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EXHIBIT 10(k)
SECOND AMENDMENT
TO
OPERATING AGREEMENT
THIS SECOND AMENDMENT TO THE OPERATING AGREEMENT ("Second
Amendment") is made and entered into as of November 25, 1996, by and between BP
Chemicals Inc., an Ohio corporation ("BP Chemicals"), and Arcadian Ohio, L.P., a
Delaware limited partnership ("Arcadian").
WHEREAS, BP Chemicals and Arcadian are parties to that certain
Operating Agreement dated May 11, 1993, as amended by a First Amendment to the
Operating Agreement, dated as of November 20, 1995 (collectively the "1993
Operating Agreement"); and
WHEREAS, Arcadian and The BOC Group, Inc., a Delaware corporation
("BOC"), are parties to that certain Asset Purchase Agreement, dated November
19, 1996 ("1996 Asset Purchase Agreement"), pursuant to which Arcadian is
selling or leasing to BOC, and BOC is purchasing or leasing from Arcadian, among
other assets and properties of Arcadian, certain liquid and solid carbon dioxide
facilities (collectively, the "CO(2) Plant") located at Arcadian's nitrogen
plant in Lima, Ohio as that plant is defined in the 1993 Operating Agreement
("Nitrogen Plant"); and
WHEREAS, Arcadian and BP Chemicals wish to amend the 1993 Operating
Agreement in light of the 1996 Asset Purchase Agreement;
NOW THEREFORE, Arcadian and BP Chemicals hereby agree to amend the 1993
Operating Agreement as follows:
1. From and after the date of this Second Amendment, subject to
Sections 2 and 3 hereof (including BP Chemicals' obligation to provide interim
operating assistance through December 00, 0000), XX Chemicals shall cease its
operation of the CO(2) Plant as the agent and for the account of Arcadian,
pursuant to the terms of the 1993 Operating Agreement, and the CO(2) Plant shall
be removed from the definition of Nitrogen Plant in the 1993 Operating
Agreement; provided, however, that there shall be no reduction in the charges
for the Operating Activities performed by BP Chemicals pursuant to the 1993
Operating Agreement including, without limitation, the Management Fee, or other
compensation or reimbursable expenses payable to BP Chemicals pursuant to the
terms of the 1993 Operating Agreement, as a result of the application of the
provisions of this Section 1.
2. Unless the 1993 Operating Agreement shall have been previously
terminated in accordance with its terms, from and after January 1, 2012 or the
date on which Arcadian shall notify BP Chemicals in writing to resume its
operation of the CO(2) Plant as the agent and for the account of Arcadian,
whichever of such dates shall be the first to occur, BP Chemicals shall
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resume its operation of the CO(2) Plant as the agent and for the account of
Arcadian, pursuant to the terms of the 1993 Operating Agreement, and the CO(2)
Plant shall be added to the definition of Nitrogen Plant in the 1993 Operating
Agreement.
3. From and after the date of this Second Amendment and until the date
on which the Operating Agreement shall terminate in accordance with its terms or
the date on which Arcadian shall notify BP in writing to resume its operation of
the CO(2) Plant as the agent and for the account of Arcadian, whichever of such
dates shall be the first to occur, BP Chemicals, acting as the agent and for the
account of Arcadian, shall provide (or cause to be provided) directly to BOC for
the CO(2) Plant the Operating Activities described in Exhibit "A" hereto
(collectively, the "CO(2) Plant Operating Activities"); provided, however that
BP Chemicals shall not be entitled to receive payment of any additional
compensation or reimbursable expenses from Arcadian or BOC in consideration of
or as a result of the application of the provisions of this Section 3. BP
Chemicals shall provide (and shall cause any Secondary Supplier to provide) the
CO(2) Plant Operating Activities in accordance with the Reasonable Operator
standard set forth in the 1993 Operating Agreement.
4. The Operating Rules attached as Exhibit F to the 1993 Operating
Agreement are hereby deleted in their entirety and the Operating Rules attached
hereto as Exhibit "B" are hereby substituted therefor.
5. BP Chemicals shall be deemed to be a third-party beneficiary of all
rights afforded to Arcadian under Appendix I to Exhibit "B" of the 1996
Manufacturing Support Agreement. In the event BP Chemicals shall provide clean
water discharge services for the account of BOC, BP Chemicals shall be deemed to
be a third-party beneficiary of all rights afforded to Arcadian under Appendix
III to Exhibit "B" of the 1996 Manufacturing Support Agreement.
6. Except as expressly modified, amended and superseded by this Second
Amendment, the terms and provisions of the 1993 Operating Agreement shall
continue in full force and effect.
IN WITNESS WHEREOF, the parties hereto have executed this Second
Amendment in duplicate by their duly authorized representatives as of the date
first above set forth above.
BP Chemicals Inc. Arcadian Ohio, L.P.
By: /s/ By: Arcadian Corporation,
--------------------- General Partner
Title: V.P.
------------------ By: /s/
-------------------
X.X. Xxxxxxxx,
President
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EXHIBIT "A" TO SECOND AMENDMENT TO OPERATING AGREEMENT
Ammonia
BP will timely provide (or arrange for the timely provision of) all ammonia as
BOC may require for use as a refrigerant in the CO(2) Plant at any time through
the existing closed-loop system located therein, subject to the condition that
BOC will maintain such closed-loop system in good operating repair.
Maintenance, Repair and Replacement of C-1 Compressor
BP will timely maintain, repair or replace (or arrange for the timely
maintenance, repair or replacement of), for the mutual benefit of Arcadian and
BOC, the C-1 Compressor and the instrumentation and other equipment associated
therewith that is located at the Nitrogen Plant for the purpose of delivering
high pressure carbon dioxide gas to Arcadian and BOC.
Demineralized Cooling Water
BP will timely provide (or arrange for the timely provision of), for BOC's
account, all demineralized cooling water needed by BOC for use in the ammonia
unit purification system.
Maintenance and Repair of Roads
BP will timely maintain and repair (or arrange for the timely maintenance and
repair of) the roads currently and subsequently providing ingress to and egress
from the CO(2) Plant consistent with BP's standard operating procedures.
Fire Water
BP will timely provide (or arrange for the timely provision of) all fire water
as BOC may require for use as such at the CO(2) Plant through BP's existing fire
water piping and distribution system and as BP may then have available as a
Reasonable Operator; provided, however, that the commitment to furnish such fire
water shall not imply a representation that the amount of fire water delivered
in the event of any fire or other emergency will be of sufficient quantity to
respond adequately to any such fire or other emergency.
Inter-Company Complex Communications
BP will timely maintain, including repair and any necessary replacement of all
or any part thereof (or arrange for the timely maintenance including repair and
any necessary replacement of all or any part thereof, of), the existing Lima,
Ohio Complex inter-company communication system, including such portions of such
communication system that are found within the CO(2) Plant.
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Disaster Plans
BP will timely furnish BOC a copy of the Disaster and Emergency Plan currently
in effect for the Lima, Ohio Complex and will facilitate (or arrange for the
facilitation of) the coordination of activities under such plan with and among
BP Chemicals, BP Oil, Arcadian and BOC.
Cooling Tower
BP Chemicals understands that Arcadian and BOC will enter into a separate
agreement relative to the expansion of the existing cooling tower (or cells
contained therein) or the construction of a new cooling tower at the Nitrogen
Plant for the cooling of carbon dioxide gas generated by Arcadian. Following any
such expansion or construction, BP will maintain, including repair and any
necessary replacement of all or any part thereof (or arrange for the
maintenance, including repair and any necessary replacement of all or any part
thereof, of), the same for the mutual account of Arcadian and BOC in accordance
with the terms thereof in order to facilitate the delivery of low pressure
carbon dioxide gas to BOC consistent with the terms of the CO(2) Gas Sale
Agreement between Arcadian and BOC.
Cooling Tower Water
BP will timely provide (or arrange for the timely provision of) all water needed
for the proper operation of the existing cooling tower (and any expansion to the
existing cooling tower or new cooling tower, as described above) located at the
Nitrogen Plant for BOC's account consistent with BP's standard operating
procedures.
Low Pressure CO(2) Gas Equipment.
BP will maintain, including repair and any necessary replacement of all or any
part thereof, (or arrange for the maintenance, including repair and any
necessary replacement of all or any part thereof, of), for the mutual benefit of
Arcadian and BOC, the Equipment and BOC Installed Equipment, as those terms are
defined in that certain Equipment Purchase and Installation Agreement, between
Arcadian and BOC, for the purpose of delivering Low Pressure CO(2) Gas to
Arcadian and BOC.
Interim Operating Assistance.
BP Chemicals will assist (or arrange for assistance to be provided to) BOC in
the operation of the CO(2) Plant on an interim basis through December 31, 1996.
Such assistance shall consist of providing (or arranging for the provision of )
the services of such number of persons as shall have been customarily employed
by BP Chemicals (or who shall have been customarily made available to BP
Chemicals under agreements with Xxxxxx Engineering or one or more other
third-party contractors) for use in the operation of the CO(2) Plant during the
three-month period immediately preceding the date of the Second Amendment, on
substantially similar shift schedules and on such other substantially similar
conditions as shall have applied during such period.
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While such persons shall be responsible for rendering assistance to BOC in the
operation of the CO(2) Plant, BP Chemicals, as the agent of Arcadian, shall at
all times exercise the sole and exclusive right to control the ways, means and
manner by which any such person who is the employee of BP Chemicals shall render
such assistance (and Xxxxxx Engineering and any other third-party contractor
shall at all times exercise the sole and exclusive right to control the ways,
means and manner by which any such person who is the employee of Xxxxxx
Engineering or any such third party contractor shall render such assistance),
and no such persons shall be deemed to be the employee or agent of Arcadian or
BOC for any purpose.
Clean Water Discharge
If at any time Arcadian and BOC agree on terms and conditions, including
appropriate cost and capital allocations, pursuant to which BP will timely
provide (or arrange for the timely provision of) clean water discharge services
for the account of BOC, such services will be provided by BP in accordance with
the terms and subject to the conditions set forth in Appendix III to Exhibit "B"
to the 1996 Manufacturing Support Agreement.
Environmental Waste Water
BP will timely provide (or arrange for the timely provision of) chemical
separation services to BOC to treat all process water discharges and stormwater
runoff from the CO(2) Plant, to the extent required by applicable law, rule or
regulation, for the account of Arcadian or BOC, in accordance with the terms and
subject to the conditions set forth in Appendix I to Exhibit B to the 1996
Manufacturing Support Agreement.
Plant Process Air
BP will timely provide (or arrange for the timely provision of) all plant
process air as BOC may require for use in the CO(2) Plant at any time.
Instrument Air
BP will timely provide (or arrange for the timely provision of) all instrument
air as BOC may require for use in the CO(2) Plant at any time.
