EXHIBIT 2.1
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ASSET PURCHASE AGREEMENT
By and Among
BP CORPORATION NORTH AMERICA INC.,
BP PIPELINES (NORTH AMERICA) INC.
and
TESORO PETROLEUM CORPORATION
Dated as of
July 16, 2001
Relating to the
Purchase and Sale
of the North Dakota Core Pipeline Interest and Related Assets
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TABLE OF CONTENTS
Page
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1. PURCHASE AND SALE OF THE PIPELINE INTEREST ............................................... 1
2. EXCLUDED ASSETS .......................................................................... 3
3. DEPOSIT AND PURCHASE PRICE ............................................................... 5
(a) Deposit .................................................................. 5
(b) Purchase Price ........................................................... 6
(c) Closing Date Payments .................................................... 6
4. ASSUMPTION OF LIABILITIES ................................................................ 7
5. CLOSING ..................................................................................10
6. SELLER'S REPRESENTATIONS AND WARRANTIES ..................................................12
(a) Organization and Good Standing ...........................................12
(b) Authority ................................................................12
(c) Consents .................................................................12
(d) No Breach ................................................................13
(e) Real Property ............................................................13
(f) Brokers ..................................................................14
(g) Machinery and Equipment ..................................................14
(h) Compliance With Laws .....................................................14
(i) Permits ..................................................................14
(j) Actions and Proceedings ..................................................14
(k) Assets ...................................................................15
(l) Tangible Assets ..........................................................15
7. ENVIRONMENTAL MATTERS ....................................................................15
(a) Environmental Representations and Warranties .............................15
(b) Limitation ...............................................................16
8. DISCLAIMERS ..............................................................................16
9. BUYER'S REPRESENTATIONS AND WARRANTIES ...................................................18
(a) Organization and Good Standing ...........................................18
(b) Authority of Buyer .......................................................18
(c) Consents .................................................................18
(d) No Breach ................................................................18
(e) Litigation ...............................................................18
(f) Brokers ..................................................................18
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(g) Availability of Funds ....................................................19
(h) No Knowledge of Misrepresentations or Omissions ..........................19
10. COVENANTS ................................................................................19
(a) Covenants of Seller ......................................................19
(b) Covenants of Buyer .......................................................21
(c) Mutual Covenants .........................................................24
11. EMPLOYEES ................................................................................27
(a) Employees ................................................................27
(b) Employment Offers to Active Employees ....................................27
(c) Employment Offers to Employees on Leave ..................................27
(d) Transfer Time ............................................................28
(e) Level of Employee Benefits Provided by Buyer .............................28
(f) Pension Plans ............................................................28
(g) Defined Contribution Pension Plans .......................................28
(h) Welfare Benefits and Other Benefits and Policies .........................29
(i) Vacation .................................................................29
(j) Severance ................................................................29
(k) WARN Act .................................................................29
(l) Service Credit ...........................................................30
12. BUYER'S OBLIGATION TO CLOSE ..............................................................30
(a) Compliance with Agreement ................................................30
(b) Representations and Warranties ...........................................30
(c) Litigation ...............................................................30
(d) Governmental Consents ....................................................31
(e) Mandan Refinery ..........................................................31
13. SELLER'S OBLIGATION TO CLOSE .............................................................31
(a) Compliance with Agreement ................................................31
(b) Representations and Warranties ...........................................31
(c) Litigation ...............................................................31
(d) Governmental Consents ....................................................31
14. FURTHER ASSURANCES .......................................................................32
15. INDEMNIFICATION ..........................................................................32
(a) Buyer's Indemnification of Seller ........................................32
(b) Seller's Indemnification of Buyer ........................................32
(c) Environmental Indemnifications ...........................................33
(d) Exclusive Remedy .........................................................34
(e) Procedures Relating to Indemnification Among Buyer and
Seller ...................................................................35
(f) Procedures Relating to Indemnification for Third Party
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Claims ...................................................................35
(g) Losses Net of Insurance and Taxes ........................................36
(h) Attorneys' Fees ..........................................................37
(i) Time Limitation ..........................................................37
(j) Monetary Limitation ......................................................37
(k) Limitation of Liability ..................................................37
(l) Environmental Remediation Monetary Limitation. ...........................37
(m) Rights-of-Way Monetary Limitation. .......................................38
(n) Mitigation ...............................................................38
(o) Losses ...................................................................38
16. TAXES ....................................................................................38
17. RECORDS/LITIGATION ASSISTANCE ............................................................39
18. TERMINATION RIGHTS .......................................................................40
19. SPECIFIC PERFORMANCE .....................................................................41
20. NOTICES ..................................................................................42
21. GOVERNING LAW; SUBMISSION TO JURISDICTION ................................................43
22. PUBLICITY ................................................................................43
23. SURVIVAL OF COVENANTS, REPRESENTATIONS AND
WARRANTIES ...............................................................................43
24. ENTIRE AGREEMENT .........................................................................43
25. ASSIGNMENT ...............................................................................44
26. AMENDMENT AND WAIVER .....................................................................44
27. EXPENSES. ................................................................................44
28. HEADINGS .................................................................................45
29. COUNTERPARTS .............................................................................45
30. INTERPRETATION ...........................................................................45
31. NO STRICT CONSTRUCTION ...................................................................45
32. SCHEDULES ................................................................................45
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33. REPRESENTATION BY COUNSEL; INTERPRETATION .................................................46
34. SEVERABILITY ..............................................................................46
35. BULK TRANSFER LAWS ........................................................................46
36. NO THIRD PARTY BENEFICIARIES ..............................................................46
37. DEFINITION OF AFFILIATE ...................................................................46
39. NO CONDITIONS .............................................................................46
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SCHEDULES
SCHEDULE DESCRIPTION
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1(a) Pipeline Assets
1(c) Contracts
2(c) Excluded Assets Related to Support and Other Services
Provided to the Pipeline Interest 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) Real Property
6(h) Compliance with Laws
6(i) Permits
6(j) Actions and Proceedings
6(k) Assets
6(l) Tangible Assets
7(a) Environmental Matters
10(a)(ii) Conduct of Business by Seller
11(a) Employees
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EXHIBITS
EXHIBIT DESCRIPTION
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A Form of Technology Agreement
B Form of Deed for the Pipeline Real Property
C Form of Assignment of Pipeline Agreements
D Form of Transition Services Agreement
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INDEX TO DEFINED TERMS
TERM PAGE
---- ----
Agreement .................................................................................................1, 30
Asbestos-Related Liabilities ..................................................................................8
Assumed Liabilities ...........................................................................................7
BP ............................................................................................................1
BP Group ......................................................................................................2
BP Pipelines ..................................................................................................1
BP RAP .......................................................................................................28
XX Xxxxxxxxx Plan ............................................................................................29
Buyer .........................................................................................................1
Buyer Indemnified Parties ....................................................................................33
Buyer Pension Plan ...........................................................................................28
CERCLA ........................................................................................................8
Closing ......................................................................................................10
Closing Date .................................................................................................10
Code .........................................................................................................11
Confidentiality Agreement ....................................................................................19
Data .........................................................................................................19
Deposit .......................................................................................................5
Deposit Return Event ..........................................................................................5
Disclosed Environmental Liabilities ...........................................................................8
Employees ....................................................................................................27
Environmental Permits .........................................................................................2
Excluded Assets ...............................................................................................3
Excluded Liabilities ..........................................................................................9
Final Orders .................................................................................................30
First Threshold ..............................................................................................37
H-S-R Act ....................................................................................................10
Health, Safety and Environmental Laws .........................................................................8
Indemnification Notice .......................................................................................35
Indemnified Party ............................................................................................35
Indemnifying Party ...........................................................................................35
knowledge ....................................................................................................12
Leave ........................................................................................................27
Xxxxx 0 Xxxxxxxxx ............................................................................................00
Xxxxx 0 Xxxxxxxxx ............................................................................................38
Losses .......................................................................................................38
Offering Memorandum ...........................................................................................8
Offsite Environmental Liabilities ............................................................................10
ordinary course of business ...................................................................................3
Permits .......................................................................................................2
Permitted Liens ..............................................................................................14
Person .......................................................................................................13
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TERM PAGE
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Personal Property .............................................................................................1
Pipeline Agreements ...........................................................................................1
Pipeline Interest .............................................................................................1
Pipeline Real Property ........................................................................................1
Pipelines .....................................................................................................1
Purchase Price ................................................................................................6
Purchased Assets ..............................................................................................1
Remediation Losses ...........................................................................................33
Rights-of-Way Losses .........................................................................................33
Schedules ....................................................................................................45
Second Threshold .............................................................................................38
Seller ........................................................................................................1
Seller Indemnified Parties ...................................................................................32
Seller Information ...........................................................................................22
Seller Vacation Policy .......................................................................................29
Seller's knowledge ...........................................................................................12
Taxes .........................................................................................................3
Technology Agreement ..........................................................................................2
Third Party Claim ............................................................................................35
Threshold ....................................................................................................37
Transferred Employees ........................................................................................27
Transition Services Agreement ................................................................................26
WARN Obligations .............................................................................................29
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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 July 16, 2001, by and among
BP Corporation North America Inc., an Indiana corporation ("BP"), and BP
Pipelines (North America) Inc., a Maine corporation ("BP Pipelines," and
together with BP, "Seller"), on the one hand, and Tesoro Petroleum Corporation,
a Delaware corporation ("Buyer"), on the other hand.
WITNESSETH:
WHEREAS, upon and subject to the terms and conditions of this
Agreement, Seller wishes to sell its interest in the assets constituting those
certain pipelines and certain liabilities, each as further described in Sections
1 and 4 (the "Pipeline Interest") located in Montana and North Dakota, and used
to transport crude oil, and Buyer wishes to purchase such assets and to assume
certain liabilities relating thereto, in each case upon the terms and subject to
the conditions set forth herein;
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 PIPELINE INTEREST. 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 Pipeline Interest (the
"Purchased Assets"):
(a) subject to Section 2(h), Seller's interest in the
pipelines and all real property interests used to transport crude oil,
as more particularly described on Schedule 1(a) attached hereto
(collectively, the "Pipelines"), including but not limited to:
(i) the real property owned by Seller on which pump
stations and booster stations are situated, as more
particularly described on Schedule 1(a)(i) attached hereto,
including the improvements to such real property, together
with all appurtenances, rights and benefits related thereto
and the fixtures thereon (the "Pipeline Real Property"); and
(ii) subject to Section 10(c)(ii), all assignable or
transferable easements, rights-of-way, permits, licenses,
leases and other rights of access relating to the Pipelines
(the "Pipeline Agreements");
(b) the machinery, equipment, vehicles, and other personal property
owned and used exclusively in the operation of the Pipeline Interest as it is
currently operated by Seller (collectively, the "Personal Property");
(c) subject to Section 10(c)(ii), all assignable or transferable rights
and obligations of Seller under the agreements, contracts, leases, licenses and
similar instruments relating exclusively to the Pipeline Interest as it is
currently operated by Seller, including those set forth on Schedule 1(c)
attached hereto;
(d) 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 Pipeline Interest 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 Pipeline Interest, for the ownership or operation of the Pipeline
Interest as it is currently operated by Seller (collectively, the "Environmental
Permits");
(e) subject to and in accordance with the Technology Transfer and
License Agreement attached hereto as Exhibit A (the "Technology Agreement"), a
nonexclusive, royalty-free license to use in the operation of the Pipeline
Interest 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;
(f) 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 Pipeline Interest 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;
(g) subject to Section 10(c)(ii) and in accordance with the Technology
Agreement, all assignable or transferable technical drawings in possession of
Seller or located at the Purchased Assets and relating exclusively to and
necessary for the operation of the Pipeline Interest as it is currently operated
by Seller; and
(h) all other assignable or transferable assets, active or inactive,
operating or abandoned, owned or leased by, or licensed to or used by Seller and
located at the Purchased Assets and used exclusively in the operation of the
Pipeline Interest 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
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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 Pipeline Interest, the Closing and any
other transaction contemplated by this Agreement, so long as such
actions do not have a material adverse effect on the Pipeline Interest,
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"):
(a) cash and cash equivalents (including marketable securities
and short-term investments);
(b) accounts and notes receivable as of 12:01 a.m., Central
Time, on the Closing Date;
(c) assets owned by other members of the BP Group, not used
exclusively by Seller in the operation of the Pipeline Interest or not
located at the Purchased Assets, 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
Pipeline Interest as described on Schedule 2(c) attached hereto and
certain other specified assets not located at the Purchased Assets as
described on Schedule 2(c) attached hereto, including assets owned by
or located at the pipeline control center in Tulsa, Oklahoma;
(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 Pipeline Interest 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 Pipeline
Interest and all copies of and subscriptions to third-party reports;
3
(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 Purchased Assets which are
not owned by Seller, including spare parts on consignment, certain
chemicals on consignment, 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 Pipeline Interest 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 Pipeline Interest;
(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
Pipeline Interest as it is currently operated by Seller;
(n) employment records, including personnel records and
medical records, relating to employees of the Pipeline Interest 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;
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(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 Pipeline
Interest 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 Pipeline Interest; and
(r) all arrangements, contracts, agreements, understandings
or commitments, whether written or oral, by and among the Pipeline
Interest and members of the BP Group, other than those listed on
Schedule 2(r) (it being understood that all such arrangements,
contracts, agreements, understandings or commitments (other than
agreements for transportation on the Pipelines) will be terminated on
or prior to Closing).
To the extent that any Excluded Assets remain located at the Pipelines
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 Pipeline Interest.
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 all
interests in real property) in an amount equal to Five Million Dollars
($5,000,000) (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 Seventeen Million Two Hundred
5
Thousand Dollars ($17,200,000), 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);
(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, except
with respect to the fulfillment of the conditions set forth in Section
12(e) for which the material breach of Buyer's representations,
warranties, covenants or agreements contained herein shall be ignored;
(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; or
(vi) this Agreement is terminated by Buyer pursuant to Section
18(a)(v); 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.
(b) Purchase Price. In consideration for the Purchased Assets, Buyer
shall pay, transfer and undertake to Seller as follows:
(i) Buyer shall pay to Seller (or Seller's designee) in cash a
price of Ninety Million Dollars ($90,000,000), representing the value
of the Purchased Assets as of the Closing Date (the "Purchase Price");
and
(ii) Buyer shall assume and agree to pay and perform and
discharge when due the Assumed Liabilities.
(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 Purchase Price
minus 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.
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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 Pipeline Interest 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 in this
subparagraph (i), 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 Pipelines, the Pipeline Real Property
and the Personal Property;
(B) all of the agreements, contracts, leases,
permits or similar instruments, including
the Pipeline Agreements, easements,
rights-of-way and other rights of access,
constituting part of the Purchased Assets;
(C) the Permits;
(D) all accounts payable and accrued liabilities
relating to goods and/or services provided
to the Pipeline Interest on or after the
Closing Date;
(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 Pipeline Interest 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,
7
arising from, incurred in connection with or relating in any
way to the ownership of the Purchased Assets or the operation
of the Pipeline Interest 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 Pipeline Interest 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 April 20,
2001, a copy of which previously has been provided to Buyer,
in the Confidential Information Memorandum for the Pipeline
Interest dated March 2001 (the "Offering Memorandum") or in
any of the health, safety and environmental records or reports
of the Pipeline Interest previously provided to Buyer
(collectively, the "Disclosed Environmental Liabilities"); and
(C) any and all obligations, responsibilities, liabilities,
compliance costs and expenses relating to governmental
requirements including mandated clean-up, fines and penalties.
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, 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, as amended, 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.
8
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, in each case, determined in accordance with
generally accepted accounting principles as in effect in the
United States at the Closing Date;
(vi) any liability or obligation in respect of
indebtedness for borrowed money;
(vii) except as otherwise provided in this Agreement,
all liabilities or obligations relating to any litigation,
threatened litigation or claims 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(j) 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 Pipeline Interest 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 Pipeline Interest; 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
9
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
Pipeline Interest (the "Offsite Environmental Liabilities");
(xi) any responsibility for the payment of any
criminal sanctions 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 Pipeline Interest 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.
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, a
business day which is not later than five (5) business days after the
last to occur of (A) 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 and (B) the notification of
approval by the Public Service Commission of North Dakota. 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 deeds for the Pipeline Real
Property, substantially in the form of Exhibit B attached
hereto;
(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);
10
(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 Pipelines' good standing in Maine and BP's and
BP Pipelines' qualification to do business and good standing
in Montana and North Dakota; 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;
(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 resolution(s) adopted
by the Board of Directors of Buyer or its affiliates, as
appropriate, 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 an
authorized officer 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; and
(v) a current certificate of Buyer's good standing in
the state of its incorporation and its qualification, or the
qualification of its wholly-owned subsidiary to which Buyer
directs that Seller convey the Purchased Assets, to do
business and good standing in Montana and North Dakota.
(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 A;
11
(ii) subject to Section 10(c)(ii), the Assignment of
Pipeline Agreements substantially in the form of Exhibit C
attached hereto for the Pipeline Agreements; and
(iii) subject to Section 10(c)(iii), the Transition
Services Agreement substantially in the form of Exhibit D
attached hereto.
(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 Xxxxxxx X. XxXxxxx, Xxxxxx Xxx and Xxxxxx X. Xxxxx. 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 Pipelines is a corporation duly organized, validly
existing and in good standing under the laws of the State of Maine.
(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 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 regulatory approvals of the Public Service
Commission of North Dakota and (iii) obtaining the consents required in
connection with the Pipeline Agreements and certain agreements,
contracts, licenses, leases, easements, rights-of-way and permits, 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
12
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 Pipeline
Interest, taken as a whole, as it is currently operated by Seller.
(d) No Breach. Subject to obtaining the consents required in
connection with the Pipeline Agreements and 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 Pipeline Interest, 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.
(e) Real Property. Title to the Pipeline 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 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 B; (J) acts done or
suffered to be done by, and
13
judgments against, Buyer and those claiming by, through or under Buyer
(collectively, (A) through (J) are referred to herein as the "Permitted
Liens").
(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 Pipeline Interest 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 Pipeline Interest,
taken as a whole, as it is currently operated by Seller.
(i) Permits. Seller possesses all Permits, licenses and
governmental approvals necessary for the operation of the Pipeline
Interest, taken as a whole, as it is currently operated by Seller,
except for (i) Environmental Permits (which are addressed in Section 7)
and, (ii) 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 operation of the Pipeline Interest,
taken as a whole, as it is currently operated by Seller.
Notwithstanding the foregoing, this Section 6(i) shall not apply to the
real property of the Pipelines, including the Pipeline Agreements, any
Pipelines rights-of-way, Permits, licenses and other real property
rights.
(j) Actions and Proceedings. Except for such matters as would
not have a material adverse effect on the operation of the Pipeline
Interest, 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 or
regulatory 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
14
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
(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.
(k) Assets. Except for (i) assets disposed of in the ordinary
course of business, subsequent to the date hereof, (ii) Excluded
Assets, (iii) pipeline rights-of-way, permits, licenses and other
property rights, and (iv) assets set forth on Schedule 6(k), 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, and which are reasonably required to operate the
Pipeline Interest immediately following the Closing Date substantially
in the manner in which the Pipeline Interest 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 Pipeline Interest, taken as a whole, as it is currently operated by
Seller.
(l) Tangible Assets. The Purchased Assets, excluding all
rights-of-way, permits, licenses, leases and other rights of access
relating to the Pipelines, 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, current usage, 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 Pipeline Interest 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 Pipeline Interest, taken as a whole, as it is
currently operated by Seller;
(ii) all environmental control equipment necessary
for the operation of the Pipeline Interest 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 Pipeline Interest by
Seller, is installed at the Purchased Assets,
15
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 material adverse effect on the Pipeline
Interest, 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 Pipeline
Interest by Seller, which, individually or in the aggregate,
would have a material adverse effect on the Pipeline Interest,
taken as a whole, as it is currently operated by Seller.
(b) Limitation. The representations and warranties set forth
in Section 7(a) 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 PIPELINE
INTEREST, THE PURCHASED ASSETS OR THE ASSUMED LIABILITIES OR ANY
PORTION THEREOF, INCLUDING THE PIPELINES OR ANY OTHER ASSET TRANSFERRED
TO BUYER PURSUANT TO THE TERMS OF THIS AGREEMENT, 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 PIPELINES, ANY PORTION
THEREOF 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 (I) THE CONDITION OR
MERCHANTABILITY OF ANY OF THE PURCHASED ASSETS, INCLUDING THE
PIPELINES, ANY PORTION THEREOF OR ANY OTHER ASSETS TRANSFERRED TO BUYER
PURSUANT TO THE TERMS AND CONDITIONS OF THIS AGREEMENT, (II) THE
FITNESS OF ANY
16
ASSETS FOR ANY PURPOSE, OR (III) THE ASSIGNABILITY, COMPLETENESS OR
CONTIGUITY OF ANY PIPELINES RIGHTS-OF-WAY, THE PIPELINE AGREEMENTS,
PERMITS, LICENSES AND OTHER PROPERTY RIGHTS, AND SELLER AND THE OTHER
MEMBERS OF THE BP GROUP EXPRESSLY DISCLAIM ANY 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
PIPELINE INTEREST, 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
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
17
ADVISABLE FOR PURPOSES OF DETERMINING WHETHER OR NOT TO ENTER INTO THIS
AGREEMENT.
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 of Buyer. 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 this
Agreement has been duly executed and delivered 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 (i) the H-S-R Act and
(ii) obtaining the regulatory approvals of the Public Service
Commission of North Dakota, 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.
(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
18
respect to this Agreement or the transactions contemplated hereby,
except pursuant to an arrangement with Xxxxxx Brothers Inc., for which
Buyer is solely responsible.
(g) Availability of Funds. Buyer has cash available to enable
it to consummate the transactions contemplated by this Agreement, to
operate the Pipelines for the reasonably foreseeable future and to meet
the Pipeline Interest'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 12, 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 Purchased
Assets and the books and records and other information
relating to the operations of the Pipeline Interest. 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
Purchased Assets and the operation of the Pipeline Interest
(the "Data") 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 of or suppliers to
the Pipeline Interest 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 Pipeline
Interest 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 and others having business relationships with the
Pipeline Interest; use commercially reasonable efforts to
19
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 constituting
Purchased Assets or other rights of the Pipeline Interest, (C)
commencing any new capital projects or making any additional
commitments for capital expenditures relating to the Pipeline
Interest in excess of Five Hundred Thousand Dollars ($500,000)
in the aggregate, or (D) granting or agreeing to grant any
bonus to any employees of the Pipeline Interest, 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 of the ordinary course of business; provided
that Seller may take any action to which Buyer consents (which
consent shall not be unreasonably withheld taking account of
Buyer's and Seller's commercial objectives with respect to the
Purchased Assets).
(iii) Schedules.
(A) 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).
(B) If such additions or changes would have a
material adverse effect on the Pipeline
Interest, 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. For purposes of this Section
10(a)(iii) only, such additions or changes
shall be deemed to have a material adverse
effect on the Pipeline
20
Interest only if such adverse effect exceeds
Five Million Dollars ($5,000,000).
(C) In the event that the parties hereto are
unable to agree upon on an adjustment to the
Purchase Price prior to the Closing Date,
each party agrees that the Closing will take
place without delay as set forth in this
Agreement and the Buyer shall pay the full
purchase price. The Parties further agree,
upon the demand of any party, to submit the
need for, and size of, any adjustment to the
Purchase Price to binding arbitration. A
party desiring to submit to arbitration any
such matter shall furnish its demand for
arbitration in writing to the other party
within a ten (10) day period commencing on
the closing date. The arbitration shall be
conducted before three (3) arbitrators who
are experienced in matters pertaining to the
pipeline industry. The arbitrators shall not
be a past or present officer, director or
employee of any party or any of its
affiliates. The arbitration shall be
governed by the Commercial Arbitration Rules
of the American Arbitration Association.
Should the arbitrators render a decision in
favor of the Buyer for an adjustment in the
Purchase Price, Seller shall pay to Buyer
such amount plus interest from the Closing
Date through and including the date payment
is made at a rate of 4% per annum.
(iv) Confidentiality. After the Closing, Seller shall
maintain the confidentiality of all information, documents and
materials relating exclusively to the Pipeline Interest,
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).
(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,
21
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 Purchased Assets and
the Assumed Liabilities; provided that Buyer
acknowledges that any and all information
provided or made available to any of 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 documents
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
Information to any of its affiliates,
provided such affiliate shall comply with
the terms of this Section 10(b)(i)(B). 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 Pipeline
Interest, 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).
22
(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
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
offices and facilities related to the Pipeline Interest; 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. In addition, Buyer agrees that, within three (3) months
after
23
the Closing Date, Buyer shall replace all signs located along
each Pipeline, including at river crossings, that identify BP,
BP Pipelines or any other member of the BP Group as the
operator of such Pipeline.
(c) Mutual Covenants. Buyer and Seller covenant and agree as
follows:
(i) H-S-R/State Regulatory Approvals. Buyer and
Seller shall each file or cause to be filed with (A) the
Federal Trade Commission and the United States Department of
Justice any notifications required to be filed under the H-S-R
Act and (B) the Public Service Commission of North Dakota the
application required to be filed pursuant to applicable law,
in each case 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
fourteen (14) 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, to cause the waiting periods under
the H-S-R Act to terminate or expire at the earliest possible
date, to successfully complete the approval process before the
Public Service Commission of North Dakota 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 or are adverse to the public interest, 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) (I) With respect to any agreement, contract,
license, lease, easement, right-of-way or
Permit which (1) is not an Excluded Asset,
(2) is material to the operation of the
Pipeline Interest as it is currently
operated by Seller 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,
24
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 operation of the
Pipeline Interest in the ordinary course of
business without giving rise to a material
adverse effect on the Pipeline Interest, 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,
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; and
(II) In addition to the obligations of
Seller under Section 10(c)(ii)(A)(I) above,
from the Closing Date until the second
anniversary of the Closing Date, Seller
shall take such actions as are commercially
reasonable and necessary, including
expending money, and Seller shall cooperate
fully with Buyer in all commercially
reasonable respects, to remedy the absence
or invalidity of any easement, right-of-way,
permit, license or other right of access
relating to the Purchased Assets.
(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. 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
25
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 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
26
Closing. Such services may include any technical and/or
managerial support required to operate the Business.
(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 Pipeline
Interest 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 Section
10 and Sections 12 and 13 and the Closing to occur as soon as
reasonably practicable after the date of this Agreement.
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 Pipeline Interest (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"). Seller shall be
entitled to update Schedule 11(a) as necessary at any time prior to
Closing to reflect any and all employment changes.
(b) Employment Offers to Active Employees. No later than ten
(10) days after the date of this Agreement (and not later than three
(3) days after any update of Schedule 11(a)), Buyer shall offer
employment with Buyer, effective as of the Closing Date, to all active
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." 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
Employee no less than seven (7) days in which to accept or reject
Buyer's employment offer.
(c) Employment Offers to 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 Employee who is on Leave as of the
Closing Date, commencing at such time as such 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
Employee's Leave; provided, however, that such Employee is ready to
return to work within one hundred twenty (120) days after the Closing
Date. Buyer will give each Employee on Leave no less than seven (7)
days in which to accept or reject Buyer's employment offer.
27
(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 an Employee on Leave, such obligations shall
not attach until the Employee on Leave commences employment with Buyer.
(e) Level of Employee Benefits Provided by Buyer. Buyer shall
provide to all 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. 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 the day immediately prior to the
Closing Date.
(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 Pension Plans. Buyer agrees that,
effective as of the Closing Date, Buyer's defined contribution pension
plans 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.
28
(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
2001 deductibles or co-payments under the applicable welfare benefit
plan of Seller or other members of the BP Group against satisfaction of
any 2001 deductibles or co-payments under Buyer's medical welfare
benefit plan for the Transferred Employees.
(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 Transferred Employee who has
actions taken against such Transferred Employee within eighteen (18)
months after the Closing Date that would make the 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 Transferred Employees'
recognized credited service amounts with Seller or other members of the
BP Group.
(k) 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
29
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 layoff, plant
closing or other action that might trigger WARN Obligations of Seller
or any other member of the BP Group.
(l) 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.
(m) 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 (i) contained in Section 6(j) with
respect to appeals from and rehearings of Final Orders and (ii) 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. As used in this Agreement, "Final Orders"
means approval by the Public Service Commission of North Dakota without
regard to whether such approval is subject to rehearing or appeal to
the extent that the consummation of the transactions contemplated by
this Agreement is permitted by law.
(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. Except
for appeals from and rehearings of Final Orders, 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
30
contemplated by this Agreement, or operation of the Pipeline Interest
by Buyer after the Closing Date.
(d) Governmental Consents. (i) 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 (ii) the transactions contemplated by this Agreement
shall have been authorized in Final Orders by applicable governmental
authorities, including the Public Service Commission of North Dakota.
(e) Mandan Refinery. Buyer shall have consummated the
acquisition of the Mandan Refinery and related assets pursuant to that
certain
Asset Purchase Agreement by and among BP, Amoco Oil Company and
Buyer, dated as of the date hereof.
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. Except
for appeals from and rehearings of Final Orders, 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 Pipeline Interest by Buyer
after the Closing Date.
(d) Governmental Consents. (i) 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 (ii) the transactions contemplated by this Agreement
shall have been authorized in Final Orders by applicable governmental
authorities, including the Public Service Commission of North Dakota.
31
14. FURTHER ASSURANCES. From time to time, as and when reasonably
requested by any party hereto, the other 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.
(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 Pipelines, and the operation of the Pipeline Interest 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,
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).
(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,
32
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
Excluded Liabilities, the provisions of Sections 15(i) through
15(k) will not apply to indemnity claims by Buyer relating to
Sections 4(b)(i) through (vi) and 4(b)(ix) through (xii).
(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; provided that, for purposes of this
Section 15, no occurrence relating to Seller's representation
contained in Section 6(k) shall be deemed to be material or
have a material adverse effect on the Pipeline Interest unless
such effect or adverse effect exceeds Two Million Five Hundred
Thousand Dollars ($2,500,000);
(iii) any failure by Seller to comply with the
provisions, if any, of state or local bulk sales laws;
(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, Health, Safety and
Environmental Laws during the pre-Closing operation of the
Pipeline Interest ("Remediation Losses"); and
(v) subject to the limitations set forth in Section
15(m), disruption in the operation of the Purchased Assets
resulting from the absence or invalidity of any easements,
rights-of-way, permits, licenses or other rights of access
relating to the Purchased Assets ("Rights-of-Way 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
33
of Seller's representations and warranties in Section 7, and
(B) the Excluded Liabilities described in Section 4(b)(x)
(provided, however, that the provisions of Section 15(j)
through 15(m) will not apply to indemnity claims by Buyer
relating to Section 4(b)(x) or 4(b)(xii) of this Agreement);
and
(ii) 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 Pipeline Interest,
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 or the Disclosed
Environmental Liabilities 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;
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 party
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 each other
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 the sole and exclusive remedy
of Buyer 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
34
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
Pipeline Interest, 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, 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
35
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, on 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 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
36
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 shall have no claim under 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 Two Million Five
Hundred Thousand Dollars ($2,500,000) and then only for the excess over
Two Million Five Hundred Thousand Dollars ($2,500,000) (the
"Threshold"); provided that Losses amounting to less than Two Hundred
Thousand Fifty 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 and
Rights-of-Way Losses, which are addressed in Section 15(l) and 15(m),
respectively, below.
(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 One Million Five
Hundred Thousand Dollars ($31,500,000).
(l) Environmental Remediation Monetary Limitation.
Notwithstanding any other provision of this Agreement, Buyer shall have
no claim under this Agreement against Seller or any other member of the
BP Group for any Remediation Losses by Seller or other members of the
BP Group unless and until the aggregate of all such Remediation Losses
incurred or sustained by the Buyer Indemnified Parties exceeds Two
Million Five Hundred Thousand Dollars ($2,500,000), and then only for
the excess over Two Million Five Hundred Thousand Dollars ($2,500,000)
(the "First Threshold"). After the First Threshold has been reached,
Buyer 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 Five
37
Million Dollars ($5,000,000) (the "Second Threshold"). Thereafter,
subject to Sections 15(j) and 15(k), Buyer shall have a claim under
this Agreement against Seller for 100% of the excess of Remediation
Losses over the Second Threshold. Notwithstanding the foregoing, 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) Rights-of-Way Monetary Limitation. Notwithstanding any
other provision of this Agreement, Buyer shall have no claim under this
Agreement against Seller or any other member of the BP Group for any
Rights-of-Way Losses unless and until the aggregate of all such
Rights-of-Way Losses incurred or sustained by the Buyer Indemnified
Parties exceeds Two Million Dollars ($2,000,000), and then only for the
excess over Two Million Dollars ($2,000,000) (the "Level 1 Threshold").
After the Level 1 Threshold has been reached, Buyer shall only have a
claim under this Agreement against Seller for fifty percent (50%) of
the excess of any Rights-of-Way Losses incurred or sustained by the
Buyer Indemnified Parties over the Level 1 Threshold unless and until
the aggregate of all such Rights-of-Way Losses incurred or sustained by
the Buyer Indemnified Parties exceeds Four Million Dollars ($4,000,000)
(the "Level 2 Threshold"). Thereafter, subject only to Section 15(k),
Buyer shall have a claim under this Agreement against Seller for 100%
of the excess of Rights-of-Way Losses over the Level 2 Threshold.
Notwithstanding the foregoing, Seller shall have no obligation to
indemnify the Buyer Indemnified Parties under this Agreement with
respect to such matters for any Rights-of-Way Losses amounting to less
than One Hundred Seventy Fifty Thousand Dollars ($175,000) in the
aggregate arising out of the same occurrence or matter.
(n) Mitigation. Each party hereto shall take all reasonable
steps and use all commercially reasonable efforts to mitigate any and
all Losses.
(o) 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).
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. Seller agrees to cooperate with and assist Buyer in
claiming any applicable occasional sale or sales tax exemption;
provided that Seller shall not incur any unreimbursed third-party
costs, expenses, fees or liabilities as a result of or in any way
relating to, the provision of such assistance.
38
(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 copies of
any books, records or accounts relating to the Pipeline Interest
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 Pipeline Interest.
(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 Pipeline
Interest, including making 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 Pipeline Interest,
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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
Pipeline Interest and relevant personnel relating to the Pipeline
Interest 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 incur any
unreimbursed third-party 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, except with respect to the fulfillment of the
conditions set forth in Section 12(e) for which the material
breach of Buyer's representations, warranties, covenants or
agreements contained herein shall be ignored);
(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 February 1, 2002;
(v) by Buyer, if the Closing does not occur on or
prior to February 1, 2002; provided, however, that, in the
event that all conditions of Section 12 other than termination
or expiration of the waiting period under the HSR Act and the
issuance of Final Orders by the Public Service Commission of
North Dakota are satisfied, then Buyer may not terminate under
this clause (v) until June 30, 2002; or
(vi) by Buyer, if a Deposit Return Event occurs.
(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:
40
(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 Pipeline Interest 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 the 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 the
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:
Tesoro Petroleum Corporation
000 Xxxxxxx Xxxxx Xxxxx
Xxx Xxxxxxx, Xxxxx
Attn: Xxxxx X. Xxxx, Xx., General Counsel
Telecopy: (000) 000-0000
with a copy to:
Fulbright & Xxxxxxxx, L.L.P.
0000 XxXxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx
Attn: Xxxxxxx X. Xxxxxx, Esq.
Telecopy: (000) 000-0000
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 Pipelines (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.
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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 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
the other party (which consent shall not be unreasonably withheld), except (a)
as such release or announcement may be required by law 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 laws and regulations), in
which case the party making the release or announcement shall allow the 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 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. 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) and 15(b). 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) with respect to the Pipeline 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 this Agreement. Except as otherwise specifically
43
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 and any purported assignment without such consent
shall be void and without effect; provided, however, that each of Buyer and
Seller may (a) assign any and all of its rights and interests hereunder to one
or more of its affiliates and (b) designate one or more of its affiliates to
perform its obligations hereunder; provided further that each of Buyer and
Seller shall remain responsible for the performance of all of its respective
obligations hereunder. 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 incur any unreimbursed third party 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
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.
44
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 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)) (the
"Schedules") 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
Pipeline Interest, the Purchased Assets, the Assumed Liabilities or Seller. In
addition, matters reflected in the Schedules are not
45
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 waives compliance 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.
38. TIME OF ESSENCE. With regard to all rights and obligations of the
parties and all dates and time periods set forth or referred to in this
Agreement, time is of the essence.
39. NO CONDITIONS. For the avoidance of doubt, the only conditions to
closing are those set forth in Sections 12 and 13 herein, and no other covenants
or conditions set forth in this Agreement are intended to have any effect on the
Closing or the payment of the Purchase Price.
****
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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/ XXXXXXX X. XXXXXXXXX
------------------------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: Attorney In Fact
BP PIPELINES (NORTH AMERICA) INC.
By: /s/ XXXX X. XXXXXX
------------------------------------------
Name: Xxxx X. Xxxxxx
Title: Attorney In Fact
TESORO PETROLEUM CORPORATION
By: /s/ XXXXXXX X. XXX XXXXX
------------------------------------------
Name: Xxxxxxx X. Xxx Xxxxx
Title: Executive Vice President &
Chief Operating Officer
