Initial Public Offering (IPO): Pre-Effective Amendment to Registration Statement (General Form) — Form S-1 Filing Table of Contents
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1: S-1/A Pre-Effective Amendment to Registration Statement HTML 3.40M
(General Form)
21: CORRESP ¶ Comment-Response or Other Letter to the SEC HTML 118K
2: EX-1.(A) Underwriting Agreement HTML 301K
3: EX-4.(D) Instrument Defining the Rights of Security Holders HTML 15K
4: EX-4.(E) Instrument Defining the Rights of Security Holders HTML 15K
5: EX-5 Opinion re: Legality HTML 19K
6: EX-8 Opinion re: Tax Matters HTML 80K
7: EX-10 Material Contract HTML 54K
8: EX-10.(H)(1) Material Contract HTML 30K
9: EX-10.(H)(2) Material Contract HTML 26K
10: EX-10.(H)(3) Material Contract HTML 48K
11: EX-10.(O) Material Contract HTML 52K
12: EX-10.(Q) Material Contract HTML 121K
13: EX-10.(R) Material Contract HTML 37K
14: EX-10.(S) Material Contract HTML 76K
15: EX-10.(T) Material Contract HTML 33K
16: EX-10.(U) Material Contract HTML 35K
17: EX-10.(W) Material Contract HTML 1.05M
18: EX-10.(X) Material Contract HTML 55K
19: EX-23.(A) Consent of Experts or Counsel HTML 12K
20: EX-24 Power of Attorney HTML 16K
CONTRIBUTION, CONVEYANCE AND ASSUMPTION AGREEMENT
DATED DECEMBER 18, 2006 AMONG ATLAS AMERICA, INC., ATLAS ENERGY
RESOURCES, LLC, AND ATLAS ENERGY OPERATING COMPANY, LLC
This
Contribution and Assumption Agreement, dated as of December 18, 2006 (this “Contribution
Agreement”), is by and among Atlas America, Inc., a Delaware corporation
(“Atlas America”), Atlas Energy Resources, LLC, a Delaware
limited liability company (“Atlas Energy”), and Atlas Energy
Operating Company, LLC, a Delaware limited liability company (“Energy
Operating”). The above-named entities are sometimes referred to in
this Contribution Agreement each as a “Party” and collectively
as the “Parties.”
WITNESSETH:
WHEREAS,
Atlas America currently wholly owns the subsidiaries listed on Schedule 1
hereto (collectively, the “Subsidiaries”) and the assets
described on Schedule 2 hereto (collectively, the “Assets”)
representing Atlas America’s natural gas and oil exploration, development,
operation, maintenance and production business (the “Business”);
WHEREAS,
Atlas
America has formed Atlas Energy pursuant to the Delaware LLC Act for the purpose
of acquiring, owning and operating the Business;
WHEREAS,
in order to accomplish the objectives and purposes in the preceding recital,
the following actions have been taken prior to the date hereof (the “Pre-Closing
Actions”):
1.
Atlas
Resources, Inc., a Pennsylvania corporation, merged with and into
Atlas
Resources, LLC, a Pennsylvania limited liability company;
2.
Atlas
Energy Corporation, an Ohio corporation, merged with and into Atlas
Energy
Ohio, LLC, an Ohio limited liability company;
3.
Viking
Resources Corporation, a Pennsylvania corporation, merged with and
into
Viking Resources, LLC, a Pennsylvania limited liability company;
4.
REI-NY,
Inc., a Delaware corporation, was converted into REI-NY, LLC, a Delaware
limited liability company;
5.
Resource
Well Services, Inc., a Delaware corporation, was converted into Resource
Well Services, LLC, a Delaware limited liability company;
6.
AIC,
Inc., a Delaware corporation, was converted into AIC, LLC, a Delaware
limited liability company;
7.
Resource
Energy, Inc., a Delaware corporation, was converted into and Resource
Energy, LLC, a Delaware limited liability company;
Atlas
Noble Corp., a Delaware corporation, was converted into Atlas Noble,
LLC,
a Delaware limited liability company;
9.
Atlas
America, Inc., a Pennsylvania corporation, merged with and into Atlas
America, LLC, a Pennsylvania limited liability company;
and
10.
Energy Operating formed AER Pipeline
Construction, Inc., a Delaware
corporation;
WHEREAS,
Atlas America and certain of the Subsidiaries are parties to the Gathering
Agreement (as defined in Article I) and Atlas America has agreed to assume
certain obligations of those Subsidiaries thereunder;
WHEREAS,
concurrently with the consummation of the transactions contemplated hereby,
each of the following shall occur:
1.
Atlas
America will contribute the Assets and its 100% interest in each
of the
Subsidiaries (the “Equity
Interests”)
to Energy Operating in exchange for (a) 30,361,746 common units
(“Common
Units”),
(b) 748,456 Class A units (the “Class
A Units”),
(c) the management incentive interests (the “Management
Incentive Interests”),
and (d) the right to receive $121,730,000, in part as a reimbursement
of
certain capital expenditures incurred with respect to the Assets
and
Subsidiaries;
2.
Atlas
America will transfer to Atlas Energy Management, Inc., a Delaware corporation
(“Atlas Management”),
all of the Class A Units and the Management Incentive Interests;
3.
In
connection with the Offering, the public, through the Underwriters,
will
contribute $132,825,000 in cash to Atlas Energy less the Underwriters’
discounts and commissions of $8,298,400 (the “Spread”)
and a structuring fee of $996,187 in exchange for 6,325,000 Common
Units;
4.
Atlas
Energy will pay transaction expenses pursuant to the transactions
contemplated by this Contribution Agreement in the amount of approximately
$1.8 million (exclusive of the Spread and the structuring fee), and
distribute $121,730,000 to Atlas America; and
5.
In
connection with the Underwriters exercise of their over-allotment
option,
the public, through the Underwriters, will contribute an additional
$19,923,750 in cash to Atlas Energy less the Spread of $1,244,760
and a
structuring fee of $149,428 in exchange for 948,750 Common Units
and the
Company will use the net proceeds to redeem Common Units from Atlas
America;
NOW,
THEREFORE,
in
consideration of the mutual covenants, representations, warranties and
agreements herein contained, the parties hereto agree as follows:
ARTICLE
I
DEFINITIONS
Section
1.1 Capitalized
terms used herein and not otherwise defined shall have the meanings ascribed
to
them below:
“APL”
means
Atlas Pipeline Partners, L.P., a Delaware limited partnership.
“Atlas
America Entities”
means
Atlas America and any Person controlled, directly or indirectly, by Atlas
America, other than Atlas Energy, Energy Operating and any subsidiary of any
such Person.
“Atlas
Energy Group”
means
Atlas Energy, Energy Operating and any subsidiary of any such Person, treated
as
a single consolidated entity, and each Investment Program.
“Atlas
Energy Assets”
means
the Transferred Assets and any assets and properties owned or leased by any
member of the Atlas Energy Group.
“Authority”
means
(i) the United States of America, (ii) any state, province, county, municipality
or other governmental subdivision within the United States of America, (iii)
any
court or any governmental department, commission, board, bureau, agency or
other
instrumentality of the United States of America, or of any state, province,
county, municipality or other governmental subdivision within the United States
of America and (iv) the National Association of Securities Dealers.
“Business
Day”
means
any day other than a Saturday, a Sunday or any other day when banks are not
open
for business generally in the State of Delaware.
“Closing”
means the closing of the transactions contemplated pursuant to this Contribution
Agreement.
“Closing
Date” means the date of Closing.
“Delaware
LLC Act”
means
the Limited Liability Company Act of the State of Delaware, as amended and
any
successor to such act.
“Gathering
Agreement”
means
the Master Natural Gas Gathering Agreement dated as of February 2, 2000 among
Atlas America, Resource Energy, LLC (formerly Resource Energy, Inc.), Viking
Resources, LLC (formerly Viking Resources Corporation) and APL, as amended
from
time to time.
“Investment
Program”
means
a
Person principally engaged in the drilling of natural gas and oil wells for
which Atlas America or any of the Subsidiaries or any of their subsidiaries
acts
as a general partner, managing partner or manager and the securities of which
have been offered and sold to investors.
“Offering”
means
the initial public offering of the Common Units contemplated by the Registration
Statement.
“Operating
Agreement”
means
the Amended and Restated Operating Agreement of Atlas Energy dated of even
date
herewith by and among Atlas America, Inc. and the members party thereto, as
amended from time to time.
“Person”
means
an individual, corporation, partnership (limited or general), limited liability
company, trust, joint stock company, unincorporated association or other legal
entity.
“Registration
Statement”
means
the registration statement on Form S-1 filed with the U.S. Securities and
Exchange Commission by Atlas Energy (File No. 333-136094).
“Toxic
Tort”
means
a
claim or cause of action arising from personal injury or property damage
incurred by the plaintiff that is alleged to have been caused by exposure to,
or
contamination by, Hazardous Substances that have been released into the
environment by or as a result of the actions or omissions of the defendant.
“Underwriters”
means
those of the underwriting syndicate as referenced in the Underwriting Agreement
between UBS Securities LLC, as representative of the Underwriters, and Atlas
Energy, dated as of December 12, 2006.
ARTICLE
II
CONTRIBUTION
AND DISTRIBUTION TRANSACTIONS
Section
2.1 Contribution
by Atlas America to Energy Operating.
(a)
Contribution.
Atlas
America hereby grants, contributes, conveys, bargains, assigns, transfers,
sets
over and delivers to Energy Operating, its successors and assigns, for its
and
their own use forever, all right, title and interest of Atlas America in and
to
all of the Assets and all of the Equity Interests (together with the Assets,
the
“Transferred
Assets”),
subject to encumbrances that do not materially adversely affect the value of
the
Transferred Assets or the ability of the Atlas Energy Group to own and operate
the Transferred Assets in substantially the same manner as they were operated
immediately prior to the Closing Date, in exchange for (i) 30,301,746 Common
Units, (ii) 748,456 Class A Units, (iii) the Management Incentive Interests
and
(iv) the right to receive $121,730,000, in part as a reimbursement of certain
capital expenditures made with respect to the Transferred Assets.
TO
HAVE
AND TO HOLD all of such right, title and interest in the Transferred Assets
unto
Energy Operating, its successors and assigned, together with all and singular
rights and appurtenances thereto in anywise belonging, subject, however, to
the
terms and conditions stated in this Contribution Agreement, and in such
instruments of conveyance forever.
(b)
Assumed
Liabilities.
Subject
to Section 2.1(c), Energy Operating hereby irrevocably and absolutely assumes,
agrees to perform, and when due, pay and discharge, only the obligations and
liabilities relating to the Transferred Assets which accrue on or after the
Closing Date and only to the extent such obligations and liabilities are not
overdue or delinquent on the Closing Date without regard to any grace period
and
without the occurrence of any increase in amounts due (the “Assumed
Liabilities”);provided,
however, that said assumption and agreement to assume the Assumed Liabilities
shall not (i) increase the obligation of Energy Operating with respect to the
Assumed Liabilities beyond that of Atlas America, (ii) waive any valid defense
that was available to Atlas America with respect to the Assumed Liabilities
or (iii) enlarge any rights or remedies of any third party under any of the
Assumed Liabilities.
(c)
Prorations.
All
obligations and liabilities assumed by Energy Operating under this Contribution
Agreement that relate to both periods of time prior to the Closing Date and
periods of time from and after the Closing Date shall be prorated as of the
close of business on the Closing Date, whether or not such adjustment would
normally be made as of such time. It is the intention of the Parties that Energy
Operating should operate the Business and the Transferred Assets for its own
account from and after the Closing Date.
Section
2.2 Contribution
by Atlas America to Atlas Management.
Atlas
America hereby grants, contributes, conveys, bargains, assigns, transfers,
sets
over and delivers to Atlas Management, its successors and assigns, for its
and
their own use forever, all right, title and interest of Atlas America in and
to
(i) 748,456 Class A Units and (ii) the Management Incentive Interests.
Section
2.3 General
Provisions Relating to Assumption of Liabilities.
Notwithstanding anything to the contrary contained in this Agreement including
the terms and provisions of this Article II, none of the Parties shall be deemed
to have assumed, and none of the Transferred Assets have been or are being
contributed subject to, (a) any liens or security interests securing consensual
indebtedness covering any of the Transferred Assets, except for encumbrances
permitted by this Contribution Agreement, and all such liens and security
interests shall be deemed to be excluded from the assumptions of liabilities
made under this Article II or (b) any of the liabilities covered by the
indemnities set forth in this Contribution Agreement to the extent such
liabilities are covered by such indemnities, and all such liabilities shall
be
deemed to be excluded from the assumptions of liabilities made under this
Article II to the extent that such liabilities are covered by such indemnities.
Section
2.4 Public
Cash Contribution.
The
Parties acknowledge a capital contribution by the public through the
Underwriters to Atlas Energy of $132,825,000 in cash ($123,530,413 after the
Spread of $8,298,400 and the structuring fee of $996,187) in exchange for
6,325,000 Common Units.
Section
2.5 Specific
Conveyances.
To further evidence the contributions and conveyances of the Transferred Assets,
each party making such contribution and conveyances may have executed and delivered
to the party receiving such contribution certain conveyance, assignment and
bill of sale instruments (the “Specific Conveyances”). The
Specific Conveyances shall evidence and perfect such sale and contribution made
by this Contribution Agreement and shall not constitute a second conveyance
of any assets or interests therein and shall be subject to the terms of this
Contribution Agreement.
Section
2.6 Payment
of Transaction Expenses by Atlas Energy.
The Parties acknowledge (a) the payment by Atlas Energy, in connection with
the transactions contemplated hereby, of estimated transaction expenses in the
amount of $1.8 million (exclusive of the
Spread and the structuring fee) and (b) the distribution by Atlas Energy of
$121,730,000 to Atlas America, in part as a reimbursement of certain capital
expenditures incurred with respect to the Transferred Assets.
Section
2.7 Issuance
of New Certificates.
At the
Closing, Atlas Energy shall issue to each of Atlas America and Atlas Management
a certificate or certificates, which may be held in book entry form,
representing the number of Common Units and Class A Units to be issued to each
of them pursuant to this Article II. Each such certificate shall be registered
in the name of the Person or Persons specified by the recipient thereof to
Atlas
Energy in writing at least two Business Days prior to the Closing.
Section
2.8 Certificate
Legends.
The
certificates evidencing the Common Units and Class A Units shall bear a legend
substantially in the form set forth below and containing such other information
as Atlas Energy may deem necessary or appropriate:
THE
SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT
OF 1933,
AS AMENDED, OR ANY STATE SECURITIES LAWS, AND NEITHER THE SECURITIES
NOR ANY
INTEREST THEREIN MAY BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR OTHERWISE
DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
SUCH
ACT AND SUCH LAWS OR PURSUANT TO AN EXEMPTION THEREFROM WHICH, IN THE
OPINION OF
COUNSEL FOR THE HOLDER, WHICH COUNSEL AND OPINION ARE REASONABLY SATISFACTORY
TO
COUNSEL FOR THIS COMPANY, IS AVAILABLE.
ARTICLE
III
GATHERING
AGREEMENT
Section
3.1 Assumption
of Obligations by Atlas America.
Atlas
America hereby expressly assumes, for itself and its successors and assigns,
the
obligations of each of the Atlas Energy, Energy Operating and the Subsidiaries,
as they may appear, to timely pay gathering fees to APL under Article 7 and
8 of
the Gathering Agreement accruing from and after the Closing Date and agrees
to
keep, perform and observe all of the covenants and conditions contained therein
on the part of any of them to be kept, performed and observed from and after
the
Closing Date.
Section
3.2 Assignment
by Atlas Energy.
Each of
Atlas Energy and Energy Operating, on their own behalf and on behalf of the
Subsidiaries, hereby irrevocably assigns, sets over, transfers and conveys
to
Atlas America all of the right, title and interest of any of them in and to
all
of the gathering fees (i) accruing to any of them from the Investment Programs
or (ii) attributable to the production interest of Atlas Energy, Energy
Operating or any of the Subsidiaries for gas gathered from and after the Closing
Date pursuant to the Gathering Agreement (the “Assigned
Amounts”).
Each
of Atlas Energy and Energy Operating shall pay, and shall cause each of the
Subsidiaries to pay, the Assigned Amounts to Atlas America within 15 Business
Days after the end of the month in which received by them.
Section
4.1 Over-Allotment
Option.
The Parties acknowledge that the Underwriters exercised their option to purchase
additional Common Units (the “Option”) in whole and that
the public, through the Underwriters, contributed additional cash of $19,923,750
in cash ($18,529,562 after the Spread of $1,244,760 and the structuring fee
of $149,428) to Atlas Energy in exchange for an additional 948,750 Common Units.
Section
4.2 Redemption
of Common Units by Atlas Energy.
The
Parties acknowledge that Atlas Energy will use the net proceeds from the
issuance of the additional Common Units pursuant to the exercise of the Option
to redeem 948,750 Common Units from Atlas America at a redemption price equal
to
the same net price received by Atlas Energy from the Underwriters.
ARTICLE
V
REPRESENTATIONS
AND WARRANTIES
Section
5.1 Representations
and Warranties of Atlas America.
Atlas
America hereby represents and warrants to Atlas Energy and Energy Operating
as
follows as of the date of this Contribution Agreement:
(a)
Status
of Atlas America.
Atlas
America has been duly incorporated and is validly existing and in good standing
under the laws of the State of Delaware, with all corporate power and authority
necessary to own or hold its properties and conduct the businesses in which
it
is engaged and to execute and deliver this Contribution Agreement and to
consummate the transactions contemplated hereby.
(b)
Title
to Subsidiaries.
Atlas
America owns 100% of the issued and outstanding equity interests in the
Subsidiaries; the Subsidiaries own 100% of the issued and outstanding equity
interests in their subsidiaries as set forth on Schedule
1;
and all
such equity interests have been duly authorized and validly issued in accordance
with the charter documents of the relevant entity, and Atlas America and the
Subsidiaries own their respective equity interests free and clear of all liens,
claims, options, charges, encumbrances or restrictions of any kind. There are
no
outstanding warrants, options, agreements, convertible or exchangeable
securities, phantom stock or other commitments pursuant to which any Subsidiary
or any of their subsidiaries is or may become obligated to issue, sell,
purchase, return or redeem any shares of capital stock or other securities
and
no equity securities of any Subsidiary or any of their subsidiaries are reserved
for issuance for any purpose.
(c)
Corporate
Action/Enforceability.
All corporate action required to be taken by Atlas America or any of its securityholders
for the authorization, execution and delivery of this Contribution Agreement
and the consummation of the transactions contemplated by this Contribution Agreement
and the Pre-Closing Actions have been validly taken. This Contribution Agreement
constitutes the valid and binding obligations of Atlas America, enforceable
in accordance with its terms except as such enforceability may be limited by
applicable bankruptcy or other similar laws affecting the rights and remedies
of creditors generally as well as by general principles of equity (regardless
of whether such enforceability is considered in a proceeding in equity or at
law).
(d)
Conflicts.
None of
the (i) the execution, delivery and performance of this Contribution Agreement
by Atlas America, or (ii) consummation of the transactions contemplated hereby
and the Pre-Closing Actions by Atlas America (A) conflicts or will conflict
with
or constitutes or will constitute a violation of Atlas America’s or any member
of the Atlas Energy Group’s certificate of incorporation, bylaws or other
organizational documents, (B) conflicts or will conflict with or constitutes
or
will constitute a breach or violation of, or a default (or an event that, with
notice or lapse of time or both, would constitute such a default) under, any
indenture, mortgage, deed of trust, loan agreement, lease or other agreement
or
instrument to which Atlas America or any member of the Atlas Energy Group is
a
party or by which Atlas America’s or any member of the Atlas Energy Group’s
properties may be bound, (C) violates or will violate any statute, law or
regulation or any order, judgment, decree or injunction of any Authority having
jurisdiction over Atlas America or any member of the Atlas Energy Group or
any
of their respective properties or assets, or (D) results or will result in
the
creation or imposition of any lien, charge or encumbrance upon any property
or
assets of Atlas America or any member of the Atlas Energy Group, which
conflicts, breaches, violations, defaults or liens, in the case of clauses
(B)
or (D), would, individually or in the aggregate, have a material adverse effect
on (i) the transactions contemplated hereby or (ii) the ownership and use by
Atlas Energy, Energy Operating and the Subsidiaries of the Atlas Energy Assets
at or after the Closing Date (a “Material
Adverse Effect”).
(e)
Consents.
No
permit, consent, approval, authorization, order, registration, filing or
qualification of or with any Authority having jurisdiction over Atlas America,
any member of the Atlas Energy Group or any of their respective properties
or by
any other third party is required in connection with (i) the execution, delivery
and performance of this Contribution Agreement by Atlas America, or (ii) the
consummation by Atlas America of the transactions contemplated by this
Contribution Agreement and the Pre-Closing Actions, except for such consents
that have been obtained or as to which the lack thereof is not reasonably likely
to have a Material Adverse Effect.
(f)
Title
to Property.
Upon
Closing, one or more members of Atlas Energy Group will have:
(i)(A)
good and defensible title to the producing oil and gas property interests (including
the wells and the working and net revenue interests attributable thereto) (the
“Wells”)
included in the Atlas America reserve report, dated March 31, 2006, included
in Registration Statement (the “Reserve
Report”),
subject only to encumbrances that do not materially adversely affect the value
of such oil and gas property interests or the ability of the Atlas Energy Group
to operate such oil and gas property interests in substantially the same manner
as they were operated immediately prior to the Closing Date and (B) good and
defensible title to each oil and gas lease as to which proved undeveloped reserves
were included in the Reserve Report (the “Leases”),
subject only to encumbrances that do not materially adversely affect the value
of any such Lease or, in the event that the Atlas Energy Group does not have
good and defensible title to such Lease (each, a “Defective
Lease”),
then (1) the Atlas Energy Group has good and defensible title to an oil and
gas lease as to which no reserves were indicated therefor in the Reserve Report
(each, a “Substitute
Lease”),
(2) one or more drilling locations have been identified for such Substitute
Lease as of the date hereof, (3) the Atlas Energy Group has a reasonable expectation
that it will drill a well on one or more of such drilling locations on the Substitute
Lease within the 24 months following the date hereof, (4) the Atlas Energy Group
has a reasonable expectation that the wells expected to be drilled at such locations
on the Substitute Lease within such 24-month period are generally comparable
in reserve potential to the reserves assigned to such Defective Lease in the
Reserve Report and in costs and (5) such Substitute Lease is not and has not
been otherwise utilized for purposes of this clause (B) with respect to another
Defective Lease;
(ii)
good
title to the general partner interests and the limited partner interests in
the
Investment Programs as set forth on Schedule
5.1(f)(ii);
(iii)
good and marketable title in fee to all real property and interests in real
property purported to be owned in fee by any of them other than the Leases
and
Wells (individually, a “Owned
Property”)
as set
forth on Schedule
5.1(f)(iii);
(iv)
good
title to the leasehold estates in all real property, personal property and
interests in such property purported to be leased by any of them other than
the
Leases and Wells (individually, a “Leased
Property”)
as set
forth on Schedule
5.1(f) (iv);
(v)
good
title to all equipment, fixtures and other personal property purported to be
owned by any of them other than the Wells; and
(vi)
valid and indefeasible easement rights or fee ownership interests in and to
the
lands on which any Atlas Energy Asset is located as of the Closing
Date;
(in
each
case) subject only [to matters contained in the instruments of conveyance
covering the Transferred Assets to evidence such contribution and conveyance
and] to encumbrances and defects that do not materially adversely affect the
value of the Atlas Energy Assets or the ability of the Atlas Energy Group to
own
and operate the Atlas Energy Assets in substantially the same manner as they
were operated immediately prior to the Closing Date. Except as would not
reasonably be expected to have a Material Adverse Effect, the Leases and all
of
the leases for the Leased Property are valid and in full force and effect,
and
there does not exist any default or event that with notice or lapse of time,
or
both, would constitute a default by any of Atlas America, or any member of
the
Atlas Energy Group under any of them, and to the knowledge of Atlas America,
there does not exist any default or event that with notice or lapse of time,
or
both, would constitute a default by any other party under any of them.
(g)
Equipment
and Improvements.
The
equipment and improvements located on the Leases (or lands pooled therewith),
Owned Property and Leased Property are in compliance with all applicable laws
and orders, and are in reasonable and serviceable condition and repair, normal
wear and tear excepted, except for any such non-compliance which would not
reasonably be expected to have a Material Adverse Effect. Neither the Owned
Property or the Leased Property nor the use or occupancy thereof by Atlas
America or any member of the Atlas Energy Group violates in any way any
applicable laws, orders, permits, covenants, conditions and restrictions,
whether federal, state, local or, to Atlas America’s knowledge, private, except
for any such violation which would not reasonably be expected to have a Material
Adverse Effect.
(h)
Intellectual
Property.
Schedule
5.1(h)
contains
a true and complete list and brief description of all patents, trademarks,
service marks, trade names, and copyrights (whether or not such trademarks,
trade names, service marks and copyrights are registered), and all pending
applications therefor, if any, owned by any member of the Atlas Energy Group
or
in which any member of the Atlas Energy Group has any rights or licenses. No
other patents, trademarks, trade names, service marks or copyrights are
reasonably necessary for the conduct of the Business in substantially the same
manner as presently operated. To Atlas America’s knowledge, there is no
infringement or alleged infringement by any person of any such trademark,
service mark, trade name, copyright or patent. Neither Atlas America nor any
member of the Atlas Energy Group has received any notice from any person
alleging any of them is infringing upon, and, to Atlas America’s knowledge, none
of Atlas America or any member of the Atlas Energy Group has infringed and
is
not now infringing on, any trademark, service mark, trade name, copyright or
patent belonging to any other person.
(i)
Compliance
with the Laws.
Atlas
America and the members of the Atlas Energy Group have complied with all, and
are not in violation of any, applicable laws, permits and orders (including,
any
applicable building, zoning, environmental protection, water use or law,
ordinance, or regulation) affecting the ownership or operation of the Business
or the Transferred Assets, except for any such non-compliance or violation
which
would not reasonably be expected to have a Material Adverse Effect.
(j)
Environmental.
(i)
Definitions.
For
purposes of this Contribution Agreement, the following terms shall have the
following meanings:
(A)
The term “Environmental
Law(s)”
means each and every law, statute, rule, regulation, order, permit, or similar
requirement of each and every Authority and common law now or hereinafter in
effect, pertaining to protection of the environment, including (1) the protection
of human health, safety, the environment, natural resources and wildlife or
(2) the management, manufacture, possession, presence, use, generation, transportation,
treatment, storage, disposal, Release, threatened Release, abatement, removal,
remediation or handling of, or exposure to, any Hazardous Substance, including
the Superfund Amendments Reauthorization Act and the Resource Conservation and
Recovery Act or (3) pollution, including, as amended, CERCLA, the Solid Waste
Disposal Act, 42 U.S.C. Section 6901 et
seq.,
the Clean Air Act, 42 U.S.C. Section 7401 et
seq.,
the Toxic Substances Control Act, the Oil Pollution Act, the Safe Drinking Water
Act, the Hazardous Materials Transportation Act and the Federal Water Pollution
Control Act, 33 U.S.C. Section 1251, et
seq.
(B)
The
term “Hazardous
Substance”
means
any substance which is (1) designated, classified or defined as a hazardous
substance, hazardous material, hazardous waste, pollutant or contaminant under
any Environmental Laws, (2) a petroleum hydrocarbon, including crude oil or
any
fraction thereof, (3) hazardous, toxic, corrosive, flammable, explosive,
infectious, radioactive or carcinogenic or (4) regulated pursuant to any
Environmental Laws.
(C)
The
term “Release”
means
any spilling, leaking, pumping, pouring, emitting, emptying, discharging,
injecting, escaping, leaching, dumping, or disposing into the environment
(including the abandonment or discarding of barrels, containers, and other
receptacles containing any Hazardous Substance).
(ii)
Compliance
with Environmental Laws.
Except
as would not reasonably be expected to have a Material Adverse Effect, Atlas
America, with respect to the Assets, and each member of the Atlas Energy Group
have been and are in compliance with all applicable Environmental Laws, and
there has been and is no liability against Atlas America or any member of the
Atlas Energy Group under any applicable Environmental Laws. None of Atlas
America or any member of the Atlas Energy Group has any knowledge of any facts
or circumstances concerning any alleged violation or liability arising under
any
Environmental Law with respect to the Owned Property, the Leased Property,
the
Leases (or any lands pooled therewith), the Wells or the Business.
(iii)
No
Release of Hazardous Substances.
Except
in accordance with applicable Environmental Laws or as would not reasonably
be
expected to have a Material Adverse Effect, there has been no Release or
threatened Release by any member of the Atlas Energy Group or, with respect
to
the Assets, Atlas America, or, to Atlas America’s knowledge, by any other person
of any Hazardous Substance existing on, beneath or from the surface, subsurface,
ground water, sediment, rivers or other bodies of water associated with the
Owned Property, the Leased Property, the Leases (or any lands pooled therewith)
or the Wells.
(iv)
Permits.
Except as would not reasonably be expected to have a Material Adverse Effect,
all permits required by or issued pursuant to any Environmental Law for the
ownership, use or operation of the Owned Property, the Leased Property, the
Leases or the Wells by any of Atlas America, or any member of the Atlas Energy
Group have been obtained in a timely manner and are presently maintained in
full force and effect. The operations of Atlas America, and any member of the
Atlas Energy Group are in material compliance with all terms and conditions
of such Permits. None of Atlas America or any member of the Atlas Energy Group
has received any notice or other communication and has any knowledge of any
facts or circumstances concerning any alleged violation of any such Permits.
(v)
No
Proceedings.
There
exists no Order, notice of violation, nor any suit, claim, proceeding, citation,
directive, summons, investigation, information request or other notice pending
or, to the knowledge of Atlas America, threatened pursuant to any Environmental
Law relating to (A) any of Atlas America’s or any member of the Atlas Energy
Group’s ownership, lease, occupation or use of the Owned Property, the Leased
Property, the Leases (or any lands pooled therewith) or the Wells, (B) any
alleged violation of, or liability under, any Environmental Law by any of Atlas
America or any member of the Atlas Energy Group, or (C) to Atlas America’s
knowledge, the suspected presence, Release or threatened Release of any
Hazardous Substance on, under, in or from the surface, subsurface, groundwater,
sediment, rivers or other bodies of water associated with the Owned Property,
the Leased Property, the Leases (or lands pooled therewith) or the Wells, nor
does there exist any valid basis for any such Order, suit, claim, proceeding,
citation, directive, summons investigation, information request, notice of
violation, or other notice.
(k)
Material
Contracts.
Excluding any Leases and except as set forth in Schedule
5.1(k),
none of
the Atlas Energy Group and, to the knowledge of Atlas America, no other party
is
in material breach or default of any material contract included within the
Atlas
Energy Assets, including any material contract of any of the Atlas Energy Group.
(l)
No
Suspense.
Except
as set forth in Schedule
5.1(l),
to the
knowledge of Atlas America, proceeds from the sale of all oil, condensate and
gas produced from the Atlas Energy Assets are being received by a member of
the
Atlas Energy Group and are not being held in suspense by a third party for
any
reason. Schedule 5.1(l) also lists all the amounts held in suspense by Atlas
America or any member of the Atlas Energy Group with respect to any oil and
gas
proceeds attributable to their respective properties and assets.
(m)
Imbalances.
Except as set forth in Schedule
5.1(m),
there exists no imbalance regarding production taken or marketed from any Lease
in which any member of the Atlas Energy Group has an interest or which is included
in the Assets (or from lands pooled with any such Lease) which could result
in (i) a portion of any member of the Atlas Energy Group’s interest in
production therefrom (in the case of any Lease) to be taken or delivered from
or after the Closing Date without such entity receiving payment therefor and
at the price it would have received absent such imbalance; (ii) any such entity
being obligated to make payment to any person or entity as a result of such
imbalance; or (iii) production being shut-in or curtailed from or after the
Closing Date due to non-compliance with allowables, production quotas, proration
rules, or similar orders or regulations of Authorities; and no such entity will
be obligated, by virtue of any prepayment arrangement, take-or-pay agreement,
or similar arrangement, to deliver hydrocarbons produced from the Atlas Energy
Assets at some future time without then receiving full payment therefor.
(n)
Transfer
Restrictions.
Except
as set forth in Schedule
5.1(n),
there
are no preferential rights of purchase that are applicable to the transactions
contemplated hereby.
(o)
Seismic
Data.
No fees
will be due and owing in connection with the transactions contemplated hereby
under any agreement covering any seismic records, shot points, field notes,
interpretations, and geological and geophysical information held by Atlas
America or any member of the Atlas Energy Group.
(p)
Plugging
and Abandonment Obligations.
Except
as set forth in Schedule
5.1(p),
there
are no Wells located any of the Leases (or lands pooled therewith) in which
Atlas America or any member of the Atlas Energy Group has an interest where
such
entity is currently required by law or contract to plug and abandoned.
(q)
Royalties
and Rentals.
Except
for revenues which are being suspended in accordance with applicable law and
except to the extent not reasonably likely to have a Material Adverse Effect,
all royalties, excess royalties, overriding royalty interests, net profit
interests, production payments, and other interests burdening production from
or
attributable to the Atlas Energy Assets have been properly and timely paid.
ARTICLE
VI
FURTHER
ASSURANCES
Section
6.1 Further
Assurances.
(a) From
time to time from and after the date of this Contribution Agreement, 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 (i) more fully to assure that the applicable Parties own all of
the
properties, rights, titles, interests, estates, remedies, powers and privileges
granted by this Contribution Agreement, or which are intended to be so granted,
or (ii) 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 Contribution Agreement or intended so to be,
including the Assets and to more fully and effectively carry out the purposes
and intent of this Contribution Agreement.
(b)
Within a reasonable time after the date of this Contribution Agreement, and
without any further consideration, Atlas America agrees to cause to be delivered
to Atlas Energy true and complete executed copies of (i) all the agreements
of
limited partnership of the Investment Programs, (ii) all the drilling operating
agreements of the Investment Programs and (iii) any other material agreements
to
which any of the Investment Programs is a party (collectively, the “Investment
Program Documents”),
in
the case of each of clauses (i) through (iii), that were not executed or made
available to Atlas Energy as of the date of this Contribution Agreement.
Section
6.2 Other
Assurances.
From
time
to time after the date of this Contribution Agreement, and without any further
consideration, each of the Parties shall execute, acknowledged 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 Contribution Agreement. Without limiting the generality
of
the foregoing, the Parties acknowledge that the Parties have used their good
faith efforts to identify all the assets being contributed to the Atlas Energy
Group as required in connection with the Offering. However, due to the age
of
some of those assets or the difficulties in locating appropriate data with
respect to some of the assets, it is possible that assets intended to be
contributed to the Atlas Energy Group were not identified and therefore are
not
included in the Assets. It is the express intent of the Parties that the Atlas
Energy Group will own all assets of the Business as of the Closing Date and
as
described 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 Atlas Energy 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 members of the Atlas Energy 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
INDEMNIFICATION
Section
7.1 Survival
of Representations and Warranties.
The
representations and warranties of Atlas America contained in Section 5.1 shall
survive the Closing; provided that those contained in Section 5.1(f)(i) shall
expire three years following the Closing Date; those contained in Section 5.1(b)
shall survive indefinitely; and all others shall expire one year following
the
Closing Date.
Section
7.2 Environmental
Indemnification.
Atlas
America shall indemnify, defend and hold harmless the Atlas Energy Group for
a
period of one year after the Closing Date from and against environmental and
Toxic Tort losses (including economic losses, diminution in value suffered
by
third parties, and lost profits), damages, injuries (including personal injury
and death), liabilities, claims, demands, causes of action, judgments,
settlements, fines, penalties, costs, and expenses (including court costs and
reasonable attorney’s and expert’s fees) of any and every kind or character,
known or unknown, fixed or contingent, suffered or incurred by the Atlas Energy
Group or any third party by reason of or arising out of:
(a)
any
violation or correction of violation of Environmental Laws associated with
the
ownership or operation of the Atlas Energy Assets, or
(b)
any event or condition associated with ownership or operation of the Transferred
Assets (including the presence of Hazardous Substances on, under, about or migrating
to or from the Atlas Energy Assets or the disposal or release of Hazardous Substances
generated by operation of the Atlas Energy Assets at non-Atlas Energy Asset
locations) including (i) the cost and expense of any investigation, assessment,
evaluation, monitoring, containment, cleanup, repair, restoration, remediation,
or other corrective action required or necessary under Environmental Laws, (ii)
the cost or expense of the preparation and implementation of any closure, remedial,
corrective action, or other plans required or necessary under Environmental
Laws, and (iii) the cost and expense for any environmental or Toxic Tort pre-trial,
trial, or appellate legal or litigation support work;
but
only
to the extent that such violation complained of under Section 7.2(a) or such
events or conditions included under Section 7.2 (b) occurred or existed before
the Closing Date (collectively, “Covered
Environmental Losses”).
Section
7.3 Limitations
Regarding Environmental Indemnification.
The
aggregate liability of Atlas America in respect of all Covered Environmental
Losses under Section 7.2 shall not exceed $25,000,000 and Atlas America will
not
have any obligation under Section 7.2 until the Covered Environmental Losses
of
the Atlas Energy Group exceed $500,000.
Section
7.4 Indemnification
by Atlas America.
In
addition to and not in limitation of the indemnification provided under Sections
7.2, Atlas America shall indemnify, defend and hold harmless each member of
the
Atlas Energy Group and such member’s directors, officers, members, employees and
representatives from and against any losses, damages, liabilities, claims,
demands, causes of action, judgments, settlements, fines, penalties, costs
and
expenses (including court costs and reasonable attorney’s fees and expert’s
fees) of any and every kind and character, known or unknown, fixed or
contingent, suffered or incurred by the Atlas Energy Group (“Losses”),
insofar as such Losses arise out of or are based upon:
(a)
a
breach of the representations and warranties of Atlas America set forth in
Section 5.1 hereof;
(b)
the
failure of Atlas America to perform its obligations under Section 3.1 after
the
Closing Date;
(c)
currently pending legal actions against the Atlas America and its
subsidiaries;
(d)
all
federal, state and local income tax liabilities attributable to the operation
of
the Transferred Assets prior to the Closing Date, including any such income
tax
liabilities of Atlas America and its subsidiaries that may result from the
consummation of the formation transactions for the Atlas Energy Group and Atlas
Management; or
(e)
the
failure of Atlas America and its subsidiaries to execute, deliver and provide
to
Atlas Energy the Investment Program Documents.
Section
7.6 Indemnification
by Atlas Energy.
Atlas
Energy and Energy Operating, jointly and severally, shall indemnify, defend
and
hold harmless Atlas America and such entity’s directors, officers, members,
employees and representatives from and against all Losses (including court
costs
and reasonable attorney’s and expert’s fees) of any and every kind or character,
known or unknown, fixed or contingent, suffered or incurred by Atlas America
insofar as such Losses arise out of or are based upon:
(a)
the
Assumed Liabilities, unless such indemnification would not be permitted under
the Operating Agreement; or
(b)
the
failure of Atlas Energy to perform its obligations under Section 3.2 after
the
Closing Date.
(a)
The
indemnified party agrees that within a reasonable period of time after it
becomes aware of facts giving rise to a claim for indemnification under this
Article VII, it will provide notice thereof in writing to the indemnifying
party, specifying the nature of and specific basis for such claim.
(b)
The
indemnifying party shall have the right to control, at its sole cost and
expense, all aspects of the defense of (and any counterclaims with respect
to)
any claims brought against the indemnified party that are covered by the
indemnification under this Article VII, including the selection of counsel,
determination of whether to appeal any decision of any Authority and the
settling of any such matter or any issues relating thereto; provided, however,
that no such settlement shall be entered into without the consent of the
indemnified party (which consent shall not be unreasonably withheld), with
the
concurrence of the Conflicts Committee of Atlas Energy in the case of the Atlas
Energy Group, unless it includes a full release of the indemnified party from
such matter or issues, as the case may be.
(c)
The
indemnified party agrees to cooperate fully with the indemnifying party, with
respect to (i) its pursuit of insurance coverage or recoveries with respect
to
the claims covered by the indemnification and (ii) all aspects of the defense
of
any claims covered by the indemnification, including the prompt furnishing
to
the indemnifying party of any correspondence or other notice relating thereto
that the indemnified party may receive, permitting the name of the indemnified
party to be utilized in connection with such defense, the making available
to
the indemnifying party of any files, records or other information of the
indemnified party that the indemnifying party considers relevant to such defense
and the making available to the indemnifying party of any employees,
representatives or agents of the indemnified party; provided, however, that
in
connection therewith the indemnifying party agrees to use reasonable efforts
to
minimize the impact thereof on the operations of the indemnified party and
further agrees to maintain the confidentiality of all files, records, and other
information furnished by the indemnified party. In no event shall the obligation
of the indemnified party to cooperate with the indemnifying party as set forth
in the immediately preceding sentence be construed as imposing upon the
indemnified party an obligation to hire and pay for counsel in connection with
the defense of any claims covered by the indemnification; provided, however,
that the indemnified party may, at its own option, cost and expense, hire and
pay for counsel in connection with any such defense. The indemnifying party
agrees to keep any such counsel hired by the indemnified party informed as
to
the status of any such defense, but the indemnifying party shall have the right
to retain sole control over such defense.
(d)
The
date on which written notification of a claim for indemnification is received
by
the indemnifying party shall determine whether such claim is timely made.
(e)
In
determining the amount of any loss, cost, damage or expense for which a Person
is entitled to indemnification under this Contribution Agreement, the gross
amount of any such indemnification will be reduced by (i) any insurance proceeds
realized by the indemnified Person, and such correlative insurance benefit
shall
be net of any incremental insurance premiums that become due and payable by
the
indemnified Person as a result of such claim and (ii) all amounts recovered
by
the indemnified Person under contractual indemnities from third Persons.
ARTICLE
VIII
MISCELLANEOUS
Section
8.1 Costs.
Atlas
Energy and Energy Operating shall pay all expenses, fees and costs, including
all 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.
Section
8.2 Headings;
References; Interpretation.
All
Article and Section headings in this Contribution 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 Contribution Agreement, shall refer
to this Contribution Agreement as a whole, including all Schedules and Exhibits
attached hereto, and not to any particular provision of this Contribution
Agreement. All personal pronouns used in this Contribution 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 use
herein of the word “including” following any general statement, term or matter
shall not be construed to limit such statement, term or matter to the specific
items or matters set forth immediately following such word or to similar items
or matters, whether or not non-limiting language (such as “without limitation”,
“but not limited to”, or words of similar import) is used with reference
thereto, but rather shall be deemed to refer to all other items or matters
that
could reasonably fall within the broadest possible scope of such general
statement, term or matter.
Section
8.3 Successors
and Assigns.
The
Contribution Agreement shall be binding upon and inure to the benefit of the
Parties and their respective successors and permitted assigns.
Section
8.4 No
Third Party Rights.
The
provisions of this Contribution Agreement are intended to bind the Parties
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 Contribution Agreement.
Section
8.5 Counterparts.
This
Contribution Agreement may be executed in any number of counterparts, all of
which together shall constitute one agreement binding on the parties hereto.
Section
8.6 Governing
Law.
This
Contribution Agreement shall be governed by, and construed in accordance with,
the laws of the State of Delaware applicable to contracts made and to be
performed wholly within such state without giving effect to conflict of law
principles thereof.
Section
8.7 Severability.
If any
of the provisions of this Contribution Agreement are held by any court of
competent jurisdiction to contravene, or to be invalid under, the laws of any
political body having jurisdiction over the subject matter hereof, such
contravention or invalidity shall not invalidate the entire Contribution
Agreement. Instead, this Contribution 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 Contribution
Agreement at the time of execution of this Contribution Agreement.
Section
8.8 Amendment
or Modification.
This
Contribution Agreement may be amended or modified from time to time only by
the
written agreement of all the Parties; provided, however, that Atlas Energy
may
not, without the prior approval of the Atlas Energy conflicts committee, agree
to any amendment or modification that, in the reasonable discretion of Atlas
Energy, will adversely affect the holders of Atlas Energy common units. Each
such instrument shall be reduced to writing and shall be designated on its
face
as an Amendment to this Contribution Agreement.
Section
8.9 Integration.
This
Contribution Agreement and the instruments referenced herein supersede all
previous understandings or agreements among the Parties, whether oral or
written, with respect to their subject matter. This document and such
instruments contain the entire understanding of the Parties with respect to
the
subject matter hereof and thereof. No understanding, representation, promise
or
agreement, whether oral or written, is intended to be or shall be included
in or
form part of this Contribution Agreement unless it is contained in a written
amendment hereto executed by the parties hereto after the date of this
Contribution Agreement.
Section
8.10 Deed;
Bill of Sale; Assignment.
To the
extent required and permitted by applicable law, this Contribution Agreement
shall also constitute a “deed,”“bill of sale” or “assignment” of the assets and
interests referenced herein.
Gas
Purchase Agreement by and between Northeast Ohio
Gas Marketing, Inc., and
Atlas Energy Group, Inc., Atlas Resources, Inc.
and Resource Energy, Inc.,
dated March 31, 1999 (GS-226); as amended by Assignment
and Novation of
Transactions by FirstEnergy Solutions Corp. (Assignor)
to Amerada Hess
Corporation, effective April 1, 2005 (GS-226)
2.
Base
Contract for Sale and Purchase of Natural Gas entered
into by and between
Open Flow Gas Supply Corporation and Atlas America,
Inc., dated June 5,2006 (GS-515)
3.
Base
Contract for Sale and Purchase of Natural Gas entered
into by and between
Atlas America, Inc. and South Jersey Resources
Group, LLC, dated September12, 2006 (GS-518)
4.
Base
Contract for Sale and Purchase of Natural Gas entered
into by and between
Equitable Gas Company, a div. of Equitable Resources,
Inc. and Atlas
America, Inc., dated October 1, 2006 (GS-519)
5.
Fifth
Amendment to Gas Purchase Agreement by and between
Atlas Energy Group Inc
and WCI Steel dated July 6, 2004
6.
Exhibit
B dated November 1, 2003 to Gas Purchase Agreement
dated October 1, 2001
by and between Northeast Ohio Natural Gas Corporation
and Atlas Energy
Group (GS-223)
7.
Agreement
dated as of November 3, 1997 by and between Weinsz
Oil & Gas, Inc.,
and Atlas Energy Group, Inc.
8.
Operating
Agreement dated as of February 17, 1995 by and
between Atlas Energy Group,
Inc., and D&L Energy, Inc.
9.
Operating
Agreement dated as of February _____, 1999 by and
between D&L Energy,
Inc., and Atlas Energy Group, Inc.
