August 10, 1998
EXHIBIT 2.2
Xxxxx Refining & Marketing, Inc.
0000 Xxxxxxxx Xxxxxx
Xx. Xxxxx, XX 00000
Re: Letter Amendment No. 1 to Agreement for Purchase and Sale of Lima Oil
Refinery dated July 1, 1998 (the "Agreement")
Dear Sir:
Whereas the parties to the Agreement wish to amend the same. It is agreed as
follows:
1. Addition of Section 1.M.
The following Section 1.M. is hereby added to the Agreement after Section
1.L.:
M. An ownership interest in the natural gas pipelines used to supply
natural gas to the Refinery and others in the Lima industrial complex,
in the form of a Capacity Lease Agreement to be agreed between the
parties.
2. Addition of Section 2.0.
The following Section 2.0. is hereby added to the Agreement after Section
2.N.:
O. An ownership interest in the electrical equipment used to supply
electricity to the Refinery and others in the Lima industrial complex,
in a form to be agreed between the parties.
3. Amendment of Sections 3.B. and 3.C.
Section 3.B. and 3.C. of the Agreement are hereby amended to read, in their
entirety, as follows:
B. Purchase Price. In consideration for the Purchased Assets, Buyer shall
pay to Seller or its affiliates on the Closing Date in immediately
available funds, by wire transfer to Seller's account number 0000000
at National City Bank, Cleveland, Ohio (ABA or Transit Routing Number
000000000) an amount equal to: (i) One Hundred Sixty Six Million Two
Hundred and Fifty Thousand Dollars ($166,250,000.00), and (ii) an
amount equal to the Estimated Inventory Value, as defined in Section 4
below, subject to adjustment for the Final Inventories Value as
specified in Schedule E, (iii) less an amount equal to the
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Deposit; and (iv) assume and agree to pay and perform the liabilities
and obligations of Seller specified in Section 5 below relating to the
Purchased Assets (the "Purchase Price"). Additionally, Buyer shall pay
by wire transfer to the Escrow Account of #0000000 Security Inc. at
National City Bank, Cleveland, Ohio (ABA or Transit Routing Number
000000000), reference Lima Oil Refinery, an amount equal to: Eight
Million, Seven Hundred Fifty Thousand Dollars ($8,750,000.00) in order
to facilitate a like-kind exchange under Section 1031 of the Code.
C. Purchase Price Allocation. Buyer and Seller shall agree on an
allocation of the Purchase Price (including any adjustments thereto)
among the parties pursuant to the provisions of Section 1060 of the
Internal Revenue Code of 1986, as amended (the "Code") and the
regulations promulgated thereunder. Seller and Buyer agree that the
fair market value of the land, land improvements and other real
property included in the Purchased Assets is $8.75 million, and that
accordingly, of the total Purchase Price, $8.75 million shall be
allocated to said property. Buyer and Seller shall not take any
position on their respective Tax Returns that is inconsistent with the
allocation of the Purchase Price. Buyer and Seller shall duly prepare
and timely file such reports and information returns as may be
required under Section 1060 of the Code and the regulations
promulgated thereunder, and report the allocation of the Purchase
Price among the Assets as so agreed. Any adjustments to Purchase Price
shall be allocated in the same manner.
4. Sections 16.G., 16.H. and 16.I. are hereby amended to read, in their
entirety, as follows:
16. Indemnification
G. Time Limitation. Any claim under Section 16.A.(ii)(y), or
16.B.(ii)(y), for Indemnity arising under or out of this Agreement or
the transactions contemplated hereunder (other than a breach of
Section 8, which will be subject to the 17 year time limitation set
forth below) for breach of warranty shall be brought within one year
after the Closing Date. Any claim under Section 16.B.(ii)(x) for
Indemnity arising under or out of this Agreement or the transactions
contemplated hereunder for breach of Section 11.B. shall be brought
within one year after the Closing Date, unless prior to such breach
Seller had knowledge of the action to be taken resulting in the
breach, in which event this limitation shall not apply. Any claim
under Section 8. or Section 16.B.(v), (vi) or (vii) for Indemnity (in
each case except to the extent relating to any Waste Unit) shall be
brought within seventeen (17) years after the Closing Date. a claim
shall be deemed to have been brought only upon delivery of a written
notice to the other party (which notice may consist of a notice of
breach pursuant to paragraph E.(v) of this Section 16.) at the notice
address set forth in Section 20., stating with reasonable specificity
the basis for the claim. Any claim required to be made within such one
or seventeen year
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period not so timely made will be forever barred. This provision shall
not be deemed to limit any claims or rights to Indemnification for
third party claims or pursuant to Sections 16.A.(i), 16.A.(iii),
16.B.(i) or 16.B.(ii)(x), (other than as provided above with respect
to Section 11.B), 16.B.(ii) or 16.B.(iv).
H. Monetary Limitation. The Buyer shall have no claim under Section
16.B.(ii)(y) or (except in the circumstances described in the
following sentence) under Section 16.B.(ii)(x) with respect to a
breach of Section 11.B. against Seller for any Losses unless and until
the aggregate of all such Losses incurred or sustained by the Buyer
exceeds Three Million Five Hundred Thousand Dollars ($3,500,000.00)
and then only for the excess over Three Million Five Hundred Thousand
Dollars ($3,500,000.00) (the "Threshold"). Claims under Section
16.B.(ii)(x) with respect to a breach of Section 11.B. shall not be
subject to or be counted for purposes of the preceding sentence if
Seller had knowledge of the action to be taken resulting in the
breach, in which event the limitation in the preceding sentence shall
not apply. After the Threshold has been reached, Seller shall have no
obligation to Indemnify the Buyer Indemnified Parties under this
Section 16. with respect to matters subject to the limitations
contained in the first sentence of this Section 16.H. for any Losses
amounting to less than Fifty Thousand Dollars ($50,000.00) in the
aggregate arising out of the same occurrence or matter. The monetary
limitations in this Section 16.H. will not apply to any Losses arising
pursuant to the provisions of Section 8. or out of a breach of
representation or warranty contained in Section 8. The provisions of
this Section 16.H. and of 16.I. shall not apply to any breach of the
last sentence of Section 7.G.
I. Limitation of Liability. Seller's aggregate liability for
Indemnification pursuant to Section 16.B.(ii)(y), or under Section
16.B(ii)(x) with respect to a breach of Section 11.B. in circumstances
where Seller did not have knowledge, prior to the breach, of action
taken that resulted in the breach of Section 11.B. shall in no event
exceed an amount equal to Twenty Five Million Dollars
($25,000,000.00). This provision shall not limit Seller's liability
for Excluded Liabilities or for Losses pursuant to the provisions of
Section 8 or out of a breach of representation or warranty contained
in Section 8.
5. Amendment of Section 25.B.
Section 25.B. of the Agreement is hereby amended to read, in its entirety,
as follows:
B. All of the terms, covenants, representations, warranties and
conditions of this Agreement shall be binding upon, and inure to the
benefit of, and be enforceable by, the parties hereto and their
respective successors, heirs, and other legal representatives. This
Agreement and the rights and obligation hereunder shall not be
assigned by any party hereto except that either party may assign its
rights and duties to any affiliate provided that the assigning party
shall remain liable for any such affiliate's duties, obligations
and/or
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liabilities hereunder, provided that with the prior written consent of
Seller (which consent will not be unreasonably withheld or delayed)
after the Closing Buyer may assign its rights and obligations under
this Agreement and (as to future obligations only) be released
therefrom to any purchaser of all or substantially all of the assets
of the Refinery. For purposes of the immediately preceding proviso,
Seller's withholding of consent will be deemed unreasonable unless the
financial strength or operating capability of the proposed purchaser
is reasonably expected to increase Seller's liability or costs
hereunder, or materially and adversely affect Seller's ability to
realize on the Indemnification provided to Seller under Sections 8.
and 16. Competitive considerations will not enter into Seller's
assessment.
Notwithstanding anything to the contrary herein, Seller shall have the
right to assign this Agreement, in whole or in part, to an
intermediary party for purposes of completing a like-kind exchange of
properties pursuant to Section 1031 of the Code. The parties
understand that the Seller desires to receive "replacement property"
(as that term is defined in Treasury Reg. (S)1.103(k)-
1(a))("Replacement Property") in full or partial exchange for the
Purchased Assets in a like-kind exchange under Section 1031 of the
Code if suitable Replacement Property can be identified and obtained.
Buyer agrees to take all reasonable steps to facilitate such like-kind
exchange, including executing any documents and instruments necessary
to consummate such like-kind exchange, as may be reasonably requested
by the Seller, provided that Buyer shall not be required hereby to
incur any additional liability or unreimbursed expense. The completion
of such like-kind exchange shall not alter the Buyer's rights
hereunder and Buyer shall have no obligation to find, select or obtain
any Replacement Property.
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6. Except as amended herein, and as provided in the letter from Xxxxx dated 20
July 98 titled Resolution Of Due Diligence Issues, the Agreement remains in
full force and effect.
In witness whereof, the parties have duly executed this instrument the day and
year first above written.
BP EXPLORATION & OIL INC. THE STANDARD OIL COMPANY
By: /s/ X. X. Xxxxx By: /s/ X. X. Xxxxx
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X.X. Xxxxx X.X. Xxxxx
Title: Vice President Title: Attorney-In-Fact
BP OIL PIPELINE COMPANY XXXXX REFINING & MARKETING, INC.
By: /s/ X. X. Xxxxx By: /s/ Xxxxx X. Xxxxx
--------------------- ----------------------------
X.X. Xxxxx Xxxxx X. Xxxxx
Title: Attorney-In-Fact Title:
BY CHEMICALS, INC.
By: /s/ X. X. Xxxxx
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X.X. Xxxxx
Title: Attorney-In-Fact
