EXHIBIT 10.44
EXECUTION COPY
SECOND AMENDED AND RESTATED
COMMODITIES REPURCHASE AGREEMENT
This SECOND AMENDED and RESTATED COMMODITIES REPURCHASE AGREEMENT (this
"Agreement"), dated as of February 11, 2003, by and among (1) EOTT Energy
Operating Limited Partnership (the "Client"), a limited partnership organized
under the laws of Delaware, (2) Standard Chartered Trade Services Corporation
("SCTSC"), a company organized under the laws of the State of Delaware, and (3)
STANDARD CHARTERED BANK, as collateral agent for SCTSC (the "Collateral Agent"),
hereby modifying that certain Amended and Restated Commodities Repurchase
Agreement, dated as of October 18, 2002, by and among Client, SCTSC and the
Collateral Agent (the "Prior Agreement").
WHEREAS, pursuant to the Prior Agreement, SCTSC has entered into a purchase and
sale transaction with Client (such transaction, including as amended by this
Agreement as the context shall require, is referred to herein as the
"Transaction"), whereby SCTSC has (a) purchased from Client 2,764,117 barrels of
crude oil constituting Client's line fill (the "Original Commodities") on
October 18, 2002, and (b) agreed to sell the Original Commodities to Client on
the Repurchase Date (as defined therein) on a spot basis as set forth in Section
1 to the Prior Agreement;
WHEREAS, each of Client and SCTSC wishes to (a) continue the Prior Agreement by
extending the Repurchase Date (as defined in the Prior Agreement), (b) adjust
the number of barrels of crude oil that SCTSC has purchased from Client to a
number mutually agreed to by Client and SCTSC two Business Days (as defined
below) prior to the Effective Date (as defined below) (the "Adjusted Barrel
Amount"), and (c) amend certain other provisions of the Prior Agreement on the
terms and conditions set forth herein;
NOW, THEREFORE, Client and SCTSC do hereby agree as follows:
1. Definitions. Capitalized terms used and not defined herein have the
meanings given to them in the Letter of Credit Agreement, dated as of
the date hereof, among Client, EOTT Energy Canada Limited Partnership
("EOTT Canada"), EOTT Energy Liquids, L.P. ("EOTT Liquids"), EOTT
Energy Pipeline Limited Partnership ("EOTT Pipeline"), EOTT Energy LLC
("EOTT LLC"), EOTT Energy General Partner, L.L.C. ("EOTT GP"), Standard
Chartered Bank, as Collateral Agent, LC Agent, and LC Issuer, and the
other banks and financial institutions party thereto from time to time
(as amended, restated, amended and restated, supplemented or otherwise
modified from time to time, the "Letter of Credit Agreement").
2. General Terms.
a) Pursuant to the Prior Agreement, the following steps have been
taken for the Transaction:
(i) Client has contacted SCTSC either by telephone or by
facsimile in the manner set forth in Section 7 below,
informing SCTSC of Client's desire to enter into the
Transaction and indicating: (x) the date on which
Client proposed that SCTSC pay the Purchase Price (as
defined below) to Client and on which the Commodities
were to be delivered to SCTSC (the "Value Date"), and
(y) if applicable, the location and account number of
the hedge account opened by Client for the
Commodities ("Hedge Account").
(ii) SCTSC then sent to Client a Transaction Confirmation
(as defined in the Prior Agreement) and Client sent
to SCTSC on the same day a Confirmation of Acceptance
(as defined in the Prior Agreement).
(iii) On the Value Date, SCTSC purchased from Client the
Original Commodities at $75,000,000 (the "Purchase
Price").
(iv) Delivery of the Original Commodities was made by
Client on the Value Date by a delivery method and
documentation that was acceptable to SCTSC,
including, without limitation, holding certificates
substantially in the form attached hereto as Exhibit
B. It was agreed that such documentation acceptable
to SCTSC shall be held by SCTSC at all times until
the Repurchase Date.
(v) Immediately upon delivery of the Original Commodities
in accordance with clause (iv) above, SCTSC paid the
Purchase Price to Client, and title to the Original
Commodities passed immediately to SCTSC.
b) The following general terms shall apply to the Transaction (as
amended hereby):
(i) All amounts paid by SCTSC to Client or by Client to
SCTSC under the Prior Agreement shall be deemed to
have been paid pursuant to this Agreement, and all
amounts owing by Client to SCTSC or by SCTSC to
Client under the Prior Agreement shall be deemed to
be (without duplication) amounts owing under this
Agreement.
(ii) The number of barrels of crude oil that SCTSC has
purchased from Client shall be adjusted to the
Adjusted Barrel Amount (such number of barrels of
crude oil being referred to herein as the
"Commodities"), and title to the portion of the
Original Commodities so adjusted (if reduced) shall
immediately pass to Client.
(iii) The total price for the Commodities under this
Agreement shall be deemed to be the same as the
Purchase Price.
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(iv) The date on which Client proposed to pay SCTSC the
Repurchase Price (as defined below) for the
repurchase from SCTSC by Client of the Commodities
(the "Repurchase Date") shall be extended to the date
which is six (6) calendar months after the Effective
Date (the "Initial Maturity Date"), unless further
extended pursuant to Section 10; provided, that (i)
Client shall have the option (but not the obligation)
to repurchase all the Commodities from SCTSC on a
date prior to the Repurchase Date (the "Optional
Prepayment Date"), subject to Section 13(b) and (ii)
Client shall have the obligation to repurchase all or
a portion of the Commodities from SCTSC on a date
prior to the Repurchase Date (the "Mandatory
Prepayment Date") in accordance with Section 4.
(v) Client shall pay (or shall have previously paid) to
SCTSC an amount equal to the interest that would
accrue on the Purchase Price as if the Transaction
were deemed to be a loan, at a rate (the "Interest
Rate") equal to LIBOR (as defined in Schedule B
attached hereto) for one-month periods beginning on
the date hereof (the "Interest Period") plus the
Applicable Margin (as defined below), payable in
arrears on the first day of each month (each, a
"Monthly Payment Date") and the Mandatory Prepayment
Date, from the Value Date until the Repurchase Date,
or if earlier, the Optional Prepayment Date. Interest
accrued on the Purchase Price or other monetary
obligations after the date such amount is due and
payable (whether on the Repurchase Date, the
Mandatory Prepayment Date, upon acceleration or
otherwise) shall be payable upon demand. As used
herein, "Applicable Margin" shall mean, if the
Repurchase Date is on the Initial Maturity Date,
three percent (3.0%) per annum, and if the Repurchase
Date is extended pursuant to Section 10, seven
percent (7.0%) per annum.
(vi) The price at which Client will repurchase the
Commodities from SCTSC on the Repurchase Date (the
"Repurchase Price") shall be equal to the Purchase
Price. SCTSC will deliver an invoice to Client prior
to the Repurchase Date setting forth the Repurchase
Price and all other amounts due and owing to SCTSC
hereunder which are payable on the Repurchase Date.
If Client shall fail to pay the Repurchase Price or
any other amount payable by Client hereunder when
due, Client shall pay to SCTSC interest on the
outstanding unpaid amount at a rate per annum equal
to the rate of interest established from time to time
by Standard Chartered Bank in New York City as its
Reference Rate (as defined below) plus, (i) if the
Repurchase Date is on the Initial Maturity Date, five
percent (5.0%) per annum and (ii) if the Repurchase
Date is extended pursuant to Section 10, nine percent
(9.0%) per annum. As used herein, "Reference Rate"
shall mean the rate publicly announced
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from time to time by Standard Chartered Bank, New
York Branch as its Reference Rate.
(vii) Client shall pay a handling fee equal to a flat fee
of US$500.00 with respect to SCTSC's invoice in
respect of the Transaction, payable upon receipt of
such invoice.
c) SCTSC shall send to Client a facsimile (the "Transaction
Confirmation") in substantially the form of Exhibit A to this
Agreement confirming the terms of the Transaction (as amended
by this Agreement), and Client shall send to SCTSC on the same
Business Day a facsimile of the Transaction Confirmation
executed by Client (the "Confirmation of Acceptance"). The
Confirmation of Acceptance is binding on Client to the same
extent as a manually signed Confirmation of Acceptance. It is
understood and agreed that a binding agreement relating to the
Transaction (as amended by this Agreement) shall exist between
Client and SCTSC only upon the completion of all steps
contemplated by this Section 2. As used herein, "Business Day"
shall mean a day on which SCTSC and commercial banks are open
for business in New York, New York.
d) Client shall pay the Repurchase Price to SCTSC on the
Repurchase Date in the manner set forth in Section 5 and,
subject to SCTSC's receipt of such Repurchase Price and all
other amounts due and owing to SCTSC hereunder, SCTSC shall
deliver to Client on such date the evidences of delivery of
the Commodities SCTSC received from Client pursuant to Section
2(c) above, and title to the Commodities shall pass to Client
immediately upon such payment and delivery. Client's
obligation to pay the Repurchase Price and all other amounts
due and owing to SCTSC hereunder on the Repurchase Date shall
be absolute and unconditional and shall not be subject to any
claim, defense, set-off or other reduction, notwithstanding
any loss or damage to, defect in or non-existence of any
Commodity or any other event or circumstance whether or not
similar to the foregoing.
3. Reduction of Maximum Commitment. The Maximum Commitment shall be
reduced as follows:
a) if Client elects to repurchase all the Commodities prior to
the Repurchase Date, on the Optional Prepayment Date, the
Maximum Commitment shall automatically and permanently be
reduced to zero;
b) if Client is obligated to repurchase all or a portion of the
Commodities prior to the Repurchase Date in accordance with
Section 4, on the Mandatory Prepayment Date, the Maximum
Commitment shall automatically and permanently be reduced by
an amount equal to the amount of such repurchase; and
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c) if Client fails to either (i) maintain a hedge contract (the
"Hedge Contract") at a price and an amount and otherwise in
form and substance satisfactory to SCTSC from a counterparty
acceptable to SCTSC or (ii) secure the Repurchase Price with
one or more letters of credit issued by a bank acceptable to
SCTSC, at a stated amount satisfactory to SCTSC, naming SCTSC
as the beneficiary and otherwise in form and substance
satisfactory to SCTSC (the "Letters of Credit"), the Maximum
Commitment shall be reduced to an amount acceptable to SCTSC.
4. Mandatory Prepayment, Etc.
a) If at any time the Purchase Price exceeds the Maximum
Commitment (whether due to a reduction in the Maximum
Commitment in accordance with this Agreement, or otherwise),
Client shall pay to SCTSC an amount at least equal to such
excess; and
b) If at any time any Designated Assets are sold, Client shall,
in accordance with the Intercreditor Agreement, cause all the
proceeds of such sale (net of costs of sale) (the "Net Sale
Proceeds") be paid to the Collateral Agent for deposit in the
Debt Service Payment Account (as defined in the Intercreditor
Agreement). Upon receipt, the Collateral Agent shall, on
behalf of Client, make a mandatory prepayment of the amounts
owing by Client to SCTSC under this Agreement in accordance
with the Intercreditor Agreement.
c) With respect to the Commodities repurchased by Client pursuant
to Section 4(b), title to such repurchased Commodities shall
pass to Client immediately upon such delivery.
5. On each date on which any amounts fall due for payment from either
SCTSC or Client under this Agreement for the Transaction, the party
required to make such payment shall do so where such amount is
denominated in United States Dollars ("Dollars") by payment in Dollars
and in immediately available funds to such account in the United States
of the other party as may be specified by it in the Transaction
Confirmation.
6. All payments to be made hereunder by Client shall be made free and
clear of and without deduction for any set-off or counterclaim and
without deduction for or on account of any present or future taxes
including but not limited to duties, levies, sales or value added
taxes, and imposts now or hereafter imposed. If Client is required by
law to make any deduction or withholding from any sum payable
hereunder, the sum payable, in respect of which such deduction or
withholding is required to be made, shall be increased to the extent
necessary to ensure that, after the making of such deduction or
withholding (including, without limitation, deduction or withholding on
account of additional sums payable under this Section), SCTSC receives
(free from any liability in respect of any such deduction or
withholding) a net sum equal to the sum which would have been received
and so retained had no such deduction or withholding been made.
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7. All facsimile communications arising as a consequence of this Agreement
shall be sent (a) if to SCTSC, at facsimile number (000) 000-0000 and
(b) if to Client, at facsimile number (000) 000-0000 or, in either
case, to such other facsimile number as SCTSC advises to Client or as
the case may be, Client advises SCTSC from time to time in writing.
8. This Agreement shall be deemed to be effective only upon satisfaction
of each of the following conditions precedent to SCTSC's satisfaction,
in each case on or prior to March 31, 2003 (the date on which all of
such conditions precedent have been satisfied shall be the "Effective
Date"):
a) SCTSC shall have received duly executed counterpart signature
pages to this Agreement.
b) Client shall have paid SCTSC a non-refundable extension fee in
an amount equal to one percent (1.0%) multiplied by (a)
$75,000,000 and (b) a ratio (i) the numerator of which is the
number of days measured from the Effective Date until the date
immediately prior to the Initial Maturity Date and (ii) the
denominator of which is 365 days.
c) All conditions precedent to Extensions of Credit in the Letter
of Credit Agreement (as defined below) (other than the
effectiveness of this Agreement) are satisfied or waived by
the LC Agent.
d) Client shall have delivered to SCTSC, in form and substance
satisfactory to SCTSC, to the extent requested, all the
documents required to be delivered to the LC Agent under
Section 2(f) of the Letter of Credit Agreement, unless waived
by the LC Agent.
e) No Event of Default exists and is continuing.
9. This Agreement shall terminate on the earliest of to occur of the
following (the "Termination Date"): (i) at the sole discretion of
Client, immediately upon written notice given by Client to SCTSC and
repurchase of the Commodities pursuant to Section 2(c), or (ii) on the
Repurchase Date or (iii) as provided in Section 11 below; provided,
however, that no such termination shall affect or nullify the rights
and obligations of the parties hereto with respect to the Transaction
that has been concluded or under which amounts may still be owing.
Notwithstanding any termination, the terms of this Agreement shall
continue to apply to the completion of the Transaction until such time
that all amounts owing under the Transaction shall have been duly paid
or otherwise discharged as contemplated by this Agreement.
10. On any date which is four Business Days prior to the Initial Maturity
Date, at the option of Client and upon written notice to SCTSC, Client
may extend the Repurchase Date from the Initial Maturity Date until a
date no later than the earlier of (a) twelve (12) calendar months after
the Initial Maturity Date and (b) August 30, 2004, upon payment to
SCTSC of a non-refundable extension fee in
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an amount equal to one percent (1.0%) multiplied by the Maximum
Commitment as of the Initial Maturity Date.
11. In the event that:
a) any representation, warranty or statement made in writing by
Client (or any of its officers, partners or members) in this
Agreement or any certificate or document delivered under this
Agreement shall have been incorrect or untrue in any respect
when made or repeated; or
b) Client shall fail to perform any covenant or agreement
contained herein or any of Client's obligations under the
Transaction effected under this Agreement; or
c) any event or condition shall occur which, in the opinion of
SCTSC, constitutes a material adverse change in the financial
position of Client, or which causes SCTSC to believe that the
ability of Client to perform its obligations under this
Agreement, the Transaction Confirmation or any other agreement
delivered in connection with the Transaction has been
significantly impaired, provided that such event or condition
shall be continuing for fifteen days after SCTSC notifies
Client thereof and during such fifteen-day period Client fails
to cure such event or condition or deliver collateral security
for Client's obligations hereunder which shall be in a form
and with a value satisfactory to SCTSC in all respects and
subject to documentation required by SCTSC to grant to the
Collateral Agent, acting on behalf of SCTSC in accordance with
the Intercreditor Agreement, a first priority perfected
security interest therein; or
d) an "Event of Default" shall have occurred under and as defined
in the Letter of Credit Agreement (any of the foregoing shall
hereinafter be known as an "Event of Default"),
SCTSC shall have the right (in addition to any other right or remedy
SCTSC may have at law, in equity under this Agreement, and subject to
the terms of the Intercreditor Agreement) to:
(w) accelerate the Repurchase Date and all other obligations
of Client hereunder to the date such right is exercised,
(x) sell without notice to Client or any third party (except
as required by law) any Commodity held by SCTSC,
(y) apply any amounts received therefor against the amounts
owed by Client to SCTSC under the Transaction and all other obligations
of Client hereunder (provided, that SCTSC may retain any balance of
such amounts until the Termination Date, and at any time prior thereto,
may apply such balance to cover any amounts due and owing to SCTSC
under the Receivables Purchase
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Agreement, and upon the Termination Date, SCTSC shall promptly remit to
the Collateral Agent any remaining balance), and
(z) terminate this Agreement, as to all the foregoing, without
protest, presentment, demand or other formality, all of which are
expressly waived by Client.
The Client shall remain liable to SCTSC for any amount still owed to
SCTSC under the Transaction and all other obligations of Client
hereunder after the sale of all Commodities held by SCTSC together with
interest thereon at the rate provided in Section 2(b)(iv).
12. Client understands and agrees that Client is obligated to repurchase at
the Repurchase Price from SCTSC on the Repurchase Date any Commodity
that is the subject of the Transaction effected under this Agreement
irrespective of any loss, damage, theft or destruction whatsoever which
may occur with respect to such Commodity during the time the
Transaction is outstanding or any other event or circumstance. In
addition, if any claim is asserted against any Commodity by any third
party, including any governmental authority, Client agrees that Client
is nonetheless obligated to repurchase such Commodity from SCTSC on the
Repurchase Date. Any risk of loss whatsoever with respect to any
Commodity that is the subject of the Transaction that is effected under
this Agreement is retained by Client.
13. Client agrees to indemnify and hold SCTSC harmless from and against:
a) all expenses and costs reasonably incurred by SCTSC and all
claims, liabilities and losses (including, but not limited to
legal fees reasonably incurred by SCTSC, sales or value added
taxes, duties and levies, excise and other taxes (other than
taxes imposed on the net income of SCTSC or franchise taxes by
(i) the United States of America or (ii) the State of New York
or any taxing authority thereof or therein)),
b) all costs and expenses reasonably incurred by SCTSC as a
result of any payment of the Repurchase Price on a date other
than the scheduled Repurchase Date or failure by SCTSC to
deliver a Commodity on the Value Date including, without
limitation, all cost or expense suffered by SCTSC in
liquidating LIBOR or other deposits or compensating any
funding bank therefor, and
c) all increases in costs or reductions in amounts receivable by
SCTSC as a result of any change in or adoption of any law,
rule, regulation or guideline (whether or not having the force
of law) after the date hereof,
incurred or suffered by SCTSC as a result of or arising from the
Transaction, SCTSC's ownership or control or possession of any
Commodity, Client's breach of any representation or warranties
contained herein or Client's failure to comply with any of the terms or
conditions contained in this Agreement except to the
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extent arising from the willful misconduct or gross negligence of
SCTSC. Such agreement to indemnify shall extend to and apply to SCTSC's
officers, directors, shareholders, employees and agents and shall
survive termination of this Agreement and payment of Client's
obligations hereunder.
14. Client shall continue to be responsible for all Commodities in all
respects including, but not limited to, arranging storage, maintenance,
shipment and other handling and treatment of all Commodities, and SCTSC
shall have no responsibility or right to participate in any of the
foregoing except in the event SCTSC purchases any Commodity after the
occurrence of an Event of Default or does any of the foregoing in
connection with its exercise of any rights or remedies under Section
11.
15. Client may not, without the consent of SCTSC, assign or delegate any of
its respective rights or obligations under this Agreement. Provided
that no Default or Event of Default shall have occurred and be
continuing, so long as the aggregate credit exposure of Standard
Chartered and SCTSC under the Credit Agreement and the Purchase
Agreements is reduced to $200,000,000 or less, SCTSC (and its assigns)
may, with the consent of Client (which consent shall not be
unreasonably withheld or delayed), assign any or all of its rights and
obligations under this Agreement to any Eligible Assignee. Otherwise,
upon consultation with EOTT OLP, SCTSC (and its assigns) may assign any
or all of its rights and obligations under this Agreement to any
Eligible Assignee. As used herein, "Eligible Assignee" shall mean any
commercial bank, savings and loan association, savings bank, finance
company, insurance company, pension fund, mutual fund investment
company, investment fund, financial institution, or other institutional
lender (whether a corporation, partnership or other entity) acceptable
to SCTSC. The parties hereto agree that this Agreement shall inure to
the benefit of any successor to such parties.
16. SCTSC hereby represents and warrants that (i) it has the capacity, and
has taken all necessary action (corporate and otherwise) to enable it
to enter into and perform its obligations under this Agreement, and
(ii) upon execution of this Agreement by or on behalf of SCTSC, this
Agreement constitutes its legal, valid and binding obligation of such
party.
17. So long as the Transaction remains outstanding, Client represents,
warrants and covenants as follows:
a) to the best of Client's knowledge, there is no financing
statement, as such term is defined by the Uniform Commercial
Code as in effect in the State of New York, now on file in any
public office covering any Commodity, nor is there any lien,
security interest or encumbrance on any such Commodity, except
for liens in favor of the Collateral Agent as provided in the
Intercreditor Agreement and the other Security Documents;
b) other than as set forth in Section [5(t)] of the Disclosure
Schedule, there are no proceedings pending or threatened
before any court, arbitrator or
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governmental or administrative authority, instrumentality or
agency that, in any one case or in the aggregate, if adversely
determined, would materially adversely affect the financial
condition or operations of Client or result in cost, liability
or expense in excess of $ 2,500,000.00;
c) Client is a limited partnership duly organized under the laws
of the state of Delaware, has all necessary power and
authority to own its properties and to carry on its business
as now being and hereafter proposed to be conducted, without
limitation or restriction, and has taken all necessary action
to authorize, execute, deliver and perform this Agreement and
the Transaction Confirmation;
d) each of this Agreement and the Transaction Confirmation shall
constitute a valid and binding legal obligation of Client,
enforceable in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditors' rights generally;
e) the execution, delivery and performance of this Agreement in
accordance with its terms do not and will not violate or
conflict, result in a breach of, or constitute a default
under, any contract to which Client is a party or by which it
or any of its properties may be bound;
f) immediately prior to the effectiveness of the Transaction,
Client is the owner of all Commodities, free from any adverse
claim, option, warrant, lien or any other right, title or
interest of any party other than SCTSC and the Collateral
Agent, subject to the Intercreditor Agreement (as defined in
the Prior Agreement);
g) from the Purchase Date until the earlier of (i) the Repurchase
Date, (ii) the Optional Prepayment Date, or (iii) the
Mandatory Prepayment Date, Client will maintain at least a
number of barrels of crude oil constituting its line fill
equal to the Adjusted Barrel Amount;
h) Client has full power and lawful authority on the Value Date
to convey, sell, and transfer to SCTSC title to all
Commodities and to grant to the Collateral Agent, acting on
behalf of SCTSC in accordance with the Intercreditor
Agreement, a valid security interest therein as herein
provided, and no consent, license, or approval of any person
or entity (including, but not limited to, any governmental
authority or agency) is required in connection therewith or
for SCTSC's ownership, purchase or sale of any Commodity;
i) Client has no place of business, offices where books of
accounts and records are kept, or places where the Commodities
are used, stored or located, except as set forth in Schedule A
annexed hereto, and Client will notify SCTSC prior to any
change in the foregoing representation;
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j) Client shall at all times maintain its records as to the
Commodities at its chief place of business at the address
referred to on Schedule A and at none other, except Client may
transfer such records to an off-site facility in accordance
with Client's internal policies relating to storage of
documents;
k) Client will not store, use or locate any of the Commodities at
any place other than as listed in Schedule A annexed hereto,
except upon prior written notice to SCTSC;
l) Client currently uses no business or trade names, except as
set forth on Schedule A annexed hereto, and covenants that it
will promptly notify SCTSC, in sufficient detail, of any
changes in, additions to, or deletions from the business or
trade names used by Client;
m) Client agrees to pay and perform all of its obligations under
this Agreement according to their terms and to comply with all
acts, rules, regulations and orders of any legislative,
administrative or judicial body or official applicable to the
operation of its business, provided that Client may contest
any acts, rules, regulations, orders and directions of such
bodies or officials in any reasonable manner which will not,
in SCTSC's opinion, adversely affect SCTSC's rights in the
Commodities;
n) all Commodities hereunder will have been acquired by Client
from non-affiliated third parties in the ordinary course of
business; and
o) Client agrees, with respect to any Commodities, unless
otherwise consented to by SCTSC in writing:
(i) not to sell, offer to sell, exchange, assign, loan,
deliver, mortgage or otherwise dispose of any of the
Commodities, including but not limited to sales in
the ordinary course of its business;
(ii) to immediately deliver to SCTSC or SCTSC's agent all
documents, instruments or other writings representing
any of the Commodities or any rights thereto;
(iii) to pay and perform all of the obligations under this
Agreement according to their terms;
(iv) to keep all Commodities free and clear of any liens,
security interests, encumbrances, taxes and
assessments of any kind, except for liens in favor of
the Collateral Agent as provided the Intercreditor
Agreement and the other Security Documents;
(v) to advise SCTSC promptly, in sufficient detail, of
any substantial change in the Commodities, and of the
occurrence of any event which would have a material
effect on the value of the Commodities or on SCTSC's
interest therein; and
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(vi) to comply with all acts, rules, regulations and
orders of any legislative, administrative or judicial
body or official applicable to the Commodities or any
part thereof or to the operation of its business,
provided that Client may contest any acts, rules,
regulations, orders and directions of such bodies or
officials in any reasonable manner which will not, in
SCTSC's opinion, adversely affect SCTSC's rights in
the Commodities.
p) Client shall deliver to SCTSC (and its assigns) from time to
time promptly upon request, all the information, documents,
reports or notices required to be delivered to the LC Agent or
any LC Participant under clauses (d), (e) and (f) of Section 6
of the Letter of Credit Agreement.
18. In respect of this Agreement and the Transaction hereunder, each party
hereto acknowledges and confirms that:
a) The purchase by SCTSC of the Commodities from Client as
contemplated herein is a "forward contract" and each party is
a "forward contract merchant" as those terms are defined in
the U.S. Bankruptcy Code; and
b) All payments made in connection with this Agreement and the
Transaction hereunder constitute "settlement payments" as that
term is defined in the U.S. Bankruptcy Code.
19. Although the parties intend that the Transaction hereunder be a
purchase and sale and not a loan, in the event the Transaction is
deemed to be a loan or financing, Client shall be deemed to have
pledged and hereby pledges, assigns and grants to the Collateral Agent,
acting on behalf of SCTSC in accordance with the Intercreditor
Agreement, as security for the performance by Client of all of Client's
obligations to SCTSC, whether now existing or hereafter arising, direct
or indirect, due or to become due, matured or unmatured, or absolute or
contingent, a first priority security interest in and lien on all of
the Commodities with respect to the Transaction hereunder, any Hedge
Contracts and all of the documents of title delivered to SCTSC pursuant
to this Agreement and all proceeds thereof, and this Agreement shall
constitute a valid and binding security agreement under applicable law.
The Collateral Agent shall have all of the rights and remedies of a
secured party under the Uniform Commercial Code of the State of New
York and other applicable law with respect to such security interest,
except as provided in the Intercreditor Agreement.
20. Notwithstanding anything to the contrary contained herein or the
Transaction Confirmation, SCTSC's only obligation to Client is to
deliver, against payment, the documents with respect to Commodities,
which SCTSC purchased or received from Client pursuant to this
Agreement and the Transaction Confirmation or the equivalent thereof.
ALL WARRANTIES BY SCTSC, EXPRESS OR IMPLIED, OF ANY NATURE WHATSOEVER,
INCLUDING WARRANTIES OF MERCHANTABILITY AND FITNESS, ARE EXCLUDED.
12
21. Client shall reimburse SCTSC, promptly upon demand, for all costs and
expenses incurred by SCTSC, including, without limitation, legal fees
and disbursements, in connection with or arising from the execution,
delivery, administration, amendment, modification or enforcement of
this Agreement, including, without limitation, legal fees and
disbursements arising from the defense of any claim, counterclaim or
proceeding asserted or commenced by Client against SCTSC or the
Collateral Agent.
22. THIS AGREEMENT AND THE TRANSACTION SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO
CHOICE OF LAW PRINCIPLES.
23. CLIENT HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND
ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE COURTS OF NEW
YORK STATE OR FEDERAL COURT OF THE UNITED STATES OF AMERICA SITTING IN
NEW YORK CITY, WHETHER TRIAL OR APPELLATE, IN ANY ACTION OR PROCEEDING
ARISING OUT OF, OR RELATING TO, THIS AGREEMENT, OR FOR RECOGNITION OR
ENFORCEMENT OF ANY JUDGMENT IN RESPECT THEREOF, AND CLIENT HEREBY
IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF
ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH
NEW YORK STATE COURT OR, TO THE EXTENT PERMITTED BY LAW, IN SUCH
FEDERAL COURT AND CONSENTS THAT ANY SUCH ACTION OR PROCEEDING MAY BE
BROUGHT IN SUCH COURTS AND WAIVES TO THE FULLEST EXTENT PERMITTED BY
LAW ANY OBJECTION OR CLAIM THAT IT MAY NOW OR HEREAFTER HAVE TO THE
VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH
ACTION OR PROCEEDING WAS BROUGHT IN AN INCONVENIENT COURT AND AGREES
NOT TO PLEAD OR CLAIM THE SAME. CLIENT HEREBY AGREES THAT A FINAL
JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY
BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY
OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS AGREEMENT SHALL AFFECT
ANY RIGHT THAT ANY PARTY MAY OTHERWISE HAVE TO BRING ANY ACTION OR
PROCEEDING RELATING TO THIS AGREEMENT IN THE COURTS OF ANY
JURISDICTION. CLIENT HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY
JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF, OR
RELATING TO, THIS AGREEMENT OR THE ACTIONS OF SCTSC IN THE NEGOTIATION,
ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF. THIS PROVISION IS A
MATERIAL INDUCEMENT FOR SCTSC TO ENTER INTO THIS AGREEMENT.
24. a) No express or implied waiver of any Event of Default by SCTSC
shall constitute a waiver of any other Event of Default and no
exercise of any remedy hereunder by SCTSC shall constitute a
waiver of SCTSC's right
13
to exercise any other remedy hereunder. No modification or
waiver of any provisions of this Agreement and no consent by
SCTSC to a departure from the terms hereof shall be effective
unless and until such shall be in writing and duly executed by
SCTSC. Without limitation of any of the foregoing, the failure
on any occasion to exercise any remedy or to give any notice
pursuant to any provisions hereof shall not constitute a
waiver of the right to exercise such remedy or give such
notice on any other occasion.
b) Each and every right granted to SCTSC or the Collateral Agent,
acting on behalf of SCTSC in accordance with the Intercreditor
Agreement, hereunder or in connection herewith, or allowed to
it by law or equity, shall be cumulative and may be exercised
from time to time.
c) The due payment and performance of Client's obligations under
this Agreement shall be without regard to any counterclaim,
right of offset or any other claim whatsoever which Client may
have against SCTSC, and no such counterclaim, right of offset
or other claims shall be asserted by Client in any action or
proceeding instituted by SCTSC for payment or performance of
such obligations of Client.
d) At any time and from time to time, upon the request of SCTSC,
Client shall execute and deliver or cause to be executed and
delivered such further documents and instruments as SCTSC may
request in order to fully effect the purpose of this Agreement
and the Transaction Confirmation.
e) All representations, warranties and agreements made herein
shall survive the delivery of this Agreement and the
Transaction Confirmation.
f) Any provision of this Agreement which is prohibited or
unenforceable in any applicable jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition
or unenforceability without invalidating the remaining
provisions hereof or affecting the validity or enforceability
of such provision in any other jurisdiction. To the extent
permitted by applicable law, Client hereby waives any
provision of law which renders any provision hereof prohibited
or unenforceable in any respect.
25. Amendment and Restatement. This Agreement amends and restates the Prior
Agreement in its entirety, and nothing in this Agreement shall be
deemed to constitute a novation of the Prior Agreement.
[Signature pages follow.]
14
IN WITNESS WHEREOF, Client, SCTSC and the Collateral Agent have each caused this
Agreement to be executed by a duly authorized officer(s) as of the date first
written above.
EOTT ENERGY OPERATING LIMITED
PARTNERSHIP
By: EOTT ENERGY GENERAL PARTNER, L.L.C., its General Partner
By:________________________________
Name: H. Xxxxx Xxxxxxx
Title: Executive Vice President and Chief Financial Officer
STANDARD CHARTERED TRADE
SERVICES CORPORATION
By: ______________________________
Name: ____________________________
Title: ___________________________
By: ______________________________
Name: ____________________________
Title: ___________________________
STANDARD CHARTERED BANK, as Collateral Agent
By: _______________________________
Name: Xxxx XxXxxxxx
Title: Senior Vice President
15
EXHIBIT A TO SECOND AMENDED AND RESTATED
COMMODITIES REPURCHASE AGREEMENT
TRANSACTION CONFIRMATION
TO: EOTT Energy Operating Limited Partnership ("Client")
ATTN: [____________]
FROM: Standard Chartered Trade Services Corporation ("SCTSC")
DATE: [____________]
Re: Second Amended and Restated Commodities Repurchase Agreement (the
"Agreement") dated February 11, 2003
Dear Sirs,
Reference is made to that certain Second Amended and Restated Commodities
Repurchase Agreement dated February 11, 2003 (as amended, modified or
supplemented from time to time, the "Agreement") among EOTT Energy Operating
Limited Partnership, SCTSC and Standard Chartered Bank. This confirmation is
delivered pursuant to Section 2(c) of the Agreement and shall be deemed to be a
part of the Agreement. All provisions contained in the Agreement govern this
Confirmation, except as expressly provided below.
The terms of the particular Transaction to which this Confirmation relates are
as follows:
- Commodity Type and Location(s): Crude oil, various locations (see monthly
inventory report attached hereto)
- Amount of Commodity: [_______] barrels
- Total purchase price payable by SCTSC: $75,000,000
- Value Date: October 18, 2002
- Repurchase Date: Initial Maturity Date (unless extended pursuant to Section
10 of the Agreement)
- Hedge Account details: [____________]
- Repurchase Price: $75,000,000
- Interest Rate: 1-month LIBOR
Exhibit A-1
- Account for payments to SCTSC: SCTSC's A/C #0000-000000-000
at Standard Chartered Bank,
Xxx Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Exhibit A-2
Please confirm that the foregoing terms set forth our agreement by executing a
copy of this Confirmation below and returning it to us by facsimile.
Very Truly Yours,
STANDARD CHARTERED TRADE SERVICES CORPORATION
By:______________________
Name:
Title:
By:______________________
Name:
Title:
Confirmed on the date first written above:
EOTT ENERGY OPERATING LIMITED PARTNERSHIP
By: EOTT Energy General Partner, L.L.C., its general partner
By: _____________________________________
Name: H. Xxxxx Xxxxxxx
Title: Executive Vice President and Chief Financial Officer
Exhibit A-3
EXHIBIT B TO SECOND AMENDED AND RESTATED
COMMODITIES REPURCHASE AGREEMENT
FORM OF HOLDING CERTIFICATE
[LETTERHEAD OF ISSUER]
HOLDING CERTIFICATE
Date _____________________
Standard Chartered Trade Services Corporation
Xxx Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attn: Xxxx XxXxxxxx
AVP Trade Operations
Dear Sirs,
This document is a negotiable document of title under the Uniform Commercial
Code. This document evidence that the goods covered hereby shall be delivered to
the order of Standard Chartered Trade Services Corporation or its endorsees or
assigns.
As of this date, the undersigned, (Issuer) , holds the following material to
your order.
QUANTITY DESCRIPTION OF GOODS LOCATION
This quantity of material will not be released or delivered to any other person
except on your written instructions. This document evidences that the holder is
entitled to receive, hold and dispose of this document and the goods it covers.
The undersigned is a bailee of the goods covered by this document.
Sincerely,
[ISSUER]
By: ____________________
Name: __________________
Title: _________________
Exhibit B-1
SCHEDULE A
INFORMATION TO BE PROVIDED BY CLIENT
- Client's place of business (chief executive office):
0000 X. Xxx Xxxxxxx Xxxxxxx X., Xxxxx 000
Xxxxxxx, XX 00000
- Offices where Client books of accounts and records are kept (other than
off-site locations used for storage of documents):
Same as chief executive office.
- Places where Commodities are used, stored or located:
See monthly inventory report attached hereto.
- Client's business or trade name(s):
EOTT Energy
EOTT Energy Operating Limited Partnership
Sched. A-1
SCHEDULE B
DEFINITION OF LIBOR
"LIBOR" means, as applicable to any loan and with respect to the
related Interest Period therefor, the rate per annum (rounded upwards, if
necessary, to the nearest 1/32 of 1%) as determined on the basis of offered
rates for deposits in U.S. dollars, for a period of time comparable to such
Interest Period and an amount comparable to such loan which appears on Telerate
Page 3750 (or any successor page) as of 11:00 a.m. London time on the day that
is two Business Days preceding the first day of such LIBOR Loan; provided,
however, if the rate described above does not appear on the Telerate system on
any applicable interest determination date, LIBOR shall be the rate (rounded
upwards as described above, if necessary) for deposits in dollars for a period
substantially equal to such Interest Period on the Reuters Page "LIBO" (or such
other page as may replace the LIBO Page on that service for the purpose of
displaying such rates), as of 11:00 a.m. (London time), on the date that is two
Business Days prior to the beginning of such Interest Period; and provided
further, however, if more than one rate is specified on Reuters Screen LIBO
Page, the applicable rate shall be the arithmetic mean of all such rates
(rounded upwards, if necessary, to the nearest 1/1000 of 1%). If both the
Telerate and Reuters system are unavailable, then LIBOR for that date will be
determined on the basis of the offered rates for deposits in U.S. dollars for a
period of time comparable to such Interest Period which are offered by four
major banks in the London interbank market at approximately 11:00 a.m. London
time, on the day that is two (2) Business Days preceding the first day of such
LIBOR Loan as selected by SCTSC. The principal London office of each of the four
major London banks will be requested to provide a quotation of its U.S. dollar
deposit offered rate. If at least two such quotations are provided, the rate for
that date will be the arithmetic mean of the quotations. If fewer than two
quotations are provided as requested, the rate for that date will be determined
on the basis of the rates quoted for loans in U.S. dollars to leading European
banks for a period of time comparable to such Interest Period offered by major
banks in New York City at approximately 11:00 a.m. New York City time, on the
day that is two Business Days preceding the first day of such LIBOR Loan. In the
event that SCTSC is unable to obtain any such quotation as provided above, it
will be deemed that LIBOR pursuant to such LIBOR Loan cannot be determined. In
the event that the Board of Governors of the Federal Reserve System shall impose
a Reserve Percentage with respect to LIBOR deposits of any Lender, then for any
period during which such Reserve Percentage shall apply, LIBOR shall be equal to
the amount determined above divided by an amount equal to 1, minus the Reserve
Percentage. "Reserve Percentage" means the maximum aggregate reserve requirement
(including all basic, supplemental, marginal, special, emergency and other
reserves) which is imposed on member banks of the Federal Reserve System against
"Euro-currency Liabilities" as defined in Regulation D. Without limiting the
effect of the foregoing, the Reserve Percentage shall reflect any other reserves
required to be maintained by such member banks with respect to (i) any category
of liabilities that includes deposits by reference to which LIBOR is to be
determined or (ii) any category of extensions of credit or other assets that
include LIBOR Loans. The interest rate for any loan that bears interest at a
rate based upon LIBOR shall change whenever the Reserve Percentage changes.
Sched. B-1
