Exhibit 2.3
EXECUTION COPY
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ASSET PURCHASE AGREEMENT
By and Among
BP CORPORATION NORTH AMERICA INC.,
BP PRODUCTS NORTH AMERICA INC.,
and
GIANT INDUSTRIES, INC.
Dated as of
February 8, 2002
Relating to the
Purchase and Sale
of the Yorktown Refinery and Related Assets
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TABLE OF CONTENTS
Page
1. PURCHASE AND SALE OF THE BUSINESS....................................... 1
2. EXCLUDED ASSETS......................................................... 3
3. DEPOSIT AND PURCHASE PRICE.............................................. 6
(a) Deposit........................................................ 6
(b) Purchase Price................................................. 7
(c) Closing Date Payments.......................................... 8
(d) Post-Closing Adjustment........................................ 8
(e) Margin Payment................................................. 8
4. ASSUMPTION OF LIABILITIES............................................... 10
(a) Assumed Liabilities............................................ 10
(b) Excluded Liabilities........................................... 12
5. CLOSING................................................................. 13
6. SELLER'S REPRESENTATIONS AND WARRANTIES................................. 15
(a) Organization and Good Standing................................. 16
(b) Authority...................................................... 16
(c) Consents....................................................... 16
(d) No Breach...................................................... 16
(e) Real Property.................................................. 17
(f) Brokers........................................................ 17
(g) Machinery and Equipment........................................ 18
(h) Compliance With Laws........................................... 18
(i) Permits........................................................ 18
(j) Intellectual Property.......................................... 18
(k) Actions and Proceedings........................................ 18
(l) Collective Bargaining Agreements............................... 19
(m) Assets......................................................... 19
(n) Tangible Assets................................................ 19
7. ENVIRONMENTAL MATTERS................................................... 19
(a) Environmental Representations and Warranties................... 19
(b) Limitation..................................................... 20
8. DISCLAIMERS............................................................. 20
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Page
9. BUYER'S REPRESENTATIONS AND WARRANTIES.................................. 22
(a) Organization and Good Standing................................. 22
(b) Authority...................................................... 22
(c) Consents....................................................... 22
(d) No Breach...................................................... 22
(e) Litigation..................................................... 23
(f) Brokers........................................................ 23
(g) Availability of Funds.......................................... 23
(h) No Knowledge of Misrepresentations or Omissions................ 23
10. COVENANTS.............................................................. 23
(a) Covenants of Seller............................................ 23
(i) Access and Information.................................. 23
(ii) Conduct of Business..................................... 24
(iii) Schedules............................................... 24
(iv) Confidentiality......................................... 25
(b) Covenants of Buyer............................................. 25
(i) Confidentiality........................................ 25
(ii) Notification............................................ 26
(iii) Litigation.............................................. 26
(iv) Title Policies.......................................... 27
(v) Removal of Seller Marks................................. 27
(vi) Project Sunshine Consent Decree......................... 27
(vii) Novation Agreement...................................... 28
(viii) Conduct of Business..................................... 28
(c) Mutual Covenants............................................... 28
(i) H-S-R................................................... 28
(ii) Assignments............................................. 29
(iii) Transition Services Agreement........................... 31
(iv) Other Governmental Approvals............................ 31
(v) Other Actions........................................... 31
(vi) Use of Certain Facilities............................... 31
11. EMPLOYEES.............................................................. 32
(a) Employees...................................................... 32
(b) Employment Offers to Active Non-Union Employees and to All
Union Employees........................................................ 32
(c) Employment Offers to Non-Union Employees on Leave.............. 32
(d) Transfer Time.................................................. 33
(e) Level of Employee Benefits Provided by Buyer................... 33
(f) Pension Plans.................................................. 33
(g) Defined Contribution Plans..................................... 34
(h) Welfare Benefits and Other Benefits and Policies............... 34
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Page
(i) Vacation....................................................... 34
(j) Severance...................................................... 34
(k) Buyer's Adoption of Collective Bargaining Agreement............ 35
(l) WARN Act....................................................... 35
(m) Service Credit................................................. 35
(n) Benefits Miscellaneous......................................... 35
12. BUYER'S OBLIGATION TO CLOSE............................................ 35
(a) Compliance with Agreement...................................... 35
(b) Representations and Warranties................................. 36
(c) Litigation..................................................... 36
(d) Governmental Consents.......................................... 36
13. SELLER'S OBLIGATION TO CLOSE........................................... 36
(a) Compliance with Agreement...................................... 36
(b) Representations and Warranties................................. 36
(c) Litigation..................................................... 36
(d) Governmental Consents.......................................... 37
(e) Right of First Refusal......................................... 37
14. FURTHER ASSURANCES..................................................... 37
15. INDEMNIFICATION........................................................ 37
(a) Buyer's Indemnification of Seller.............................. 37
(b) Seller's Indemnification of Buyer.............................. 38
(c) Environmental Indemnifications................................. 39
(d) Exclusive Remedy............................................... 39
(e) Procedures Relating to Indemnification Among Buyer and Seller.. 40
(f) Procedures Relating to Indemnification for Third Party Claims.. 41
(g) Losses Net of Insurance and Taxes.............................. 42
(h) Attorneys' Fees................................................ 42
(i) Time Limitation................................................ 42
(j) Monetary Limitation............................................ 42
(k) Limitation of Liability........................................ 43
(l) Environmental Remediation Monetary Limitation.................. 43
(m) Mitigation..................................................... 43
(n) Losses......................................................... 43
16. TAXES.................................................................. 43
17. RECORDS/LITIGATION ASSISTANCE.......................................... 44
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Page
18. TERMINATION RIGHTS..................................................... 45
19. SPECIFIC PERFORMANCE................................................... 46
20. NOTICES................................................................ 46
21. GOVERNING LAW; SUBMISSION TO JURISDICTION.............................. 47
22. PUBLICITY.............................................................. 47
23. SURVIVAL OF COVENANTS, REPRESENTATIONS AND WARRANTIES.................. 48
24. ENTIRE AGREEMENT....................................................... 48
25. ASSIGNMENT............................................................. 48
26. AMENDMENT AND WAIVER................................................... 49
27. EXPENSES............................................................... 49
28. HEADINGS............................................................... 49
29. COUNTERPARTS........................................................... 49
30. INTERPRETATION......................................................... 50
31. NO STRICT CONSTRUCTION................................................. 50
32. SCHEDULES.............................................................. 50
33. REPRESENTATION BY COUNSEL; INTERPRETATION.............................. 51
34. SEVERABILITY........................................................... 51
35. BULK TRANSFER LAWS..................................................... 51
36. NO THIRD PARTY BENEFICIARIES........................................... 51
37. DEFINITION OF AFFILIATE................................................ 51
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SCHEDULES
SCHEDULE DESCRIPTION
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1(a) Major Refinery Equipment and Facilities
1(b) Refinery Real Property
1(c)(ii) Off-Site Storage Facilities
1(f) Contracts
1(i) Third-Party Process Technology Licenses
2(c) Excluded Assets Related to Support and Other
Services Provided to the Refinery by the BP Group
2(o) Other Excluded Assets
2(p) Excluded Contracts
2(r) Intercompany Agreements
6(c) Consents
6(d) No Breach
6(e)(i) Real Property Exceptions
6(g) Machinery and Equipment
6(h) Compliance
6(i) Permits
6(k) Actions and Proceedings
6(l) Collective Bargaining Agreements
6(m) Assets
7(a) Environmental Matters
10(a)(ii) Conduct of Business
10(c)(vi) Environmental Facilities
11(a) Employees
11(k) Letter of Understanding-Successorship
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EXHIBITS
EXHIBIT DESCRIPTION
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A Methodology For Valuing Inventories
B Form of Technology Transfer and License Agreement
C Form of Deeds for Real Property
D Form of Transition Services Agreement
E Novation Agreement
F Form of Project Sunshine Consent Decree Modification
G-1 Natural Gas Liquids Supply Agreement
G-2 Natural Gas Liquids Sales Agreement
G-3 Petroleum Coke Marketing Services Agreement
G-4 Term Petroleum Intermediates and Blendstocks Agreement
G-5 Term Petroleum Crude Oil Agreement
G-6 Term Petroleum Intermediates and Blackoils Agreement
G-7 Term Petroleum Product Agreement
G-8 Product Purchase Agreement
H Railcar Lease Agreement
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INDEX TO DEFINED TERMS
Term Page
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Actual Gasoline Margin..................................................... 9
Actual Heating Oil Margin.................................................. 9
affiliate ................................................................. 51
Agreement ................................................................. 1
Asbestos-Related Liabilities............................................... 11
Assumed Liabilities........................................................ 10
Base Price ................................................................ 7
BP ........................................................................ 1
BP Group .................................................................. 3
BP Products ............................................................... 1
BP RAP .................................................................... 33
XX Xxxxxxxxx Plan ......................................................... 34
Business .................................................................. 1
Buyer ..................................................................... 1
Buyer Indemnified Parties.................................................. 38
Buyer Pension Plan......................................................... 33
CBA ....................................................................... 35
CERCLA .................................................................... 12
Closing ................................................................... 13
Closing Date .............................................................. 14
Code ...................................................................... 14
Confidentiality Agreement.................................................. 23
Data ...................................................................... 23
Deposit ................................................................... 6
Deposit Return Event....................................................... 6
Disclosed Environmental Liabilities........................................ 11
Due Date .................................................................. 9
Employees ................................................................. 32
Environmental Control Bonds................................................ 31
Environmental Facilities................................................... 31
Environmental Permits...................................................... 2
Excluded Assets ........................................................... 3
Excluded Liabilities....................................................... 12
First Threshold ........................................................... 43
Gasoline Margin Payment.................................................... 8
H-S-R Act ................................................................. 13
Health, Safety and Environmental Laws...................................... 11
Heating Oil Margin Payment................................................. 8
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Term Page
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Hydrocarbon Inventories.................................................... 1
Indemnification Notice..................................................... 40
Indemnified Party.......................................................... 40
Indemnifying Party......................................................... 40
Inventories ............................................................... 2
knowledge ................................................................. 15
Leave ..................................................................... 32
Losses .................................................................... 43
Margin Payment ............................................................ 8
Margin Payment Period...................................................... 8
Non-Hydrocarbon Inventories................................................ 2
Non-Union Employees........................................................ 32
Non-Union Transferred Employees............................................ 32
Novation Agreement......................................................... 28
Offering Memorandum........................................................ 21
Offsite Environmental Liabilities.......................................... 13
ordinary course of business................................................ 3
Permits ................................................................... 2
Permitted Liens ........................................................... 17
Person .................................................................... 16
Personal Property ......................................................... 2
Project Sunshine Consent Decree............................................ 11
Purchase Price ............................................................ 7
Purchased Assets .......................................................... 1
Real Property ............................................................. 1
Refinery .................................................................. 1
Remediation Losses......................................................... 38
Second Threshold .......................................................... 43
Seller .................................................................... 1
Seller Indemnified Parties................................................. 37
Seller Information......................................................... 26
Seller Vacation Policy..................................................... 34
Seller's knowledge......................................................... 15
Taxes ..................................................................... 4
Technology Agreement....................................................... 2
Terminal Agreement......................................................... 7
Third Party Claim ......................................................... 41
Threshold ................................................................. 42
Transferred Employees...................................................... 32
Transition Services Agreement.............................................. 31
Union ..................................................................... 32
Union Employees ........................................................... 32
Union Transferred Employees................................................ 32
VEPCO ..................................................................... 5
WARN Obligations .......................................................... 35
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ASSET PURCHASE AGREEMENT
This ASSET PURCHASE AGREEMENT for the purchase and sale of assets
("Agreement"), is made and entered into as of February 8, 2002, by and among BP
Corporation North America Inc., an Indiana corporation ("BP"), and BP Products
North America Inc., a Maryland corporation ("BP Products," and together with BP,
"Seller"), on the one hand, and Giant Industries, Inc., a Delaware corporation
("Buyer"), on the other hand.
W I T N E S S E T H:
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WHEREAS, upon and subject to the terms and conditions of this
Agreement, Seller wishes to sell its petroleum refining assets located in the
vicinity of Yorktown, Virginia and related assets, as described below (the
"Business") and certain liabilities, each as further described in Sections 1 and
4, and Buyer wishes to purchase the Business and to assume certain liabilities
relating thereto, in each case upon the terms and subject to the conditions set
forth herein; and
NOW, THEREFORE, in consideration of the mutual promises made herein
and for other good and valuable consideration, the receipt and sufficiency of
which is hereby expressly acknowledged, and subject to the conditions
hereinafter set forth, the parties hereto agree as follows:
1. PURCHASE AND SALE OF THE BUSINESS. Subject to the terms and conditions
of this Agreement (including the provisions of Section 10(c)(ii)), Seller agrees
to sell, assign, convey, transfer and deliver, or cause such sale, assignment,
conveyance, transfer and delivery by Seller's affiliates, to Buyer, as of the
Closing Date, and Buyer agrees to purchase and take assignment and delivery from
Seller as of the Closing Date, of all of Seller's rights, title and interest in
the following assets relating to the Business (the "Purchased Assets"):
(a) the refinery and related equipment and facilities of Seller
located in the vicinity of Yorktown, Virginia, including the process
units, docks, storage tanks, control houses, office buildings, laboratory
facilities, warehouses, boiler houses, power plants, waste water treatment
facilities and other similar facilities of such refinery, major items of
which are listed on Schedule 1(a) attached hereto (the "Refinery");
(b) the real property on which the Refinery is situated, whether or
not contiguous, owned by Seller and used in the operation of the Business
as it is currently operated by Seller, in each case as more particularly
described on Schedule 1(b) attached hereto, including (subject to Section
2(h)) the improvements to such real property together with all
appurtenances thereto and the fixtures thereon (the "Real Property");
(c) the hydrocarbon inventories (the "Hydrocarbon Inventories") of
the Business as of the Closing Date (which shall be measured and valued in
accordance with Exhibit A attached hereto), including:
(i) all crude oil inventories at, or in transit to, the
Business where title has passed to Seller;
(ii) all crude oil inventories in the storage tanks at the
Business, and in any off-site storage facilities described on
Schedule 1(c)(ii) (it being expressly understood by the parties
hereto that all such hydrocarbon inventories shall consist of the
total contents thereof, regardless of whether above or below the
off-take pipe, including bottom sediment and water);
(iii) all refined and intermediate product inventories at the
Business; and
(iv) all additives at the Business;
but in all cases excluding all finished and unfinished products which have
left the Business and are en route to any customer (including the BP
Group) where title has passed to the customer;
(d) the non-hydrocarbon inventories of the Business as of the
Closing Date consisting of (i) the chemicals and catalyst inventories
located at the Business, (ii) the stores inventories, including
maintenance and capital spares, joints, valves and parts located at the
Business or in any off-site storage facility and (iii) any precious metals
and other non-hydrocarbon inventories of the Business (collectively, the
"Non-Hydrocarbon Inventories," and together with Hydrocarbon Inventories,
the "Inventories");
(e) the machinery (including machinery related to the utilities),
vehicles and other personal property owned and used exclusively in the
operation of the Business as it is currently operated by Seller
(collectively, the "Personal Property");
(f) subject to Section 10(c)(ii), all assignable or transferable
rights and obligations of Seller under the supply, distribution, exchange,
collective bargaining and other agreements, contracts, leases, licenses
and similar instruments relating exclusively to the Business as it is
currently operated by Seller, including those set forth on Schedule 1(f)
attached hereto;
(g) subject to Section 10(c)(ii), all assignable or transferable
permits or licenses of Seller from any federal, state or local regulatory
agencies which are necessary to and used exclusively in connection with
the ownership and operation of the Business as it is currently operated by
Seller (collectively, the "Permits"), including any approval,
registration, authorization, certificate, certificate of occupancy,
consent, exemption, license, order or permit or other similar
authorization of or filing with any governmental authority required by
applicable Health, Safety and Environmental Laws in effect on or prior to
the Closing Date, as they are enforced with respect to the Business, for
the ownership or operation of the Business as it is currently operated by
Seller (collectively, the "Environmental Permits");
(h) subject to and in accordance with the Technology Transfer and
License Agreement attached hereto as Exhibit B (the "Technology
Agreement"), a nonexclusive, royalty-free license
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to use in the operation of the Business as it is currently operated by
Seller certain technology, software, know-how and proprietary information
owned by Seller, BP p.l.c. and/or its other direct or indirect
subsidiaries and its affiliates (together with Seller, the "BP Group"),
whether patented or unpatented, as more specifically described in the
Technology Agreement;
(i) subject to Section 10(c)(ii) and subject to and in accordance
with the Technology Agreement, Seller's assignable or transferable rights
under the process technology licenses with third parties listed on
Schedule 1(i) attached hereto, all as are necessary and used exclusively
for the operation of the Business as it is currently operated by Seller;
(j) subject to Section 2(e), all operating records and data in
possession of Seller or any other member of the BP Group and relating
exclusively to and necessary for the operation of the Business as it is
currently operated by Seller, including all books, records, cost and
pricing information, accounting records, supplier lists and records,
training materials and equipment, training records, maintenance and
inspection reports, equipment lists, repair notes and archives;
(k) subject to Section 10(c)(ii) and in accordance with the
Technology Agreement, all assignable or transferable technical drawings in
possession of Seller located at the Business and relating exclusively to
and necessary for the operation of the Business as it is currently
operated by Seller; and
(l) all other assignable or transferable assets, active or inactive,
owned or leased by, or licensed to or used by Seller and located at the
Business and used exclusively in the operation of the Business as it is
currently operated by Seller;
provided that the Purchased Assets shall not include the Excluded Assets.
At any time and from time to time prior to the Closing, Seller shall
have the right to update and supplement the description of the Purchased
Assets (including the Schedules and Exhibits referred to above) to reflect
changes, including additions and deletions, occurring in the ordinary
course of business prior to the Closing. For purposes of this Agreement,
the term "ordinary course of business" shall include all reasonably
necessary actions taken in connection with, in contemplation of or in
preparation for, the sale of the Business, the Closing and any other
transaction contemplated by this Agreement so long as such actions do not
have a material adverse effect on the Business, taken as a whole, as it is
currently operated by Seller or the Purchased Assets, taken as a whole.
2. EXCLUDED ASSETS. The Purchased Assets shall not include any assets
other than those specifically described in Section 1 above, and, without
limiting the generality of the foregoing, Seller (or, as applicable, other
members of the BP Group) shall retain and not sell, convey, transfer or deliver
to Buyer, and Buyer shall not purchase or have any rights in, the following
assets, each of which is specifically excluded from the Purchased Assets being
sold hereunder (collectively, the "Excluded Assets"):
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(a) cash and cash equivalents (including marketable securities and
short-term investments);
(b) accounts and notes receivable and exchange balances due from a
third party as of 12:01 a.m., Central Time, on the Closing Date, including
payments for all finished and unfinished products which have left the
Business and are en route to any customer (including members of the BP
Group) prior to the Closing Date where title has passed to the customer,
provided that all accounts receivable with respect to any Inventories
included or to be included in the Purchased Assets shall not be Excluded
Assets;
(c) assets owned by other members of the BP Group not used
exclusively by Seller in the operation of the Business or not located at
the Business, including employee and other records (including employee
personnel and medical records) necessary to administer salaried payrolls
and benefits and welfare plans retained by Seller or other members of the
BP Group and to file tax returns, assets related to certain support
services provided by the BP Group to the Business including those
described on Schedule 2(c) attached hereto and certain other specified
assets not located at the Business as described on Schedule 2(c) attached
hereto;
(d) tax refunds arising out of all taxes, charges, fees, imposts,
duties, levies, withholdings or other assessments imposed by any
governmental entity, including environmental taxes, excise taxes, customs,
duties, utility, property, income, sales, use, value added, transfer and
fuel taxes, and any interest, fines, penalties or additions to tax
attributable to or imposed on or with respect to any such assessment,
including all applicable income, sales, use, excise, business, occupation
or other tax, if any, relating in any way to this Agreement or any other
service, supply or operating agreement (collectively, "Taxes") relating to
the Purchased Assets accruing to or for any period, or portion thereof,
ending prior to or on the Closing Date;
(e) all forecasts, financial information or financial statements and
proprietary manuals (except rights to use manuals specific to and
necessary for the operation of the Business as it is currently operated by
Seller (as determined by Seller in its reasonable discretion)) prepared by
or used by Seller or another member of the BP Group to the extent not
relating exclusively to the Business and all copies of and subscriptions
to third-party reports;
(f) except as otherwise expressly provided in the Technology
Agreement, all proprietary BP Group computer systems and software;
(g) defenses and claims that Seller could assert against third
parties, other than claims which Seller could assert on account of matters
or acts as to which Buyer has agreed to assume liability or as to matters
to the extent Buyer is entitled to be indemnified by Seller pursuant to
this Agreement;
(h) any assets, property improvements, appurtenances, fixtures,
equipment or goods located at the Business which are not owned by Seller,
including spare parts on consignment, certain chemicals on consignment,
leased nitrogen units, transformers, wires, pipes and equipment
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owned by Virginia Electric and Power Company ("VEPCO"), city water mains
and other equipment, leased and rented mobile equipment, leased office
equipment, copiers, telephones and other leased items;
(i) to the extent not otherwise excluded, proprietary information,
intellectual property (including patents, inventions and trade secrets (in
each case, whether patentable or not) and copyrights) and technology of
Seller and other members of the BP Group not used exclusively in the
operation of the Business as it is currently operated by Seller or not
otherwise assignable by Seller;
(j) all service marks, trademarks, trade names, trade dress or other
indicia of origin of Seller and other members of the BP Group and variants
thereof, including the following: the words "Amoco" and "Standard," any
items that include the words "Amoco" or "Standard," the BP Group torch and
oval design, the letters "BP," any items that include the word "BP," the
phrase "BP Oil," the BP Group shield or the BP Group Helios logo and/or
variants thereof;
(k) all books, documents, records and files prepared in connection
with or relating in any way to the transactions contemplated by this
Agreement, including bids received from other parties and analyses
relating in any way to the Purchased Assets, the Assumed Liabilities and
the Refinery;
(l) all rights of Seller and other members of the BP Group under or
pursuant to this Agreement and the other agreements and transactions
contemplated hereby;
(m) any assets, properties and rights of Seller and/or other members
of the BP Group not used exclusively in the operation of the Business as
it is currently operated by Seller;
(n) employment records, including personnel records and medical
records, relating to employees of the Business, and subject to Section 11,
all rights of Seller and other members of the BP Group and any assets
under employee benefit plans or trusts;
(o) the assets, property and property improvements, appurtenances,
fixtures, equipment, goods and rights listed on Schedule 2(o) attached
hereto;
(p) the rights and obligations of Seller and other members of the BP
Group under any agreements, contracts, leases, licenses and similar
instruments that do not relate exclusively to the Refinery or are not
assignable by Seller, including those set forth on Schedule 2(p) attached
hereto;
(q) any rights under or amounts payable from present or former
insurance policies applicable to the Business; and
(r) all arrangements, contracts, agreements, understandings or
commitments, whether written or oral by and among members of the BP Group,
other than those listed on Schedule 2(r)
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attached hereto (it being understood that all such arrangements,
contracts, agreements, understandings or commitments will be terminated on
or prior to Closing).
To the extent that any Excluded Assets remain located at the Business or
any other owned or leased real property constituting part of the Purchased
Assets after the Closing Date, Buyer shall grant to Seller and other
members of the BP Group and their respective representatives reasonable
access to such property from and after the Closing Date for a reasonable
period of time not to exceed 180 days in order to permit Seller and such
persons to review and remove such Excluded Assets and make any other
appropriate arrangements with respect thereto. Seller agrees that it will
consult with Buyer in advance of taking any such actions following the
Closing Date with a view towards establishing a mutually agreeable plan
for such review and removal so that these actions will not unreasonably
interfere with the normal operation of the Business.
3. DEPOSIT AND PURCHASE PRICE.
(a) Deposit. On the date hereof, Buyer shall pay to Seller (or
Seller's designee) in immediately available funds, by wire transfer to an
account designated by Seller, a non-refundable deposit against the
Purchase Price of certain of the Purchased Assets (excluding the Real
Property) in the amount of Ten Million Dollars ($10,000,000.00) (the
"Deposit"). The Deposit shall be non-refundable in that it shall not be
returned to Buyer under any circumstances, unless this Agreement shall be
terminated by Buyer or by Seller, the Closing shall not have occurred and
a Deposit Return Event has occurred in which event Seller shall transfer
to Buyer, in immediately available funds by wire transfer to an account
designated by Buyer, a cash amount equal to the Deposit plus interest
thereon from the date on which the Deposit was received by Seller through
and including the date on which such payment is made at a rate of 4% per
annum. As used herein, the term "Deposit Return Event" means the
occurrence of any of the following:
(i) between the date hereof and the Closing Date, there shall
have occurred any damage, destruction or other casualty losses with
respect to the Purchased Assets that (A) cause the Purchased Assets
to become unusable or inoperable and not capable of repair for a
period of at least ninety (90) days or (B) individually or in the
aggregate, have an estimated cost (as determined by Seller in good
faith) to repair or replace of more than Fifty Million Dollars
($50,000,000.00), that has not been substantially repaired or
rectified by Seller by the later of the Closing Date or within
ninety (90) days after Seller becomes aware of the existence of such
matter (provided, for the avoidance of doubt, that if Seller elects
to repair or rectify any such damage, destruction or other casualty
losses, Seller shall bear the cost of any such repair or
replacement);
(ii) each of Buyer and Seller mutually agree that the closing
condition set forth in Sections 12(d) and 13(d) has become incapable
of fulfillment and each of Buyer and Seller have complied with the
obligations of Section 10(c)(i);
(iii) this Agreement is terminated pursuant to Section
18(a)(i);
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(iv) this Agreement is terminated by Buyer pursuant to Section
18(a)(ii) (other than pursuant to Section 12(d) which is covered
under Section 3(a)(ii) above); provided, however, that at the time
of such termination, Buyer is not in material breach of its
representations, warranties, covenants or agreements contained in
this Agreement;
(v) this Agreement is terminated by Seller pursuant to Section
18(a)(iv); provided, however, that at the time of such termination,
Buyer is not in material breach of its representations, warranties,
covenants or agreements contained in this Agreement;
(vi) this Agreement is terminated by Buyer pursuant to Section
18(a)(vi); provided, however, that at the time of such termination,
Buyer is not in material breach of its representations, warranties,
covenants or agreements contained in this Agreement; or
(vii) this Agreement is terminated as a result of a
consummation of the sale of the Refinery in accordance with the
exercise of rights under that certain Terminal Agreement, dated
February 28, 1986, among Amoco Oil Company, VEPCO and Waterview
Seafood Company (the "Terminal Agreement").
(b) Purchase Price. In consideration for the Purchased Assets, Buyer
shall pay, transfer and undertake to Seller as follows (collectively, the
"Purchase Price"):
(i) Buyer shall pay to Seller (or Seller's designee) in cash:
(A) a base price of One Hundred Twenty Seven Million
Five Hundred Thousand Dollars ($127,500,000.00),
representing the value of the Purchased Assets
(excluding the value of the Hydrocarbon
Inventories) as of the Closing Date (the "Base
Price"); plus
(B) an amount equal to the estimated market value of
the Hydrocarbon Inventories, as of the Closing
Date, as determined by Seller in accordance with
Exhibit A attached hereto;
(ii) Buyer shall pay to Seller (or Seller's designee) the
Margin Payments, as described in Section 3(e) below; and
(iii) Buyer shall assume and agree to pay and perform and
discharge when due the Assumed Liabilities.
For purposes of determining the market value of the Hydrocarbon
Inventories, all Hydrocarbon Inventories which are located in storage
tanks shall be valued as specified on Exhibit A based on the total
contents thereof, regardless of whether above or below the off-take pipe,
excluding only the bottom sediment and water (it being expressly
understood by the parties hereto,
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however, that such bottom sediment and water shall constitute part of the
Purchased Assets to be transferred to Buyer).
(c) Closing Date Payments. On the Closing Date, Buyer shall pay to
Seller (or Seller's designee), in immediately available funds by wire
transfer to an account designated by Seller, the total of (i) the amount
equal to the Base Price plus (ii) the amount specified by Section
3(b)(i)(B) above, minus (iii) an amount equal to the Deposit specified in
Section 3(a) above (which amount shall already have been paid by Buyer to
Seller upon the execution of this Agreement) plus interest thereon from
the date on which the deposit was received by Seller through and including
the Closing Date at a rate of 4% per annum.
(d) Post-Closing Adjustment. The Purchase Price shall be subject to
adjustment based on the final market value of the Hydrocarbon Inventories
as described in this Section 3(d). Within thirty (30) days following the
Closing Date, the final market value of the Hydrocarbon Inventories as of
the Closing Date shall be determined by Seller and Buyer in accordance
with procedures specified in Exhibit A. If the final market value of the
Hydrocarbon Inventories is greater than the estimated market value of the
Hydrocarbon Inventories referenced in Section 3(b) above, Buyer shall pay
to Seller an amount equal to such difference, and if the final market
value of the Hydrocarbon Inventories is less than such estimated market
value of the Inventories, Seller shall pay to Buyer an amount equal to
such difference. In either case, such payment shall include interest from
the Closing Date through and including the date the payment is made at a
rate of 4% per annum, and such payment shall be made in immediately
available funds within five (5) business days after the determination of
the final market value of the Hydrocarbon Inventories.
(e) Margin Payment. For the period commencing January 1, 2003
through and including December 31, 2005 (except as set forth otherwise
herein) (the "Margin Payment Period"), Buyer shall pay to Seller (or
Seller's designee) on a monthly basis in immediately available funds, by
wire transfer to an account designated by Seller, an amount (each such
amount, a "Margin Payment") equal to (I) the Gasoline Margin Payment for
such month, plus (II) the Heating Oil Margin Payment for such month, plus
(III) any portion of any previous Margin Payment (including any interest
accrued thereon) that remains unpaid; provided, however, that Buyer's
total Margin Payments under this Agreement shall not exceed Twenty Five
Million Dollars ($25,000,000) (excluding interest paid, if any, by Buyer
to Seller as a result of Buyer's failure to make payment when due on any
Margin Payment), and the Margin Payment Period shall expire upon Buyer's
payment of such amount. Buyer's obligation to pay each Margin Payment when
due shall not be conditioned upon or related in any way to the performance
of the Business or any other businesses of the Buyer, Buyer's operation
thereof, the condition of the Purchased Assets or Buyer's ownership of the
Purchased Assets.
(i) For purposes of this Section 3(e), the "Gasoline Margin
Payment" in any month shall equal an amount determined by
multiplying (x) 10,000 by (y) the amount by which the Actual
Gasoline Margin exceeds $5.500 per barrel by (z) the number of days
in the month. For purposes of this Section 3(e), the "Heating Oil
Margin Payment" in any given month shall equal an amount determined
by multiplying (x) 10,000 by (y) the
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amount by which the Actual Heating Oil Margin exceeds $4.000 per
barrel by (z) the number of days in the month.
(ii) For purposes of this Section 3(e), the "Actual Gasoline
Margin" shall be an amount equal to (a) the average amount per
barrel of the near month unleaded gasoline contract quoted on the
New York Mercantile Exchange for each day of the month on which such
contract is quoted, measured at settlement less (b) the average
amount per barrel of the near month light sweet crude oil contract
quoted on the New York Mercantile Exchange for each day of the month
on which such contract is quoted, measured at settlement. For
purposes of this Section 3(e), the "Actual Heating Oil Margin" shall
be an amount equal to (a) the average amount per barrel of the near
month heating oil contract quoted on the New York Mercantile
Exchange for each day of the month on which such contract is quoted,
measured at settlement, less (b) the average amount per barrel of
the near month light sweet crude oil contract quoted on the New York
Mercantile Exchange for each day of the month on which such contract
is quoted, measured at settlement.
(iii) Each Margin Payment shall be paid no later than the
fifth day on which banks located in New York, NY conduct business of
the month immediately succeeding the month for which such Margin
Payment is calculated (each such date, a "Due Date"). In the event
that Buyer fails to pay any Margin Payment by the corresponding Due
Date, such Margin Payment shall accrue interest at an annual rate
equal to the lower of (i) the rate appearing on page 3750 of the
Telerate Service (or on any successor or substitute page of such
service, or any successor to or substitute for such services,
providing rate quotations comparable to those currently provided on
such page of such service for purposes of providing quotations of
interest rates applicable to dollar deposits in the London interbank
market)("LIBOR") (calculated at the end of the day on the Due Date,
as adjusted at the end of each subsequent Due Date while any Margin
Payment and corresponding interest remains outstanding) plus five
percent (5%) or (ii) the highest interest rate allowable by law. All
amounts of any Margin Payment (including any interest accrued
thereon) that remain unpaid as of the Due Date of the immediately
succeeding month shall become part of the succeeding Margin Payment
in the manner set forth in Section 3(e) above.
(iv) Upon Buyer's failure to make three (3) successive Margin
Payments on or prior to the Due Date as provided in this Section
3(e), Buyer shall immediately pay to Seller (a) Twenty Five Million
Dollars ($25,000,000) less (b) the sum of all Margin Payments
previously made by Buyer under this Agreement (excluding interest
paid, if any, by Buyer to Seller, or outstanding, as a result of
Buyer's failure to make payment when due on any Margin Payment).
(v) Notwithstanding any of the provisions in this Section
3(e), at any time during the life of this Agreement Buyer may
discharge all of its obligations relating to such Margin Payments
and shall not be subject to any further requirement to make any
Margin Payments (other than the payment of interest, if any,
accruing as a result of a failure to
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make any Margin Payment as described in Section 3(e)(iii) above) and
the Margin Payment Period shall expire if (i) Buyer provides written
notice to Seller (or Seller's designee) of its intent to make a
payment under this Section 3(e)(v) at least ninety (90) days prior
to any such payment, and (ii) Buyer pays to Seller (or Seller's
designee) an amount in cash equal to (i) Twenty Five Million Dollars
($25,000,000) less (ii) the sum of all Margin Payments previously
made by Buyer under this Agreement (excluding interest paid, if any,
by Buyer to Seller, or outstanding, as a result of Buyer's failure
to make payment when due on any Margin Payment).
4. ASSUMPTION OF LIABILITIES.
(a) Assumed Liabilities. As of the Closing Date, Buyer shall,
without any further action on the part of Buyer or Seller, assume and
agree to pay, perform and discharge, and indemnify, defend and hold Seller
and the other members of the BP Group harmless from, each of the following
liabilities (collectively, the "Assumed Liabilities") (provided that the
Assumed Liabilities shall not include the Excluded Liabilities):
(i) all obligations, responsibilities, liabilities, costs and
expenses of whatever kind and nature, primary or secondary, direct
or indirect, absolute or contingent, whether based in common law or
statute or arising under written contract or otherwise, known or
unknown, liquidated or unliquidated, real or potential, tangible or
intangible, whether or not accrued, caused by, arising out of,
incurred in connection with or relating in any way to the ownership
of the Purchased Assets or the operation of the Business now
existing or arising at any time prior to, on or after the Closing
Date as heretofore, currently or hereafter conducted. Without
limiting the generality of the foregoing, the Assumed Liabilities
shall include all obligations, responsibilities, liabilities, costs
and expenses of Seller and/or any other member of the BP Group
caused by, arising out of, incurred in connection with or relating
in any way to any of the following, prior to, on or after the
Closing Date:
(A) the Business (including the Refinery, the Real
Property, the Inventories and the Personal
Property);
(B) all of the agreements, contracts, collective
bargaining agreements, leases, permits or similar
instruments, including easements, rights-of-way
and other rights of access, constituting part of
the Purchased Assets;
(C) the Permits;
(D) except with respect to Hydrocarbon Inventories,
all accounts payable and accrued liabilities
relating to goods and/or services provided to the
Business on or after the Closing Date;
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(E) the Transferred Employees to the extent provided
in Section 11; and
(F) all actions, grievances, arbitrations, suits,
liabilities, obligations, proceedings and
investigations of, relating to or arising out of
the Business or operations of the Business or any
of the Purchased Assets, including those asserted
under, relating to, arising out of or incurred in
connection with Health, Safety and Environmental
Laws; and
(ii) subject to any rights to indemnification Buyer may have
pursuant to Section 15, all obligations, responsibilities,
liabilities, costs and expenses caused by, arising from, incurred in
connection with or relating in any way to the ownership of the
Purchased Assets or the operation of the Business under, relating to
or otherwise required or incurred to achieve or maintain compliance
with Health, Safety and Environmental Laws, as the same are in
effect from time to time, irrespective of whether the events or
conditions giving rise to such liabilities occurred prior to, on or
after the Closing Date, including (A) any and all obligations,
responsibilities, liabilities, costs and expenses caused by, arising
from, incurred in connection with or relating in any way to the
existence of asbestos and lead-based paint at, on or within the
Business or the Purchased Assets, including any incidental
contamination resulting therefrom (collectively, the
"Asbestos-Related Liabilities"), (B) any and all obligations,
responsibilities, liabilities, compliance costs and expenses
(whether presently realized or projected) caused by, arising from,
incurred in connection with or otherwise relating in any way to the
matters disclosed in that certain URS report dated March 23, 2001, a
copy of which previously has been provided to Buyer, the
Confidential Information Memorandum or in any of the health, safety
and environmental records or reports of the Business previously
provided to Buyer (collectively, the "Disclosed Environmental
Liabilities"), (C) any and all obligations, responsibilities,
liabilities, compliance costs and expenses relating to governmental
requirements including mandated clean-up, and (D) any and all
obligations, responsibilities, liabilities, compliance costs and
expenses incurred in connection with, arising as a result of or
otherwise required to comply with those terms and conditions of the
Project Sunshine Consent Decree. As used in this Agreement, "Project
Sunshine Consent Decree" means that certain consent decree among the
United States of America (including certain intervening state and
local governments), BP Exploration and Oil Co., Amoco Oil Company
and Atlantic Richfield Company, in Civil No. 2:96CV095 RL (N.D. IN),
as the same may be amended, supplemented or revised from time to
time.
As used in this Agreement, "Health, Safety and Environmental
Laws" means any and all past, present or future local, state, and
federal laws, principles of common law, statutes, ordinances,
regulations, rules, orders, permits, standards or requirements
(including consent decrees, judicial decisions, judgments,
injunctions and administrative orders issued or approved
thereunder), together with all related amendments and implementing
regulations and all common law, pertaining to or regulating
pollution,
-11-
environmental protection, health and safety of persons, pipeline
safety, natural resource damages, conservation of resources,
wildlife, waste management, the use, storage, generation,
production, treatment, emission, discharge, remediation, removal,
disposal or transport or any other activity related to a toxic or
hazardous substance, waste or material (including crude petroleum
and its fractions or derivatives thereof), or any other
environmental matter, including: the Comprehensive Environmental
Response, Compensation and Liability Act ("CERCLA"), 42 U.S.C.
Section 9601 et. seq.; the Resource Conservation and Recovery Act,
as amended, 42 U.S.C. Section 6901 et. seq.; the Toxic Substances
Control Act, as amended, 15 U.S.C. Section 2601 et. seq.; the Clean
Air Act, as amended, 42 U.S.C. Section 7401 et. seq.; the Federal
Water Pollution Control Act, as amended, 33 U.S.C. Section 1251 et.
seq.; the Safe Drinking Water Act of 1974, as amended, 42 U.S.C.
Section 3009(f) et. seq.; the Emergency Planning and Community
Right-to-Know Act of 1986, 42 U.S.C. Section 11001 et. seq.; the
Occupational Safety and Health Act of 1970, as amended, 29 U.S.C.
Section 651 et. seq.; and the Hazardous Liquid Pipeline Safety Act,
as amended, 49 U.S.C. Section 60101 et. seq.
Buyer's obligations under this Section 4(a) shall not be
subject to offset or reduction by reason of any actual or alleged breach
by Seller of any representation, warranty or covenant contained in this
Agreement or any agreement or document delivered in connection herewith or
any right or alleged right to indemnification hereunder.
(b) Excluded Liabilities. The liabilities and obligations of Seller
and other members of the BP Group transferred to Buyer shall not include
the following (collectively, the "Excluded Liabilities"):
(i) any liability or obligation for Taxes (including
deficiencies, interest and penalties relating thereto) accruing to
or for any period ending on or prior to the Closing Date, except to
the extent provided otherwise in Section 16;
(ii) any liability or obligation for any expenses incurred in
connection with the transactions contemplated by this Agreement;
(iii) any brokerage or finder's fees payable by Seller or any
other member of the BP Group in connection with the transactions
contemplated by this Agreement;
(iv) any liability or obligation accruing prior to the Closing
Date for real property taxes and charges as prorated in accordance
with Section 16(b);
(v) any liability or obligation with respect to any accounts
payable and exchange balances owed to a third party, in each case,
determined in accordance with generally accepted accounting
principles as in effect in the United States at the Closing Date
(notwithstanding anything to the contrary contained in this
Agreement, all accounts payable with respect to any Inventories
shall be Excluded Liabilities);
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(vi) any liability or obligation in respect of indebtedness
for borrowed money, including the Environmental Control Bonds;
(vii) except as otherwise provided in this Agreement, any
liabilities or obligations relating to litigation commenced or
threatened as of the Closing Date against Seller or any other member
of the BP Group to the extent attributable solely to periods ending
prior to the Closing Date, including those set forth on Schedule
6(k) attached hereto; provided, that Buyer shall provide Seller with
reasonable access to (and permission to take copies of) all records
and reasonable access to all relevant personnel of the Business in
connection with the defense of any such claims in accordance with
the provisions of Section 17 hereof;
(viii) to the extent attributable solely to periods ending
prior to the Closing Date, all liabilities or obligations with
respect to third party personal injury or wrongful death claims,
including those arising under Health, Safety and Environmental Laws,
relating to the pre-Closing operation of the Business; provided that
(i) this clause shall not be deemed to include any liability or
obligation for property damage and (ii) Buyer shall provide Seller
with reasonable access to (and permission to take copies of) all
records and reasonable access to all relevant personnel of the
Business in connection with the defense of any such claims in
accordance with the provisions of Section 17 hereof;
(ix) all liabilities or obligations relating to any violations
by Seller or other members of the BP Group of antitrust laws prior
to the Closing Date;
(x) all liabilities or obligations arising under Health,
Safety and Environmental Laws with respect to the disposal prior to
the Closing Date by Seller or any member of the BP Group (or by a
third-party at the express direction of Seller of any member of the
BP Group) at any location other than the Purchased Assets of
hazardous materials generated as a result of or in connection with
the operation of the Business (the "Offsite Environmental
Liabilities");
(xi) any responsibility for the payment of any criminal
sanctions or civil fines or penalties imposed by a regulatory agency
of any federal, state or local government against Seller or other
members of the BP Group imposed at any time arising from the
operation of the Purchased Assets prior to the Closing Date;
provided that Buyer shall provide Seller with reasonable access to
(and permission to take copies of) all records and reasonable access
to all relevant personnel of the Business in connection with the
defense of any such claims in accordance with Section 17 hereof; and
(xii) any liability or obligation related to an Excluded
Asset.
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5. CLOSING.
(a) Subject to the parties' satisfaction or waiver of the conditions
precedent set forth in Sections 12 and 13, the closing and consummation of
the transactions contemplated by this Agreement (the "Closing") shall take
place at 10:00 a.m., Central Time, at the offices of Xxxxxxxx & Xxxxx at
000 Xxxx Xxxxxxxx Xxxxx, Xxxxxxx, Xxxxxxxx, on a business day which is not
later than the later of (i) five (5) business days after the expiration of
the waiting period, or any extension thereof (without challenge), provided
for in the Xxxx-Xxxxx-Xxxxxx Antitrust Improvement Act of 1976, as amended
(the "H-S-R Act"), if a filing is required, or (ii) any later date on or
prior to May 31, 2002 as the parties may otherwise agree. The date of the
Closing is referred to herein as the "Closing Date."
(b) On the Closing Date, Seller shall deliver to Buyer the
following:
(i) duly-executed limited or special warranty deeds for the
Real Property, substantially in the form of Exhibit C attached
hereto, conveying fee simple title to such Real Property subject to
the Permitted Liens;
(ii) appropriately executed instruments of sale, assignment,
transfer and conveyance evidencing and effecting the sale and
transfer to Buyer of the Purchased Assets (it being expressly
understood by the parties hereto, however, that such instruments
shall not require Seller or any other Person to make any additional
representations, warranties or covenants, express or implied, not
contained in this Agreement);
(iii) a certified copy of the resolution(s) adopted by the
Board of Directors of Seller authorizing the transactions
contemplated by this Agreement and authorizing specified individuals
to act on behalf of Seller in connection therewith;
(iv) an incumbency certificate, duly executed by an authorized
officer of Seller attesting to the due appointment and authorization
of individuals signing this Agreement on behalf of Seller, any
agreement contemplated hereby or any agreement related to the
transactions contemplated hereby;
(v) a current certificate of BP's good standing in Indiana and
BP Products' good standing in Maryland and BP's and BP Products'
qualification to do business and good standing in Virginia; and
(vi) the affidavit referred to in Section 1445(b)(2) of the
Internal Revenue Code of 1986, as amended, (the "Code") in customary
form.
(c) On the Closing Date, Buyer shall deliver to Seller the
following:
(i) the payments specified in Section 3(c) hereof;
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(ii) instruments of assumption evidencing and effecting the
assumption by Buyer of the Assumed Liabilities and such other
documents as are required by this Agreement;
(iii) a certified copy of the resolutions adopted by the
Boards of Directors of Buyer, authorizing the transactions
contemplated by this Agreement and authorizing specified individuals
to act on behalf of Buyer herewith;
(iv) an incumbency certificate, duly executed by authorized
officers of Buyer attesting to the due appointment and authorization
of individuals signing this Agreement on behalf of Buyer, any
agreement contemplated hereby or any agreement related to the
transactions contemplated hereby;
(v) current certificates of Buyer's good standing in the state
of its incorporation and the Buyer's qualification to do business
and good standing in Virginia;
(vi) a modification to the Project Sunshine Consent Decree, in
a form satisfactory to Seller and the United States of America and
substantially similar to Exhibit F attached hereto, duly executed by
an authorized officer of Buyer (provided that such modification
shall be for the purpose of making Buyer a party thereto and shall
not result in any substantive changes in the obligations that Buyer
is assuming as compared to the obligations contained in the Project
Sunshine Consent Decree relating to the Purchased Assets as of the
Closing Date);
(vii) evidence, in a form satisfactory to Seller, of Buyer's
acceptance of the CBA (as defined in Section 11(k)); and
(viii) the Novation Agreement substantially in the form of
Exhibit E.
(d) On the Closing Date, Buyer and Seller shall each deliver duly
executed counterparts by the appropriate parties of the following:
(i) the Technology Agreement substantially in the form of
Exhibit B;
(ii) subject to Section 10(c)(iii), the Transition Services
Agreement substantially in the form of Exhibit D attached hereto;
(iii) the Natural Gas Liquids Supply Agreement substantially
in the form of Exhibit G-1;
(iv) the Natural Gas Liquids Sales Agreement substantially in
the form of Exhibit G-2;
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(v) the Petroleum Coke Marketing Services Agreement
substantially in the form of Exhibit G-3;
(vi) the Term Petroleum Intermediates and Blendstocks
Agreement substantially in the form of Exhibit G-4;
(vii) the Term Petroleum Crude Oil Agreement substantially in
the form of Exhibit G-5;
(viii) the Term Petroleum Intermediates and Blackoils
Agreement substantially in the form of Exhibit G-6;
(ix) the Term Petroleum Product Agreement substantially in the
form of Exhibit G-7;
(x) the Product Purchase Agreement substantially in the form
of Exhibit G-8; and
(xi) the Railcar Lease Agreement substantially in the form of
Exhibit H.
(e) All of the transactions identified in this Section 5 shall occur
simultaneously, and none shall be deemed completed until all are
completed. Unless otherwise expressly provided for herein, all transfers
of assets and liabilities, as well as all other actions related to the
Closing, shall be deemed to have occurred at 12:01 a.m., Central Time, on
the Closing Date.
6. SELLER'S REPRESENTATIONS AND WARRANTIES. Subject to the exceptions,
disclaimers and other matters set forth in this Section 6 and in Section 8
below, the matters set forth on the Schedules to this Agreement and any other
written disclosures made to Buyer at any time prior to the Closing Date, Seller
hereby represents and warrants to Buyer as of the date of this Agreement and as
of the Closing Date (except with respect to those representations and warranties
that speak as to a particular date or time, which need only be true and correct
as of such date or time) as set forth below. For purposes of this Agreement,
"knowledge," when used in the phrase "Seller's knowledge" in this Agreement
means, and shall be limited to, the actual knowledge (without independent
investigation) of the manager of the Refinery and the individuals acting as his
or her direct reports as of the date of this Agreement. Buyer understands that
none of such individuals is making any representations or warranties to Buyer
and that such individuals shall have no liability to Buyer in connection with
the matters covered in this Section 6.
(a) Organization and Good Standing. BP is a corporation duly
organized, validly existing and in good standing under the laws of the
State of Indiana. BP Products is a corporation duly organized, validly
existing and in good standing under the laws of the State of Maryland.
(b) Authority. Seller has the corporate power and authority to enter
into this Agreement and the transactions contemplated hereby and to carry
out its obligations hereunder. The execution, delivery and performance of
this Agreement and the transactions contemplated hereby have been duly
authorized and this Agreement has been duly executed and delivered by
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Seller and constitutes a valid and binding agreement of Seller enforceable
against Seller in accordance with its terms, except as such enforceability
is limited by general principles of equity and applicable provisions of
bankruptcy, insolvency, moratorium, reorganization or similar laws.
(c) Consents. Other than with respect to (i) the H-S-R Act, (ii)
obtaining the consents or waivers required in connection with certain
agreements, contracts, licenses, leases, easements, rights-of-way and
permits and (iii) Buyer's execution of a modification to the Project
Sunshine Consent Decree and the filing thereof with the U.S. District
Court upon Closing, in accordance with the terms and conditions of
paragraph six of the Project Sunshine Consent Decree, no consent, approval
of or by, or filing with or notice to any other individual, corporation,
partnership, association, trust, limited liability company or any other
entity or organization, including a government or political subdivision or
agency, unit or instrumentality thereof (a "Person") is required with
respect to Seller in connection with the execution, delivery or
enforceability of this Agreement or the consummation of the transactions
provided for hereby, except where the failure to obtain such consent or
approval, make such filing or give such notice would not have a material
adverse effect on the Business, taken as a whole, as it is currently
operated by Seller.
(d) No Breach. Subject to obtaining the consents and waivers
required in connection with certain agreements, contracts, licenses,
leases, easements, rights-of-way and permits and except for such matters
as would not have a material adverse effect on the Business, taken as a
whole, as it is currently operated by Seller, the execution and delivery
of this Agreement and the consummation of the transactions contemplated
hereby and the compliance by Seller with any of the provisions hereof does
not and will not (i) violate or conflict with, or result in a breach of,
any provisions of, or constitute a default (or an event which, with notice
or lapse of time or both, would constitute a default) under, or result in
termination of, or accelerate the performance required by, or result in
the creation of any lien or other encumbrance upon the Purchased Assets
under any of the terms, conditions or provisions of the Certificate of
Incorporation or By-Laws of Seller or under any material agreement,
instrument or obligation to which Seller is a party, or by which the
Purchased Assets are otherwise bound, or (ii) violate any order,
injunction, judgment, decree or award, federal, state, local or foreign
law, ordinance, statute, rule or regulation to which Seller is subject, or
by which Seller or its assets or properties may be bound.
(e) Real Property.
(i) Title to the Real Property is owned in fee by Seller and,
when transferred to Buyer, shall be good and marketable, free and
clear of all liens and encumbrances, except for: (A) such items as
are set forth on Schedule 6(e)(i) attached hereto or the other
Schedules attached hereto; (B) mechanics', carriers', workmen's,
repairmen's or other like liens arising or incurred in the ordinary
course of business, liens arising under original purchase price
conditional sales contracts and equipments leases with third parties
entered into in the ordinary course of business, liens for taxes and
other governmental charges which are not due and payable or which
may thereafter be paid without penalty or which are being contested
in good faith and liens relating to environmental or safety
conditions; (C) other imperfections of title, restrictions or
encumbrances, if any, which imperfections
-17-
of title, restrictions or encumbrances do not, individually or in
the aggregate, materially adversely impair the continued use and
operation of the assets to which they relate in the operation of the
Business as currently conducted by Seller; (D) easements, covenants,
conditions, rights-of-way, minor title exceptions and other similar
restrictions; (E) any conditions that would be shown on an accurate
survey or upon a personal inspection of the Real Property; (F)
existing leases, licenses and similar agreements; (G) zoning,
building, fire, health, environmental and pollution control laws,
ordinances, rules and safety regulations and other similar
restrictions; (H) the rights of the owners of outstanding oil, gas
and mineral interests and/or their lessees, to explore for, drill,
produce and develop said oil, gas and minerals owned by them in, on
and under said lands, together with the right to use as much of the
surface of said lands as is reasonably necessary to exercise their
rights to explore for and extract said oil, gas and minerals from
said lands; (I) the exposure restrictions contained in the deeds
attached hereto as Exhibit C; and (J) acts done or suffered to be
done by, and judgments against, Buyer and those claiming by, through
or under Buyer (collectively, (A) through (J) are referred to herein
as the "Permitted Liens").
(ii) Subject to the Disclosed Environmental Liabilities, to
Seller's knowledge, all water, sewer, gas, steam, electric,
telephone and drainage facilities and all other utilities necessary
for the operation of the Real Property as it is currently operated
by Seller are adequately available to service the Real Property.
(iii) To Seller's knowledge, the Real Property has access to a
public street adjoining the Real Property, and such access is not
dependent on any land or other real property interest which is not
included in the Real Property.
(iv) There are no Permitted Liens that would have a material
adverse effect on the Business, taken as a whole, as it is currently
operated by Seller.
(f) Brokers. Seller has not retained any broker or finder or
incurred any liability or obligation for any brokerage fees, commissions,
finder's fees or similar compensation with respect to this Agreement or
the transactions contemplated hereby, except pursuant to an agreement with
Rothschild Inc., for which Seller or another member of the BP Group will
be solely responsible.
(g) Machinery and Equipment. Other than with respect to items leased
from third parties, Seller has, and as of the Closing Buyer will have,
valid title to all major items of machinery and equipment included in the
Purchased Assets free and clear of all liens and encumbrances, except for
Permitted Liens.
(h) Compliance With Laws. To Seller's knowledge, other than with
respect to Health, Safety and Environmental Laws (which are addressed in
Section 7), the Purchased Assets are in compliance in all material
respects with all laws, governmental regulations, orders and decrees, as
they are currently enforced with respect to the operation of the Business
by Seller, except for violations, non-compliance or other matters, if any,
which would not have a material adverse effect on the operation of the
Business, taken as a whole, as it is currently operated by Seller.
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(i) Permits. Seller possesses all Permits, licenses and governmental
approvals necessary for the operation of the Business, taken as a whole,
as it is currently operated by Seller, except (i) for Environmental
Permits (which are addressed in Section 7) and (ii) for such Permits,
licenses and other governmental approvals the failure to possess would
not, individually or in the aggregate, have a material adverse effect on
the Business, taken as a whole, as it is currently operated by Seller.
(j) Intellectual Property.
(i) BP Group-Owned Process Technology. Seller or another
member of the BP Group has the right to use, and to license to Buyer
pursuant to the Technology Agreement, the material BP Group-owned
process technology that is used in and necessary for the operation
of the Business as it is currently operated by Seller, except for
any technology which would not have a material adverse effect on the
operation of the Business, taken as a whole, as it is currently
operated by Seller.
(ii) Non-BP Group-Owned Process Technology. Schedule 1(i)
attached hereto contains a true, correct and complete list of all
material process technology (which does not include software and
related intellectual property matters) not owned by the BP Group
that is used in and necessary for the operation of the Business as
it is currently operated by Seller. To Seller's knowledge, Seller
has not received any notices of, and is not aware of any facts that
indicate a likelihood of, any infringement by Seller of any of such
non-BP Group-owned process technology rights due to the operation of
the Business as it is currently operated by Seller.
(k) Actions and Proceedings. Except for such matters as would not
have a material adverse effect on the operation of the Business, taken as
a whole, as it is currently operated by Seller, and except as set forth on
the Schedules attached hereto:
(i) there is no action, suit, arbitration proceeding or claim
pending, or to Seller's knowledge, threatened against Seller and/or
any other member of the BP Group involving or affecting the
Purchased Assets, and, other than Permitted Liens, except as set
forth in Section 7, there are no decrees, injunctions, liens, orders
or judgments of or with any court or governmental department or
agency outstanding against Seller and/or any other member of the BP
Group relating to or affecting the Purchased Assets;
(ii) no action, suit, arbitration or regulatory proceeding is
pending, or to Seller's knowledge, threatened seeking to restrain or
prohibit this Agreement or any agreement, instrument or transaction
contemplated hereby, or to obtain damages, a discovery order or
other relief in connection with this Agreement or the transactions
contemplated hereby; and
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(iii) there is no pending, or to Seller's knowledge,
threatened condemnation or other governmental taking of any of the
Real Property included in the Purchased Assets.
(l) Collective Bargaining Agreements. Schedule 6(l) attached hereto
sets forth each collective bargaining agreement, contract extension
agreement, memorandum of agreement and letter of understanding by or to
which any of the Union Employees (as defined in Section 11(a)) is covered
or subject.
(m) Assets. Except for (i) assets disposed of in the ordinary course
of business, (ii) Excluded Assets, permits, licenses and other property
rights, and (iii) assets set forth on Schedule 6(m), the Purchased Assets
and the assets, properties and rights provided to Buyer pursuant to this
Agreement and the other agreements contemplated hereby, include all
material assets, other than the intellectual property assets and leases
and licenses and other contracts that are not transferable, which are
reasonably required to operate the Business immediately following the
Closing Date substantially in the manner in which the Business is
currently conducted by Seller, except for such assets the failure of which
to include would not individually or in the aggregate, have a material
adverse effect on the Business, taken as a whole, as it is currently
operated by Seller.
(n) Tangible Assets. The Purchased Assets are free from material
defects, have been maintained substantially in accordance with normal
industry practice, and are in substantially good operating condition and
repair for their age (taking account of their nature, normal wear and tear
and continued repair and replacement in accordance with Seller's past
practice).
7. ENVIRONMENTAL MATTERS.
(a) Environmental Representations and Warranties. Subject to the
exceptions, disclaimers and other matters set forth in Section 6 above and
Section 8 below, the matters set forth on the Schedules attached hereto,
the Disclosed Environmental Liabilities and any other written disclosures
made to Buyer at any time prior to the Closing Date, to Seller's
knowledge, as of the date hereof and as of the Closing Date:
(i) all Environmental Permits necessary for the operation of
the Business as it is currently operated by Seller have been
obtained and are in effect and, where applicable, applications for
renewal thereof have been timely filed, except where the failure to
obtain such Environmental Permits or have them in effect or file for
such renewals would not, individually or in the aggregate, have a
material adverse effect on the Business, taken as a whole, as it is
currently operated by Seller;
(ii) all environmental control equipment necessary for the
operation of the Business as it is currently operated by Seller is
in substantial compliance with Health, Safety and Environmental
Laws, as they are currently enforced with respect to the operation
of the Business by Seller, is installed at the Business, and such
equipment is operating in a manner sufficient to achieve and
maintain such compliance under normal operating conditions, except
where the failure to be in such compliance would not have a
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material adverse effect on the Business, taken as a whole, as it is
currently operated by Seller; and
(iii) there are no existing or known violations of Health,
Safety and Environmental Laws, as they are currently enforced with
respect to the operation of the Business by Seller, which,
individually or in the aggregate, would have a material adverse
effect on the Business, taken as a whole, as it is currently
operated by Seller.
(b) Limitation. The representations and warranties set forth in this
Section 7 represent the sole and exclusive representations and warranties
of Seller with respect to health, safety or environmental matters,
including any matters arising under or relating to Health, Safety and
Environmental Laws.
8. DISCLAIMERS. EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT
AND THE INSTRUMENTS, DOCUMENTS AND AGREEMENTS REFERRED TO HEREIN OR EXECUTED IN
CONNECTION WITH THE TRANSACTIONS CONTEMPLATED HEREBY:
(a) NEITHER SELLER NOR ANY OTHER MEMBER OF THE BP GROUP MAKES ANY
REPRESENTATIONS OR WARRANTIES OF ANY KIND OR NATURE, EXPRESS OR IMPLIED,
AT LAW OR IN EQUITY, WITH RESPECT TO ITSELF, THE BUSINESS, THE REFINERY,
THE PURCHASED ASSETS, THE ASSUMED LIABILITIES OR ANY PORTION THEREOF, AND
SELLER AND THE OTHER MEMBERS OF THE BP GROUP EXPRESSLY DISCLAIM ANY
IMPLIED WARRANTIES, INCLUDING ANY IMPLIED WARRANTIES OF MERCHANTABILITY OR
FITNESS FOR A PARTICULAR PURPOSE OR ORDINARY PURPOSE OR ANY REPRESENTATION
OR WARRANTY AS TO VALUE;
(b) THE PURCHASED ASSETS, INCLUDING THE BUSINESS AND ANY OTHER
ASSETS TRANSFERRED TO BUYER PURSUANT TO THE TERMS AND CONDITIONS OF THIS
AGREEMENT ARE BEING TRANSFERRED "AS IS, WHERE IS"AND "WITH ALL FAULTS" AND
BUYER SHALL RELY UPON ITS OWN EXAMINATION THEREOF;
(c) NEITHER SELLER NOR ANY OTHER MEMBER OF THE BP GROUP MAKES ANY
REPRESENTATIONS OR WARRANTIES WITH RESPECT TO THE CONDITION OF THE
BUSINESS, INCLUDING ANY OF THE PURCHASED ASSETS, THE MERCHANTABILITY OF
THE BUSINESS, INCLUDING THE PURCHASED ASSETS, THE FITNESS OF ANY ASSETS
FOR ANY PURPOSE OR THE ASSIGNABILITY, COMPLETENESS OR CONTIGUITY OF
PIPELINE RIGHTS OF WAY, PERMITS, LICENSES AND OTHER PROPERTY RIGHTS, AND
SELLER AND THE OTHER MEMBERS OF THE BP GROUP EXPRESSLY DISCLAIM ANY
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AND ALL SUCH REPRESENTATIONS AND WARRANTIES OF ANY KIND OR NATURE;
(d) BUYER EXPRESSLY ACKNOWLEDGES THAT NONE OF SELLER, ANY OTHER
MEMBER OF THE BP GROUP OR ANY OTHER PERSON HAS MADE ANY REPRESENTATION OR
WARRANTY, EXPRESS OR IMPLIED, AT LAW OR IN EQUITY, AS TO THE ACCURACY OR
COMPLETENESS OF ANY INFORMATION REGARDING THE BUSINESS, THE PURCHASED
ASSETS OR THE ASSUMED LIABILITIES, EXCEPT AS EXPRESSLY SET FORTH IN THIS
AGREEMENT OR THE SCHEDULES HERETO, AND BUYER FURTHER AGREES THAT NONE OF
SELLER, ANY OTHER MEMBER OF THE BP GROUP OR ANY OTHER PERSON SHALL HAVE OR
BE SUBJECT TO ANY LIABILITY TO BUYER OR ANY OTHER PERSON RESULTING FROM
THE DISTRIBUTION TO BUYER, OR BUYER'S USE OF, ANY SUCH INFORMATION,
INCLUDING THE CONFIDENTIAL INFORMATION MEMORANDUM, DATED AS OF FEBRUARY
2001 (THE "OFFERING MEMORANDUM"), AND ANY INFORMATION, DOCUMENT OR
MATERIAL MADE AVAILABLE TO BUYER IN CERTAIN "DATA ROOMS," MANAGEMENT
PRESENTATIONS OR ANY OTHER FORM IN EXPECTATION OF THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT; AND
(e) BUYER EXPRESSLY ACKNOWLEDGES THE DISCLAIMERS OF SELLER AND THE
OTHER MEMBERS OF THE BP GROUP, INCLUDING (I) THOSE SET FORTH IN SECTIONS
8(a), 8(b), 8(c) AND 8(d) ABOVE AND (II) THAT THERE ARE UNCERTAINTIES
INHERENT IN ANY ESTIMATES, PROJECTIONS AND OTHER FORECASTS AND PLANS
PROVIDED BY SELLER AND OTHER MEMBERS OF THE BP GROUP TO BUYER, INCLUDING
ANY SUCH INFORMATION CONTAINED IN THE OFFERING MEMORANDUM, THAT BUYER IS
AWARE OF AND FAMILIAR WITH SUCH UNCERTAINTIES AND THAT BUYER TAKES FULL
RESPONSIBILITY FOR MAKING ITS OWN EVALUATION OF THE ADEQUACY AND ACCURACY
OF ANY SUCH ESTIMATES, PROJECTIONS AND OTHER FORECASTS AND PLANS
(INCLUDING THE REASONABLENESS OF THE ASSUMPTIONS UNDERLYING SUCH
ESTIMATES, PROJECTIONS AND FORECASTS) IN CONNECTION WITH THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT. ACCORDINGLY, NEITHER SELLER NOR ANY OTHER
MEMBER OF THE BP GROUP MAKES ANY REPRESENTATIONS OR WARRANTIES WITH
RESPECT TO SUCH ESTIMATES, PROJECTIONS AND OTHER FORECASTS AND PLANS
(INCLUDING THE REASONABLENESS OF THE ASSUMPTIONS UNDERLYING SUCH
ESTIMATES, PROJECTIONS AND FORECASTS). BUYER ACKNOWLEDGES THAT IT HAS HAD
SUFFICIENT OPPORTUNITY TO MAKE WHATEVER INVESTIGATION IT HAS DEEMED
NECESSARY AND ADVISABLE FOR PURPOSES OF DETERMINING WHETHER OR NOT TO
ENTER INTO THIS AGREEMENT.
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9. BUYER'S REPRESENTATIONS AND WARRANTIES. Buyer hereby represents and
warrants to Seller as of the date of this Agreement and as of the Closing Date
(except with respect to those representations and warranties that speak as to a
particular date or time, which need only be true and correct as of such date or
time) as set forth below:
(a) Organization and Good Standing. Buyer is a corporation duly
organized, validly existing and in good standing under the laws of the
State of Delaware.
(b) Authority. Buyer has the corporate power and authority to enter
into this Agreement and the transactions contemplated hereby and to carry
out its obligations hereunder. The execution, delivery and performance of
this Agreement and the transactions contemplated hereby have been duly
authorized and executed by Buyer, and this Agreement constitutes a valid
and binding agreement of Buyer enforceable against Buyer, in accordance
with its terms, except as such enforceability is limited by general
principles of equity and applicable provisions of bankruptcy, insolvency,
moratorium, reorganization or similar laws.
(c) Consents. Other than with respect to the H-S-R Act, no consent,
approval of or by, or filing with or notice to any other Persons is
required with respect to Buyer in connection with the execution, delivery
or enforceability of this Agreement or the consummation of the
transactions provided for hereby.
(d) No Breach. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby and the compliance by
Buyer with any of the provisions hereof does not and will not: (i) violate
or conflict with, or result in a breach of, any provisions of, or
constitute a default (or an event which, with notice or lapse of time or
both, would constitute a default) under, or result in termination of, or
accelerate the performance required by any of the terms, conditions or
provisions of the Certificate of Incorporation or By-Laws or other
organizational documents of Buyer or under any material agreement,
instrument or obligation to which Buyer is a party or (ii) violate any
order, injunction, judgment, decree or award, federal, state, local or
foreign law, ordinance, statute, rule or regulation to which Buyer is
subject, or by which Buyer or its assets or properties may be bound.
(e) Litigation. No action, suit, arbitration or regulatory
proceeding is pending or, to Buyer's knowledge, threatened seeking to
restrain or prohibit this Agreement, or any agreement, instrument or
transaction contemplated hereby, or to obtain damages, a discovery order
or other relief in connection with this Agreement or the transactions
contemplated hereby.
(f) Brokers. Buyer has not retained any broker or finder or incurred
any liability or obligation for any brokerage fees, commissions, finders'
fees or similar compensation with respect to this Agreement or the
transactions contemplated hereby, except pursuant to an arrangement with
Bank of America, N.A. and its affiliates for which Buyer is solely
responsible.
(g) Availability of Funds. At Closing, Buyer will have cash, or cash
equivalents, available to enable it to consummate the transactions
contemplated by this Agreement, to operate
-23-
the Business for the reasonably foreseeable future and to meet the
Business's financial obligations as such are presently known or reasonably
anticipated.
(h) No Knowledge of Misrepresentations or Omissions. Buyer has no
knowledge that any representation or warranty of Seller in this Agreement
or any agreement contemplated hereby is not true and correct in all
material respects, and Buyer has no knowledge of any material errors in,
or material omissions from, the Schedules to this Agreement or the
schedules, exhibits or attachments to any agreement contemplated hereby.
10. COVENANTS.
(a) Covenants of Seller. Seller covenants and agrees as follows:
(i) Access and Information. Subject to the provisions of the
letter agreement between Buyer and Seller with respect to
confidentiality dated on or about December 18, 2000 (the
"Confidentiality Agreement") and upon reasonable notice, Seller
shall grant, or cause to be granted to, Buyer access during normal
business hours throughout the period between the date of this
Agreement and the Closing Date to the Business and the books and
records and other information relating to the operations of the
Business. During this period, Seller shall use all commercially
reasonable efforts to furnish, or cause to be furnished to, Buyer
and its representatives all data and information concerning the
Business (the "Data") and concerning operations of the Business
which may reasonably be requested by Buyer and shall use all
commercially reasonable efforts to make available, or cause to be
made available, such personnel of Seller as may reasonably be
requested for the furnishing of such Data. During this period, Buyer
shall not contact or communicate with any employees, customers,
suppliers or distributors of the Business without Seller's prior
written consent. Buyer shall indemnify and hold Seller and its
affiliates harmless against any and all Losses suffered in
connection with the exercise of Buyer's rights under this Section
10(a)(i). Notwithstanding any provision in this Agreement to the
contrary, Buyer's obligations under this Section 10(a)(i) shall
survive the termination of this Agreement and the consummation of
the transactions contemplated hereby.
(ii) Conduct of Business. Except as provided on the Schedules
attached hereto, Seller shall: operate the Business in the ordinary
course of business consistent with past practice or as described in
the Offering Memorandum; use commercially reasonable efforts to
maintain satisfactory relationships with employees, suppliers,
distributors, customers, collective bargaining units and others
having business relationships with the Business; use commercially
reasonable efforts to maintain the Purchased Assets in reasonably
good operating condition, normal wear and tear excepted; maintain
its inventory of supplies, parts and other materials and inventories
and keep its books of account records and files, in each case in the
ordinary course of business consistent with past practice; refrain
from (A) amending, modifying, waiving any rights under or
terminating (or allowing to terminate) any material contract, except
in the ordinary course of business, (B) disposing of, encumbering,
selling or otherwise transferring any of the material assets
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constituting Purchased Assets or other rights of the Business,
except sales of inventory in the ordinary course of business, (C)
commencing any new capital projects or making any additional
commitments for capital expenditures relating to the Business in
excess of Five Hundred Thousand Dollars ($500,000) in the aggregate,
except in connection with certain scheduled turnarounds, and except
as reasonably required to comply with the Project Sunshine Consent
Decree, or (D) granting or agreeing to grant any bonus to any
employees of the Business, except for any bonus approved prior to
the date hereof or made in the ordinary course of business, or enter
into any contract of employment involving aggregate annual salary in
excess of Two Hundred Thousand Dollars ($200,000), collective
bargaining agreement or other labor contract with respect to any
such employees outside the ordinary course of business; provided
that Seller may take any action to which Buyer consents (which
consent shall not be unreasonably withheld).
(iii) Schedules. Prior to the Closing Date, Seller shall
notify Buyer of additions or changes to the Schedules to this
Agreement required to reflect events since the date of this
Agreement or facts discovered by Seller after the date hereof, so as
to cause Seller's representations and warranties contained herein
(other than any which speak as to a particular date) to be true and
correct in all material respects as of the Closing Date. Notices
given by Seller pursuant to this Section 10(a)(iii) will be deemed
to have amended the Schedules, to have qualified the representations
and warranties contained in Sections 6 and 7, and to have corrected
any misrepresentation or breach of warranty that otherwise might
have existed hereunder by reason of the fact, circumstance, event or
development (with the result that no misrepresentation or breach
shall be deemed to have occurred), in each case to the extent of the
disclosure contained in such notice, including for purposes of
Section 12(b). If such additions or changes would have a material
adverse effect on the Business, taken as a whole, as it is currently
operated by Seller, the parties shall negotiate in good faith to
determine a reasonable adjustment to the Purchase Price to fully
reflect any Losses actually incurred by Buyer resulting from such
matters.
(iv) Confidentiality. After the Closing, Seller shall maintain
the confidentiality of all information, documents and materials
relating exclusively to the Business, including all such materials
which remain in the possession of Seller, except to the extent that
disclosure of any such information is requested or required by law
(by oral questions, interrogatories, requests for information or
other documents in legal proceedings, subpoena, civil investigative
demand or any other similar legal process) or legal or
administrative process or authorized by Buyer or reasonably occurs
in connection with disputes over the terms of this Agreement. The
provisions of this Section 10(a)(iv) shall not apply to any
information, documents or materials which are in the public domain
or shall come into public domain, other than by reason of a breach
by the Seller of its obligations hereunder. Furthermore,
notwithstanding the foregoing, Seller shall be permitted to disclose
any confidential information (i) to any other member of the BP Group
or (ii) as required to operate Seller's ongoing business; provided
such member shall comply with the terms of this Section 10(a)(iv).
In addition, Seller shall be permitted to disclose this Agreement in
order to satisfy its obligations under the Terminal Agreement.
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(b) Covenants of Buyer. Buyer covenants and agrees as follows:
(i) Confidentiality.
(A) Buyer acknowledges that all information provided
to any of it and its affiliates, directors,
officers, employees, counsel, auditors,
accountants, agents, advisors and other
representatives by Seller and other members of the
BP Group and their respective directors, officers,
employees, counsel, auditors, accountants, agents,
advisors and other representatives is subject to
the terms of the Confidentiality Agreement, the
terms of which are hereby incorporated herein by
reference. Effective upon, and only upon, the
Closing, the Confidentiality Agreement shall
terminate only with respect to information
provided to any of Buyer and its affiliates,
directors, officers, employees, counsel, auditors,
accountants, agents, advisors and other
representatives that relates solely to the
Business, the Purchased Assets and the Assumed
Liabilities; provided that Buyer acknowledges that
any and all information provided or made available
to it and its affiliates, directors, officers,
employees, counsel, auditors, accountants, agents,
advisors and other representatives by or on behalf
of Seller (other than information relating solely
to the Purchased Assets and the Assumed
Liabilities) shall remain subject to the terms and
conditions of the Confidentiality Agreement on and
after the Closing Date.
(B) Buyer agrees that, from and after the Closing
Date, Buyer shall, and shall cause its affiliates,
directors, officers, employees, counsel, auditors,
accountants, agents, advisors and other
representatives to, keep the Seller Information
confidential following the Closing Date, except to
the extent that disclosure of any such Seller
Information is requested or required by law (by
oral questions, interrogatories, requests for
information or other documentation in legal
proceedings, subpoena, civil investigative demand
or any other similar legal process) or legal or
administrative process or authorized by Seller or
reasonably occurs in connection with disputes over
the terms of this Agreement. The provisions of
this Section 10(b)(i)(B) shall not apply to any
information, documents or materials which are in
the public domain or shall come into the public
domain, other than by reason of a breach by Buyer
of its obligations hereunder or under the
Confidentiality Agreement. Furthermore,
notwithstanding the foregoing, Buyer shall be
permitted to disclose the Seller
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Information to any of its affiliates. In
connection with the Transferred Employees, Buyer
shall use commercially reasonable efforts, at
Seller's request and at Buyer's expense, to
enforce existing confidentiality agreements and
rights requiring employees to keep trade secrets
confidential. For purposes of this Agreement,
"Seller Information" shall mean all information
concerning Seller and/or any other member of the
BP Group, other than information that relates
exclusively to the Business, the Purchased Assets
and the Assumed Liabilities and other than any
such information that is available to the public
on the Closing Date, or thereafter becomes
available to the public, other than as a result of
a breach of this Section 10(b)(i).
(ii) Notification. From the date hereof through and including
the Closing Date, Buyer shall promptly notify Seller if Buyer
obtains knowledge that any representation or warranty of Seller in
this Agreement or any agreement contemplated hereby or information
set forth in the Schedules hereto is not true and correct in all
material respects, or if Buyer obtains knowledge of any material
errors in, or omissions from, the Schedules to this Agreement.
(iii) Litigation. With respect to all litigation and other
matters set forth on the Schedules attached hereto and any other
matters that constitute Excluded Liabilities and for so long as
Seller is contesting or defending such matter, Buyer shall cooperate
in all respects with Seller and other members of the BP Group and
their respective counsel in their efforts to conduct or resolve such
litigation, including by making available to them such documents and
witnesses as may be deemed necessary or useful therefor in Seller's
sole but reasonable discretion. With respect to any dispute or
litigation involving any terminated Employee seeking reinstatement,
Buyer shall take such actions as are necessary for Seller to comply
with the terms of any judgment, decision or order of any proper
authority issued in connection with such dispute or litigation
(including by offering to employ such former Employee) and shall
treat any former Employee who is ordered to be reinstated as a
Transferred Employee for all purposes hereunder.
(iv) Title Policies. Buyer may procure, and shall pay the cost
of the premium for commitments or policies from title insurance
companies to provide owner's title insurance policies with respect
to the portions of the Purchased Assets constituting real property,
provided, however, that Buyer's ability or inability to obtain title
insurance (and without regard to (i) any exceptions contained
therein and (ii) any title insurance premium Buyer is required to
pay in order to obtain such title insurance) on such real property
for any reason shall not cause there to be an adjustment to the
Purchase Price and shall not cause the Closing of the transactions
contemplated by this Agreement to be delayed.
(v) Removal of Seller Marks. Buyer agrees that, within three
(3) months after the Closing Date, Buyer shall (i) remove,
obliterate, cover or replace, as appropriate, all
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signs, billboards, containers, drums, advertisements or other media
containing any service marks, trade names, trade dress or other
indicia of origin of Seller or any member of the BP Group, including
the words "Amoco" and "Standard," any items that include the words
"Amoco" or "Standard," the BP Group torch and oval design, the
letters "BP," any items that include the word "BP," the phrase "BP
Oil," the BP Group shield or the BP Group Helios logo or variants
thereof located on or appurtenant to any of the Purchased Assets,
including signs, billboards and advertisements or other media
located at the Business and (ii) return to Seller, or at Seller's
option, destroy (and certify such destruction to Seller) all items
and materials, including stationery, letterhead and purchase orders,
located at any of the Purchased Assets containing the above
described marks.
(vi) Project Sunshine Consent Decree. Buyer represents and
warrants that it has received a copy of the Project Sunshine Consent
Decree and that it has the financial and technical capability to
assume the obligations set forth in the Project Sunshine Consent
Decree with respect to the Purchased Assets. Buyer covenants and
agrees that prior to or at the Closing it will execute and deliver a
modification to the Project Sunshine Consent Decree, in
substantially the form attached hereto as Exhibit F, or otherwise
satisfactory to Seller and the United States of America, pursuant to
which Buyer shall agree to be bound by the terms and conditions of
the Project Sunshine Consent Decree applicable to the Purchased
Assets, and Buyer further covenants and agrees that from and after
the Closing Date it shall comply in all respects with those
provisions of the Project Sunshine Consent Decree (including any
amendments, supplements or revisions thereto) relating to the
operation, maintenance, insurance, and use of the Refinery and the
Business and assume all costs and expenses associated therewith, and
Buyer shall be responsible and liable for all costs and expenses
arising from or relating in any way to compliance with the Project
Sunshine Consent Decree as it relates to the Business. Buyer further
agrees that the provisions of this paragraph shall be binding upon
(A) any successors or assigns of Buyer, (B) any transferees of all
or any portion of the Business and (C) any grantee of rights of use
and/or operation thereof. Prior to transferring any interest in the
Business, Buyer shall deliver to Seller written evidence
satisfactory to Seller that such transferee has agreed to assume and
has the financial and technical capability to assume the obligations
set forth in the Project Sunshine Consent Decree with respect to the
Purchased Assets.
(vii) Novation Agreement. Buyer covenants and agrees that on
the Closing Date it will execute and deliver to Seller a novation
agreement, substantially in the form of Exhibit E attached hereto,
to be bound by the terms and conditions of, and become a party to,
the Terminal Agreement.
(viii) Conduct of Business. For the period during which Buyer
is obligated under this Agreement to make Margin Payments, Buyer
shall operate the Business in the ordinary course of business
generally consistent with the manner in which a reasonably prudent
petroleum refining industry operator would operate the Business.
(c) Mutual Covenants. Buyer and Seller covenant and agree as
follows:
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(i) H-S-R. Buyer and Seller shall each file or cause to be
filed with the Federal Trade Commission and the United States
Department of Justice any notifications required to be filed under
the H-S-R Act with respect to the transactions contemplated hereby,
and Buyer and Seller shall bear the costs and expenses of their
respective filings; provided that Buyer and Seller shall each pay
50% of the filing fee in connection therewith. Buyer and Seller
shall use their respective reasonable best efforts to make such
filings promptly (and in any event within ten (10) business days)
following the date hereof, to respond promptly to any requests for
additional information and documentary materials made by either of
such agencies, to make any further filings that may be necessary,
proper or advisable in connection therewith and to cause the waiting
periods under the H-S-R Act to terminate or expire at the earliest
possible date and to resist in good faith, at each of their
respective cost and expense (including the institution or defense of
legal proceedings), any assertion that the transactions contemplated
hereby constitute a violation of the antitrust laws, all to the end
of expediting consummation of the transactions contemplated hereby.
Each of Buyer, on the one hand, and Seller, on the other, shall
consult with the other prior to any meetings, by telephone or in
person, with the staff of the applicable governmental authorities,
and each of Buyer and Seller shall have the right to have a
representative present at any such meeting.
(ii) Assignments.
(A) With respect to any agreement, contract, license,
lease, easement, right-of-way or Permit which (1)
is material to the operation of the Business as it
is currently operated by Seller, (2) is intended
to be assigned to Buyer hereunder and (3) requires
consent for the assignment thereof to Buyer,
Seller shall take such actions as are commercially
reasonable and necessary, and Buyer shall
cooperate fully with Seller in all commercially
reasonable respects, to effect assignment thereof
to Buyer as of the Closing Date. It is understood
that such actions by Seller shall not include any
requirement of Seller to expend money, commence
any litigation or offer or grant any accommodation
(financial or otherwise) to any third party. In
the event that Seller is unable to obtain the
requisite approval for assignment of any such
agreement, contract, license, lease, easement,
right-of-way or Permit, or in the event such
agreement, contract, license, lease, easement,
right-of-way or Permit is required to be amended
or supplemented and is not so amended or
supplemented as of the Closing Date, and such
assignment is reasonably necessary to conduct the
Business in the ordinary course of business
without giving rise to a material adverse effect
on the Business, at the written request of Buyer
on or before the Closing Date (except where such
action would be unlawful or prohibited by such
agreement, contract, license, lease,
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easement, right-of-way or Permit), Seller shall
(x) retain any such agreement, contract, license,
lease, easement, right-of-way or Permit and shall
enter into an arrangement with Buyer to provide
Buyer with the benefits of such agreement,
contract, license, lease, easement, right-of-way
or Permit, provided, that Buyer shall perform
Seller's obligations thereunder arising on or
after the Closing Date (and indemnify Seller
against Losses suffered in connection therewith)
until such agreement, contract, license, lease,
easement, right-of-way or Permit is assigned to
Buyer or expires at the earliest opportunity in
accordance with its terms, or is properly amended
or supplemented, and (y) take all commercially
reasonable and necessary actions required to
assign to Buyer, or amend or supplement, any such
agreement, contract, license, lease, easement,
right-of-way or Permit as soon as practicable
after the Closing Date.
(B) Notwithstanding Seller's obligations pursuant to
Section 10(c)(ii)(A), the assignment of any
agreement, contract, license, lease, easement,
right-of-way or Permit to be transferred to Buyer
which requires consent for assignment, or
amendment or supplement, may be effected after the
Closing Date. Except as otherwise provided in this
Agreement, the Purchase Price shall not be subject
to adjustment, and the Closing of the transactions
contemplated by this Agreement shall not be
delayed, by reason of any inability to obtain
consent for assignment of any agreement, contract,
license, lease, easement, right-of-way or Permit
or any such amendment or supplement. Buyer
acknowledges that certain consents to the
transactions contemplated by this Agreement may be
required from parties to agreements, contracts,
licenses, leases, easements, rights-of-way or
Permits (written or otherwise) to which any of
Seller or other member of the BP Group is a party,
and such consents may not be obtained (provided
that Seller has complied with its obligations
under this Section 10(c)(ii)). Buyer agrees that
Seller shall not have any liability whatsoever to
Buyer arising out of or relating to the failure to
obtain any consents that may have been or may be
required in connection with the transactions
contemplated by this Agreement or because of the
default, acceleration or termination of any such
agreement, contract, license, lease, easement,
right-of-way or Permit as a result thereof
(provided that Seller has complied with its
obligations under this Section 10(c)(ii)). Buyer
further agrees that no representation, warranty or
covenant of Seller contained herein shall be
breached or deemed breached and no condition of
Buyer shall be deemed not to be satisfied as a
result of the failure
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to obtain any consent or as a result of any such
default, acceleration or termination or any
lawsuit, action, claim, proceeding or
investigation commenced or threatened by or on
behalf of any persons arising out of or relating
to the failure to obtain any consent or any such
default, acceleration or termination (provided
that Seller has complied with its obligations
under this Section 10(c)(ii)).
(C) With respect to any agreement, contract, license,
lease, easement, right-of-way or Permit that may
not be properly assigned to Buyer because of the
failure to obtain a required consent or that may
not be operated or used by Seller for Buyer's
benefit, Buyer shall indemnify, defend and hold
harmless Seller and the other members of the BP
Group from and against any liability that Seller
or any other members of the BP Group may have in
connection with such nontransferred agreements,
contracts, licenses, leases, easements,
rights-of-way or Permits as a result of the
transactions contemplated by this Agreement;
provided that, for the avoidance of doubt, it is
expressly understood and agreed that in the event
Seller is unable to provide Buyer the benefits of
any such agreement, contract, license, lease,
easement, right-of-way or Permit, Buyer shall not
be required to indemnify Seller against Losses
suffered in connection therewith until and to the
extent Seller, with full cooperation from Buyer in
all respects, is able to provide Buyer the benefit
of any such agreement, contract, license, lease,
easement, right-of-way or Permit.
(iii) Transition Services Agreement. In the event Buyer and
Seller agree that transition services will be necessary after the
Closing, Buyer and Seller shall negotiate in good faith to execute
and deliver at the Closing a Transition Services Agreement
substantially in the form attached hereto as Exhibit D (the
"Transition Services Agreement"). Promptly following the execution
of this Agreement, representatives of Buyer and Seller shall meet to
develop a transition plan which shall identify services, service
periods (not to exceed six (6) months) and service charges to be
provided pursuant to the terms and conditions of the Transition
Services Agreement and which will, to the extent practicable, be
completed prior to the Closing.
(iv) Other Governmental Approvals. Buyer and Seller shall
cooperate with each other and take all reasonable steps necessary to
obtain authorization for the sale of the Business from all other
applicable governmental authorities.
(v) Other Actions. Buyer and Seller shall otherwise use their
respective commercially reasonable efforts to cause the satisfaction
of all conditions precedent in this
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Section 10 and Sections 12 and 13 and the Closing to occur as soon
as reasonably practicable after the date of this Agreement.
(vi) Use of Certain Facilities. Buyer acknowledges that the
environmental facilities listed on Schedule 10(c)(vi) (the
"Environmental Facilities"), part of the Purchased Assets, were
constructed and equipped using the proceeds from the sale of (A)
$1,000,000 Industrial Development Authority of York County, Virginia
Environmental Control Revenue Bonds (Amoco Oil Company Project),
Series 1977 and (B) $2,800,000 Industrial Development Authority of
York County, Virginia Pollution Control Revenue Bonds (Amoco Oil
Company Project), Series 1977 (collectively, the "Environmental
Control Bonds"). As set forth in Section 4(b)(vi), the Environmental
Control Bonds are Excluded Liabilities. Buyer hereby covenants and
agrees that from and after the Closing Date, it shall (1) use the
Environmental Facilities in a manner so as to continue the
tax-exempt status of the Environmental Control Bonds in accordance
with Section 103(b) of the Internal Revenue Code of 1954, as
amended, and in full compliance with the use requirements set forth
in the agreements governing the Environmental Control Bonds and
other tax certifications relating to the Environmental Control
Bonds, and (2) comply with all applicable agreements securing the
Environmental Control Bonds relating to the operation, maintenance,
insurance, use, removal of liens, payment of taxes and keeping of
records with respect to the Environmental Facilities. Prior to
Closing, Seller shall furnish Buyer with copies of the agreements
governing the Environmental Control Bonds and tax certifications
relating to the Environmental Control Bonds. Buyer agrees that it
shall take all actions necessary to ensure that the provisions of
this Section 10(c)(vi) shall be binding upon (i) any successors and
assigns of Buyer, (ii) any transferee of all or any portion of the
Environmental Facilities, and (iii) any grantee of rights of use
and/or operation thereof. Buyer further agrees that it will
cooperate with Seller in any refunding of the Environmental Control
Bonds by providing Seller with information reasonably requested by
Seller related to any such refunding bonds on a tax-exempt basis.
11. EMPLOYEES.
(a) Employees. Schedule 11(a) attached hereto contains a list of all
employees of Seller or other members of the BP Group directly employed in
the operation of the Business (collectively, the "Employees"), including
employees who are receiving short-term disability benefits or are on
family and medical, medical/long-term disability, administrative or
military leave or any other type of leave that entitles the employee to
reinstatement upon completion of the leave under the applicable leave
policies of Seller or other members of the BP Group (collectively,
"Leave"). Schedule 11(a) sets forth both Employees represented by Local
2-10 of the Paper, Allied-Industrial, Chemical and Energy Workers
International Union (the "Union") and the Employee membership of the Union
("Union Employees") and Employees not represented by the Union ("Non-Union
Employees"). Seller shall be entitled to update Schedule 11(a) as
necessary at any time prior to Closing to reflect any and all employment
changes.
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(b) Employment Offers to Active Non-Union Employees and to All Union
Employees. No later than ten (10) days after the date of this Agreement
(and not later than five (5) days after any update of Schedule 11(a)),
Buyer shall offer employment with Buyer, effective as of the Closing Date,
to all active Non-Union Employees and to all Union Employees at the same
or better salaries or wages, with similar duties and responsibilities, at
the same location and on the same status (e.g., full-time or part-time) as
provided by Seller or other members of the BP Group immediately prior to
the Closing Date. All Employees who accept employment with Buyer pursuant
to the offers described either in this Section 11(b) or in Section 11(c)
are referred to herein as "Transferred Employees." Transferred Employees
who are Union Employees are also referred to herein as "Union Transferred
Employees," and Transferred Employees who are Non-Union Employees are also
referred to herein as "Non-Union Transferred Employees." Buyer shall not
reduce any Transferred Employee's initial salary or wages as an employee
of Buyer during the 12-month period after the Closing Date. Buyer will
give each active Non-Union Employee and each Union Employee no less than
seven (7) days in which to accept or reject Buyer's employment offer.
(c) Employment Offers to Non-Union Employees on Leave. In addition,
no later than ten (10) days after the date of this Agreement, Buyer shall
offer employment with Buyer to each Non-Union Employee who is on Leave as
of the Closing Date, commencing at such time as such Non-Union Employee is
ready to return to work, at the same or better salaries or wages, with
similar duties and responsibilities, at the same location and on the same
status (e.g., full-time or part-time) as provided by Seller or other
members of the BP Group immediately prior to the commencement of such
Non-Union Employee's Leave; provided, however, that such Non-Union
Employee is ready to return to work within one hundred twenty (120) days
after the Closing Date. Buyer will give each Non-Union Employee on Leave
no less than seven (7) days in which to accept or reject Buyer's
employment offer.
(d) Transfer Time. All Transferred Employees shall become employees
of Buyer as of 12:01 a.m., Central Time, on the Closing Date and except as
otherwise provided herein, at such time, Buyer shall assume and be
responsible for payment of all salaries and benefits and all other costs
and liabilities relating to the Transferred Employees, except that with
regard to a Non-Union Employee on Leave, such obligations shall not attach
until the Non-Union Employee on Leave commences employment with Buyer.
(e) Level of Employee Benefits Provided by Buyer. Buyer shall
provide to all Non-Union Transferred Employees employee benefits in
accordance with employee benefit plans (such as defined benefit plans,
defined contribution plans and welfare benefit plans), programs, policies
and pay practices (such as vacations, bonuses and short-term disability
leaves) which shall be the same as or better than the benefits provided to
substantially similar employees of Buyer and its affiliates. No later than
the Closing Date, Seller will provide to Buyer the Transferred Employees'
recognized credited service, and participation, vesting and, as
applicable, benefit accrual periods of service amounts, with Seller or
other members of the BP Group as of immediately prior to the Closing Date.
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(f) Pension Plans. Buyer agrees that, effective as of the Closing
Date, Buyer will sponsor a defined benefit pension plan ("Buyer Pension
Plan"), as defined under Section 3(35) of the Employee Retirement Income
Security Act of 1974, as amended, with respect to Transferred Employees
who participate in the BP Retirement Accumulation Plan ("BP RAP") prior to
the Closing Date. The Buyer Pension Plan will provide that (i) such
Transferred Employees will be eligible to participate in the Buyer Pension
Plan as of the Closing Date, and (ii) such Transferred Employees will be
given service credit equal to the number of years of participation and
vesting periods of service such Transferred Employees have under the BP
RAP. The Buyer Pension Plan also will grant service for benefit accrual
service equal to the number of years of benefit accrual service for those
Transferred Employees who have an accrued benefit in the BP RAP and may
provide that the age 65 single life annuity payable to Transferred
Employees under the Buyer Pension Plan may be offset by the amount of the
age 65 single life annuity payable to such Transferred Employees under the
BP RAP. In no event shall the age 65 single life benefit accrued under the
Buyer Pension Plan for Transferred Employees be less than the benefit such
Transferred Employees would receive if only service with Buyer were
recognized under the Buyer Pension Plan. The Buyer Pension Plan may
include such other terms and provisions as shall be determined by Buyer in
its sole discretion to the extent not inconsistent with this Section
11(f). Seller agrees to furnish on a timely basis such information with
regard to benefits payable to Transferred Employees under the BP RAP and
such other information as Buyer may from time to time, within one (1) year
after the Closing Date, reasonably request for purposes of complying with
this Section 11(f).
(g) Defined Contribution Plans. Buyer agrees that, effective as of
the Closing Date, Buyer's defined contribution plan that Transferred
Employees participate in shall be amended to recognize such Transferred
Employees' participation and vesting periods of service with Seller and
other members of the BP Group for purposes of determining participation,
vesting and the level of company contributions.
(h) Welfare Benefits and Other Benefits and Policies. For each
Transferred Employee who participates in any welfare benefit plan, or is
subject to any policy or pay practice, of Buyer, both Buyer and the
applicable welfare benefit, policy and pay practice (i) shall recognize
the Transferred Employee's recognized credited service amounts with Seller
and other members of the BP Group for all purposes including eligibility,
vesting and benefit determination and accrual; (ii) shall not require a
physical examination or other proof of insurability, and shall waive all
coverage exclusions and limitations relating to waiting periods or
pre-existing conditions, with respect to any of the Transferred Employees
or any dependent covered by Seller's and other members of the BP Group's
comparable welfare benefit plan, policy or pay practice in effect as of
the Closing Date; and (iii) shall credit the expenses of the Transferred
Employees which were credited toward deductibles or co-payments for the
year in which the Closing occurs under the applicable welfare benefit plan
of Seller or other members of the BP Group against satisfaction of any
deductibles or co-payments for the year in which the Closing occurs under
Buyer's medical welfare benefit plan for the Transferred Employees.
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(i) Vacation. Seller shall be responsible for paying the Transferred
Employees for any vacation due as of the Closing Date under the applicable
vacation policy of Seller or other members of the BP Group (the "Seller
Vacation Policy"). Buyer will provide Transferred Employees who, based
upon the recognized credited service amounts of such Transferred Employees
with Seller or other members of the BP Group, were eligible for a greater
amount of annual vacation under the Seller Vacation Policy than they are
under Buyer's vacation policy even after Buyer recognizes such Transferred
Employees' credited service amounts, with their Seller annual vacation
amount. Between the Closing Date and the end of the year in which the
Closing occurs, Buyer shall permit all Transferred Employees to take the
same number of days of vacation on an unpaid basis as they would have been
eligible to take immediately prior to the Closing Date under the Seller
Vacation Policy based upon the recognized credited service amounts of such
Transferred Employees with Seller or other members of the BP Group.
(j) Severance. Buyer shall establish a severance policy
substantially similar to the 2001 XX Xxxxxxxxx Benefits Plan (the "XX
Xxxxxxxxx Plan") with respect to any Non-Union Transferred Employee who
has actions taken against such Non-Union Transferred Employee within
twelve (12) months after the Closing Date that would make the Non-Union
Transferred Employee eligible for severance benefits under the involuntary
terminations section of the XX Xxxxxxxxx Plan. Buyer's severance policy
established under this Section 11(j) shall recognize the Non-Union
Transferred Employees' recognized credited service amounts with Seller or
other members of the BP Group.
(k) Buyer's Adoption of Collective Bargaining Agreement. Buyer will
recognize the Union as the exclusive representative of the Union
Transferred Employees and will adopt all collective bargaining agreements
between Seller and the Union and all existing contract extension
agreements, memoranda of agreement, letters of understanding and similar
agreements and instruments (collectively, the "CBA"), except that Buyer is
not required to continue the existing employee benefit plans provided for
under any applicable provisions of the CBA. If Buyer does not continue
said existing employee benefit plans, Buyer will comply with the terms of
the Letter of Understanding-Successorship attached hereto as Schedule
11(k) relating to establishing and implementing an alternate package of
benefit plans and shall indemnify the Seller Indemnified Parties against
any Losses caused by, arising from, incurred in connection with or
relating in any way thereto.
(l) WARN Act. Buyer represents and warrants to, and covenants with,
Seller that there will be no major employment losses as a consequence of
the transactions contemplated by this Agreement that might trigger
obligations under the Worker Adjustment and Retraining Notification Act,
29 U.S.C. Section 2101 et. seq., or under any similar provision of any
federal, state, regional, foreign or local law, rule or regulation
(collectively, "WARN Obligations"). To the extent that any WARN
Obligations might arise as a consequence of the transactions contemplated
by this Agreement, Buyer shall be responsible for, and shall indemnify the
Seller Indemnified Parties against any Losses caused by, arising from,
incurred in connection with or relating in any way to, any WARN
Obligations arising as a result of any employment losses occurring on or
after the Closing Date. For ninety (90) days following the Closing Date,
Buyer shall not engage in any mass
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layoff, plant closing or other action that might trigger WARN Obligations
of Seller or any other member of the BP Group.
(m) Service Credit. From and after the Closing Date, the Transferred
Employees shall be given credit for their service recognized by Seller or
other members of the BP Group prior to the Closing Date for all purposes,
including eligibility, vesting and benefit determination and accrual under
all applicable plans and programs of Buyer as well as for purposes of
determining any vacation, severance or other related benefits to be
provided pursuant to the manner described above.
(n) Benefits Miscellaneous. Notwithstanding the foregoing, Buyer
shall not be liable for any obligations arising out of participation by
Transferred Employees in the Employee Benefit Plans of Seller.
12. BUYER'S OBLIGATION TO CLOSE. Buyer's obligation to close under this
Agreement is subject to the fulfillment on or prior to the Closing Date of each
of the following conditions (except to the extent that Buyer shall have
hereafter agreed in writing to waive one or more of such conditions).
(a) Compliance with Agreement. Seller shall have performed and
complied in all material respects with all covenants, agreements and
conditions required by this Agreement to be performed or complied with by
Seller prior to the Closing Date.
(b) Representations and Warranties. The representations and
warranties of Seller made in this Agreement (as amended by Seller in
accordance with Section 10(a)(iii)) shall be true and correct in all
material respects as of the date hereof and on and as of the Closing Date,
as though made on and as of the Closing Date, except for representations
and warranties that speak as of a specific date or time (which need only
be true and correct as of such date or time). Seller shall have performed
or complied in all material respects with the obligations and covenants
required by this Agreement to be performed or complied with by Buyer by
the time of the Closing.
(c) Litigation. There shall not be any judicial restraining order or
injunction, preliminary or otherwise, in effect prohibiting the Closing of
the transactions contemplated by this Agreement. There shall not be
pending or threatened any litigation or proceeding instituted by any
federal, state or foreign governmental agency to restrain, prohibit or
otherwise interfere with or obtain substantial monetary damages in
connection with the consummation of the transactions contemplated by this
Agreement, or operation of the Business by Buyer after the Closing Date.
(d) Governmental Consents. The applicable waiting period under the
H-S-R Act and any extension thereof shall have terminated or expired,
without a challenge to the transactions contemplated by this Agreement,
and the transactions contemplated by this Agreement shall have been
authorized by applicable governmental authorities.
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13. SELLER'S OBLIGATION TO CLOSE. Seller's obligation to close under this
Agreement is subject to the fulfillment on or prior to the Closing Date of each
of the following conditions (except to the extent that Seller shall have
hereafter agreed in writing to waive one or more of such conditions).
(a) Compliance with Agreement. Buyer shall have performed and
complied in all material respects with all covenants, agreements and
conditions required by this Agreement to be performed or complied with by
Buyer prior to the Closing Date.
(b) Representations and Warranties. The representations and
warranties of Buyer made in this Agreement shall be true and correct in
all material respects as of the date hereof and on and as of the Closing
Date, as though made on and as of the Closing Date, except for
representations and warranties that speak as of a specific date or time
(which need only be true and correct as of such date or time). Buyer shall
have performed or complied in all material respects with the obligations
and covenants required by this Agreement to be performed or complied with
by Buyer by the time of the Closing.
(c) Litigation. There shall not be any judicial restraining order or
injunction, preliminary or otherwise, in effect prohibiting the Closing of
the transactions contemplated by this Agreement. There shall not be
pending or threatened any litigation or proceeding instituted by any
federal, state or foreign governmental agency to restrain, prohibit or
otherwise interfere with or obtain substantial monetary damages in
connection with the consummation of the transactions contemplated by this
Agreement, or the operation of the Business by Buyer after the Closing
Date.
(d) Governmental Consents. The applicable waiting period under the
H-S-R Act and any extension thereof shall have terminated or expired,
without a challenge to the transactions contemplated by this Agreement,
and the transactions contemplated by this Agreement shall have been
authorized by applicable governmental authorities.
(e) Right of First Refusal. Seller shall be satisfied, in its sole
discretion, that (i) VEPCO has consented to the transactions contemplated
by this Agreement or has waived or elected not to exercise rights it may
have with respect to the transactions contemplated by this Agreement in
accordance with the terms and provisions of the Terminal Agreement or (ii)
Seller has complied fully with its obligations under the Terminal
Agreement.
14. FURTHER ASSURANCES. From time to time, as and when reasonably
requested by any party hereto, each party shall execute and deliver, or cause to
be executed and delivered, all such documents and instruments and shall take, or
cause to be taken, all such further or other actions (subject to the limitations
set forth in Section 10(c)(ii)), which documents, instruments or actions are
consistent with, and customary and necessary for, the consummation of the
transactions contemplated by this Agreement.
15. INDEMNIFICATION.
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(a) Buyer's Indemnification of Seller. Except as otherwise provided
herein and subject to the provisions of this Section 15, from and after
the Closing Date, Buyer shall indemnify, defend, save and hold harmless,
Seller, the other members of the BP Group, and their respective directors,
officers, employees, shareholders, partners, counsel, auditors,
accountants, agents, advisors and other representatives and each of the
heirs, executors, successors and assigns of any of the foregoing
(collectively, the "Seller Indemnified Parties"), from and against any and
all Losses of any kind which are caused by, arise from, are incurred in
connection with or relate in any way to:
(i) the ownership of the Purchased Assets, including the
Refinery and all of the other Purchased Assets, and the operation of
the Refinery on and after the Closing Date, including those Losses
arising under, any foreign, federal, state or local laws or
regulations, or any contract, warranty, tort or other theory of law;
(ii) Buyer's modification of any technology, software,
know-how or proprietary information transferred or licensed to Buyer
pursuant to the Technology Agreement;
(iii) (A) Buyer's breach of or failure to perform any covenant
or agreement in this Agreement requiring performance by Buyer on or
after the Closing Date (including any discontinuance, suspension or
modification of any compensation or employee benefit plan or program
maintained by Buyer as contemplated by Section 11); or (B) Buyer's
breach of any representation or warranty in this Agreement which
survives the Closing; or
(iv) the Assumed Liabilities;
provided, however, that Buyer shall not have any liability under clause
(iii) above for any breach of a representation or warranty contained in
this Agreement or the other agreements contemplated hereby if Seller had
knowledge of such breach at the time of Closing and failed to notify Buyer
of such breach.
(b) Seller's Indemnification of Buyer. Except as otherwise provided
herein and subject to the provisions of this Section 15, from and after
the Closing Date, Seller shall indemnify, defend, save and hold harmless,
Buyer, its affiliates and their respective directors, officers, employees,
shareholders, partners, counsel, auditors, accountants, agents, advisors
and other representatives and each of the heirs, executors, successors and
assigns of any of the foregoing (collectively, the "Buyer Indemnified
Parties") from and against any and all Losses of any kind which are caused
by, arise from, are incurred in connection with or relate in any way to:
(i) the Excluded Assets or the Excluded Liabilities (other
than any environmental matters covered by Section 15(c)(ii) below)
(provided, however, that with respect to the Excluded Liabilities,
the provisions of Sections 15(i) through (l) will not apply to
indemnity claims by Buyer relating to Sections 4(b)(i) through (vi)
and 4(b)(ix) through (xii) of this Agreement);
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(ii) (A) Seller's breach of or failure to perform any covenant
or agreement in this Agreement requiring performance by Seller on or
after the Closing Date; or (B) Seller's breach of any representation
or warranty in this Agreement which survives the Closing;
(iii) any failure by Seller to comply with the provisions, if
any, of state or local bulk sales laws; and
(iv) subject to the limitations set forth in Section 15(l),
property damage caused by, or any environmental remediation required
due to a violation of the Health, Safety and Environmental Laws
during the pre-Closing operation of the Business by Seller or other
members of the BP Group ("Remediation Losses");
provided, however, that Seller shall not have any liability under
clause (ii) above for any breach of a representation or warranty
contained in this Agreement or the other agreements contemplated
hereby if Buyer had knowledge of such breach at the time of Closing
and failed to notify Seller of such breach in accordance with
Section 10(b)(ii), and no Losses caused by, arising from, incurred
in connection with or related in any way thereto shall be aggregated
for purposes of Section 15(j).
(c) Environmental Indemnifications. Buyer and Seller shall provide
the environmental indemnifications specified below:
(i) Seller shall indemnify, defend, save and hold harmless the
Buyer Indemnified Parties from and against any and all Losses of any
kind which are caused by, arise from, are incurred in connection
with or relate in any way to (A) a breach of Seller's
representations and warranties in Section 7 or (B) the Excluded
Liabilities described in Section 4(b)(x)(provided, however, that the
provisions of Sections 15(i) through 15(l) will not apply to
indemnity claims by Buyer relating to Section 4(b)(x) of this
Agreement); and
(ii) Except as otherwise provided herein, Buyer shall assume
responsibility for, and shall indemnify, defend, save and hold
harmless, the Seller Indemnified Parties from and against (A) any
and all Losses of any kind which are caused by, arise from, are
incurred in connection with or relate in any way to, the ownership
of the Purchased Assets or the operation of the Business, under,
relating to or otherwise required or incurred to achieve or maintain
compliance with Health, Safety and Environmental Laws, as the same
are in effect from time to time, irrespective of whether the events
giving rise to such liabilities occurred prior to, on or after the
Closing Date, including any and all Losses of any kind which are
caused by, arise from, are incurred in connection with or relate in
any way to Asbestos-Related Liabilities, the Disclosed Environmental
Liabilities or the Project Sunshine Consent Decree and (B) any and
all Losses that are caused by or result or arise from changes in,
modifications to or amendments of Health, Safety and Environmental
Laws that were in effect prior to the Closing Date or promulgated,
made or enacted on or after the Closing Date;
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provided, however, that Seller shall not have any liability under
clause (i) above for any breach of a representation or warranty
contained in this Agreement or the other agreements contemplated
hereby if Buyer had knowledge of such breach at the time of Closing
and failed to notify Seller of such breach in accordance with
Section 10(b)(ii), and no Losses caused by, arising from, incurred
in connection with or related in any way thereto shall be aggregated
for purposes of Section 15(j).
(d) Exclusive Remedy. Any claim or cause of action based on, arising
out of or relating in any way to any of the transactions contemplated
under this Agreement (including all Exhibits and Schedules attached hereto
or referenced herein) must be brought by either Buyer or Seller in
accordance with the provisions and limitations of this Agreement, whether
such claim arises out of any contract, tort or otherwise. Except as
otherwise provided in this Agreement, the parties hereby waive to the
fullest extent permitted under applicable law, any and all rights, claims
and causes of action they may have against one another relating to the
subject matter of this Agreement and the other agreements contemplated
hereby arising under or based on any federal, state, provincial, local or
foreign statute, law, ordinance, rule or regulation or otherwise,
including such rights, claims and causes of action Buyer may have against
Seller under CERCLA, breaches of statutory or implied warranties or
otherwise, nuisance or other tort actions, and common law rights of
contribution. Without limiting the generality of the foregoing, Buyer
understands and agrees that the rights accorded under this Section 15 are
its sole and exclusive remedy against Seller or any other member of the BP
Group with respect to any matters relating to Health, Safety and
Environmental Laws. Buyer hereby waives any right to seek contribution or
other recovery from Seller or any other member of the BP Group under such
Health, Safety and Environmental Laws, and Buyer hereby releases Seller
and the other members of the BP Group from any claims, demands or causes
of action that Buyer has or may have in the future against Seller and/or
the other members of the BP Group under Health, Safety and Environmental
Laws. Buyer further acknowledges and agrees that, (A) other than the
representations and warranties of Seller specifically contained in this
Agreement, there are no representations or warranties of Seller, any other
member of the BP Group or their respective directors, officers, employees,
shareholders, partners, counsel, auditors, accountants, agents, advisors
or other representatives or any other Person either express or implied,
with respect to any of them, the Business, the Purchased Assets or the
Assumed Liabilities and (B) it shall have no claim or right to
indemnification with respect to any information, documents or materials
furnished by Seller, any other member of the BP Group or their respective
directors, officers, employees, shareholders, partners, counsel, auditors,
accountants, agents, advisors or other representatives or any other Person
or any of their officers, directors, employees, shareholders, partners,
counsel, auditors, accountants, agents, advisors or other representatives,
including the Offering Memorandum and any information, documents or
material made available to Buyer in certain "data rooms," management
presentations or any other form in expectation of the transactions
contemplated by this Agreement.
(e) Procedures Relating to Indemnification Among Buyer and Seller.
Following the discovery of any facts or conditions which could reasonably
be expected to give rise to a Loss or Losses for which indemnification is
provided under this Agreement, the party seeking indemnification (the
"Indemnified Party") shall, as promptly as reasonably possible thereafter,
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provide written notice to the party from whom indemnification is sought
(the "Indemnifying Party"), setting forth the specific facts and
circumstances, in reasonable detail, relating to such Loss or Losses and
the amount of Loss or Losses (or a reasonable, good-faith estimate thereof
if the actual amount is not known or not capable of reasonable
calculation) ("Indemnification Notice"); provided, however, that failure
to give such Indemnification Notice on a timely basis shall not affect the
indemnification provided hereunder except to the extent the Indemnifying
Party shall have been actually and materially prejudiced as a result of
such failure. Notwithstanding the foregoing:
(i) a Buyer Indemnified Party shall not be entitled to make a
claim against Seller under Section 15(b)(ii) unless and until (A)
Buyer shall have provided Seller written notice of such default; and
(B) Seller shall have failed to cure such default within sixty (60)
days after Seller's receipt of Buyer's notice; and
(ii) a Seller Indemnified Party shall not be entitled to make
a claim against Buyer under Section 15(a)(iii) unless and until (A)
Seller shall have provided Buyer written notice of default; and (B)
Buyer shall have failed to cure such default within sixty (60) days
after Buyer's receipt of Seller's notice.
(f) Procedures Relating to Indemnification for Third Party Claims.
(i) In order for an Indemnified Party to be entitled to any
indemnification provided for under this Agreement in respect of,
arising out of or involving a claim or demand made by any Person
against the Indemnified Party (a "Third Party Claim"), such
Indemnified Party must provide an Indemnification Notice to the
Indemnifying Party of the Third Party Claim as promptly as
reasonably possible after receipt by such Indemnified Party of
notice of the Third Party Claim. Thereafter, the Indemnified Party
shall deliver to the Indemnifying Party, within five (5) business
days after the Indemnified Party's receipt thereof, copies of all
notices and documents (including court papers) received by the
Indemnified Party relating to the Third Party Claim; provided,
however, that failure to provide an Indemnification Notice, or
deliver copies of all notices and documents, in a timely manner
shall not affect the indemnification provided hereunder except to
the extent the Indemnifying Party shall have been actually
prejudiced as a result of such failure.
(ii) If a Third Party Claim is made against an Indemnified
Party, the Indemnifying Party shall be entitled to participate in
the defense thereof and, if it so chooses and acknowledges its
obligation to indemnify the Indemnified Party therefor, to assume
the defense thereof with counsel selected by the Indemnifying Party
and reasonably satisfactory to the Indemnified Party.
Notwithstanding any acknowledgment made pursuant to the immediately
preceding sentence, the Indemnifying Party shall continue to be
entitled to assert any limitation on its indemnification
responsibility contained in Sections 15(j) and 15(k). Should the
Indemnifying Party so elect to assume the defense of a Third Party
Claim, the Indemnifying Party shall not be liable to the Indemnified
Party for legal expenses subsequently incurred by the Indemnified
Party in connection with the defense thereof. If the Indemnifying
Party assumes such defense, the Indemnified Party shall have
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the right to participate in the defense thereof and to employ
counsel, at its own expense, separate from the counsel employed by
the Indemnifying Party, it being understood, however, that the
Indemnifying Party shall control such defense. The Indemnifying
Party shall be liable for the fees and expenses of counsel employed
by the Indemnified Party for any period during which the
Indemnifying Party has not assumed the defense thereof. If the
Indemnifying Party chooses to defend any Third Party Claim, all the
parties hereto shall cooperate in the defense or prosecution of such
Third Party Claim. Such cooperation shall include the retention and
(upon the Indemnifying Party's request) the provision to the
Indemnifying Party of records and information which are reasonably
relevant to such Third Party Claim and making employees available on
a mutually convenient basis to provide additional information and
explanation of any material provided hereunder. Whether or not the
Indemnifying Party shall have assumed the defense of a Third Party
Claim, the Indemnified Party shall not admit any liability with
respect to, or settle, compromise or discharge, or consent to the
entry of any judgment with respect to such Third Party Claim without
the Indemnifying Party's prior written consent (which consent shall
not be unreasonably withheld).
(g) Losses Net of Insurance and Taxes. The amount of any and all
Losses under this Section 15 and elsewhere under this Agreement shall be
determined net of any amounts recovered or recoverable by the Indemnified
Party under insurance policies, indemnities or other reimbursement
arrangements with respect to such Losses. Each party hereby waives, or
will procure the waiver of, any subrogation rights that its insurer may
have with respect to any indemnifiable Losses. The amount of any and all
Losses shall be reduced by the amount of any net reduction in cash Tax
payable by the Indemnified Party with respect to such Losses through and
including the Tax year in which the indemnification payment is made. Any
indemnity payment under this Agreement shall be treated as an adjustment
to the Purchase Price for tax purposes.
(h) Attorneys' Fees. In connection with any litigation arising out
of this Agreement or to enforce any indemnification claim pursuant to this
Agreement, the prevailing party shall be entitled to recover from the
nonprevailing party its reasonable attorneys' fees and costs, on appeal or
otherwise.
(i) Time Limitation. Except as otherwise provided herein, any claim
by any Buyer Indemnified Party for indemnity arising under this Agreement,
including pursuant to Sections 15(b) and 15(c), shall be brought within
two (2) years after the Closing Date. A claim shall be deemed to have been
brought only upon delivery of a proper Indemnification Notice to the other
party at the notice address set forth in Section 20. Any claim required to
be made within such two (2) year period not so timely made shall be
forever barred.
(j) Monetary Limitation. Buyer Indemnified Parties shall have no
claim under Section 15(b)(i)-(iii) of this Agreement against Seller or any
other member of the BP Group for any Losses unless and until the aggregate
of all such Losses incurred or sustained by the Buyer Indemnified Parties
exceeds Four Million Dollars ($4,000,000) and then only for the excess
over Four Million Dollars ($4,000,000) (the "Threshold"); provided that
Losses amounting to less than Two Hundred
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Fifty Thousand Dollars ($250,000) in the aggregate arising out of the same
occurrence or matter shall not be aggregated with other Losses for
purposes of determining whether and when the Threshold has been reached.
After the Threshold has been reached, Seller shall have no obligation to
indemnify the Buyer Indemnified Parties under this Agreement with respect
to such matters for any Losses amounting to less than Two Hundred Fifty
Thousand Dollars ($250,000) in the aggregate arising out of the same
occurrence or matter. For purposes of this Section 15(j), Losses shall
exclude Remediation Losses, which are treated separately in Section 15(l).
(k) Limitation of Liability. Seller's aggregate liability for
Indemnification pursuant to this Agreement, including Section 15(b) and
(c), shall in no event exceed an amount equal to Thirty-Five Million
Dollars ($35,000,000).
(l) Environmental Remediation Monetary Limitation. Notwithstanding
any other provision of this Agreement, none of the Buyer Indemnified
Parties shall have any claim under Section 15(b)(iv) of this Agreement
against Seller or any other member of the BP Group for any Remediation
Losses unless and until the aggregate of all such Remediation Losses
incurred or sustained by the Buyer Indemnified Parties exceeds Five
Million Dollars ($5,000,000), and then only for the excess over Five
Million Dollars ($5,000,000) (the "First Threshold"). After the First
Threshold has been reached, Buyer Indemnified Parties shall only have a
claim under this Agreement against Seller for fifty percent (50%) of the
excess of any Remediation Losses incurred or sustained by the Buyer
Indemnified Parties over the First Threshold unless and until the
aggregate of all such Remediation Losses incurred or sustained by the
Buyer Indemnified Parties exceeds Ten Million Dollars ($10,000,000) (the
"Second Threshold"). Thereafter, subject to Sections 15(j) and 15(k),
Buyer Indemnified Parties shall have a claim under this Agreement against
Seller for 100% of the excess of Remediation Losses over the Second
Threshold. Notwithstanding the foregoing, Remediation Losses amounting to
less than Two Hundred Fifty Thousand Dollars ($250,000) in the aggregate
arising out of the same occurrence or matter shall not be aggregated with
any other Remediation Losses for purposes of determining whether and when
the First Threshold or the Second Threshold has been reached. After the
First Threshold or Second Threshold has been reached, Seller shall have no
obligation to indemnify the Buyer Indemnified Parties under this Agreement
with respect to such matters for any Remediation Losses amounting to less
than Two Hundred Fifty Thousand Dollars ($250,000) in the aggregate
arising out of the same occurrence or matter.
(m) Mitigation. Each party hereto shall take all reasonable steps
and use all commercially reasonable efforts to mitigate any and all
Losses.
(n) Losses. As used in this Agreement, "Losses" means any and all
costs, claims, losses, liabilities, obligations (including corrective and
remedial obligations), damages and expenses (including reasonable legal
fees and expenses but excluding any liability relating to consequential
damages, lost profits or punitive damages).
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16. TAXES
(a) Except as provided in this Section 16, Buyer shall be liable for
and pay all Taxes, utility charges or apportionments which arise as a
result of this Agreement or the consummation of the transactions
contemplated hereby or as a result of any purchase, sale, rental, lease,
storage, use, consumption or operation of the Purchased Assets by Buyer.
(b) General and special real estate and other ad valorem taxes and
assessments and other state or local taxes, fees, charges and assessments
in respect of real property on the basis of the fiscal year in which the
Closing occurs shall be prorated between Buyer and Seller as of 12:01
a.m., Central Time, on the Closing Date. If the Closing Date shall occur
before the tax rate or assessment is fixed for such fiscal year, the
apportionment of such taxes and payments at the Closing shall be based
upon the most recently ascertainable tax bills; provided, that Buyer and
Seller shall recalculate and re-prorate said taxes and payments and make
the necessary cash adjustments promptly upon the issuance, and on the
basis, of the actual tax bills received for the fiscal year in which the
Closing occurs and the amount of any payments in lieu of tax made with
respect to any such fiscal year.
(c) Personal property taxes, if any, on the basis of the fiscal year
in which the Closing occurs shall be prorated between Buyer and Seller as
of 12:01 a.m., Central Time, on the Closing Date. If the Closing Date
shall occur before the tax rate or assessment is fixed for such fiscal
year, the apportionment of such taxes at the Closing shall be based upon a
reasonable estimate mutually agreed upon by Buyer and Seller; provided,
that Buyer and Seller shall recalculate and re-prorate said taxes and make
the necessary cash adjustments promptly upon the issuance of, and on the
basis of, the actual tax bills received for such fiscal year.
17. RECORDS/LITIGATION ASSISTANCE.
(a) For a period of seven (7) years following the Closing Date,
Buyer shall provide to Seller and other members of the BP Group (and their
counsel, auditors, accountants, agents, advisors or other representatives)
reasonable access to and permission to take from the Business copies of
any books, records or accounts relating to the Business through and
including the Closing Date; and Buyer shall not destroy or dispose of any
such books, records and accounts for a period of at least seven (7) years
after the Closing Date without first offering to surrender to Seller such
books, records and accounts which Buyer may intend to destroy or dispose
of. Seller agrees that it will consult with Buyer in advance of taking any
such actions following the Closing Date with a view towards establishing a
mutually agreeable plan for such visits so that these actions will not
unreasonably interfere with the normal operation of the Business.
(b) After the Closing Date, each party shall provide such assistance
as the other party may from time to time reasonably request in connection
with the preparation of tax returns required to be filed, any audit or
other examination by any taxing authority, any judicial or administrative
proceeding relating to liability for taxes, or any claim for refund in
respect of such Taxes or in connection with any litigation and proceedings
or liabilities related to the Business, including making
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available employees for interviews, litigation preparation and testimony.
The requesting party shall reimburse the assisting party for the
out-of-pocket costs incurred by the assisting party.
(c) If Buyer, as a result of the transactions contemplated by this
Agreement, at any time within twelve (12) months after the Closing Date,
is required to file with the Securities and Exchange Commission financial
statements relating to the Business, Seller shall provide such assistance
as Buyer may reasonably request in connection with the preparation of such
financial statements, including providing to Buyer Seller's books, records
or accounts relating to the Business and relevant personnel relating to
the Business and access to Seller's independent auditors from the date
hereof through and including the Closing Date and for a period of twelve
(12) months thereafter; provided that Seller shall not be required to take
any action that would cause it to incur any additional costs, expenses,
fees or liabilities as a result of or in any way relating to, the
provision of such assistance.
18. TERMINATION RIGHTS.
(a) This Agreement may be terminated at any time prior to the
Closing Date as follows and in no other manner:
(i) by mutual written consent of Buyer and Seller;
(ii) by Buyer, if any of the conditions set forth in Section
12 shall have become incapable of fulfillment, and shall not have
been waived by Buyer (provided, however, that Buyer is not in
material breach of its representations, warranties, covenants or
agreements contained in this Agreement);
(iii) by Seller, if any of the conditions set forth in Section
13 shall have become incapable of fulfillment, and shall not have
been waived by Seller (provided, however, that Seller is not in
material breach of its representations, warranties, covenants or
agreements contained in this Agreement);
(iv) by Seller, if the Closing does not occur on or prior to
May 31, 2002;
(v) by Buyer, if a Deposit Return Event occurs; or
(vi) by Buyer, if the Closing does not occur on or prior to
May 31, 2002; provided, however, that in the event that all
conditions of Section 12 other than termination or expiration of the
waiting period under the H-S-R Act are satisfied, then Buyer may not
terminate under this clause (vi) until September 30, 2002.
(b) In the event of termination by Buyer or Seller pursuant to this
Section 18, written notice thereof shall forthwith be given to the other
party and the transactions contemplated by this Agreement shall be
terminated, without further action by any party. If the transactions
contemplated by this Agreement are terminated as provided herein:
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(i) Buyer shall return to Seller all documents and copies and
other materials received from, or on behalf of, Seller relating to
the transactions contemplated hereby, whether so obtained before or
after the execution hereof; and
(ii) all confidential information received by Buyer with
respect to the Purchased Assets, the Assumed Liabilities and the
Business shall be treated in accordance with the terms and
conditions of the Confidentiality Agreement, which shall remain in
full force and effect notwithstanding the termination of this
Agreement.
(c) If this Agreement is terminated and the transactions
contemplated hereby are abandoned as described in this Section 18, this
Agreement shall become void and of no further force and effect, except for
the provisions of:
(i) Section 10(b)(i) relating to the obligation of Buyer to
keep confidential certain information and data obtained by it;
(ii) Section 22 relating to publicity;
(iii) Section 10(a)(i) relating to indemnification in
connection with the matters contemplated thereby;
(iv) Section 27 relating to certain expenses;
(v) Sections 6(f) and 9(f) relating to finder's fees and
broker's fees; and
(vi) this Section 18.
Nothing in this Section 18 shall be deemed to release any party from
any liability for any breach by such party of the terms and provisions of this
Agreement or to impair the right of any party to compel specific performance by
another party of its obligations under this Agreement.
19. SPECIFIC PERFORMANCE. Each party hereto acknowledges and agrees that
each other party would be damaged irreparably in the event any of the provisions
of this Agreement are not performed in accordance with their specific terms or
otherwise are breached. Accordingly, each party hereto agrees that each other
party shall be entitled to an injunction or injunctions to prevent breaches of
the provisions of this Agreement and to enforce specifically this Agreement and
the terms and provisions hereof in any action instituted in any court of the
United States or any state thereof having jurisdiction over the parties hereto
and the matter (subject to the provisions set forth in Section 21 below), in
addition to any other remedy to which they may be entitled, at law or in equity.
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20. NOTICES.
(a) All notices or other communications required or permitted to be
given hereunder shall be in writing and shall be delivered by hand or sent
by prepaid telex or telecopy, or sent, postage prepaid, by registered,
certified or express mail, or reputable overnight courier service and
shall be deemed given when so delivered by hand, telexed or telecopied, or
if mailed, five (5) days after mailing (one (1) business day in the case
of express mail or overnight courier service), as follows:
If to Buyer:
Giant Industries, Inc.
00000 Xxxxx Xxxxxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
Attn: Xxx Xxxxxxxxxx, Vice President, General Counsel and
Secretary
Telecopy:____________________________
with a copy to:
_____________________________________
_____________________________________
_____________________________________
Attn: ______________________________
Telecopy:____________________________
If to Seller:
BP Corporation North America Inc.
000 Xxxx Xxxxxxxx Xxxxx
Xxxxxxx, XX 00000
Attn: Assistant General Counsel - Corporate
Telecopy: (000) 000-0000
BP Products North America Inc.
000 Xxxx Xxxxxxxx Xxxxx
Xxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxxxxx
Telecopy: (000) 000-0000
(b) Any party may change the address to which such communications
are to be directed to it by giving written notice to the other in the
manner in paragraph (a) above.
21. GOVERNING LAW; SUBMISSION TO JURISDICTION. This Agreement and the
obligations of the parties hereunder shall be governed by and construed and
enforced in accordance
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with the substantive and procedural laws of the State of Illinois, without
regard to rules on choice of law. Any action to enforce the terms hereof may be
properly venued in, and shall be brought in, the federal or state courts located
in Xxxx County in the State of Illinois on a non-exclusive basis. Each party
hereto agrees that it shall submit to the jurisdiction of such courts for
purposes of actions to enforce the terms of this Agreement.
22. PUBLICITY. Buyer and Seller agree that, from the date hereof through
and including the Closing Date, no public release or announcement concerning the
transactions contemplated hereby shall be issued or made by any party hereto
(including any member of the BP Group) without the prior consent of each other
party (which consent shall not be unreasonably withheld), except (a) as such
release or announcement may be required by law, prior contractual obligations or
the rules or regulations of any securities exchange, whether in the United
States, United Kingdom or elsewhere, (or in the opinion of counsel such release
or announcement is appropriate or desirable under or in light of such
contractual obligations, laws and regulations), in which case the party making
the release or announcement shall allow each other party reasonable time to
comment on such release or announcement in advance of such issuance, and (b)
that any member of the BP Group, including Seller, may make such an announcement
to its employees. Notwithstanding the foregoing, Buyer and Seller shall
cooperate to prepare a joint press release to be issued on the Closing Date and,
upon the request of either Buyer or Seller, at the time of the signing of this
Agreement. Buyer and Seller agree to keep the terms of this Agreement
confidential, except to the extent required by applicable law or prior
contractual obligation or for financial reporting purposes and except that the
parties may disclose such terms to their respective (and in the case of Seller,
the BP Group's) counsel, auditors, accountants, agents, advisors and other
representatives as necessary in connection with the ordinary conduct of their
respective businesses (so long as such Persons agree to keep the terms of this
Agreement confidential).
23. SURVIVAL OF COVENANTS, REPRESENTATIONS AND WARRANTIES. Except for
Section 10(b)(viii), the covenants and representations and warranties in this
Agreement and in any other document delivered in connection herewith shall
survive the Closing solely for purposes of Sections 15(a), 15(b) and 15(c). The
covenants in Section 10(b)(viii) shall terminate on the expiration of the Margin
Payment Period. The representations and warranties in this Agreement shall
terminate at the close of business on the second anniversary of the Closing
Date; provided, however, that the representations and warranties provided in
Section 6(e)(i) and (ii) with respect to the Real Property shall not survive and
shall terminate at the Closing.
24. ENTIRE AGREEMENT. This Agreement, the attached Schedules and Exhibits
and the agreements referred to herein or executed simultaneously herewith, set
forth the entire agreement and understanding of the parties in respect to the
transactions contemplated hereby and thereby and supersede all prior agreements,
arrangements and undertakings, whether written or oral, relating to the subject
matter hereof (other than the Confidentiality Agreement which shall continue in
effect). No representation, promise, inducement or statement of intention,
whether written or oral, has been made by any party which is not embodied in or
superseded by this Agreement or the Confidentiality Agreement or in the
documents referred to herein, and no party shall be bound by or liable for any
alleged representation, promise, inducement or statement of intention not so set
forth whether in the Offering Memorandum, in certain "data rooms," management
presentations or any other form in expectation of the transactions contemplated
by
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this Agreement. Except as otherwise specifically provided in this Agreement, no
conditions, usage of trade, course of dealing or performance, understanding or
agreement purporting to modify, vary, explain or supplement the terms or
conditions of this Agreement will be binding unless hereafter made in writing
and signed by the party to be bound, and no modification will be effected by the
acknowledgment or acceptance of documents containing terms or conditions at
variance with or in addition to those set forth in this Agreement, except as
otherwise specifically agreed to by the parties in writing.
25. ASSIGNMENT. This Agreement and any rights and obligations hereunder
shall not be assignable or transferable by Buyer or Seller (including by
operation of law in connection with a merger or sale of stock, or sale of
substantially all the assets, of Buyer or Seller) without the prior written
consent of the other party (provided that Buyer shall not require the consent of
Seller to transfer its rights and obligations hereunder to a wholly owned
subsidiary of Buyer, as long as Buyer first fully guarantees such subsidiary's
performance of all of Buyer's obligations under this Agreement and under all of
the agreements that are exhibits hereto) and any purported assignment without
such consent shall be void and without effect; provided, however, that in the
event Buyer wishes to assign or transfer its rights and obligations prior to
expiration of the Margin Payment Period and Seller consents to such transfer
(or, in the event that the consent of Seller is not required to effect such
transfer, Buyer provides notice to Seller of such proposed transfer), Buyer
shall be permitted to transfer its rights and obligations under this Agreement
only if it (i) absolutely, unconditionally and irrevocably guarantees the
prompt, complete and full performance of the obligations of transferee to make
Margin Payments as set forth in Section 3(e) of this Agreement, (ii) agrees that
exercise by Seller of any right pursuant to the Agreement shall not preclude the
concurrent or subsequent exercise of any other right or remedy, at law or in
equity, against Buyer or any transferee, (iii) agrees that Seller shall not be
required to institute suit or exhaust its remedies against a transferee in order
to enforce the performance by Buyer of the obligations of the transferee to make
the Margin Payments, and (iv) agrees that such guarantee shall be a guarantee of
payment as well as a guarantee of performance. Notwithstanding the foregoing,
Seller may assign or transfer any or all of its rights hereunder to any
qualified intermediary in order to complete an exchange of like-kind property
under Section 1031 of the Code and, at the request of Seller, Buyer shall
execute such agreements and other documents as may be necessary, in the
reasonable opinion of Seller's counsel, to complete and otherwise effectuate
Seller's exchange of properties in accordance with said Section 1031 of the Code
and the regulations thereunder; provided that Buyer shall not be required to
take any action that would cause it to incur any additional costs, expenses,
fees or liabilities as a result of or connected with the exchange.
26. AMENDMENT AND WAIVER. This Agreement may be amended, modified,
superseded or canceled, and any of the terms, covenants, representations,
warranties or conditions hereof may be waived, only by a written instrument
executed by the parties hereto, or, in the case of a waiver, by or on behalf of
the party waiving compliance. The failure of any party at any time or times to
require performance of any provision hereof shall in no manner affect the right
at a later time to enforce the same. No waiver by any party of any condition, or
of any breach of any term, covenant, representation or warranty contained in
this Agreement, in any one or more instances, shall be deemed to be or construed
as a further or continuing waiver of any such condition or breach or a waiver of
any other condition or of any breach of any other term, covenant representation
or warranty. No course of dealing between or among any Persons having any
interest in this Agreement shall be deemed effective to modify, amend or
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discharge any part of this Agreement or any rights or obligations of any Person
under or by reason of this Agreement.
27. EXPENSES. Whether or not the transactions contemplated hereby are
consummated, and except as otherwise specifically provided in this Agreement,
all costs and expenses incurred in connection with this Agreement and the
transactions contemplated hereby, including legal, due diligence, accounting and
investment banking fees and expenses, shall be paid by the party incurring such
costs or expenses.
28. HEADINGS. The section and paragraph headings contained in this
Agreement are for reference purposes only, and shall not in any way affect the
meaning or interpretation of this Agreement.
29. COUNTERPARTS. This Agreement may be executed simultaneously in one or
more counterparts (including by means of telecopied signature pages), all of
which shall be considered one and the same agreement, and shall become effective
when one or more such counterparts have been signed by each of the parties and
delivered to the other party.
30. INTERPRETATION. Unless the context requires otherwise:
(a) this Agreement includes this Asset Purchase Agreement and any
other agreement entered into by Buyer and Seller on the Closing Date or in
connection with the transactions contemplated hereby;
(b) the singular shall include the plural and the plural shall
include the singular and any gender shall include all other genders, all
as the meaning and the context of the Agreement shall require;
(c) references to Sections and paragraphs refer to sections and
paragraphs, respectively, of this Agreement;
(d) references to Exhibits and Schedules are to exhibits and
schedules attached to this Agreement, each of which is hereby incorporated
and made a part of this Agreement for all purposes as if set forth in full
herein;
(e) the words "including," "include," "includes" and all variants
thereof mean "including, without limitation;" and
(f) all references to "Dollars" and "dollars" in this Agreement are
to United States dollars.
31. NO STRICT CONSTRUCTION. Notwithstanding the fact that this Agreement
has been drafted or prepared by one of the parties, Buyer and Seller confirm
that both they and their respective counsel have reviewed, negotiated and
adopted this Agreement as the joint agreement and understanding of the parties,
and the language used in this Agreement shall be deemed to be the language
chosen by the
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parties hereto to express their mutual intent, and no rule of strict
construction shall be applied against any Person.
32. SCHEDULES. The disclosures in the Schedules hereto (including any
disclosures made in amendments made pursuant to Section 10(a)(iii)) are to be
taken as relating to the representations and warranties of Seller as a whole.
Matters listed once on the Schedules shall be deemed disclosed with reference to
all sections of the Schedules and all of Sections 6 and 7 of this Agreement. The
inclusion of information in the Schedules hereto shall not be construed as an
admission that such information is material to the Business, the Purchased
Assets, the Assumed Liabilities or Seller. In addition, matters reflected in the
Schedules are not necessarily limited to matters required by this Agreement to
be reflected in such Schedules. Such additional matters are set forth for
informational purposes only and do not necessarily include other matters of a
similar nature. Prior to the Closing, Seller shall have the right at all times
to supplement, modify or update the Schedules hereto; provided, however, that
any such supplements, modifications or updates shall be subject to the
provisions of Section 10(a)(iii). The Schedules are incorporated herein by
reference and made a part hereof.
33. REPRESENTATION BY COUNSEL; INTERPRETATION. Buyer and Seller
acknowledge that each of them has been represented by counsel in connection with
this Agreement and the transactions contemplated hereby. Accordingly, any rule
of law or any legal decision that would require interpretation of any claimed
ambiguities in this Agreement against the party that drafted it has no
application and is expressly waived.
34. SEVERABILITY. Whenever possible, each provision of this Agreement
shall be interpreted in such manner as to be valid and effective under
applicable law, but if any provision of this Agreement or the application of any
such provision to any Person or circumstance shall be held invalid, illegal or
unenforceable in any respect by a court of competent jurisdiction, such
invalidity, illegality or unenforceability shall not affect any other provision
hereof.
35. BULK TRANSFER LAWS. Buyer hereby waive compliances by Seller with the
provisions of any so-called bulk transfer laws of any jurisdiction in connection
with the purchase and sale of the Purchased Assets. Seller shall indemnify and
hold Buyer harmless from any Losses which Buyer may incur due to failure to so
comply in accordance with Section 15.
36. NO THIRD PARTY BENEFICIARIES. Except as provided with respect to
indemnification as set forth in Section 15 and elsewhere in this Agreement,
nothing in this Agreement shall confer any rights upon any Person other than the
parties hereto and their respective heirs, successors and permitted assigns.
37. DEFINITION OF AFFILIATE. As used herein, the term "affiliate" shall
have the meaning set forth in Rule 405 promulgated under the Securities Act of
1933, as amended.
* * * * *
-51-
IN WITNESS WHEREOF, the parties have duly executed this instrument
as of the day and year first above written.
BP CORPORATION NORTH AMERICA INC.
By: /s/ Xxxx X. Xxxxxx
-------------------------------
Name: Xxxx X. Xxxxxx
Title: Attorney-in-Fact
BP PRODUCTS NORTH AMERICA INC.
By: /s/ Xxxx X. Xxxxxx
-------------------------------
Name: Xxxx X. Xxxxxx
Title: Attorney-in-Fact
GIANT INDUSTRIES, INC.
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Executive Vice President and
Chief Operating Officer
Signature Page to Asset Purchase Agreement
