The Members and Assignees agree that the
rights, duties and obligations of the Members and Assignees in their capacities as such are only as
set forth in this Agreement and as otherwise arise under the Act. Furthermore, the Members and
Assignees agree that the existence of any rights of a Member or Assignee, or the exercise or
forbearance from exercise of any such rights shall not create any duties or obligations of the
Member or Assignees in their capacities as such, nor shall such rights be construed to enlarge or
otherwise alter in any manner the duties and obligations of the Members or Assignees.
11
ARTICLE 4
DISTRIBUTIONS
4.1
Distributions of Available Cash
. An amount equal to 100% of Available Cash with
respect to each fiscal quarter of the Partnership shall be distributed simultaneously to the
Members in proportion to their relative Percentage Interests within forty-five days after the end
of such quarter.
4.2
Persons Entitled to Distributions
. All distributions of Available Cash to Members for
a fiscal quarter pursuant to Section 4.1 shall be made to the Members shown on the records of the
Company to be entitled thereto as of the last day of such quarter, unless the transferor and
transferee of any Units otherwise agree in writing to a different distribution and such
distribution is consented to in writing by the Board.
4.3
Limitations on Distributions
.
(a) Notwithstanding any provision of this Agreement to the contrary, no distributions shall be
made except pursuant to this Article 4 or Article 14.
(b) Notwithstanding any provision of this Agreement to the contrary, no distribution hereunder
shall be permitted if such distribution would violate Section 18-607 of the Act or other applicable
law.
4.4
Distributions on Dissolution and Winding Up
. Upon the dissolution and winding up of the Company, the proceeds of liquidation after the
payment of creditors as specified in Article 14 shall be distributed to all of the Members in
accordance with their positive Capital Account balances as properly adjusted through the time of
such distribution.
4.5
Withholding of Taxes
. The Company will withhold taxes from distributions to the extent
required to do so by applicable law. Any amounts so withheld and paid or required to be paid to a
taxing authority will be treated as if they had been distributed to the Member from whose
distribution the amount was withheld.
ARTICLE 5
ALLOCATIONS
5.1
Allocations of Profit and Loss
. Profit and Loss for a taxable year of the Company, and
each item thereof, shall be allocated among the Members, Pro Rata.
5.2
Allocations of Liquidating Gain and Loss
. Liquidating Gains and Liquidating Losses
shall be allocated among the Members, Pro Rata.
5.3
Transfers
. In the event of a Transfer of Units during a taxable year, the Company
shall make an interim closing of its books (or, at the election of the applicable Transferor and
Transferee and with the consent of the Board, utilize any other method permitted under Section 706
of the Code) for purposes of determining the allocations and distributions required under this
Agreement.
12
5.4
Additional Allocations
. Notwithstanding any other provisions of this Section 5.4, the
following special allocations shall be made for each taxable period:
(a) Notwithstanding any other provision of this Section 5.4, if there is a net decrease in
Company Minimum Gain during any Company taxable period, each Member shall be allocated items of
Company 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),(g)(2), and (j)(2)(i). For purposes
of this Section 5.4(a), each Members Capital Account 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 5.4 with respect to such taxable period. This Section 5.4(a)
is intended to comply with the Company Minimum Gain chargeback requirement in Treasury Regulation
Section 1.704-2(f) and shall be interpreted consistently therewith.
(b) Notwithstanding the other provisions of this Section 5.4 (other than (a) above), if there
is a net decrease in Member Nonrecourse Debt Minimum Gain during any Company taxable period, any
Member with a share of Member Nonrecourse Debt Minimum Gain at the beginning of such taxable period
shall be allocated items of Company 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
(j)(2)(ii). For purposes of this Section 5.4(b) each Members Adjusted Capital Account balance
shall be determined, and the allocation of income and gain required hereunder shall be effected,
prior to the application of any other allocations pursuant to this Section 5.4, other than Section
5.4(a) above, with respect to such taxable period. This Section 5.4(b) is intended to comply with
the Member Nonrecourse Debt Minimum Gain chargeback requirement in Treasury Regulation Section
1.704-2(i)(4) and shall be interpreted consistently therewith.
(c) Except as provided in (a) and (b) above, in the event any Member unexpectedly receives any
adjustments, allocations or distributions described in Treasury Regulation Sections
1.704-1(b)(2)(ii)(d)(4), (5), or (6), items of Company income and gain shall be specially allocated
to such Member in an amount and manner sufficient to eliminate, to the extent required by such
Treasury Regulation, the deficit balance, if any, in its Adjusted Capital Account created by such
adjustments, allocations or distributions as quickly as possible unless such deficit balance is
otherwise eliminated pursuant to (a) or (b) above.
(d) In the event any Member has a deficit balance in its Adjusted Capital Account at the end
of any Company taxable period, such Member shall be specially allocated items of Company gross
income and gain in the amount of such excess as quickly as possible; provided, that an allocation
pursuant to this Section 5.4(d) shall be made only if and to the extent that such Member would have
a deficit balance in its Adjusted Capital Account after all other allocations provided in this
Section 5.4 have been tentatively made as if this Section 5.4(d) were not in this Agreement.
(e) Nonrecourse Deductions for any taxable period shall be allocated to the Members, Pro Rata
.
13
(f) Member Nonrecourse Deductions for any taxable period shall be allocated 100% to the Member
that bears the Economic Risk of Loss with respect to the Member Nonrecourse Debt to which such
Member Nonrecourse Deductions are attributable in accordance with Treasury Regulation Section
1.704-2(i). If more than one Member bears the Economic Risk of Loss with respect to a Member
Nonrecourse Debt, Member Nonrecourse Deductions attributable thereto shall be allocated between or
among such Members in accordance with the ratios in which they share such Economic Risk of Loss.
(g) Nonrecourse Liabilities. For purposes of Treasury Regulations Section 1.752-3(a)(3), the
Members agree that
Excess Nonrecourse Liabilities
of the Company, as defined in Treasury
Regulations Section 1.752-3(a)(3), shall be allocated 100% to the Members, Pro Rata.
(h) To the extent an adjustment to the adjusted tax basis of any Company asset pursuant to
Sections 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 Members in a manner consistent with
the manner in which their Capital Accounts are required to be adjusted pursuant to such provisions.
(i) Notwithstanding any other provision of this Section 5.4 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 income, gain, loss and deduction
allocated to each Member pursuant to the Required Allocations and Agreed Allocations, together,
shall be equal to the net amount of such items that would have been allocated to each such Member
under the Agreed Allocations if the Required Allocations had not otherwise been provided for in
this Section 5.4.
5.5
Income Tax Allocations
.
(a) Except as provided in this Section 5.5, each item of income, gain, loss and deduction of
the Company for federal income tax purposes shall be allocated among the Members in the same manner
as such items are allocated for book purposes under Sections 5.1 and 5.2.
(b) The Members recognize that with respect to any property contributed to the Company, there
may be a difference between the basis of the property to the Company for federal income tax
purposes and its fair market value at the time of the contribution. In such case, all items of tax
depreciation, cost recovery, amortization, and gain or loss with respect to such properties shall
be allocated among the Members to take into account such disparities in accordance with the
provisions of sections 704(b) and 704(c) of the Code and the Treasury Regulations under those
sections.
(c) For tax purposes, recapture of tax deductions arising out of a disposition of property
shall, to the extent consistent with the allocations for tax purposes of the gain or amount
realized giving rise to such recapture, be allocated to the Members in the same proportions as the
recaptured deduction was originally allocated.
14
(d) All items of income, gain, loss, deduction and credit allocated to the Members in
accordance with the provisions hereof and basis allocations recognized by the Company for federal
income tax purposes shall be determined without regard to any election under Section 754 of the
Code which may be made by the Company;
provided, however
, such allocations, once made, shall be
adjusted as necessary or appropriate to take into account the adjustments permitted by Sections 734
and 743 of the Code.
5.6
Negative Capital Accounts
. In no event shall any Member be obligated to pay to the
Company, any other Member or any creditor of the Company any deficit balance in its Capital
Account.
ARTICLE 6
MEETINGS OF MEMBERS
6.1
Time and Place
. Any meeting of the Members may be held at such time and place, within
or outside the State of Indiana, as may be fixed by the Board or as shall be specified in the
notice or waiver of notice of the meeting. If the place for a meeting is not fixed by the Board,
such meeting shall be held at the Companys principal office.
6.2
Annual Meeting
. The annual meeting shall be held on the date and at the time and place
fixed from time to time by the Board. The annual meeting shall be for the purpose of electing a
board of directors and transacting such other business as may properly be brought before the
meeting.
6.3
Special Meeting
. A special meeting for any purpose or purposes may be called by the
Board and shall be called by the Board upon the written request of any Member holding at least 15%
of the outstanding Units.
6.4
Record Date for Determination of Membership
. In order that the Board may determine the
Members (i) entitled to notice of or to vote at any meeting of Members, (ii) entitled to express
consent to action in writing without a meeting, (iii) entitled to exercise any rights in respect of
any change, conversion, or exchange of Units, (iv) entitled to receive a distribution with respect
to any Units, or (v) for the purpose of any other lawful action, the Board may fix, in advance, a
record date, which record date shall not precede the date upon which the resolution fixing the
record date is adopted by the Board. The record date for determining the Members entitled to notice
of or to vote at any meeting of the Members or any adjournment thereof shall not be more than 60
nor less than 10 days before the date of such meeting. The record date for determining the Members
entitled to consent to action in writing without a meeting pursuant to Section 6.10 shall not be
more than 10 days after the date upon which the resolution fixing the record date is adopted by the
Board. The record date for any other action shall not be more than 60 days prior to such action. If
no record date is fixed, (a) the record date for determining Members entitled to notice of or to
vote at any meeting shall be at the close of business on the day immediately preceding the day on
which notice is given or, if notice is waived by all Members, at the close of business on the day
immediately preceding the day on
15
which the meeting is held, (b) the record date for determining
Members entitled to express consent to action in writing without a meeting, when no prior action by
the Board is required, shall be the first date on which a signed written consent setting forth the
action taken or to be taken is delivered to the Company and, when prior action by the Board is
required, shall be at the close of business on the day on which the Board adopts the resolution
taking such prior action, and (c) the record date for determining Members for any other purpose
shall be at the close of business on the day on which the Board adopts the resolution relating to
such other purpose. A determination of the Members of record entitled to notice of or to vote at a
meeting of Members is effective for any adjournment of the meeting unless the Board fixes a new
record
date, which the Board shall do if the meeting is adjourned to a date more than 120 days after the
date fixed for the original meeting.
6.5
Notice to Members
. Written notice stating the place, date, and hour of the meeting
and, in case of a special meeting, the purpose or purposes for which the meeting is called, shall
be given not less than 10 nor more than 60 days before the date of the meeting, except as otherwise
required by the Act. If an annual or special meeting of Members is adjourned to a different date,
time, or place, notice need not be given of the new date, time or place if the new date, time or
place is announced at the meeting before adjournment;
provided, however
, that, if a new record date
for the adjourned meeting is fixed pursuant to Section 6.4, notice of the adjourned meeting shall
be given to persons who are Members as of the new record date.
6.6
Waiver
. Attendance of a Member, either in person or by proxy, at any meeting, whether
annual or special, shall constitute a waiver of notice of such meeting, except where a Member
attends a 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. A written
waiver of notice of any such meeting signed by a Member or Members entitled to such notice, whether
before, at or after the time for notice or the time of the meeting, shall be equivalent to notice.
Neither the business to be transacted at, nor the purpose of, any meeting need be specified in any
written waiver of notice.
6.7
Quorum
. The holders of a majority of the outstanding Units entitled to vote at a
meeting, present in person or represented by proxy, shall constitute a quorum at all meetings of
the Members for the transaction of business, except as otherwise provided by the Act. If, however,
such a quorum shall not be present at any meeting of Members, the Chairman of the Board or a
majority of the Members entitled to vote, present in person or represented by proxy, shall have the
power to adjourn the meeting from time to time, without notice if the time and place are announced
at the meeting, until a quorum shall be present. At such adjourned meeting at which a quorum shall
be present, any business may be transacted which might have been transacted at the original
meeting. If the adjournment is for more than 30 days or if after the adjournment a new record date
is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each Member
of record entitled to vote at the meeting.
6.8
Matters Requiring Member Approval
.
(a) Without the prior written consent of Members holding at least 75% of the outstanding
Units, the Company shall not, and shall not permit any of its Subsidiaries to, effect any:
16
(i) Merger, consolidation or share exchange into or with any other Person, or any other
similar business combination transaction (other than any such transaction entered into
solely between the Company and any of its subsidiaries or among any of them) involving the
Company or any of its Significant Subsidiaries (as defined in Rule 1-02(w) of Regulation S-X
promulgated by the Securities and Exchange Commission, as amended) or financial
restructuring of the Company or the Partnership;
provided
,
however
, that in
the event not all Members receive identical consideration, whether in their capacity as a
Member or as a limited partner of the Partnership, both in form and amount (in proportion to
their Units or Limited Partner Interests, as the case may be) in such transaction, such
transaction shall require the prior written consent of any Member receiving consideration
that differs from the consideration to be received by Members holding at least 50% of the
outstanding Units;
(ii) voluntary filing for bankruptcy, liquidation, dissolution or winding up of the
Company or any of its subsidiaries or any event that would cause a dissolution or winding up
of the Company or any of it subsidiaries or any consent by the Company or any of its
subsidiaries to any action brought by any other Person relating to any of the foregoing;
(iii) sale, lease, transfer, pledge or other disposition of all or substantially all of
the properties or assets of the Company or the Company and any of its subsidiaries taken as
a whole;
(iv) withdrawal of the Company as general partner of the Partnership;
(v) material tax decisions or elections on behalf of the Company;
(vi) conversion of the Company from a limited liability company into another form of
entity; or
(vii) other than equity securities subsequently approved pursuant to this Section 6.8,
authorization, sale and/or issuance by the Company of its Units, or other equity securities
of the Company, whether in a private or public offering, including an initial public
offering, or the grant, sale or issuance of other securities (including rights, warrants and
options) convertible into, exchangeable for or exercisable for any Units or other equity
securities.
6.9
Voting and Proxies
. At every meeting of the Members, each Member that is entitled to
vote at such meeting shall be entitled to vote in person or by proxy, but no proxy shall be voted
after three years from its date unless the proxy provides for a longer period. When a quorum is
present at any meeting, the vote of the holders of a majority of the outstanding Units of each
class present in person or represented by proxy that are entitled to vote on a question shall
decide any such question brought before such meeting, unless the question is one upon which, by
express provision of the Act or this Agreement, a different vote is required, in which case such
express provision shall govern.
6.10
Action by Consent of the Members
. Any action required or permitted to be taken at a
meeting of the Members, including at the annual meeting, may be taken without a meeting if
17
a
written consent setting forth the action so taken is signed by Members holding the number of Units,
as applicable, as is required by the Act or this Agreement for approval of the action in question.
Such consent may be in one instrument or in several instruments, and shall have the same force and
effect as a vote of the Members at a meeting duly called and held.
6.11
Telephonic Meetings
. Members may participate in any meeting of the Members through
the use of any means of conference telephones or similar communications equipment as long as all
persons participating can hear one another. A Member so participating shall be deemed to be
present in person at the meeting.
ARTICLE 7
MANAGEMENT
7.1
Management of the Companys Affairs
.
(a) Except as otherwise provided in this Agreement, all management powers over the business
and affairs of the Company shall be vested in a board of directors (the
Board
) and, subject to
the direction of the Board, the Officers. The Directors shall constitute managers of the Company
within the meaning of the Act.
(b) Except as otherwise specifically provided in this Agreement, the authority and functions
of the Board on the one hand and of the Officers on the other shall be identical to the authority
and functions of the board of directors and officers, respectively, of a corporation organized
under the General Corporation Law of the State of Delaware. Thus, except as otherwise specifically
provided in this Agreement, the business and affairs of the Company shall be managed under the
direction of the Board, and the day-to-day activities of the Company shall be conducted on the
Companys behalf by the Officers, who shall be agents of the Company.
7.2
Number; Qualification; Election; Tenure
.
(a) The number of directors (each a
Director
and collectively, the
Directors
) constituting
the Board shall be fixed from time to time pursuant to a resolution adopted by Members holding a
majority of the outstanding Units then entitled to vote at an election of Directors. A Director
need not be a Member. Each Director shall serve as a member of the Board until the earlier of his
resignation, death or removal from office or until his or her successor is duly elected and
qualified. The number of Directors constituting the initial Board shall be seven and the initial
Directors shall be the following individuals:
Fred M. Fehsenfeld, Jr.
F. William Grube
James S. Carter
William S. Fehsenfeld
Robert E. Funk
Nicholas J. Rutigliano
Michael L. Smith
(b) Except as set forth in Section 7.2(c), at each annual meeting of the Members, the
successor to each Director shall be elected to hold office for a term expiring at the next annual
18
meeting of Members. To be elected as a Director, a natural person must (i) be chosen in accordance
with Section 7.10, (ii) be chosen in accordance with Section 7.2(c) or (iii)(A) have been properly
nominated for a position as a Director in accordance with Section 7.2(d) and (B) receive a
plurality of the votes cast for the position at a meeting of Members held for such purpose at which
a quorum is present in Person or by proxy.
(c) So long as (i) F. William Grube is the Chief Executive Officer of the Company and (ii) F.
William Grube or trusts established for the benefit of his family members (or Permitted Transferees
of Mr. Grube or of such trusts other than the Company) (Mr. Grube, such trusts, and such Permitted
Transferees other than the Company being hereafter referred to as the Grube Family Group)
continue to own at least 300 Units (the aggregate number of Units that were owned by the Grube
Family Group on the date that this Agreement was first amended and restated in connection with the
initial public offering of the Partnership), Mr. Grube will be entitled to serve as a director of
the Company. In the event Mr. Grube is no longer the Chief Executive Officer of the Company, Mr.
Grube may continue to serve as a director, or, at his option (or, in the event of his death, at the
option of the executor of his estate), Mr. Grube (or such executor) may appoint a member of Mr.
Grubes family to serve as a director in his place, in each case so long as the Grube Family Group
continues to own at least 300 Units. In the event that (i) any Member who is part of the Grube
Family Group Transfers any of such Members Units pursuant to Section 11.7 hereof to one or more
Transferee(s) (each, a Grube Family Group Transferee) other than in connection with a Permitted
Transfer and (ii) in connection with such Transfer, Mr. Grube (or the executor of his estate) shall
agree to assign Mr. Grubes (or such executors) rights to designate himself or a family member as
a director to a Grube Family Group Transferee, then the Grube Family Group Transferee that is the
assignee of such designation rights shall (upon completion of such Transfer and the resignation of
any Grube family member who may then be serving as a director) be entitled to appoint one person of
its choosing to serve as a director of the Company in accordance with the terms of the assignment
of such rights, so long as the Grube Family Group Transferee and the Grube Family Group continue to
own, in the aggregate, at least 300 Units. In no event will the Grube Family Group and the Grube
Family Group Transferees in the aggregate be entitled to designate or appoint more than one
director. At every election of directors held while the Grube Family Group (or, if applicable, the
Grube Family Group and the Grube Family Group Transferee(s) in the aggregate) owns at least 300
Units, each Member shall cast all of such Members votes for the election as a director of Mr.
Grube, or of the family member appointed by Mr. Grube (or by the executor of his estate), or of the
person appointed by the Grube Family Group Transferee (as the case may be), and the Board of
Directors in connection with each such election shall include Mr. Grube or such appointed person
(as the case may be) in its slate of nominees.
(d) Before a meeting of the Members at which an election of Directors is to be held, the Board
shall nominate its slate of persons to be presented for election at such meeting. Other
nominations for Directors may be made by any Member that holds more than 10% of the
outstanding Units, but any Member nominations must be in writing, in proper form and delivered
to the Secretary of the Company not less than ten days prior to the meeting of Members at which the
nominee is to be elected. To be in proper form, such Member nomination must set forth in writing
as to each person whom such Member proposes to nominate for election or re-election as a Director
all information relating to such person as is required to be disclosed in solicitations of proxies
for election of Directors, or is otherwise required, in each case pursuant to Regulation 14A under
the Securities Exchange Act of 1934, as amended, and Rule 14a-11 thereunder (or any successor rule
promulgated thereunder).
19
7.3
Notice
. Written notice of all regular meetings of the Board must be given to all
Directors at least five calendar days prior to the regular meeting of the Board and two business
days prior to any special meeting of the Board. Neither the business to be transacted at, nor the
purpose of, any regular or special meeting of the Board need be specified in the notice of such
meeting. A meeting may be held at any time without notice if all the Directors are present or if
those not present waive notice of the meeting either before or after such meeting.
7.4
Regular Meetings
. The board shall meet at least quarterly, and a regular meeting of
the Board shall be held without notice other than this Section 7.4 immediately after, and at the
same place as, the annual meeting of the Members. The Board may, by resolution, provide the time
and place for the holding of additional regular meetings without other notice than such resolution.
7.5
Special Meetings
. Special Meetings of the Board may be called at any time at a request
of the Chairman or by any Director.
7.6
Action by Consent of the Board
. Any action required or permitted to be taken at a
meeting of the Board, including at the annual meeting, may be taken without a meeting if a written
consent setting forth the action so taken is signed by the number of Directors as is required by
this Agreement for approval of the action in question. Such consent may be in one instrument or in
several instruments, and shall have the same force and effect as a vote of the Directors at a
meeting duly called and held.
7.7
Telephonic Meetings
. Directors may participate in any meeting of the Board through the
use of any means of conference telephones or similar communications equipment as long as all
persons participating can hear one another. A Director so participating shall be deemed to be
present in person at the meeting.
7.8
Quorum; Voting Requirement
. A majority of the Directors, present in person or participating in accordance with Section 7.7,
shall constitute a quorum for the transaction of business, but if at any meeting of the Board there
shall be less than a quorum present, a majority of the Directors present may adjourn the meeting
from time to time without further notice. Except as otherwise provided in this Agreement, an act by
the majority of the Directors present at a meeting at which a quorum is present shall be the act of
the Board. The Directors present at a duly organized meeting may continue to transact business
until adjournment, notwithstanding the withdrawal of enough Directors to leave less than a quorum.
7.9
Committees
.
(a) The Board may establish committees of the Board. Any such committee, to the extent
provided in the resolution of the Board or in this Agreement, shall have and may exercise all
powers and authority of the Board in the management of the business and affairs of the Company; but
no such committee shall have the power or authority in reference to the following matters: (i)
approving or adopting, or recommending to the Members, any action or matter
expressly required by
this Agreement or the Act to be submitted to the Members for approval; or (ii) adopting, amending
or repealing any provision of this Agreement.
20
(b) The Board shall have an audit committee (the
Audit Committee
) comprised of Independent
Directors. The Audit Committee shall establish a written audit committee charter in accordance with
the rules and regulations of the NASDAQ National Market or any National Securities Exchange on
which the Common Units are listed from time to time, and the Securities and Exchange Commission, as
amended from time to time. The Audit Committee shall review the financial statements of the Company
and the Partnership, review the external financial reporting of the Partnership, recommend
engagement of the Partnerships independent auditors, review procedures for internal auditing and
the adequacy of the Partnerships internal accounting controls and perform such other related
functions as may be directed by the Board from time to time. Each member of the Audit Committee
shall satisfy the rules and regulations of the NASDAQ National Market or any National Securities
Exchange on which the Common Units are listed from time to time and the Securities and Exchange
Commission, as amended from time to time, pertaining to qualification for service on an audit
committee.
(c) The Board shall have a compensation committee (the
Compensation Committee
). The
Compensation Committee shall be charged with such matters pertaining to the compensation of
Directors, Officers and other personnel of the Company, the review, approval and administration of
any Incentive Plans put in place by the Company or the Partnership and such other related matters
as may be directed by the Board from time to time.
(d) The Board may have a conflicts committee comprised of no fewer than two Directors (the
"
Conflicts Committee
), all of whom shall be Independent Directors. The Conflicts Committee may
review, and approve or disapprove, transactions in which a potential conflict of interest exists or
arises between the Company, or any of its Affiliates (other than a Group Member), on the one hand,
and any Group Member, any Partner (as defined in the Partnership Agreement, all in accordance with
the applicable provisions of the Partnership Agreement. Any
matter approved by the Conflicts Committee in accordance with the provisions, and subject to
the limitations, of the Partnership Agreement, shall not be deemed to be a breach of any fiduciary
or other duties owed by the Board or any Director to the Company or the Members.
(e) At every meeting of a committee, the presence of a majority of all the members thereof
shall constitute a quorum and the affirmative vote of a majority of the members present shall be
necessary for the adoption by the committee of any resolution. The chairman of the committee or a
majority of the members of the committee may fix the time and place of its meetings unless the
Board shall otherwise provide. Notice of such meetings shall be given to each member of the
committee in the manner provided for in Section 7.3. The Board shall have power at any time to
fill vacancies in, to change the membership of, or to dissolve any committee. Nothing herein shall
be deemed to prevent the Board from appointing one or more committees consisting in whole or in
part of persons who are not Directors;
provided
,
however
, that no such committee shall have or may
exercise any authority of the Board.
7.10
Vacancies; Increases in the Number of Directors
. Unless otherwise provided by this
Agreement, vacancies and newly created directorships resulting from any increase in the authorized
number of Directors may be filled by the holders of a majority of the outstanding
Units then
entitled to vote at an election of Directors and any Director so chosen shall hold office until
their successor shall be duly elected and qualified or until their earlier death, resignation or
removal.
21
7.11
Removal
. Any Director may be removed, with or without cause, at any time by the
holders of a majority of the outstanding Units then entitled to vote at an election of Directors;
provided
,
however
, that Mr. Grube, or any individual appointed to be a Director by
Mr. Grube (or by the executor of his estate) or by a Grube Family Group Transferee pursuant to
Section 7.2(c) may be removed only by Mr. Grube or by the executor of his estate, or by such Grube
Family Group Transferee, as the case may be.
7.12
Compensation of Directors
. Except as expressly provided in any written agreement
between the Company and a Director or by resolution of the Board, no Director shall receive any
compensation from the Company for services provided to the Company in its capacity as a Director,
except that each Director shall be compensated for attendance at Board meetings at rates of
compensation as from time to time established by the Board;
provided, however
, that the Directors
who are also employees of the Company shall receive no compensation for their services as Directors
or committee members. In addition to the foregoing, the members of the Conflicts Committee shall
receive such additional compensation as from time to time established by the Board. All the
Directors shall be entitled to be reimbursed for out-of-pocket costs and expenses incurred in the
course of their service as Directors.
ARTICLE 8
OFFICERS
8.1
Elected Officers
. The officers of the Company (the
Officers
) shall be selected by,
and serve at the pleasure of, the Board. The Officers shall carry on the day to day activities of
the Company and shall have such other authority and duties delegated to each of them, respectively,
by the Board from time to time. The Officers shall be a Chairman of the Board, a President and
Chief Executive Officer, a Chief Financial Officer, a Secretary and such other officers (including
Executive Vice Presidents, Senior Vice Presidents and Vice Presidents) as the Board from time to
time may elect in accordance with this Article 8. The Chairman of the Board shall be chosen from
among the Directors. All Officers shall each have such powers and duties as generally pertain to
their respective offices, subject to the specific provisions of this Article 8. Any Person may be
selected by the Board to hold multiple offices. The Board may from time to time elect such other
officers (including one or more Vice Presidents, Controllers, Assistant Secretaries and Assistant
Treasurers) as it determines to be necessary or appropriate for the conduct of the business of the
Company. Such other officers and agents shall have such duties and shall hold their offices for
such terms as shall be provided in this Agreement or as may be prescribed by the Board.
8.2
Election and Term of Office
. The Officers of the Company shall be elected annually by
the Board at the regular meeting of the Board held after the annual meeting of the Members. If the
election of Officers shall not be held at such meeting, such election shall be held as soon
thereafter as convenient. Each Officer shall hold office until such persons
successor shall have
been duly elected and shall have qualified or until such persons death or until he shall resign or
be removed pursuant to Section 8.8.
22
8.3
Chairman of the Board
. The Chairman of the Board shall preside at all meetings of the
Members and of the Board. The Board may also elect a Vice Chairman to act in the place of the
Chairman upon his absence or inability to act.
8.4
President and Chief Executive Officer
. The President and Chief Executive Officer shall
be responsible for the general management of the affairs of the Company and shall perform all
duties incidental to such persons office that may be required by law and all such other duties as
are properly required of him by the Board. He shall make reports to the Board and the Members and
shall use his best efforts to see that all orders and resolutions of the Board and of any committee
thereof are carried into effect. The President and Chief Executive Officer, if he is also a
Director, shall, in the absence of or because of the inability to act of the Chairman of the Board
or any Vice Chairman elected by the Board, perform all duties of the Chairman of the Board and
preside at all meetings of Members and of the Board.
8.5
Vice Presidents
. Each Executive Vice President and Senior Vice President and any other Vice President shall have
such powers and shall perform such duties as shall be assigned to him by the Board.
8.6
Chief Financial Officer and Assistant Treasurers
. The Chief Financial Officer shall
act as the Chief Financial Officer of the Company and shall exercise general supervision over the
receipt, custody and disbursement of corporate funds. The Chief Financial Officer shall cause the
funds of the Company to be deposited in such banks as may be authorized by the Board, or in such
banks as may be designated as depositories in the manner provided by resolution of the Board. The
Chief Financial Officer shall, in general, perform all duties incident to the office of the Chief
Financial Officer and shall have such further powers and duties and shall be subject to such
directions as may be granted or imposed from time to time by the Board. Assistant Treasurers shall
have such of the authority and perform such of the duties of the Chief Financial Officer as may be
provided in this Agreement or assigned to them by the Board or the Chief Financial Officer.
Assistant Treasurers shall assist the Chief Financial Officer in the performance of the duties
assigned to the Chief Financial Officer, and in assisting the Chief Financial Officer, each
Assistant Treasurer shall for such purpose have the powers of the Chief Financial Officer. During
the Chief Financial Officers absence or inability to act, the Chief Financial Officers authority
and duties shall be possessed by such Assistant Treasurer or Assistant Treasurers as the Board may
designate.
8.7
Secretary and Assistant Secretaries
. The Secretary shall keep or cause to be kept, in
one or more books provided for that purpose, the minutes of all meetings of the Board, the
committees of the Board and the Members. The Secretary shall see that all notices are duly given in
accordance with the provisions of this Agreement and as required by law; shall be custodian of the
records and the seal of the Company and affix and attest the seal to all documents to be executed
on behalf of the Company under its seal; and shall see that the books, reports, statements,
certificates and other documents and records required by law to be kept and filed are properly kept
and filed; and in general, shall perform all the duties incident to the office of Secretary and
such other duties as from time to time may be assigned to the Secretary by the
23
Board. Assistant
Secretaries shall have such of the authority and perform such of the duties of the Secretary as may
be provided in this Agreement or assigned to them by the Board or the Secretary. Assistant
Secretaries shall assist the Secretary in the performance of the duties assigned to the Secretary,
and in assisting the Secretary, each Assistant Secretary shall for such purpose have the powers of
the Secretary. During the Secretarys absence or inability to act, the Secretarys authority and
duties shall be possessed by such Assistant Secretary or Assistant Secretaries as the Board may
designate.
8.8
Removal
. Any Officer elected by the Board may be removed by the affirmative vote of a
majority of the Board. No elected Officer shall have any contractual rights against the Company for
compensation by virtue of such election beyond the date of the election of such persons successor,
such persons death, such persons resignation or such persons removal, whichever event shall
first occur, except as otherwise provided in an employment contract or under an employee deferred
compensation plan.
8.9
Vacancies
. A newly created elected office and a vacancy in any elected office because
of death, resignation or removal may be filled by the Board for the unexpired portion of the term
at any meeting of the Board.
8.10
Compensation
. The Officers shall receive such compensation for their services as may
be designated by the Compensation Committee. In addition, the Officers shall be entitled to be
reimbursed for out-of-pocket costs and expenses incurred in the course of their service hereunder.
8.11
Powers of Attorney
. The Company may grant powers of attorney or other authority as
appropriate to establish and evidence the authority of the Officers and other Persons.
8.12
Delegation of Authority
. Unless otherwise provided by this Agreement or by resolution
of the Board, no Officer shall have the power or authority to delegate to any Person such Officers
rights and powers as an Officer to manage the business and affairs of the Company.
ARTICLE 9
STANDARDS OF CONDUCT, LIABILITY AND INDEMNIFICATION
9.1
Standards of Conduct and Fiduciary Duties
.
(a) In causing the Company to make a determination or take or decline to take any action in
its capacity as the general partner of the Partnership as opposed to in its individual capacity, an
Indemnitee shall act in accordance with Article VII of the Partnership Agreement and shall not be
subject to any other or different standards imposed by this Agreement or any other agreement
contemplated hereby or under the Act or any other law, rule or regulation.
(b) In causing the Company to make a determination or take or decline to take any action in
its individual capacity as opposed to in its capacity as the general partner of the Partnership,
then, unless another express standard is provided for in this Agreement, an Indemnitee shall act in
good faith and shall not be subject to any other or different standards imposed by this Agreement,
any other agreement contemplated hereby or under the Act or any other law, rule or regulation. In
order for a determination or other action affecting the Company to be in good faith for purposes
of this Agreement, an Indemnitee must reasonably believe that the determination or other action is
in the best interests of the Company, unless the context otherwise requires.
24
(c) To the extent that, at law or in equity, an Indemnitee has duties (including fiduciary
duties) and liabilities relating thereto to the Company, to the Partnership, or to any Member, an
Indemnitee acting under this Agreement shall not be liable to the Company, the Partnership or to
any Member for its good faith reliance on the provisions this Agreement. The provisions of this
Agreement, to the extent that they restrict the duties and liabilities of an Indemnitee otherwise
existing at law or in equity, are agreed by the parties hereto to replace such other duties and
liabilities of such Indemnitee.
9.2
Liability and Exculpation
.
(a) Notwithstanding anything to the contrary set forth in this Agreement, no Indemnitee shall
be liable for monetary damages to the Company, the Partnership, the Members or any Assignee, 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 Indemnitees conduct was criminal.
(b) An Indemnitee shall be fully protected in relying in good faith upon the books and records
of the Company, the books and records of the Partnership, and upon such information, opinions,
reports or statements presented to the Company by any Person as to matters the Indemnitee believes
are within such other Persons professional or expert competence, including information, opinions,
reports or statements as to the value and amount of the assets, liabilities, profits, losses or any
other facts pertinent to the existence and amount of assets from which distributions to Members
might properly be paid.
9.3
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 Company 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 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 9.3, 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 Indemnitees conduct was unlawful.
25
(b) To the fullest extent permitted by law, expenses (including legal fees and expenses)
incurred by an Indemnitee who is indemnified pursuant to this Section 9.3 in defending any claim,
demand, action, suit or proceeding shall, from time to time, be advanced by the Company prior to a
determination that the Indemnitee is not entitled to be indemnified upon receipt by the Company 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 in this Section 9.3.
(c) The Company may purchase and maintain insurance, to the extent and in such amounts as the
Company determines to be reasonable, on behalf of Indemnitees and such other Persons as the Company
shall determine, against any liability that may be asserted against or expenses that may be
incurred by any such Indemnitees or other Persons in connection with the activities of the Company
or such Indemnitees. The Company may enter into indemnity contracts with Indemnitees or other
Persons and adopt written procedures pursuant to which arrangements are made for the advancement of
expenses and the funding of obligations and containing such other procedures regarding
indemnification as the Board determines are necessary or appropriate.
(d) The indemnification provided by this Section 9.3 shall be in addition to any other rights
to which an Indemnitee may be entitled under any agreement, pursuant to any vote of the Members, as
a matter of law or otherwise, both as to actions in the Indemnitees capacity as an Indemnitee and
as to actions in any other capacity, 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.
ARTICLE 10
TAXES
10.1
Tax Returns
. The Tax Matters Member shall prepare and timely file (on behalf of the
Company) all federal, state and local tax returns required to be filed by the Company. Each Member
shall furnish to the Company all pertinent information in its possession relating to the Companys
operations that is necessary to enable the Companys tax returns to be timely prepared and filed.
The Company shall bear the costs of the preparation and filing of its tax returns.
10.2
Tax Elections
.
(a) The Company shall make the following elections on the appropriate tax returns:
|
(i)
|
|
to adopt the calendar year as the Companys fiscal year;
|
|
|
(ii)
|
|
to adopt the accrual method of accounting;
|
(iii) to make the election under Section 754 of the Code in accordance with applicable
Treasury Regulations thereunder, subject to the reservation of the right to seek to revoke
any such election upon the Tax Matters Members determination that such revocation is in the
best interests of the Members;
26
(iv) to elect the remedial method under Treasury Regulations Section 1.704-3(d) for
purposes of Section 704(d) of the Code; and
(v) any other election the Board determines to be necessary or appropriate.
(b) Neither the Company nor any Member shall make an election for the Company to be excluded
from the application of the provisions of subchapter K of chapter 1 of subtitle A of the Code or
any similar provisions of applicable state law and no provision of this Agreement shall be
construed to sanction or approve such an election.
10.3
Tax Matters Member
.
(a) The Heritage Group, or such other Member selected by the Board, shall act as the
tax
matters partner
of the Company pursuant to Section 6231(a)(7) of the Code (the
Tax Matters
Member
). The Tax Matters Member shall take such action as may be necessary to cause to the extent
possible each Member to become a
notice partner
within the meaning of Section 6223 of the Code.
The Tax Matters Member shall inform each Member of all significant matters that may come to its
attention in its capacity as Tax Matters Member by giving notice thereof on or before the fifth
business day after becoming aware thereof and, within that time, shall forward to each Member
copies of all significant written communications it may receive in that capacity.
(b) The Tax Matters Member shall take no action without the authorization of the Board, other
than such action as may be required by applicable law. Any cost or expense incurred by the Tax
Matters Member in connection with its duties, including the preparation for or pursuance of
administrative or judicial proceedings, shall be paid by the Company.
(c) The Tax Matters Member shall not enter into any extension of the period of limitations for
making assessments on behalf of the Members without first obtaining the consent of the Board. The
Tax Matters Member shall not bind any Member to a settlement agreement without obtaining the
consent of such Member. Any Member that enters into a settlement agreement with respect to any
Company item (as described in Section 6231(a)(3) of the Code) shall notify the other Members of
such settlement agreement and its terms within 90 days from the date of the settlement.
(d) No Member shall file a request pursuant to Section 6227 of the Code for an administrative
adjustment of Company items for any taxable year without first notifying the other Members. If the
Board consents to the requested adjustment, the Tax Matters Member shall file the request for the
administrative adjustment on behalf of the Members. If such consent is not obtained within 30 days
from such notice, or within the period required to timely file the request for administrative
adjustment, if shorter, any Member may file a request for administrative adjustment on its own
behalf. Any Member intending to file a petition under Sections 6226, 6228 or other Section of the
Code with respect to any item involving the Company shall notify the other Members of such
intention and the nature of the contemplated proceeding. In the case where the Tax Matters Member
is intending to file such petition on behalf of the Company, such notice shall be given within a
reasonable period of time to allow the Members to participate in the choosing of the forum in which
such petition will be filed.
27
(e) If any Member intends to file a notice of inconsistent treatment under Section 6222(b) of
the Code, such Member shall give reasonable notice under the circumstances to the other Members of
such intent and the manner in which the Members intended treatment of an item is (or may be)
inconsistent with the treatment of that item by the other Members.
ARTICLE 11
TRANSFERS OF MEMBERSHIP INTERESTS
11.1
General Restrictions
.
(a) A Member may Transfer its Units (i) to a Permitted Transferee pursuant to Section 11.2, or
(ii) pursuant to the terms of Section 11.7. Any purported Transfer of a Membership Interest in
violation of the terms of this Agreement shall be null and void and of no force and effect. Except
upon a Transfer of all of a Members Units in accordance with this Section 11.1, no Member shall
have the right to withdraw as a Member of the Company.
(b) Notwithstanding any other provision of this Agreement, no Member may pledge, mortgage or
otherwise subject its Units to any Encumbrance.
11.2
Permitted Transferees
.
(a) Notwithstanding the provisions of Section 11.7, each Member shall have the right to
Transfer (but not to substitute the transferee as a substitute Member in such Members place,
except in accordance with Section 11.3), by a written instrument, all or any of its Units to a
Permitted Transferee.
(b) Unless and until admitted as a substitute Member pursuant to Section 11.3, a transferee of
a Members Units in whole or in part shall be an assignee with respect to such Transferred Units
and shall not be entitled to participate in the management of the business and affairs of the
Company or to become, or to exercise the rights of, a Member, including the right to vote, the
right to require any information or accounting of the Companys business, or the right to inspect
the Companys books and records. Such transferee shall only be entitled to receive, to the extent
of the Transferred Units, the share of distributions and profits, including distributions
representing the return of Capital Contributions, to which the transferor would otherwise be
entitled with respect to the Transferred Units. The transferor shall have the right to vote such
Transferred Units until the transferee is admitted to the Company as a substitute Member with
respect to the Transferred Units.
11.3
Substitute Members
. No transferee of all or part of a Members Units shall become a
substitute Member in place of the transferor unless and until:
(a) Such Transfer is in compliance with the terms of Section 11.1; and
(b) the transferee has executed an instrument in form and substance reasonably satisfactory to
the Board accepting and adopting, and agreeing to be bound by, the terms and provisions of the
Certificate and this Agreement.
28
Upon satisfaction of all the foregoing conditions with respect to a particular transferee, the
appropriate officers shall cause the books and records of the Company to reflect the admission of
the transferee as a substitute Member to the extent of the Transferred Units held by such
transferee.
11.4
Effect of Admission as a Substitute Member
. A transferee who has become a substitute
Member has, to the extent of the Transferred Units, all the rights, powers and benefits of, and is
subject to the obligations, restrictions and liabilities of a Member under, the Certificate, this
Agreement and the Act. Upon admission of a transferee as a substitute Member, the transferor of
the Units so held by the substitute Member shall cease to be a Member of the Company to the extent
of such Transferred Units.
11.5
Consent
. Each Member hereby agrees that upon satisfaction of the terms and conditions
of this Article 11 with respect to any proposed Transfer, the transferee may be admitted as a
Member without any further action by a Member hereunder.
11.6
Additional Members
. Subject to Section 6.8, any Person may become an additional
Member of the Company for such consideration as the Board shall determine,
provided
that such
additional Member complies with all the requirements of a transferee under Section 11.3(a) and (b).
11.7
Right of Sale
. Each Member shall have the right to sell its Units other than to a
Permitted Transferee in the following manner:
(a) If at any time any of the Members (a
Selling Member
) wishes to sell such Selling
Members Units, such Selling Member shall give Notice thereof to each of the other Members and the
Company. The Notice shall state the amount of the Selling Members Units that the Selling Member
wishes to sell.
(b) Each of the Members other than the Selling Member (the
Non-Selling Members
) shall have
the right to negotiate with the Selling Member for the sale of its Units for a period of 90 days.
If the Selling Member does not reach an agreement to sell its Units to one or more Non-Selling
Members, the Selling Member will be free to sell its Units to a third party on whatever terms the
Selling Member chooses, subject to Section 11.3.
ARTICLE 12
12.1
No Preemptive Rights
.
No Member shall have preemptive rights to purchase
Units.
ARTICLE 13
BOOKS OF ACCOUNT, RECORDS AND REPORTS
13.1
Preparation and Maintenance of Books and Records
. The Company shall prepare and
maintain records and books of account covering such matters relative to the Companys business as
are usually entered into records and books of account maintained by limited liability companies
engaged in businesses of like character. The Companys books and records shall be
29
maintained in accordance with partnership accounting practices and procedures and shall incorporate
such method of tax accounting as the Board determines is permissible and would be in the best
interests of the Company.
13.2
Company Documentation Requirements
. The Company shall keep at its principal office
the following:
(a) A current list of the full name and last known business or residence address of each
Member and Assignee (if any) set forth in alphabetical order together with the capital contribution
of each Member and Assignee;
(b) Copies of the Companys federal, state and local income tax or information returns and
reports, if any, for the six most recent taxable years;
(c) A copy of the Certificate of Formation and all amendments thereto;
(d) Copies of this Agreement and all amendments thereto;
(e) The books and records of the Company as they relate to the business affairs and operations
of the Company for the current and the four most recent fiscal years; and
(f) Any other books and records that the Company is required to maintain under the Act or
other applicable law.
13.3
Fiscal Year
. The Fiscal Year of the Company shall be the calendar year.
13.4
Company Funds
. The funds of the Company shall be deposited in such bank account or
accounts, or invested in such interest-bearing or non-interest-bearing investments, as shall be
designated by the Board. All withdrawals from any such bank accounts shall be made by the duly
authorized agent or agents of the Company.
13.5
Statements
.
(a) The Company shall cause to be prepared at least annually, at Company expense, the
information related to the Companys business activities necessary for the preparation of each
Members federal and state income tax returns, and upon the written request of a Member, the
Company shall send or cause to be sent such information relevant for such Member to each requesting
Member within 90 days after the end of each taxable year, unless the Company reasonably determines
there is good reason to defer the sending of such information, but in no event shall such
information be sent to such Member later than 180 days after the end of the taxable year. If the
Company deems it required or desirable, a copy of the Companys federal, state and/or local income
tax or information returns for that year shall also be sent to such Member along with such
information.
(b) The Company shall provide to the Members such annual or other periodic reports on its
business and financial affairs as may be required under the Act, other applicable law, or as
otherwise deemed appropriate by the Board.
30
(c) In addition to the information, reports and statements furnished to the Members pursuant
to subsections 13.5(a) and (b), the Company shall obtain an annual audit of the Company certified
to by an independent certified public accountant, which shall be transmitted by the Company to each
requesting Member within three months after the close of each fiscal year, containing, at a
minimum:
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(i)
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a balance sheet of the Company as of the beginning and close of such fiscal year;
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(ii)
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a statement of Company Profits and Losses for such fiscal year; and
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(iii)
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a statement of such Members Capital Account as of the close of such fiscal year,
and changes therein during such fiscal year.
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ARTICLE 14
DISSOLUTION AND TERMINATION OF THE COMPANY
14.1
Dissolution
. The death, dissolution, bankruptcy, expulsion or removal of a Member
shall not cause the dissolution of the Company, and upon any such event the business of the Company
shall continue to be conducted pursuant to the terms of this Agreement. The Company shall be
dissolved and its affairs wound up on the happening of any of the following events (herein each a
Dissolution Event
):
(a) By an election by the Members holding at least 75% of the outstanding Units to dissolve
the Company;
(b) The entry of a decree of judicial dissolution of the Company pursuant to Section 18-802 of
the Act; or
(c) The occurrence of any event that makes it unlawful for the business of the Company to be
carried on or for the Members to carry on such business in a limited liability company form.
14.2
Winding Up and Liquidation
. Upon the occurrence of a Dissolution Event, the Member
holding the greatest number of Units (the
Liquidator
) shall cause a full accounting of the assets
and liabilities of the Company to be taken and shall cause the assets to be liquidated and the
business of the Company to be wound up as promptly as possible. To the extent permitted by the Act,
the proceeds of such liquidation shall be applied, first, to creditors in satisfaction of
liabilities of the Company (whether by payment or by making of reasonable provision for payment),
including any loans to the Company by Members, and any remaining assets of the Company shall be
distributed in accordance with Section 4.4. The holders of Units shall continue to share
distributions, profits, losses and allocations during the period of liquidation in accordance with
Articles 3, 4 and 5. Except as otherwise authorized by the Board, the Liquidator shall not be
entitled to any special compensation for serving as the liquidator of the Company.
14.3
No Recourse
. A Member shall look solely to the assets of the Company for the return
of its Capital Contributions, and if the assets remaining after the payment and discharge of
31
Company debts and liabilities are insufficient to provide for the return of its Capital
Contributions, a Member shall have no recourse against any other Member. No holder of an interest
in the Company shall have any right to demand or receive property other than cash upon dissolution,
winding up and termination of the Company.
14.4
No Deficit Contribution Obligation
. No Member shall have any obligation, upon a
liquidation, to make any Capital Contribution for purposes of eliminating or diminishing any
negative balance in such Members Capital Account.
ARTICLE 15
AMENDMENTS; POWER OF ATTORNEY
15.1
Amendments Generally
. Except as otherwise provided in this Agreement, any provision
of this Agreement may be amended pursuant to any amendment that is approved by Members holding at
least 75% of the total Units then outstanding;
provided, however
, that no modification of the terms
of this Agreement that (i) increases or extends any financial obligation or liability of a Member,
(ii) alters the method of division of profits and losses or a method of distributions made to a
Member, (iii) adversely affects a Members ability to designate Directors or (iv) otherwise
adversely affects the obligations or rights of a Member (as a Member under this Agreement) in a
manner disproportionately different than the other Member(s) shall be effective without the prior
written consent of such Member.
15.2
Power of Attorney
. Each Member hereby irrevocably appoints the Member holding the
greatest number of Units as its true and lawful attorney-in-fact, with full power and authority, on
behalf and in the name of such Member, to execute, acknowledge, swear to and file pertinent
instruments (a) in connection with any amendment to this Agreement approved in accordance with this
Article 15, (i) to admit additional or substitute Members as authorized by this Agreement, and (ii)
in any other respect, provided there has been compliance with this Agreement with respect to the
amendment in question, and (b) required of the Company by applicable law.
ARTICLE 16
MISCELLANEOUS
16.1
No Registration of Units
. Each Member agrees that the Units being issued hereunder to
the Members may be securities and that such Units have been issued without registration under the
Securities Act of 1933, as amended (the
Securities Act
), or registration or qualification under
any state securities or
Blue Sky
laws, in reliance on exemptions from those registration and
qualification provisions. Each Member represents and warrants to the Company that it has acquired
or is acquiring its Units for investment purposes only and without any view toward or intent to
dispose of or distribute such Units or any interest therein. Each Member also agrees that, in the
absence of an applicable exemption from registration and qualification, neither the Units, nor any
interest therein may be transferred without registration under the Securities Act and registration
or qualification under applicable state securities or
Blue Sky
laws.
32
16.2
Exhibits
. Each of the Exhibits attached to this Agreement are incorporated herein by
reference and expressly made a part of this Agreement for all purposes. References to any Exhibit
in this Agreement shall be deemed to include this reference and incorporation.
16.3
Severability
. If any provision of this Agreement or portion thereof, or the
application of such provision or portion thereof to any Person or circumstance, shall be held
invalid, the remainder of this Agreement, or the application of such provision or portion thereof
to Persons or circumstances other than those to which it is held invalid, shall not be affected
thereby.
16.4
Successors and Assigns
. Except as otherwise herein provided, this Agreement shall be
binding upon and inure to the benefit of the parties hereto, their respective heirs executors,
administrators and successors, and all other persons hereafter having or holding an interest in
this Company, whether as Assignees, Transferees, Substitute Members, Additional Members or
otherwise.
16.5
Governing Law
. This Agreement and the rights of the parties hereunder shall be
governed by and construed in accordance with the internal laws, and not the laws pertaining to
choice or conflict of laws, of the State of Delaware. Each Member consents to the exclusive
jurisdiction of the federal and state courts located in Wilmington, Delaware with respect to any
litigation arising under or related to this Agreement.
16.6
Counterparts
. This Agreement may be executed by original or facsimile signature in
one or more counterparts, each of which shall be deemed an original and all of which taken together
shall constitute one and the same instrument.
16.7
No Third Party Beneficiaries
. The provisions of this Agreement shall not be for the
benefit of, nor shall they be enforceable by, any Person who is not an Assignee or a party to this
Agreement.
16.8
Notices
. Except as expressly provided otherwise in this Agreement, all notices,
requests, or consents provided for or permitted to be given under this Agreement must be in writing
and must be given either by depositing that writing in the United States mail, addressed to the
Person, postage prepaid, and registered or certified with return receipt requested, or by
delivering that writing to the Person in person, by courier, or by facsimile transmission. If
mailed or delivered by courier, such notice shall be deemed to be given when deposited in the
United States mail, postage prepaid, or when deposited with a reputable overnight courier,
addressed to the Person at its address as it appears in the records of the Company. If given by
facsimile transmission, such notice shall be deemed to be given when upon receipt of confirmation
of a successful facsimile transmission to the facsimile number of the Person as it appears in the
records of the Company. If given personally or otherwise than by mail, courier or facsimile
transmission, such notice shall be deemed to be given when either handed to the Person or delivered
to the Persons address as it appears in the records of the Company. All notices, requests, and
consents to be given to a Member must be sent or delivered to the address given for that Member as
reflected in this Agreement or such other address as that Member may specify by written notice to
the Company and to the other Members. Whenever any notice is required to be given by law or this
Agreement, a written waiver thereof, signed by the Person entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to the giving of such
notice.
33
16.9
Entire Agreement; Interpretation
. This Agreement contains the entire understanding
between the parties with respect to the subject matter hereof and supersedes any prior
understandings between them with respect to said subject matter, and specifically, but without
limiting the foregoing, supercedes and replaces that certain Limited Liability Company Agreement of
Calumet GP, LLC dated as of September 29, 2005. There are no representations, agreements,
arrangements or understandings, oral or written, between and among the parties hereto relating to
the subject matter of this Agreement that are not fully expressed herein. This Agreement is not to
be interpreted for or against any Member or the Company, and no Person will be deemed the
draftsperson of this Agreement.
(SIGNATURE PAGES FOLLOW)
34
IN WITNESS WHEREOF, the parties hereto have executed this Amended and Restated Limited
Liability Company Agreement effective as of the Effective Date.
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CALUMET GP, LLC
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By:
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/s/ R. Patrick Murray, II
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R. Patrick Murray, II
Vice President and Chief Financial Officer
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THE HERITAGE GROUP
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By:
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/s/ Fred M. Fehsenfeld, Jr.
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Fred M. Fehsenfeld, Jr.
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Chief Executive Officer
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[Signature Page to the GP LLC Agreement]
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JANET KRAMPE GRUBE GRANTOR
RETAINED ANNUITY TRUST DATED
JANUARY 31, 2002
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By:
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/s/ Janet K. Grube
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Janet K. Grube
Trustee
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MILDRED L. FEHSENFELD IRREVOCABLE
INTERVIVOS TRUST FOR THE BENEFIT OF
FRED MEHLERT FEHSENFELD, JR. AND
HIS ISSUE
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By:
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/s/ James C. Fehsenfeld
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James C. Fehsenfeld
Trustee
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MAGGIE FEHSENFELD TRUST NUMBER
106 FOR THE BENEFIT OF FRED MEHLERT
FEHSENFELD, JR. AND HIS ISSUE
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By:
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/s/ James C. Fehsenfeld
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James C. Fehsenfeld
Trustee
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[Signature Page to the GP LLC Agreement]
SCHEDULE A
SCHEDULE OF MEMBERS
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Number of
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Name & Address
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Units
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The Heritage Group
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5400 W. 86th Street
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Indianapolis, IN 46268-0123
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510
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Janet Krampe Grube Grantor
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Retained Annuity Trust
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dated January 31, 2002
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2780 Waterfront Parkway E. Drive
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Suite 200
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Indianapolis, IN 46214
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300
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Mildred L. Fehsenfeld Irrevocable
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Intervivos Trust for the Benefit of
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Fred Mehlert Fehsenfeld, Jr.
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and his issue
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5400 W. 86th Street
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Indianapolis, IN 46268-0123
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95
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Maggie Fehsenfeld Trust
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Number 106 for the Benefit of
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Fred Mehlert Fehsenfeld, Jr.
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and his issue
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5400 W. 86th Street
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Indianapolis, IN 46268-0123
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95
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EXHIBIT A
NON-NEGOTIABLE UNIT CERTIFICATE FOR
UNITS IN CALUMET GP, LLC
This Certificate and the Units represented hereby are subject to a certain Amended and Restated
Limited Liability Company Agreement dated as of January 31, 2006, and any amendment thereto, a copy
of which agreement is on file at the principal place of business of the Company, and, except as
otherwise provided in said agreement, any sale, gift, pledge, assignment, bequest, transfer,
transfer in trust, mortgage, alienation, hypothecation, encumbering or disposition of Units in any
manner whatsoever, voluntarily or involuntarily, including, without limitation, any attachment,
assignment for the benefit of creditors or transfer by operation of law or otherwise, or any
transfer as a result of any voluntary or involuntary legal proceedings, execution, sale,
bankruptcy, insolvency, or otherwise of this Certificate or the Units represented hereby in
violation of said agreement shall be invalid.
Calumet GP, LLC, a Delaware limited liability company (the Company), hereby certifies that
(the Holder) is the registered owner of the above referenced Units in the Company.
This Certificate is issued pursuant to the Amended and Restated Limited Liability Company
Agreement of the Company, dated as of January 31, 2006, as the same may be amended, modified or
supplemented from time to time (the Limited Liability Company Agreement). The rights, powers,
preferences, restrictions and limitations of the Units represented hereby are set forth in, and the
Certificate and the Units represented hereby are issued and shall in all respects be subject to,
the terms and provisions of, the Limited Liability Company Agreement. THE UNITS REPRESENTED BY THIS
CERTIFICATE ARE NONTRANSFERABLE EXCEPT AS EXPRESSLY PROVIDED IN THE LIMITED LIABILITY COMPANY
AGREEMENT. By acceptance of this Certificate for the above referenced Units, and as a condition to
being entitled to any rights and/or benefits with respect to the Units evidenced hereby, the Holder
hereof (including any transferee hereof) is deemed to have agreed, whether or not such Holder is
admitted to the Company as a Member of the Company with respect to the Units evidenced hereby, to
comply with and be bound by all the terms and conditions of the Limited Liability Company
Agreement.
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Date:______________
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Calumet GP, LLC
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By:
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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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EXHIBIT 10.4
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
CONTRIBUTION, CONVEYANCE AND ASSUMPTION
AGREEMENT
CONTRIBUTION, CONVEYANCE AND ASSUMPTION AGREEMENT
This Contribution, Conveyance and Assumption Agreement, dated as of January 31, 2006, is
entered into by and among
F. WILLIAM GRUBE,
an individual (
Grube
),
JANET KRAMPE GRUBE
, an
individual (Grube Wife),
JANET KRAMPE GRUBE GRANTOR RETAINED ANNUITY TRUST DATED JANUARY 31,
2002
, an Indiana trust (
Grube Trust I
),
JANET KRAMPE GRUBE GRANTOR RETAINED ANNUITY TRUST
DATED MARCH 18, 2004
, an Indiana trust (
Grube Trust II
),
FRED M. FEHSENFELD, JR.
, an
individual (
Fehsenfeld, Jr.
),
MILDRED L. FEHSENFELD IRREVOCABLE INTERVIVOS TRUST FOR THE
BENEFIT OF FRED MEHLERT FEHSENFELD, JR. AND HIS ISSUE
, an Indiana trust (
Fehsenfeld Trust
I
),
MAGGIE FEHSENFELD TRUST NUMBER 106 FOR THE BENEFIT OF FRED MEHLERT FEHSENFELD, JR. AND HIS
ISSUE
, an Indiana trust (
Fehsenfeld Trust II
),
CALUMET, INCORPORATED
, an Indiana
corporation (
Calumet Inc.
),
THE HERITAGE GROUP
, an Indiana general partnership
(
THG
),
CALUMET GP, LLC
, a Delaware limited liability company (
GP LLC
),
CALUMET
SPECIALTY PRODUCTS PARTNERS, L.P.
, a Delaware limited partnership (
MLP
),
CALUMET
OPERATING, LLC,
a Delaware limited liability company (
OLLC
),
CALUMET LUBRICANTS CO.,
LIMITED PARTNERSHIP,
an Indiana limited partnership (
Calumet LP
),
CALUMET SALES COMPANY
INCORPORATED
, a Delaware corporation (
Reseller
),
CALUMET HOLDING, LLC
, a Delaware limited
liability company (
Holding
),
CALUMET PENNSYLVANIA, LLC
, a Delaware limited liability
company (
Calumet PA
),
CALUMET LP GP, LLC
, a Delaware limited liability company
(
Calumet LP GP
), and
CALUMET SHREVEPORT PACKAGING, LLC
, an Indiana limited liability
company (
Shreveport Packaging
). The above-named entities are sometimes referred to in
this Agreement each as a
Party
and collectively as the
Parties
. Capitalized
terms used herein shall have the meanings assigned to such terms in Section 1.1.
RECITALS
:
WHEREAS
, THG, Calumet Inc., Grube, Fehsenfeld, Jr., Fehsenfeld Trust I, Fehsenfeld Trust II
and GP LLC have formed MLP pursuant to the Delaware Revised Uniform Limited Partnership Act (the
Delaware LP Act
) for the purpose of engaging in any business activity that is approved by
GP LLC and that lawfully may be conducted by a limited partnership organized pursuant to the
Delaware LP Act.
WHEREAS,
in order to accomplish the objectives and purposes in the preceding recital, each of
the following actions have been taken prior to the date hereof:
1. THG, Fehsenfeld, Jr. and Grube (collectively, the
Organizational GP
Owners
) formed GP LLC, under the terms of the Delaware Limited Liability Company Act
(the
Delaware LLC Act
), to which (i) THG contributed $510.00 in exchange for a 51%
member interest in GP LLC, (ii) Fehsenfeld, Jr. contributed $190.00 in exchange for a 19%
member interest in GP LLC, and (iii) Grube contributed $300.00 in exchange for a
30% member interest in GP LLC (such member interests are, collectively, the
Organizational GP Interests
).
2. THG, Calumet Inc., Grube, Fehsenfeld, Jr., Fehsenfeld Trust I, Fehsenfeld Trust II
and GP LLC formed MLP (collectively, the
Organizational MLP Owners
), under the
terms of the Delaware LP Act, to which (i) THG contributed $555.66 in exchange for a 55.57%
limited partner interest in MLP, (ii) Calumet Inc. contributed $98.00 in exchange for a
9.80% limited partner interest in MLP, (iii) Grube contributed $203.84 in exchange for a
20.38% limited partner interest in MLP, (iv) Fehsenfeld, Jr. contributed $24.50 in exchange
for a 2.45% limited partner interest in MLP, (v) Fehsenfeld Trust I contributed $49.00 in
exchange for a 4.90% limited partner interest in MLP, (vi) Fehsenfeld Trust II contributed
$49.00 in exchange for a 4.90% limited partner interest in MLP, and (vii) THG (on behalf of
GP LLC) contributed $20.00 in exchange for a 2% general partner interest in MLP (such
limited partner interests are, collectively, the
Organizational MLP Interests
).
3. MLP formed OLLC, under the terms of the Delaware LLC Act, and contributed $1,000 to
OLLC in exchange for all of the member interests in OLLC.
4. Calumet LP formed Reseller, under the terms of the Delaware General Corporation Law
(the
DGCL
), and contributed $1,000 to Reseller in exchange for all of the common
stock of Reseller.
5. Calumet Inc. formed Calumet LP GP, under the terms of the Delaware LLC Act, and
contributed $1,000 to Calumet LP GP in exchange for all of the member interests in Calumet
LP GP.
6. Calumet LP formed Calumet PA, under the terms of the Delaware LLC Act, and
contributed $1,000 to Calumet PA in exchange for all of the member interests in Calumet PA.
7. Calumet LP formed Holding, under the terms of the Delaware LLC Act, and contributed
$1,000 to Holding in exchange for all of the member interests in Holding.
8. Calumet LP and certain of its subsidiaries entered into the Term Loan Facility and
the Revolving Credit Facility and borrowed $225,000,000 under the Term Loan Facility and
$78,300,000 under the Revolving Credit Facility and retired and repaid all amounts
outstanding under the National City Facility, the Old Credit Facility and the Old Notes.
9. Calumet LP contributed $93,352,531.01 of the amount it borrowed under the Revolving
Credit Facility to Calumet Shreveport, LLC (
Shreveport
) as a capital contribution
(the
Shreveport Contribution
).
10. Shreveport used the Shreveport Contribution to retire and repay all of its
outstanding indebtedness under the Shreveport Term Loan Facility and the Shreveport
Revolving Credit Facility.
2
WHEREAS,
concurrently with the consummation of the transactions contemplated hereby, each of
the following shall occur:
1. Calumet LP will convey all of its right, title and interest in the Non-MLP Assets to
Calumet PA as a capital contribution.
2. Calumet LP will convey all of its right, title and interest in the Non-Qualifying
Income Assets to Reseller as a capital contribution.
3. Calumet LP will convey all of its member interest in each of (i) Calumet PA (such
membership interest, the
Calumet PA Interest
) and (ii) Shreveport Packaging, (such
membership interest, the
Shreveport Packaging Interest
) to Holding as a capital
contribution.
4. Calumet LP will distribute all of its member interest in Holding (the
Holding
Interest
) to Grube Wife, Grube Trust I, Grube Trust II, Fehsenfeld, Jr., Fehsenfeld
Trust I, Fehsenfeld Trust II, Calumet Inc. and THG (collectively, the
Calumet
Owners
) as follows:
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(a)
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Grube Wife will receive a 0.197% interest in the Holding Interest;
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(b)
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Grube Trust I will receive a 18.105% interest in the Holding Interest;
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(c)
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Grube Trust II will receive a 2.498% interest in the Holding Interest;
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(d)
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Fehsenfeld, Jr. will receive a 2.5% interest in the Holding Interest;
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(e)
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Fehsenfeld Trust I will receive a 5.0% interest in the Holding Interest;
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(f)
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Fehsenfeld Trust II will receive a 5.0% interest in the Holding Interest;
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(g)
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Calumet Inc. will receive a 10.0% interest in the Holding Interest; and
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(h)
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THG will receive a 56.7% interest in the Holding Interest.
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5. Calumet Inc. will convey its general partner interest in Calumet LP (the
Calumet LP GP Interest
) to Calumet LP GP as a capital contribution.
6. Grube Trust I, Fehsenfeld Trust I, Fehsenfeld Trust II and THG (collectively, the
New GP Owners
) will convey a limited partner interest in Calumet LP with an
aggregate value equal to 2% of the equity value of MLP at the closing of the transactions
contemplated by this Agreement (the
Interest
) to GP LLC as a capital contribution
(of which 32.4% of such Interest shall be contributed by Grube Trust I, 6.25% of such
Interest shall be contributed by Fehsenfeld Trust I, 6.25% of such Interest shall be
contributed by Fehsenfeld Trust II and 55.1% of such Interest shall be contributed by THG).
3
7. Fehsenfeld Trust I and Fehsenfeld Trust II will each contribute $445,006.50,
respectively in cash to GP LLC as capital contributions in exchange for additional member
interests in GP LLC, resulting in GP LLC being owned as follows:
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(a)
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THG will own a 51% member interest;
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(b)
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Grube Trust I will own a 30.0% member interest;
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(c)
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Fehsenfeld Trust I will own a 9.5% member interest; and
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(d)
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Fehsenfeld Trust II will own a 9.5% member interest.
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8. The Organizational GP Interests of the Organizational GP Owners will be redeemed and
cancelled and $1,000 shall thereupon be paid to the Organizational GP Owners in proportion
to their initial capital contributions.
9. GP LLC will convey the Interest to MLP in exchange for (a) 515,857 General Partner
Units, which represents a continuation of its 2% general partner interest in MLP, and (b)
the issuance of the IDRs.
10. In connection with MLPs initial underwritten public offering (the
Offering
), Messrs. Fred M. Fehsenfeld Sr., Mac Fehsenfeld and Frank B. Fehsenfeld
(collectively, the
Fehsenfeld Investors
) will contribute an aggregate
$14,998,249.50 in cash to MLP in exchange for an aggregate 750,100 Common Units (at a price
per Common Unit of $19.995) representing a 2.9% interest in MLP.
11. The Calumet Owners (other than Calumet Inc.) will convey their remaining limited
partner interests in Calumet LP to MLP in exchange for (a) 5,169,129 Common Units
representing a 20.04% limited partner interest in MLP, of which (i) Grube Wife will receive
11,660 Common Units, (ii) Grube Trust I will receive 1,020,456 Common Units, (iii) Grube
Trust II will receive 147,853 Common Units, (iv) Fehsenfeld, Jr. will receive 147,973 Common
Units, (v) Fehsenfeld Trust I will receive 286,077 Common Units, (vi) Fehsenfeld Trust II
will receive 286,077 Common Units and (vii) THG will receive 3,269,033 Common Units, and (b)
11,723,599 Subordinated Units representing a 45.45% limited partner interest in MLP, of
which (i) Grube Wife will receive 26,445 Subordinated Units, (ii) Grube Trust I will
receive 2,314,396 Subordinated Units, (iii) Grube Trust II will receive 335,332 Subordinated
Units, (iv) Fehsenfeld, Jr. will receive 335,600 Subordinated Units, (v) Fehsenfeld Trust I
will receive 648,825 Subordinated Units, (vi) Fehsenfeld Trust II will receive 648,825
Subordinated Units, and (vii) THG will receive 7,414,176 Subordinated Units.
12. Calumet Inc. will convey its member interest in Calumet LP GP to MLP in exchange
for (a) 591,886 Common Units representing a 2.29% limited partner interest in MLP and (b)
1,342,401 Subordinated Units representing a 5.20% limited partner interest in MLP.
13. The Organizational MLP Interests of the Organizational MLP Owners will be redeemed
and cancelled and $980 shall thereupon be paid to the Organizational MLP
Owners in proportion to their initial capital contributins and $20
will be paid to GP LLC
4
14. In connection with the Offering, the public, through the Underwriters, will
contribute $122,547,850 in cash to MLP, less the Underwriters discount of $7,965,610.25
(excluding structuring fees of $612,739.25 to be paid to Goldman, Sachs & Co. and $2,000,000
to be paid to Petrie, Parkman & Co., Inc.), in exchange for 5,699,900 Common Units
representing a 22.10% limited partner interest in MLP.
15. MLP will (a) pay or cause to be paid approximately $6,612,739.25 of offering
expenses (excluding the Underwriters discount, but including structuring fees of $612,739
to be paid to Goldman, Sachs & Co. and $2,000,000 to be paid to Petrie, Parkman & Co., Inc.)
in connection with the Offering of the Common Units and (b) contribute the balance of the
Offering proceeds to Calumet LP as a capital contribution (of which 10% of such contribution
will be made to Calumet LP on behalf of Calumet LP GP).
16. MLP will convey its limited partner interest in Calumet LP and its member interest
in Calumet LP GP to OLLC as a capital contribution.
17. Calumet LP will repay approximately (a) $108,000,000 of outstanding indebtedness
under the Term Loan Facility and (b) $15,000,000 of outstanding indebtedness under the
Revolving Credit Facility.
18. To the extent the Underwriters exercise their over-allotment option to purchase up
to 854,985 Common Units (the
Over-Allotment Option
), MLP will use the net proceeds
to repay up to approximately $17,187,335 of Calumet LPs additional outstanding indebtedness
under the Term Loan Facility.
19. The organizational documents of the Parties will be amended and restated as
necessary to reflect the applicable matters set forth above and as contained in this
Agreement.
NOW, THEREFORE,
in consideration of their mutual undertakings and agreements hereunder, the
Parties undertake and agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1
Terms
. The following defined terms shall have the meanings given below:
Agreement
means this Contribution, Conveyance and Assumption Agreement.
Code
means Internal Revenue Code of 1986, as amended.
Common Units
has the meaning as set forth in the MLP Agreement.
5
Effective Time
means 12:01 a.m. Eastern Standard Time on January 31, 2006.
General Partner Units
has the meaning as set forth in the MLP Agreement.
IDR
has the same meaning as Incentive Distribution Right as set forth in
the MLP Agreement.
MLP
has the meaning as set forth in the opening paragraph of this Agreement.
MLP Agreement
means the First Amended and Restated Agreement of Limited
Partnership of MLP, as it may be amended, supplemented or restated from time to time.
National City Facility
means (i) the Amended and Restated Credit Agreement
dated as of February 23, 2003, among THG and certain of its affiliates, as Borrowers, and
National City Bank of Indiana (
National City
), as Administrative Agent and (ii)
the Amended and Restated Guarantee dated as of February 23, 2003, among Calumet LP and
certain other parties, as Guarantors, and National City, as Administrative Agent.
Non-MLP Assets
means those assets set forth on
Schedule A
.
Non-MLP Liabilities
means all liabilities arising out of or related to the
ownership of the Non-MLP Assets to the extent arising or accruing on and after the Effective
Time, whether known or unknown, accrued or contingent, and whether or not reflected on the
books and records of Calumet LP or its affiliates.
Non-Qualifying Income Assets
means those assets set forth on
Schedule
B
and such other assets that do not generate qualifying income as defined in Section
7704 of the Code.
Non-Qualifying Income Liabilities
means all liabilities arising out of or
related to the ownership of the Non-Qualifying Income Assets to the extent arising or
accruing on and after the Effective Time, whether known or unknown, accrued or contingent,
and whether or not reflected on the books and records of Calumet LP or its affiliates.
Old Credit Facility
means that $180,000,000 revolving promissory note dated
as of June 30, 2005 by and among Calumet LP, as Borrower, and The Heritage Group (d/b/a
Asphalt Refining Company), as Lender.
Old Notes
means the $11,400,000 million in outstanding notes issued to The
Heritage Group (d/b/a Asphalt Refining Company) by Calumet LP.
Partnership Group
means the MLP and any Subsidiary.
Revolving Credit Facility
means that $225,000,000 Revolving Credit Agreement
dated as of December 9, 2005, by and among Calumet LP, Shreveport, Calumet Shreveport
Lubricants & Waxes, LLC, an Indiana limited liability company
6
(
Shreveport L&W
), and Calumet Shreveport Fuels, LLC, an Indiana limited liability company (
Shreveport
Fuels
), as Borrowers, Bank of America, N.A., as Administrative Agent and Lender, and
the other Lenders party thereto.
Registration Statement
means the registration statement on Form S-1
(Registration No. 333-128880) filed by MLP relating to the Offering.
Shreveport Term Loan Facility
means that $40,000,000 Term Loan Agreement
dated as of October 25, 2004, by and among Shreveport, as Borrower, Shreveport L&W and
Shreveport Fuels, as Guarantors, and Lehman Commercial paper Inc. as Administrative Agent
and Lender.
Shreveport Revolving Credit Facility
means that $125,000,000 Revolving Credit
Agreement dated as of October 25, 2004, by and among Shreveport, as Borrower, Shreveport L&W
and Shreveport Fuels, as Guarantors, LaSalle Business Credit, LLC as Administrative Agent
and Lender, and the others Lenders party thereto.
Subordinated Units
has the meaning as set forth in the MLP Agreement.
Subsidiary
shall have the meaning given to it in the MLP Agreement.
Term Loan Facility
means that $225,000,000 Term Loan Agreement dated as of
December 9, 2005, by among Calumet LP, as Borrower, Calumet LPs subsidiaries from time to
time party thereto, as Guarantors, and Bank of America, N.A., as Administrative Agent and
Lender.
Underwriters
means Goldman, Sachs & Co., Deutsche Banc Securities Inc.,
Raymond James & Associates, Inc. and Petrie Parkman & Co., Inc.
ARTICLE II
CONTRIBUTIONS, ACKNOWLEDGMENTS AND DISTRIBUTIONS
Section 2.1
Contribution of Non-MLP Assets by Calumet LP to Calumet PA
. Calumet LP
hereby grants, contributes, bargains, conveys, assigns, transfers, sets over and delivers to
Calumet PA, its successors and assigns, for its and their own use forever, all of its right, title
and interest in and to the Non-MLP Assets, and Calumet PA hereby accepts such assets as a
contribution to the capital of Calumet PA.
TO HAVE AND TO HOLD the Non-MLP Assets unto Calumet PA, its successors and assigns, together with
all and singular the rights and appurtenances thereto in any way belonging, subject, however, to
the terms and conditions stated in this Agreement, forever.
Section 2.2
Contribution of Non-Qualifying Income Assets by Calumet LP to Reseller
.
Calumet LP hereby grants, contributes, bargains, conveys, assigns, transfers, sets over and
delivers to Reseller, its successors and assigns, for its and their own use forever, all of its
right, title and interest in and to the Non-Qualifying Income Assets, and Reseller hereby accepts
such assets as a contribution to the capital of Reseller.
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TO HAVE AND TO HOLD the Non-Qualifying Income Assets unto Reseller, its successors and assigns,
together with all and singular the rights and appurtenances thereto in any way belonging, subject,
however, to the terms and conditions stated in this Agreement, forever.
Section 2.3
Contribution of Calumet PA Interest and Shreveport Packaging Interest by
Calumet LP.
Calumet LP hereby grants, contributes, bargains, conveys, assigns, transfers,
sets over and delivers to Holding, its successors and assigns, for its and their own use forever,
all of its right title and interest in and to each of the (i) Calumet PA Interest and (ii)
Shreveport Packaging Interest, and Holding hereby accepts such Calumet PA Interest and Shreveport
Packaging Interest as a contributions to the capital of Holding.
Section 2.4
Distribution of Holding Interest by Calumet LP.
Calumet LP hereby
distributes, grants, bargains, conveys, assigns, transfers, sets over and delivers all of its
right, title and interest in and to (i) 0.197% of the Holding Interest to Grube Wife, (ii) 18.105%
of the Holding Interest to Grube Trust I, (iii) 2.498% of the Holding Interest to Grube Trust II,
(iv) 2.5% of the Holding Interest to Fehsenfeld, Jr., (v) 5.0% of the Holding Interest to
Fehsenfeld Trust I, (vi) 5.0% of the Holding Interest to Fehsenfeld Trust II, (vii) 10.0% of the
Holding Interest to Calumet Inc., (viii) 56.7% of the Holding Interest to THG, and each of Grube
Wife, Grube Trust I, Grube Trust II, Fehsenfeld, Jr, Fehsenfeld Trust I, Fehsenfeld Trust II,
Calumet Inc. and THG hereby accepts its respective percentage of the Calumet PA Interest as a
distribution.
Section 2.5
Contribution of Calumet LP GP Interest by Calumet Inc. to Calumet LP GP
.
Calumet Inc. hereby grants, contributes, bargains, conveys, assigns, transfers, sets over and
delivers to Calumet LP GP, its successors and assigns, for its and their own use forever, all of
its right, title and interest in and to the Calumet LP GP Interest as a capital contribution, and
Calumet LP GP hereby accepts the Calumet LP GP Interest as a contribution to the capital of Calumet
LP GP.
Section 2.6
Contribution of the Interest by New GP Owners to GP LLC.
The New GP
Owners hereby grant, contribute, bargain, convey, assign, transfer, set over and deliver to GP LLC,
its successors and assigns, for its and their own use forever, the Interest as a capital
contribution (of which 32.4% of such Interest shall be contributed by Grube Trust I, 6.25% of such
Interest shall be contributed by Fehsenfeld Trust I, 6.25% of such Interest shall be contributed by
Fehsenfeld Trust II and 55.1% of such Interest shall be contributed by THG), and GP LLC hereby
accepts the Interest as a contribution to the capital of GP LLC.
Section 2.7
Contribution of Additional Cash by Fehsenfeld Trust I and Fehsenfeld Trust II
to GP LLC.
Fehsenfeld Trust I and Fehsenfeld Trust II hereby grant,
contribute, bargain, convey, assign, transfer, set over and deliver to GP LLC, its successors
and assigns, for its and their own use forever, $445,006.50 and $445,006.50, respectively as a
capital contribution and to increases their respective interests in GP LLC to 9.5% and 9.5%, and GP
LLC hereby accepts the cash consideration as a contribution to the capital of GP LLC.
Section 2.8
Redemption of Organizational GP Interest.
Calumet GP hereby redeems the
Organizational GP Interest from the Organizational GP Owners and retires the
Organizational GP Interest in exchange for a payment in cash to the Organizational GP Owners equal to an aggregate
$1,000.
8
Section 2.9
Contribution of the Interest by GP LLC to MLP
. GP LLC hereby grants,
contributes, bargains, conveys, assigns, transfers, sets over and delivers to MLP, its successors
and assigns, for its and their own use forever, the Interest in exchange for (a) 515,857 General
Partner Units, which represent a continuation of its 2% general partner interest in MLP, and (b)
the issuance of the IDRs, and MLP hereby accepts the Interest as a contribution to the capital of
MLP.
Section 2.10
Fehsenfeld Investors Cash Contribution
. The Parties acknowledge an
aggregate cash contribution by the Fehsenfeld Investors to MLP of an aggregate $14,998,249.50 in
exchange for an aggregate 750,100 Common Units representing a 2.91% interest in MLP.
Section 2.11
Contribution of Remaining Limited Partner Interests in Calumet LP by the
Calumet Owners (other than Calumet Inc.) to MLP
. The Calumet Owners (other than Calumet Inc.)
hereby grant, contribute, bargain, convey, assign, transfer, set over and deliver to MLP, its
successors and assigns, for its and their own use forever, all remaining limited partner interests
in Calumet LP in exchange for (a) 5,169,129 Common Units representing a 20.04% limited partner
interest in MLP, of which (i) Grube Wife will receive 11,660 Common Units, (ii) Grube Trust I will
receive 1,020,456 Common Units, (iii) Grube Trust II will receive 147,853 Common Units, (iv)
Fehsenfeld, Jr. will receive 147,973 Common Units, (v) Fehsenfeld Trust I will receive 286,077
Common Units, (iv) Fehsenfeld Trust II will receive 286,077 Common Units and (vii) THG will receive
3,269,033 Common Units, and (b) 11,723,599 Subordinated Units representing a 45.45% limited partner
interest in MLP, of which (i) Grube Wife will receive 26,455 Subordinated Units, (ii) Grube Trust I
will receive 2,314,396 Subordinated Units, (iii) Grube Trust II will receive 335,332 Subordinated
Units, (iv) Fehsenfeld, Jr. will receive 335,600 Subordinated Units, (v) Fehsenfeld Trust I will
receive 648,825 Subordinated Units, (vi) Fehsenfeld Trust II will receive 648,825 Subordinated
Units, and (vii) THG will receive 7,414,176 Subordinated Units, and MLP hereby accepts such limited
partner interests in Calumet LP as a contribution to the capital of MLP.
Section 2.12
Contribution of Interest in Calumet LP GP by Calumet Inc. to MLP
Calumet Inc. hereby grants, contributes, bargains, conveys, assigns, transfers, sets over and
delivers to MLP, its successors and assigns, for its and their own use forever, all its member
interest in Calumet LP GP in exchange for (a) 591,886 Common Units representing a 2.29% limited
partner interest in MLP and (b) 1,342,401 Subordinated Common Units representing a 5.20% limited
partner interest in MLP, and MLP hereby accept such member interest as a contribution to the
capital of MLP.
Section 2.13
Redemption of Organizational MLP Interest; Distribution to GP.
MLP hereby
redeems the Organizational MLP Interest from the Organizational MLP Owners and retires the
Organizational MLP Interest in exchange for a payment in cash to the Organizational MLP Owners
equal to an aggregate $980. MLP hereby distributes $20 to GP LLC.
9
Section 2.15
Public Cash Contribution
. The Parties acknowledge a cash contribution by
the public through the Underwriters to MLP of $122,547,850 ($114,582,239.75 after the Underwriters
discount of $7,965,610.25 (excluding structuring fees of $612,739.25 to be paid to Goldman, Sachs &
Co. and $2,000,000 to be paid to Petrie, Parkman & Co., Inc.)) in exchange for 5,699,900 Common
Units representing a 22.10% interest in MLP.
Section 2.16
Payment of Transaction Expenses and Contribution of Remaining Proceeds by
MLP
. The Parties acknowledge (a) the payment by MLP, in connection with the transactions
contemplated hereby, of transaction expenses in the amount of approximately $6,612,739.25
(exclusive of the Underwriters discount, but including structuring fees of $612,739.25 to be paid
to Goldman, Sachs & Co. and $2,000,000 to be paid to Petrie, Parkman & Co., Inc.) and (b) the
contribution by MLP of approximately $127,000,000 to Calumet LP (of which 10% is deemed to be
contributed on behalf of Calumet LP GP).
Section 2.17
Contribution of Interests in Calumet LP and Calumet LP GP by MLP to OLLC
.
MLP hereby grants, contributes, bargains, conveys, assigns, transfers, sets over and delivers to
OLLC, its successors and assigns, for its and their own use forever, all its limited partner
interest in Calumet LP and all its member interest in Calumet LP GP, and OLLC hereby accepts such
limited partner interest in Calumet LP and such member interest in Calumet LP GP as a contribution
to the capital of OLLC.
Section 2.18
Payment of Outstanding Indebtedness by Calumet LP.
The parties
acknowledge (a) the repayment by Calumet LP of approximately $108,000,000 of outstanding
indebtedness under the Term Loan Facility and (b) the repayment by Calumet LP of approximately
$15,000,000 of outstanding indebtedness under the Revolving Loan Facility.
Section 2.19
Admission of Calumet LP GP as General Partner of Calumet LP
.
Each of the
partners of Calumet LP, all of which are parties to this Agreement, hereby expressly consents to
the admission of Calumet LP GP as the new general partner of Calumet LP and to the withdrawal of
Calumet Inc. as the general partner, as a result of the assignment and contribution described in
Section 2.5. Calumet LP GP assumes Calumet Inc.s liabilities under Indiana Code 23-16-3-8, 23-16-6
and 23-16-7, and Calumet Inc. is released from those liabilities. The partners of Calumet LP direct
the general partner of Calumet LP to take any and all actions necessary or advisable to give effect
to the admission of the new general partner of Calumet LP, including but not limited to filing an
amended and restated Certificate of Limited Partnership with the Secretary of State of the State of
Indiana and entering into an amended and restated limited partnership agreement reflecting all the
transfers and changes effected by this Agreement.
Section 2.20
Admission of New Limited Partner of Calumet LP
.
Each of the limited
partners of Calumet LP has transferred and conveyed its entire limited partnership interest either
to GP LLC or to MLP, with the agreement and understanding that these interests would be further
conveyed by GP LLC to MLP, and then by MLP to OLLC, in the manner described in Sections 2.6, 2.9,
2.11, 2.12 and 2.15 of this Agreement. All the partners of Calumet LP, including the general
partner, intend and expressly consent to the admission of OLLC as the limited partner of Calumet LP
and to the withdrawal of each Calumet Owner (other than Calumet Inc.) as a limited partner. OLLC
assumes the liabilities of the assigning limited partners under Indiana Code 23-16-3-8, 23-16-6 and
23-16-7, and each of the assigning limited partners is
10
released from those liabilities. The
partners direct the general partner to take any and all actions necessary or advisable to give
effect to the admission of the new limited partner, including but not limited to entering into an
amended and restated limited partnership agreement reflecting all the transfers and changes
effected by this Agreement.
Section 2.21
Intent to Admit Assignees as New Partners and/or Members
.
Pursuant to
this Agreement, several parties assign and convey ownership interests in limited partnerships or
limited liability companies, and in each case, the assignor and assignee intend for the assignee to
be admitted as a partner to the partnership or admitted as a member of the limited liability
company, as applicable. To the extent required by any organic document of the organization, or
required by law, each partner and member of any organization affected by an assignment and
conveyance of an ownership interest described in this Agreement (all of which partners and members
are also parties to this Agreement) hereby consents to the admission of the assignee as a partner
to the partnership (whether general or limited) or as a member of a limited liability company, as
applicable. The parties agree to take any and all other actions, including execution of amendments
or other documents, that may be necessary or advisable to carry out the intent and purposes of this
Section.
ARTICLE III
ASSUMPTIONS OF CERTAIN LIABILITIES
Section 3.1
Assumption of Non-MLP Liabilities by Calumet PA
. In connection with the
contribution and transfer by Calumet LP of the Non-MLP Assets to Calumet PA, as set forth in
Section 2.1 above, Calumet PA hereby assumes and agrees to duly
and timely pay, perform and discharge the Non-MLP Liabilities, to the full extent that Calumet
LP has been heretofore or would have been in the future obligated to pay, perform and discharge the
Non-MLP Liabilities were it not for the execution and delivery of this Agreement; provided,
however, that said assumption and agreement to duly and timely pay, perform and discharge the
Non-MLP Liabilities shall not (a) increase the obligation of Calumet PA with respect to the Non-MLP
Liabilities beyond that of Calumet LP, (b) waive any valid defense that was available to Calumet LP
with respect to the Non-MLP Liabilities or (c) enlarge any rights or remedies of any third party,
if any, under any of the Non-MLP Liabilities.
Section 3.2
Assumption of Non-Qualifying Income Liabilities by Reseller
. In
connection with the contribution and transfer by Calumet LP of the Non-Qualifying Income Assets to
Reseller, as set forth in Section 2.2 above, Reseller hereby assumes and agrees to duly and timely
pay, perform and discharge the Non-Qualifying Income Liabilities, to the full extent that Calumet
LP has been heretofore or would have been in the future obligated to pay, perform and discharge the
Non-Qualifying Income Liabilities were it not for the execution and delivery of this Agreement;
provided, however, that said assumption and agreement to duly and timely pay, perform and discharge
the Non-Qualifying Income Liabilities shall not (a) increase the obligation of Reseller with
respect to the Non-Qualifying Income Liabilities beyond that of Calumet LP, (b) waive any valid
defense that was available to Calumet LP with respect to the Non-Qualifying Income Liabilities or
(c) enlarge any rights or remedies of any third party, if any, under any of the Non-Qualifying
Income Liabilities.
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ARTICLE IV
ADDITIONAL TRANSACTIONS
Section 4.1
Over-Allotment Option
. The Parties acknowledge that in the event the
Underwriters exercise their Over-Allotment Option, (i) MLP shall contribute the net proceeds
therefrom to OLLC; (ii) OLLC shall then contribute the net proceeds to Calumet LP (of which 10% of
such contribution will be made to Calumet LP on behalf of Calumet LP GP); and (iii) Calumet LP
shall use the net proceeds to repay approximately $17,187,335 of additional outstanding
indebtedness under the Term Loan Facility.
ARTICLE V
TITLE MATTERS
Section 5.1
Encumbrances
.
(a) Except to the extent provided in any other document executed in connection with this
Agreement or the Offering, the contribution and conveyance (by operation of law or otherwise) of
the various physical assets owned as reflected in this Agreement (collectively, the
Assets
) are made expressly subject to all recorded and unrecorded liens (other than
consensual liens), encumbrances, agreements, defects, restrictions, adverse claims and all laws, rules,
regulations, ordinances, judgments and orders of governmental authorities or tribunals having or
asserting jurisdictions over the Assets and operations conducted thereon or in connection
therewith, in each case to the extent the same are valid and enforceable and affect the Assets,
including all matters that a current survey or visual inspection of the Assets would reflect.
(b) To the extent that certain jurisdictions in which the Assets are located may require that
documents be recorded in order to evidence the transfers of title reflected in this Agreement, then
the provisions set forth in Section 5.1(a) immediately above shall also be applicable to the
conveyances under such documents.
Section 5.2
Disclaimer of Warranties; Subrogation; Waiver of Bulk Sales Laws
.
(a) EXCEPT TO THE EXTENT PROVIDED IN ANY OTHER DOCUMENT EXECUTED OR DELIVERED IN CONNECTION
WITH THIS AGREEMENT OR THE OFFERING, THE PARTIES ACKNOWLEDGE AND AGREE THAT NONE OF THE PARTIES HAS
MADE, DOES NOT MAKE, AND EACH SUCH PARTY SPECIFICALLY NEGATES AND DISCLAIMS, ANY REPRESENTATIONS,
WARRANTIES, PROMISES, COVENANTS, AGREEMENTS OR GUARANTIES OF ANY KIND OR CHARACTER WHATSOEVER,
WHETHER EXPRESS, IMPLIED OR STATUTORY, ORAL OR WRITTEN, PAST OR PRESENT, REGARDING (A) THE VALUE,
NATURE, QUALITY OR CONDITION OF THE ASSETS, INCLUDING THE WATER, SOIL, GEOLOGY OR ENVIRONMENTAL
CONDITION OF THE ASSETS GENERALLY OR INCLUDING THE PRESENCE OR LACK OF HAZARDOUS SUBSTANCES OR
OTHER MATTERS ON THE ASSETS, (B) THE INCOME TO BE DERIVED FROM THE ASSETS, (C) THE SUITABILITY OF
THE ASSETS FOR ANY AND ALL ACTIVITIES AND USES THAT MAY BE CONDUCTED THEREON, (D) THE COMPLIANCE OF
OR BY THE ASSETS OR THEIR OPERATION WITH ANY LAWS (INCLUDING ANY ZONING,
12
ENVIRONMENTAL PROTECTION, POLLUTION OR LAND USE LAWS, RULES, REGULATIONS, ORDERS OR REQUIREMENTS), OR (E) THE HABITABILITY,
MERCHANTABILITY, MARKETABILITY, PROFITABILITY OR FITNESS FOR A PARTICULAR PURPOSE OF THE ASSETS.
EXCEPT TO THE EXTENT PROVIDED IN ANY OTHER DOCUMENT EXECUTED OR DELIVERED IN CONNECTION WITH THIS
AGREEMENT OR THE OFFERING, THE PARTIES ACKNOWLEDGE AND AGREE THAT EACH HAS HAD THE OPPORTUNITY TO
INSPECT THE RESPECTIVE ASSETS, AND EACH IS RELYING SOLELY ON ITS OWN INVESTIGATION OF THE
RESPECTIVE ASSETS AND NOT ON ANY INFORMATION PROVIDED OR TO BE PROVIDED BY ANY OF THE PARTIES.
EXCEPT TO THE EXTENT PROVIDED IN ANY OTHER DOCUMENT EXECUTED OR DELIVERED IN CONNECTION WITH THIS
AGREEMENT OR THE OFFERING, NONE OF THE PARTIES IS LIABLE OR BOUND IN ANY MANNER BY ANY VERBAL OR
WRITTEN STATEMENTS, REPRESENTATIONS OR INFORMATION PERTAINING TO THE ASSETS FURNISHED BY ANY AGENT,
EMPLOYEE, SERVANT OR THIRD PARTY. EXCEPT TO THE EXTENT PROVIDED IN ANY OTHER DOCUMENT EXECUTED OR
DELIVERED IN CONNECTION WITH THIS AGREEMENT OR THE OFFERING, EACH OF THE PARTIES ACKNOWLEDGES THAT
TO THE MAXIMUM EXTENT PERMITTED BY LAW, THE CONTRIBUTION OF THE ASSETS AS PROVIDED FOR HEREIN
IS MADE IN AN AS IS, WHERE IS CONDITION WITH ALL FAULTS, AND THE ASSETS ARE CONTRIBUTED AND
CONVEYED SUBJECT TO ALL OF THE MATTERS CONTAINED IN THIS SECTION. THIS SECTION SHALL SURVIVE SUCH
CONTRIBUTION AND CONVEYANCE OR THE TERMINATION OF THIS AGREEMENT. THE PROVISIONS OF THIS SECTION
HAVE BEEN NEGOTIATED BY THE PARTIES AFTER DUE CONSIDERATION AND ARE INTENDED TO BE A COMPLETE
EXCLUSION AND NEGATION OF ANY REPRESENTATIONS OR WARRANTIES, WHETHER EXPRESS, IMPLIED OR STATUTORY,
WITH RESPECT TO THE ASSETS THAT MAY ARISE PURSUANT TO ANY LAW NOW OR HEREAFTER IN EFFECT, OR
OTHERWISE, EXCEPT AS SET FORTH IN THIS AGREEMENT OR ANY OTHER DOCUMENT EXECUTED OR DELIVERED IN
CONNECTION WITH THIS AGREEMENT OR THE OFFERING.
(b) The contributions of the Assets made under this Agreement are made with full rights of
substitution and subrogation of the respective Parties receiving such contributions, and all
persons claiming by, through and under such Parties, to the extent assignable, in and to all
covenants and warranties by the predecessors-in-title of the Parties contributing the Assets, and
with full subrogation of all rights accruing under applicable statutes of limitation and all rights
of action of warranty against all former owners of the Assets.
(c) Each of the Parties agrees that the disclaimers contained in this Section 5.2 are
conspicuous disclaimers. Any covenants implied by statute or law by the use of the words
grant, contribute, convey, bargain, assign, transfer, deliver, sell or set over
or any of them or any other words used in this Agreement are hereby expressly disclaimed, waived or
negated.
(d) Each of the Parties hereby waives compliance with any applicable bulk sales law or any
similar law in any applicable jurisdiction in respect of the transactions contemplated by this
Agreement.
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ARTICLE VI
FURTHER ASSURANCES
Section 6.1
Further Assurances
. From time to time after the date hereof, and without
any further consideration the Parties agree to execute, acknowledge and deliver all such additional
deeds, assignments, bills of sale, conveyances, instruments, notices, releases, acquittances and
other documents, and will do all such other acts and things, all in accordance with applicable law,
as may be necessary or appropriate (a) more fully to assure that the applicable Parties own all of
the properties, rights, titles, interests, estates, remedies, powers and privileges granted by this
Agreement, or which are intended to be so granted, or (b) more fully and effectively to vest in the
applicable Parties and their respective successors and assigns beneficial and record title to the
interests contributed and assigned by this Agreement or intended so to be and to more fully and
effectively carry out the purposes and intent of this Agreement.
Section 6.2
Other Assurances
. From time to time after the Effective Time,
and without any further consideration, each of the Parties shall execute, acknowledge and deliver
all such additional instruments, notices and other documents, and will do all such other acts and
things, all in accordance with applicable law, as may be necessary or appropriate to more fully and
effectively carry out the purposes and intent of this Agreement. Without limiting the generality of
the foregoing, the Parties acknowledge that the parties have used their good faith efforts to
attempt to identify all of the assets being contributed to the MLP or its subsidiaries as required
in connection with the Offering. However, due to the age of some of those assets and the
difficulties in locating appropriate data with respect to some of the assets it is possible that
assets intended to be contributed to the MLP or its subsidiaries were not identified and therefore
are not included in the assets contributed to the MLP or its subsidiaries. It is the express intent
of the Parties that the MLP or its subsidiaries own all assets necessary to operate the assets that
are identified in this Agreement and in the Registration Statement. To the extent any assets were
not identified but are necessary to the operation of assets that were identified, then the intent
of the Parties is that all such unidentified assets are intended to be conveyed to the appropriate
members of the Partnership Group. To the extent such assets are identified at a later date, the
Parties shall take the appropriate actions required in order to convey all such assets to the
appropriate member of the Partnership Group. Likewise, to the extent that assets are identified at
a later date that were not intended by the parties to be conveyed as reflected in the Registration
Statement, the Parties shall take the appropriate actions required in order to convey all such
assets to the appropriate party.
ARTICLE VII
EFFECTIVE TIME
Notwithstanding anything contained in this Agreement to the contrary, none of the provisions
of Article II or Article III of this Agreement shall be operative or have any effect until the
Effective Time, at which time all the provisions of Article II or Article III of this Agreement
shall be effective and operative in accordance with Article VIII, without further action by any
Party.
14
ARTICLE VIII
MISCELLANEOUS
Section 8.1
Order of Completion of Transactions
. The transactions provided for in
Article II of this Agreement shall be completed immediately following the Effective Time in the
order set forth in Article II of this Agreement. The transactions provided for in Article III of
this Agreement shall be completed simultaneously with the transactions provided for in Article II
of this Agreement. The transactions provided for in Article IV of this Agreement shall be
completed after those provided for in Article II and Article III of this Agreement.
Section 8.2
Costs
. Except for the transaction expenses set forth in Section 2.14, OLLC shall pay all expenses,
fees and costs, including sales, use and similar taxes arising out of the contributions,
conveyances and deliveries to be made hereunder, and shall pay all documentary, filing, recording,
transfer, deed and conveyance taxes and fees required in connection therewith. In addition, OLLC
shall be responsible for all costs, liabilities and expenses (including court costs and reasonable
attorneys fees) incurred in connection with the implementation of any conveyance or delivery
pursuant to Article VI of this Agreement.
Section 8.3
Headings; References; Interpretation
. All Article and Section headings in
this Agreement are for convenience only and shall not be deemed to control or affect the meaning or
construction of any of the provisions hereof. The words hereof, herein and hereunder and
words of similar import, when used in this Agreement, shall refer to this Agreement as a whole, and
not to any particular provision of this Agreement. All references herein to Articles and Sections
shall, unless the context requires a different construction, be deemed to be references to the
Articles and Sections of this Agreement, respectively. All personal pronouns used in this
Agreement, whether used in the masculine, feminine or neuter gender, shall include all other
genders, and the singular shall include the plural and vice versa. The terms include,
includes, including or words of like import shall be deemed to be followed by the words
without limitation.
Section 8.4
Successors and Assigns
. The Agreement shall be binding upon and inure to
the benefit of the Parties and their respective successors and assigns.
Section 8.5
No Third Party Rights
. The provisions of this Agreement are intended to
bind the parties signatory hereto as to each other and are not intended to and do not create rights
in any other person or confer upon any other person any benefits, rights or remedies and no person
is or is intended to be a third party beneficiary of any of the provisions of this Agreement.
Section 8.6
Counterparts
. This Agreement may be executed in any number of
counterparts, all of which together shall constitute one agreement binding on the Parties.
Section 8.7
Governing Law
. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Indiana applicable to contracts made and to be performed
wholly within such state without giving effect to conflict of law principles thereof.
Section 8.8
Severability
. If any of the provisions of this Agreement are held by any
court of competent jurisdiction to contravene, or to be invalid under, the laws of any political
15
body having jurisdiction over the subject matter hereof, such contravention or invalidity shall not
invalidate the entire Agreement. Instead, this Agreement shall be construed as if it did not
contain the particular provision or provisions held to be invalid, and an equitable adjustment
shall be made and necessary provision added so as to give effect to the intention of the Parties as
expressed in this Agreement at the time of execution of this Agreement.
Section 8.9
Amendment or Modification
. This Agreement may be amended or modified from
time to time only by the written agreement of all the Parties.
Section 8.10
Integration
. This Agreement and the instruments referenced herein
supersede all previous understandings or agreements among the Parties, whether oral or written,
with respect to its subject matter. This document and such instruments contain the entire
understanding of the Parties. No understanding, representation, promise or agreement, whether oral
or written, is intended to be or shall be included in or form part of this Agreement unless it is
contained in a written amendment hereto executed by the Parties after the date of this Agreement.
Section 8.11
Deed; Bill of Sale; Assignment
. To the extent required and permitted by
applicable law, this Agreement shall also constitute a deed, bill of sale or assignment of
the assets and interests referenced herein.
[
THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK
]
16
IN WITNESS WHEREOF, this Agreement has been duly executed by the Parties as of the date first
written above.
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/s/ F. William Grube
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F. WILLIAM GRUBE
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/s/ Janet Krampe Grube
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JANET KRAMPE GRUBE
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JANET KRAMPE GRUBE GRANTOR RETAINED ANNUITY TRUST
DATED JANUARY 31, 2002
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By:
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/s/ Janet K. Grube
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Janet K. Grube
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Trustee
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JANET KRAMPE GRUBE GRANTOR RETAINED ANNUITY TRUST
DATED MARCH 18, 2004
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By:
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/s/ Janet K. Grube
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Janet K. Grube
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Trustee
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/s/ Fred M. Fehsenfeld, Jr.
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FRED M. FEHSENFELD, JR.
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MILDRED L. FEHSENFELD IRREVOCABLE INTERVIVOS TRUST
FOR THE BENEFIT OF FRED MEHLERT FEHSENFELD, JR. AND
HIS ISSUE
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By:
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/s/ James C. Fehsenfeld
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James C. Fehsenfeld
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Trustee
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Calumet Specialty Products Partners, L.P.
Contribution, Conveyance and Assumption Agreement
Signature Page
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MAGGIE FEHSENFELD TRUST NUMBER 106 FOR THE BENEFIT OF
FRED MEHLERT FEHSENFELD, JR. AND HIS ISSUE
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By:
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/s/ James C. Fehsenfeld
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James C. Fehsenfeld
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Trustee
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THE HERITAGE GROUP
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By:
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/s/ Fred M. Fehsenfeld, Jr.
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Fred M. Fehsenfeld, Jr.
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Chief Executive Officer
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CALUMET, INCORPORATED
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By:
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/s/ R. Patrick Murray, II
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R. Patrick Murray, II
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Vice President and Chief Financial Officer
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CALUMET GP, LLC
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By:
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/s/ R. Patrick Murray, II
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R. Patrick Murray, II
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Vice President and Chief Financial Officer
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CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
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By: Calumet GP, LLC, its general partner
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By:
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/s/ R. Patrick Murray, II
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R. Patrick Murray, II
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Vice President and Chief Financial Officer
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Calumet
Specialty Products Partners, L.P.
Contribution, Conveyance and Assumption Agreement
Signature Page
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CALUMET OPERATING, LLC
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By: Calumet Specialty Products Partners, L.P., its
sole member
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By:
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Calumet GP, LLC, its general partner
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By:
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/s/ R. Patrick Murray, II
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R. Patrick Murray, II
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Vice President and Chief Financial Officer
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CALUMET LP GP, LLC
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By: Calumet, Incorporated, its sole member
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By:
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/s/ R. Patrick Murray, II
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R. Patrick Murray, II
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Vice President and Chief Financial Officer
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CALUMET LUBRICANTS CO., LIMITED PARTNERSHIP
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By: Calumet, Incorporated, its general partner
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By:
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/s/ R. Patrick Murray, II
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R. Patrick Murray, II
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Vice President and Chief Financial Officer
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CALUMET SALES COMPANY INCORPORATED
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By:
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/s/ R. Patrick Murray, II
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R. Patrick Murray, II
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Vice President and Chief Financial Officer
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Calumet Specialty Products Partners, L.P.
Contribution, Conveyance and Assumption Agreement
Signature Page
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CALUMET PENNSYLVANIA, LLC
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By: Calumet Lubricants Co., Limited Partnership, its
sole member
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By: Calumet, Incorporated, its general partner
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By:
/s/ R. Patrick Murray, II
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R. Patrick Murray, II
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Vice President and Chief Financial Officer
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CALUMET HOLDING, LLC
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By: Calumet Lubricants Co., Limited Partnership, its
sole member
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By: Calumet, Incorporated, its general partner
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By:
/s/ R. Patrick Murray, II
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R. Patrick Murray, II
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Vice President and Chief Financial Officer
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CALUMET SHREVEPORT PACKAGING, LLC
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By:
/s/ R. Patrick Murray, II
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Name:
R.
Patrick Murray, II
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Title:
Vice
President and Chief Financial Officer
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Calumet Specialty Products Partners, L.P.
Contribution, Conveyance and Assumption Agreement
Signature
Page
SCHEDULE A
ALL ASSETS OWNED OR USED BY CALUMET LUBRICANTS CO., LIMITED PARTNERSHIP (
CALUMET
) IN
CONNECTION WITH THE ROUSEVILLE REFINERY (AS DEFINED BELOW) AND/OR THE RENO FACILITY (AS DEFINED
BELOW) INCLUDING, BUT NOT LIMITED TO THE FOLLOWING:
ROUSEVILLE REFINERY
1.
Rouseville Refinery.
The refinery facilities located at Plant Number 1 in Rouseville,
Pennsylvania described further in item 6 below (the
Rouseville Refinery
), including,
without limitation, (a) feedstock and supply agreements related to the operation of the wax
business; (b) the hydrotreater, deresining, dewaxing and bauxite filtration units; (c) the boiler
house and utility complex; (d) the wastewater treatment facilities; (e) the Rouseville Refinery
packaging plant and associated tankage; (g) all existing tankage; (g) all loading and unloading
facilities for tank cars and tank trucks; (h) all maintenance supplies and spare parts associated
with the above equipment; (i) existing wax feedstocks, in process wax products and footsoil, and
finished wax products and footsoil necessary to operate the wax business; (j) existing accounts
receivable necessary to operate the wax business; and (k) any document, agreement, instrument,
certificate, writing, notice, consent, affidavit, letter, telegram, telex, statement, file,
computer disk, microfiche or other document in electronic format, schedule, exhibit, or any other
paper or record whatsoever relating to the current and proposed operations of the Rouseville
Refinery;
2.
Equipment.
All machinery, transportation equipment, spare parts, supplies tools,
equipment, computer equipment furnishings and fixtures owned, leased or subject to a contract of
purchase and sale, or lease commitment (collectively, the
Equipment
) that is used in the
Rouseville Refinery as operated by Calumet;
3.
Rouseville Inventories.
All saleable, usable inventories of wax feedstocks, in process wax
products and footsoil, finished wax products and related packaging materials, and footsoil related
to the Rouseville Refinery wherever situated;
4.
Accounts Receivable.
All accounts and notes receivable (collectively, the
Accounts
Receivable
) relating to the Rouseville Refinery;
5.
Proprietary Information.
All rights to the names and any derivations thereof, any patent
rights, inventions, shop rights, know how, trade secrets, designs, drawings, art work, plans,
prints, manuals, models, design registrations, inventors certificates, technical information and
data, copyrightable works, lists of materials, patterns, models, records, diagrams, formulae,
product design standards, tools, die, jigs, models, prototypes, product information literature,
computer files, computer software, hard copy files, catalogs, specifications, confidentiality
agreements, confidential information and other proprietary technology and similar information; all
registered and unregistered trademarks, service marks, logos, trade names and all other trademark
rights; all registered and unregistered copyrights; and all registrations for, and
applications for registration of, any of the foregoing (collectively, the
Proprietary
Information
), that are used in the conduct of the Rouseville Refinery, and any and all other
information and material proprietary to Calumet, owned, possessed or used by it, whether or not
such information is embodied in writing or other physical form, and that is not generally known to
the public, that (a) relates to financial information regarding the Rouseville Refinery, including,
without limitation, (i) business plans and (ii) sales, financing, pricing and marketing procedures
or methods of Calumet, or (b) relates to specific business matters concerning the identity of or
other information regarding sales personnel or customers of the Rouseville Refinery;
6.
Real Property.
All real property, or any interest therein that is used in the Rouseville
Refinery;
7.
Entitlements.
The benefit of all unfilled or outstanding purchase orders, sales or service
contracts, other commitments, contracts, engagements and leases to which Calumet is entitled
(collectively, the
Entitlements
) that relate to the Rouseville Facility;
8.
Building and Equipment.
The office building and the associated equipment and real
property;
9.
Laboratory and Equipment.
The laboratory and the associated equipment and real property;
10.
Emergency Response Building and Equipment.
The emergency response building and the
associated equipment and real property;
11.
Software.
The environmental, safety and operations software;
12.
Prepaid Expenses and Deposits.
All prepaid expenses and deposits made by Calumet relating
to the Rouseville Refinery;
13.
Air Emissions Credits.
Any air emissions credits existing as of the date hereof
associated with the Rouseville Refinery, if any, and any additional air emissions credits resulting
from or associated with the operation of the Rouseville Refinery after the date hereof; and
14.
Intangible Assets.
Any intangible assets associated with the Rouseville Facility.
RENO FACILITY
15.
Reno Facility.
The wax producing, blending and packaging facility located in Reno,
Pennsylvania described further in item 20 below (the
Reno Facility
), including, without
limitation, all tankage, wax blending and packaging equipment, loading and unloading facilities and
warehouse facility;
16.
Equipment.
All Equipment that is used in the Reno Facility as operated by Calumet;
17.
Reno Inventories.
All saleable, usable inventories of wax feedstocks, in process wax
products and footsoil, finished wax products and related packaging materials, and footsoil related
to the Reno Refinery wherever situated;
18.
Accounts Receivable.
All Accounts Receivable relating to the Reno Facility;
19.
Proprietary Information.
All Proprietary Information that are used in the conduct of the
Reno Facility, and any and all other information and material proprietary to Calumet, owned,
possessed or used by it, whether or not such information is embodied in writing or other physical
form, and that is not generally known to the public, that (a) relates to financial information
regarding the Reno Facility, including, without limitation, (i) business plans and (ii) sales,
financing, pricing and marketing procedures or methods of Calumet, or (b) relates to specific
business matters concerning the identity of or other information regarding sales personnel or
customers of the Reno Facility;
20.
Real Property.
All Real Property that is used in the Reno Facility;
21.
Entitlements.
Entitlements that relate to the Reno Facility;
22.
Office Building and Equipment.
The office building and the associated equipment and real
property;
23.
Software.
The environmental, safety and operations software;
24.
Prepaid Expenses and Deposits.
All prepaid expenses and deposits made by Calumet relating
to the Reno Facility;
25.
Air Emissions Credits.
Any air emissions credits existing as of the date hereof
associated with the Reno Facility and the interests of Calumet, if any, and any additional air
emissions credits resulting from or associated with the operation of the Reno Facility after the
date hereof; and
26.
Intangibles.
Any intangible assets associated with the Reno Facility.
SCHEDULE B
1. Contract No. SP0600-05-D-0470 for the purchase and sale of JP-8 jet fuel by and between the
United States of America (Defense Energy Support Center) and Calumet Shreveport Fuels, LLC, dated
as of March 18, 2005, as amended or novated to date.
2. Aviation Jet Fuels Sales and Purchase Agreement by and between Calumet Shreveport Fuels,
LLC and Comair, Inc., dated December 1, 2005.
3. Supply arrangement with Atlantic Southeast Airlines for period July 1, 2005 through June
30, 2006 with approximate volumes of 150,000 gallons per month.
4. Supply arrangement with Continental Airlines for one year period starting July 1, 2005 with
approximately volumes of 45,000 gallons per month.
5. Supply arrangement with American Eagle, a wholly owned subsidiary of AMR Corporation, which
began approximately December 1, 2005 with anticipated volumes of 50,000 gallons per month.