This excerpt taken from the PAA 8-K filed Jun 12, 2006.
Merger Agreement. On June 12, 2006, the Partnership announced that it had entered into an Agreement and Plan of Merger (the Merger Agreement) with PPX, PPX General Partner, General Partner Holdco, Plains AAP, L.P., a Delaware limited partnership (PAA General Partner), and Plains All American GP LLC, (GP LLC), pursuant to which PPX will be merged into the Partnership, and all outstanding common units of PPX not purchased by the Partnership pursuant to the Purchase Agreement will be converted into common units of the Partnership based on an exchange ratio of 0.77 common units of the Partnership per common unit of PPX. The Merger Agreement was unanimously approved by GP LLCs Board of Directors, as well as by the Board of Directors of General Partner Holdco.
Each of the Partnership and PPX has made customary representations, warranties and covenants in the Merger Agreement. In addition, the Merger Agreement contains certain termination rights for both the Partnership, on the one hand, and PPX, on the other, and further provides that, upon termination of the Merger Agreement under specified circumstances, the Partnership will be required to pay PPX a termination fee of $10 million and under other specified circumstances, the Partnership will be required to pay PPX a termination fee of $40 million. In addition, under specified circumstances, PPX will be required to pay the Partnership a termination fee of $10 million and under other specified circumstances, PPX will be required to pay the Partnership a termination fee of $40 million.
The merger is subject to customary closing conditions including, among other things, (1) approval by the affirmative vote or consent of at least a unit majority (as such term is defined in the agreement of limited partnership of PPX) of the holders of the outstanding common units and subordinated units in PPX, (2) approval by the affirmative vote or consent of at least a majority of the holders of outstanding common units in the Partnership, (3) receipt of applicable regulatory approvals, including the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, the approvals of state utility commissions in California, Colorado and Wyoming, and the approvals of Canadian regulatory agencies, (4) effectiveness of a registration statement on Form S-4 with respect to the issuance of the Partnerships common units in connection with the Merger, (5) approval for listing the common units of the Partnership to be issued in connection with the Merger on the New York Stock Exchange and (6) closing of the transactions contemplated by the Purchase Agreement.
The foregoing description of the merger and the Merger Agreement does not purport to be complete and is qualified in its entirety by reference to the Merger Agreement, which is filed as Exhibit 2.2 hereto and is incorporated into this report by reference.