EXHIBIT 10.7
EXECUTION COPY
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
This AMENDED AND RESTATED RECEIVABLES PURCHASE AGREEMENT (the "Agreement"),
dated as of October 18, 2002, by and among (1) EOTT Energy Operating Limited
Partnership (the "Seller"), a limited partnership organized under the laws of
Delaware, (2) Standard Chartered Trade Services Corporation ("SCTSC"), a company
organized under the laws of the State of Delaware, and (3) STANDARD CHARTERED
BANK, as collateral agent for SCTSC (the "Collateral Agent"), hereby modifying
that certain Receivable(s) Purchase Agreement, dated as of October 19, 1999, as
amended by the First Amendment to the Receivable(s) Purchase Agreement dated as
of January 12, 2000 and that certain letter agreement dated as of April 23,
2002, by and between the Seller and SCTSC (the "Prior Agreement").
WHEREAS, the Seller is engaged in the sale of certain goods ("Goods") to ▇▇▇▇
Supply and Trading, L.P. (f/k/a ▇▇▇▇ Petroleum Group L.P.) (the "Buyer") (as
indicated in Appendix "A"); and
WHEREAS, pursuant to the Prior Agreement, SCTSC purchased from the Seller
certain receivables which are payable by the Buyer on October 20, 2002 and
November 20, 2002 (the "Existing Receivables"); and
WHEREAS, the sales to the Buyer will give rise to receivable(s) (which, together
with the Existing Receivables, shall constitute "Qualified Receivable(s)") which
are current and evidenced by Pro-Forma Invoice(s) and Final Invoice(s) (as
defined below in Section 1.A) and title documents, as may be required by SCTSC,
and in form and content acceptable to SCTSC, such as transport documents,
pipeline tickets, receipts and/or nominations and truck or marine bills of
lading; and
WHEREAS, the payment of such Qualified Receivable(s) shall be due to the Seller
on due dates which apply to each of the Qualified Receivable(s); and
WHEREAS, the Seller has requested that SCTSC purchase from the Seller, from time
to time, all of its rights, title and interest in Qualified Receivable(s), up to
the Maximum Commitment (as defined below), in accordance with the terms and
conditions set forth in this Agreement which include recourse back to the Seller
in the circumstances outlined below;
WHEREAS, the Buyer will remit payment, in accordance with instructions provided
by the Seller, as per Appendix "B", to Standard Chartered Bank, New York Branch,
for the account of EOTT Energy Operating Limited Partnership, Account No.
▇▇▇▇-▇▇▇▇▇▇-▇▇▇, Attention: ▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, with value on the due date
of each Invoice (as defined below). The due date of each invoice shall be
referred to hereafter as an "Invoice Due Date";
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WHEREAS, the Seller has filed a voluntary petition commencing a case (the
"Case") under Chapter 11 of the U.S. Bankruptcy Code (the "Bankruptcy Code") in
the United States Bankruptcy Court for the Southern District of Texas (the
"Court");
WHEREAS, each of the Seller and SCTSC wishes to continue the Prior Agreement in
effect without interruption during the pendency of the Case;
WHEREAS, a modification of the Prior Agreement is necessary to enable the
parties to so perform during the pendency of the Case, and each of the Seller
and SCTSC wishes to amend certain other provisions of the Prior Agreement on the
terms and conditions set forth herein;
NOW, THEREFORE, the Seller and SCTSC do hereby agree as follows:
1. Transaction Origination
A. Initiation of each Transaction
From time to time, the Seller will cause copies of the
pro-forma and/or the final invoices to the Buyer (each an
"Invoice" or, as the context may require, a "Pro-Forma
Invoice" or a "Final Invoice") and the relevant title
documents, as may be required by nominations, truck ▇▇▇▇(s) of
lading, marine ▇▇▇▇(s) of lading or any other title document
as may be acceptable to SCTSC, to be delivered to SCTSC by
courier, which Invoices shall contain information required by
SCTSC, including a description of the Goods, their quantity,
type, value and other relevant terms and conditions. Payment
terms on the Seller's Invoices will be for a period not to
exceed fifty two (52) days from the date of the Seller's
Pro-Forma Invoice. A Final Invoice will substitute each
Pro-Forma Invoice within a thirty five (35) day period of time
from the date the Pro-Forma Invoice was issued. The Final
Invoice is the invoice issued by the Seller to the Buyer,
subsequent to the Pro-Forma Invoice which indicates the total
amount of Goods actually delivered to the Buyer within an
agreed period of time and the amount due for payment on the
Invoice Due Date. The aggregate amount outstanding at any
point in time for all Qualified Receivable(s) shall not exceed
One Hundred Million U.S. Dollars ($100,000,000) (the "Maximum
Commitment").
B. SCTSC Notice of Qualified Receivable(s)
SCTSC may accept the Seller's Transaction Confirmation in the
form of Appendix "C-1", annexed, if the Goods and terms
covering the Qualified Receivable(s) are acceptable to SCTSC
and if it appears to SCTSC that all conditions set forth in
this Agreement have been met. SCTSC shall evidence any such
acceptance by returning a copy of the Seller's Transaction
Confirmation marked "Accepted on (date) by (signature)" by
telefax to the Seller.
C. Commitment to Purchase
If at the time the Seller proposes that SCTSC purchase any
Qualified Receivable(s), (i) all conditions precedent to
Extensions of Credit under the SCB
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DIP Credit Agreement (as defined below), (ii) all other
conditions precedent herein are satisfied, and (iii) no Event
of Seller Default exists and is continuing, SCTSC will
purchase any such Qualified Receivable(s).
As used herein, "SCB DIP Credit Agreement" means that certain
Debtor in Possession Letter of Credit Agreement, dated as of
the date hereof, by and between the Seller, EOTT Energy Canada
Limited Partnership ("EOTT Canada"), EOTT Energy Liquids, L.P.
("EOTT Liquids"), EOTT Energy Pipeline Limited Partnership
("EOTT Pipeline"), EOTT Energy Partners, L.P. ("EOTT MLP"),
EOTT Energy General Partner, L.L.C. ("EOTT GP"), Standard
Chartered Bank, as Collateral Agent, LC Agent, and LC Issuer,
and the other banks and financial institutions party thereto
from time to time. Capitalized terms used and not defined
herein have the meanings given to them in the SCB DIP Credit
Agreement.
D. Payment to the Seller by SCTSC
(i) Upon purchase of the Qualified Receivable(s), SCTSC
shall thereupon make payment to the Seller for 90% of
the aggregate face value of the Qualified
Receivable(s) indicated on the applicable Pro-Forma
Invoice (the "Purchase Price") less the discount fee,
handling fees and any other fees or expenses incurred
due to SCTSC as defined in Section 2 of this
Agreement and remit the difference to the Seller.
Approximately thirty five (35) days after the
Seller's issuance of the Pro-Forma Invoice, the
Seller will issue its Final Invoice to the Buyer.
This Final Invoice will replace the Pro-Forma
Invoice. As a condition precedent for SCTSC's
payment, the Seller hereby sells, assigns and
transfers over to SCTSC its entire title and interest
in and right to receive payment for each Qualified
Receivable, all contract rights with respect thereto
and all of the Seller's rights to the Goods and
property represented thereby.
(ii) From time to time, to the extent, if any, that the
Maximum Commitment exceeds 90% of the aggregate
amount due for payment on the applicable Invoice Due
Date for all Qualified Receivable(s), EOTT OLP shall
be entitled to post a Letter of Credit (subject to
applicability of availability restrictions in the SCB
DIP Credit Agreement) in a stated amount equal to
such excess for the benefit of SCTSC. Such Letter of
Credit shall have an expiry date no earlier than one
month from the date of issuance and shall be in form
and substance satisfactory to SCTSC. Upon receipt of
such Letter of Credit, SCTSC shall thereupon make
payment to the Seller for 100% of the stated amount
of such Letter of Credit (the "Additional Purchase")
less the discount fee and any other applicable fees
or expenses incurred due to SCTSC as defined in
Section 2 of this Agreement (without duplication of
the fees or expenses referred to in Section 1.C(i)
above) and remit the difference to the Seller.
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E. Payment to SCTSC by the Buyer
With respect of each Qualified Receivable, the Buyer will be
required to remit payment for the full amount of the Final
Invoice, in accordance with instructions provided by the
Seller as per Appendix "B" and as per each Final Invoice, to
Standard Chartered Bank, New York Branch (the "Bank"), ABA
Number ▇▇▇▇▇▇▇▇▇, for the account of EOTT Energy Operating
Limited Partnership, Account No. ▇▇▇▇-▇▇▇▇▇▇-▇▇▇, Attention:
▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ (the "EOTT Account"). The EOTT Account
will be subject to a Blocked Account Agreement under which the
Seller authorizes the Bank to remit such funds credited to the
EOTT Account, from time to time to Standard Chartered Bank,
New York Branch, ABA Number ▇▇▇▇▇▇▇▇▇, for the account of
Standard Chartered Trade Services Corporation, Account No.
▇▇▇▇-▇▇▇▇▇▇-▇▇▇, Attention: ▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ (the "SCTSC
Account") in order to repay SCTSC for the Purchase Price of
such Qualified Receivable.
The balance remaining in the SCTSC Account, after deducting
(i) an amount equal to such Purchase Price and (ii) any fees,
costs, expenses and other amounts owing to SCTSC pursuant to
this Agreement in respect of such Qualified Receivable, shall
be applied as follows:
(1) Provided that no Event of Seller Default exists and is
continuing upon receipt of such funds in the SCTSC Account,
SCTSC shall promptly remit such balance to the Collateral
Agent; and
(2) In the event that an Event of Seller Default exists and is
continuing upon receipt of such funds in the SCTSC Account,
SCTSC shall retain such balance until the Termination Date,
and at any time prior thereto, may apply such balance to cover
any amounts due and owing to SCTSC under (a) this Agreement,
with respect to any other Qualified Receivables, and (b) the
Crude Oil Purchase Agreement. Upon the Termination Date, SCTSC
shall promptly remit to the Collateral Agent any remaining
balance in the SCTSC Account.
2. Fees and Interest
A. Facility Fee
Upon assumption of this Agreement, the Seller will pay SCTSC a
non-refundable facility fee in an amount equal to (a) one
percent (1%) per annum multiplied by (b) the Average Daily
Maximum Facility Amount (as defined below), payable to SCTSC
in arrears on each Monthly Payment Date.
"Average Daily Maximum Facility Amount" for any month for each
such agreement shall equal the quotient of (x) the sum of the
Maximum Commitment on each day during the month divided by (y)
the total number of days in such month.
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B. Handling Fee
The Seller shall pay to SCTSC a handling fee ("Handling Fee")
on all Qualified Receivable(s) purchased by SCTSC hereunder in
a flat amount of Five Hundred U.S. Dollars ($500), on each of
the Seller's Pro-Forma Invoices purchased by SCTSC. Such
Handling Fee shall be deducted from any payment due to the
Seller.
C. Discount Fee
The Seller agrees to pay SCTSC a discount fee on (i) the
outstanding Qualified Receivable(s) purchased and (ii) the
Additional Purchase, in each case calculated at the applicable
LIBOR (defined below) plus a spread of three hundred basis
point per annum (300 b.p. p.a.) (the "Discount Fee"). The
Discount Fee due by the Seller to SCTSC shall be calculated as
follows: (x) with respect to the outstanding Qualified
Receivable(s) purchased, on the aggregate Purchase Price of
the Qualified Receivable(s) purchased by SCTSC from the date
payment was made to the Seller on the Invoice Due Date, and
(y) with respect to the Additional Purchase, on the stated
amount of the applicable Letters of Credit, in each case
calculated on the basis of a 360 actual day year. SCTSC will
deduct the applicable Discount Fee from its payment due to the
Seller, plus any and all other fees and incidental expenses
incurred or anticipated by SCTSC (including legal and, other
fees) in obtaining payment from the Buyer. The Discount Fee as
specified above will apply for a period not to exceed (A) the
Invoice Due Date for the Qualified Receivable(s) purchased and
(B) the expiry date for the Letters of Credit supporting the
Additional Purchases, as applicable.
LIBOR is defined as the rate per annum at which deposits in US
Dollars for the period comparable to the period from the date
SCTSC is to make payment to the Seller to the date payment is
due to SCTSC from the Buyer are offered to SCTSC by the Bank,
as quoted at 11:00 a.m. New York time, for value two (2)
Business Days (as defined herein) prior to the date when
payment is made by SCTSC to the Seller, provided, however,
that if the Bank cannot offer SCTSC a LIBOR rate calculated as
set forth above, the Seller agrees that the LIBOR rate shall
be defined as such other rate as the Bank shall determine as
its cost of funds.
A Business Day is defined as a day on which SCTSC and
commercial banks are open for business in New York, New York.
D. Excess Costs
Any Qualified Receivable(s) not paid on the Invoice Due Date
by Buyer shall be subject to a penalty to cover any excess
costs incurred by SCTSC as a result of any delay in the Buyer
making payment by the Invoice Due Date. The Seller shall have
the responsibility of collecting such excess costs from the
Buyer as well as the ultimate responsibility for payment of
SCTSC's excess costs. The Seller hereby assigns and transfers
to SCTSC all such amounts the Seller shall receive in coverage
of such excess costs. The Seller shall set the penalty rate
for such excess costs, but it shall be no less than the Bank's
applicable overnight
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Reference Rate in effect from time to time plus a margin of
two percent per annum (2% p.a.) and shall be based on the face
amount of the Final Invoice from the Invoice Due Date until
full repayment thereof has been received by SCTSC from the
Buyer.
"Reference Rate" is defined as the rate established from time
to time by the Bank as its Reference Rate, as quoted at 11:00
a.m. New York time.
Notwithstanding the above, the Seller shall not have the
responsibility to collect or pay any such penalties hereunder
(except for any such penalties actually received by the
Seller) for any portion of the Qualified Receivables deemed
Uncollectible (as defined herein). A Qualified Receivable will
be deemed "Uncollectible" if (i) it has been unpaid for more
than 120 days after the due date stated on the Final Invoice,
(ii) it has been written off by SCTSC as uncollectible or
should have been written off in accordance with SCTSC's sole
and absolute credit determination, (iii) the Buyer becomes a
debtor in bankruptcy proceedings or is otherwise judicially
determined to be insolvent, or (iv) the Buyer acknowledges in
writing that it is insolvent or financially unable to pay such
Qualified Receivable(s).
E. Mis-directed Payments
In the event of funds being forwarded in error by the Buyer
directly to another account of the Seller rather than to the
Account, the Seller undertakes to hold these funds in trust
for SCTSC and to immediately remit said payment to the SCTSC
Account. The Seller will pay SCTSC a rate of interest equal to
the Bank's applicable overnight Reference Rate plus three
percent per annum, (3% p.a.) based on a 360 day year and the
actual number of days elapsed, for the period between receipt
of payment by the Seller and the date such funds are received
in full by SCTSC.
3. Role and Responsibility of the Seller
A. Relationship of Parties
Neither the Seller nor SCTSC shall be deemed a partner, agent,
representative or joint venturer of the other.
B. Covenants, Representations and Warranties of the Seller
The Seller agrees, represents, warrants with and to SCTSC both
now and with each transaction contemplated hereunder that:
(i) it is a limited partnership duly organized under the
laws of the state of Delaware, and has the full
power, authority and legal right to incur and to
perform its obligations under this Agreement;
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(ii) it has taken all required action necessary to
authorize the due execution and delivery by its duly
appointed officers of this Agreement;
(iii) the officers executing this Agreement and any
Appendix are duly authorized and empowered to execute
said documents on behalf of the Seller;
(iv) no authorization or approval or other action by, and
no notice to or filing with, any governmental
authority or regulatory body, other than the
Bankruptcy Court, is required for the due execution,
delivery and performance by it of this Agreement;
(v) the execution, delivery and performance by the Seller
of this Agreement does not contravene any law,
regulation or contractual restriction binding on or
affecting the Seller and that the Buyer is a party
with which the Seller is permitted to transact
business pursuant to all applicable laws, regulations
and rulings of both the United States and its
agencies and the State in which the Seller maintains
its principal place of business and, in particular,
to the regulations of the U.S. Treasury Department's
Office of Foreign Assets Control;
(vi) to the best of its knowledge there exist no material
disputes or discrepancies outstanding between the
Seller and the Buyer relating to prior transactions
(except to the extent that the Seller advises SCTSC
of such a dispute and SCTSC chooses in its sole
discretion to waive such dispute or discrepancy
solely for the purpose of purchasing a Qualified
Receivable);
(vii) each of the Qualified Receivable(s) is a legal,
binding and assignable by the Seller and is
enforceable in accordance with is respective terms;
(viii) each of the Qualified Receivable(s) is or will be
unaltered and genuine and the Seller has exclusive
and unencumbered title to same;
(ix) except for liens in favor of the Collateral Agent as
provided in the Orders and the Intercreditor
Agreement, each of the Qualified Receivable(s) will
not have been sold, assigned, transferred or
encumbered by a lien or security interest of any
nature, directly or indirectly, prior to its
acceptance by SCTSC and this is a material term of
this Agreement;
(x) the Seller is not prohibited by any security, loan or
other agreement from selling the Qualified
Receivable(s) as contemplated herein and such sales
do not conflict with any agreement binding on the
Seller;
(xi) to the best of the Seller's knowledge, the Buyer has
not asserted any claim, defense or right of offset to
payment of the Qualified Receivable(s), nor does it
have grounds to make such assertions; However, if the
Seller
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learns of any such claim, defense or right of offset,
it will promptly notify SCTSC thereof in writing;
(xii) each of the Invoices and title documents, such as
transport documents, pipeline tickets, receipts or
nominations, truck or marine ▇▇▇▇(s) of lading, as
may be required by SCTSC, is or will be unaltered and
genuine and the Seller has exclusive and unencumbered
title to same;
(xiii) the Seller agrees to compensate SCTSC for all costs,
claims, losses and expenses (including, but not
limited to legal fees) incurred or suffered by SCTSC
as a result of any transaction or as a result of the
Seller's breach of any representation or warranty
contained herein or the Seller's failure to comply
with any of the terms or conditions contained herein;
(xiv) the Collateral Agent is granted hereby a security
interest in and a right of set-off with respect to
all Qualified Receivable(s) which have been purchased
by SCTSC and in all contract rights and proceeds
related thereto, all as security for payment and
performance of all of the Seller's obligations to
SCTSC, whether now existing or hereafter arising,
direct or indirect, due or to become due, matured or
unmatured, or absolute or contingent. The Collateral
Agent shall act in accordance with the Intercreditor
Agreement and may file such financing statements as
it elects with the Seller's signature to perfect its
security interest;
(xv) it will cooperate fully with SCTSC in taking any and
all actions requested by SCTSC in collecting all
amounts owed by the Buyer which the Seller is allowed
to perform under its contract with the Buyer,
including, and not limited to, delaying or not
shipping future deliveries of Goods to the Buyer
unless (and until) SCTSC has been paid in full;
(xvi) SCTSC shall have the right to request, and the Seller
shall provide promptly, such information about the
purchase, delivery and terminalling of the Goods as
SCTSC may reasonably request and SCTSC may, upon
reasonable advance notice, inspect the Goods and the
Seller's records pertaining to the Goods;
(xvii) the guarantee issued in favor of the Seller by ▇▇▇▇
Industries Inc; which guarantees all obligations of
the Buyer to the Seller is in full force and effect
on the date of this Agreement and will continue to be
in full force and effect as long as any amounts are
due and owing to SCTSC with respect to any Qualified
Receivable(s); and
(xviii) the Seller agrees to issue to the Buyer a Final
Invoice approximately thirty five (35) days after the
issuance of the Pro-Forma Invoice, but not later than
the fifth Business Day of each month, and to provide
SCTSC with a copy thereof on the same day as it is
issued to the Buyer.
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C. Indemnity
The Seller acknowledges that SCTSC shall have no liability for
any product liability claim from the Seller, the Buyer or any
other person relating to or arising out of the Goods,
including but not limited to claims relating to the
performance (or nonperformance) of the Seller, the quality of
the Goods supplied, the contents of any shipments and/or any
damage or loss (economic or physical) suffered by the Buyer or
any other person arising out of the Goods supplied. The Seller
agrees to bear the full risk of defects in or due to the
nonconformity of the Goods. The Seller further agrees that it
shall hold SCTSC harmless and indemnify SCTSC from any and all
claims of the Buyer or any third party relating to any product
liability and/or damage claim of any party or person arising
from the non-performance of the Seller, from defects in the
Goods or injury or loss arising from the Goods. The Seller
further acknowledges that SCTSC shall be excused from
performing any obligations hereunder which are prevented or
delayed by any occurrence not within its effective control
including, without limitation, destruction or damage to the
Goods, strikes, floods, fire, accidents, Acts of God or any
governmental orders or regulations.
D. On each date on which any amounts fall due for payment from
either SCTSC or the Seller under this Agreement for any
transaction, the party required to make such payment shall
effect such payment denominated in U.S. Dollars ("Dollars") by
payment in Dollars and in immediately available funds (or such
funds as may at the time be customary in the City of New York
for settlement in the City of New York of banking transactions
in Dollars) to such account in the United States of the other
party as such party may designate to the other in writing; or,
where such amount is denominated in any other currency, by
payment in such other currency and in immediately available
funds (or in such funds as may at the time be customary in the
city of delivery of such funds for the settlement in such city
of international banking transactions) to such account of the
other party as shall be specified by it in the Transaction
Confirmation.
E. All payments hereunder by the Buyer or by the Seller to SCTSC
shall be made free and clear of and without deduction for any
set-off or counterclaim and without deduction for or on
account of any present or future taxes including but not
limited to duties, levies, sales or value added taxes and
imposts now or hereafter imposed. If the Buyer is required by
law to make any deduction or any withholding is required to be
made, the Seller shall ensure that the relevant payment shall
be increased to the extent necessary to ensure that, after the
making of such deduction or withholding, SCTSC receives (free
from any liability in respect of any such deduction or
withholding) a net sum equal to the sum which would have been
received and so retained had no such deduction or withholding
been made.
4. Event of Seller Default
Each of the following events are herein defined as an "Event of Seller
Default":
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A. the Seller's failure to discharge any of its obligations under
this Agreement or with respect to the Goods or the underlying
contract pertaining thereto.
B. an order shall be entered in the Case authorizing the grant of
a claim or interest in any way superior to the claim and
interest of SCTSC in and to the Qualified Receivables and the
contract rights and proceeds related thereto, subject only to
the Intercreditor Agreement;
C. an order shall be entered in the Case authorizing the Seller
to reject this Agreement; or
D. an "Event of Default" shall have occurred under and as defined
in the SCB DIP Credit Agreement.
The Seller shall immediately notify SCTSC in writing of the occurrence
of an Event of Seller Default and SCTSC shall have the right (in
addition to any other right or remedy SCTSC may have at law, in equity
or under this Agreement, subject to the Intercreditor Agreement) to
demand that the Seller deliver immediately at the request of SCTSC to
it or to any third party nominated by SCTSC for collection by such
party (which may be an affiliate of SCTSC) any Qualified Receivable(s)
held by SCTSC under any transaction.
5. Event of Buyer Default
Each of the following events are herein defined as the "Event of Buyer
Default":
A. the filing of a petition in bankruptcy or for the appointment
of a receiver by or against the Buyer or any similar event; or
B. the Buyer's failure to pay within one Business Day after the
Invoice Due Date for the full amount of the Final Invoice to
SCTSC or to the Seller, as the case may be, by the Invoice Due
Date or to discharge any of its other obligations with respect
to the Goods or the underlying contract pertaining thereto for
any reason whatsoever or for no reason, including any claim
that the Goods are, in whole or in part, not suitable or not
consistent with the underlying contract of sale.
The Seller shall immediately notify SCTSC in writing of the occurrence
of an "Event of Buyer Default" and, if the Buyer's bankruptcy or
failure to pay is due to any of the causes listed in Section 8 of this
Agreement, SCTSC shall have the same limited recourse rights against
the Seller as are described in Section 8, below.
6. Conditions Precedent to Effectiveness of Agreement
As a condition precedent to the effectiveness of this Agreement, the
Seller shall have caused to be delivered to SCTSC, in form and
substance satisfactory to SCTSC, (a) a counterpart of this Agreement
executed by the parties hereto, (b) a copy of resolutions of the Board
of Directors or other authorizing documents of the Seller, in form and
substance satisfactory to SCTSC, approving the execution and
performance of the Agreement, certified by the Secretary or other
appropriate officer of the Seller, (c) an
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incumbency certificate executed by the Secretary or other appropriate
officer of the Seller certifying the names and signatures of the
officers of the Seller authorized to execute and act under this
Agreement, (d) the opening of the Account with the Bank, (e) a duly
executed Blocked Account Agreement between the Seller, SCTSC and the
Bank, and (f) a copy of the guarantee referred to in Section
3.A.(xvii), above, and the Oil Supply Contract referred to in Section
8, below.
It shall be an additional condition precedent to the continuing
effectiveness of this Agreement that an order shall have entered in the
Case authorizing the Seller to assume the Agreement under Section 365
of the Bankruptcy Code and authorizing the Seller to enter into and
perform its obligations under the SCB DIP Credit Agreement.
7. Termination
A. This Agreement shall terminate:
(i) At the sole discretion of the Seller, immediately
upon written notice given by the Seller to SCTSC;
(ii) Upon the earliest to occur of (x) an Event of Seller
Default, at SCTSC's election, (y) an Event of Buyer
Default, at SCTSC's election, or (z) the Maturity
Date; or
(iii) Upon payment in full in cash by the Seller of all of
the obligations owing to SCTSC hereunder.
The date that this Agreement terminates shall be referred to
as the "Termination Date".
B. Notwithstanding anything else contained herein, the
termination of this Agreement shall not affect the rights or
obligations of either party hereto with respect to any
Qualified Receivable(s) purchased prior to the effective date
of termination, unless SCTSC has not purchased the Qualified
Receivable(s) from the Seller, in which case SCTSC may treat
the purchase of said Qualified Receivable(s) as rescinded
without further obligation or liability of SCTSC.
8. SCTSC Remedies
The sale of the Qualified Receivable(s) herein is with limited recourse
to the Seller. This right of limited recourse shall apply in the event
of:
a) rejection of documents presented to the Buyer and/or
assertion by the Buyer of any commercial disputes
concerning quantity, quality, specifications,
suitability/merchantability or performance of the
Goods, or the institution of any litigation,
counterclaims, set-offs or write-offs, or
b) assertion by the Buyer that the Pro-Forma Invoice,
the Final Invoice and/or the Crude Oil Supply and
Terminalling Agreement dated December
11
1, 1998 (as same may have been amended) (the "Oil
Supply Contract") between the Seller and the Buyer
that relates to a Qualified Receivable(s) was not
adhered to, or
c) the occurrence of any of the events or circumstances
listed in Article 8 of the Oil Supply Contract or the
termination or material amendment or modification to
that Contract, or
d) any one of the covenants, representations or
warranties made by the Seller in this Agreement
proving to have been incorrect in any material
respect, or
e) the Goods under any Qualified Receivable shall have
been lost, destroyed or subjected to an event which
could create an insurance claim of any nature, or
f) if the Seller fails to issue to the Buyer (or the
Buyer claims non-receipt of) a Final Invoice within
thirty five (35) days from the date of the Pro-Forma
Invoice.
Upon the occurrence of any of the foregoing circumstances or in the
event of non-acceptance of the Goods by the Buyer for any reason (or
for no reason), the Seller shall, upon demand, immediately return to
SCTSC any monies received from SCTSC relating to said transaction,
together with interest calculated at the rate of 3% per annum over the
Bank's Reference Rate in effect from time to time, from the date of
SCTSC's payment to the Seller to the date of SCTSC's receipt of full
payment. SCTSC shall, upon receipt of payment in full from the Seller,
assign all of its rights, title and interest in the Goods and/or assign
any evidence of debt from the Buyer relating to said transaction to the
Seller and shall have no further liability or obligation with respect
to the transaction. The Seller shall be fully liable for any claims,
costs, fines, levies, duties, interests, fees and/or penalties arising
out of the Buyer's failure to accept the Goods, provided, however, that
the Seller shall reimburse SCTSC for any reasonable costs and fees
SCTSC may incur relating to the Buyer's non-acceptance of the Goods
and/or fees and costs incurred in attempting to seek payment from the
Buyer.
9. Miscellaneous
A. Notices
All notices, requests, reports, information or demands shall
be effective when given or made through telex or telefax, two
days after deposit in the mails, or upon hand delivery, at the
following addresses (or at such other addresses as either
party may notify to the other in writing):
To the Seller:
Name: EOTT Energy Operating Limited Partnership
Address: ▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Telefax: (▇▇▇) ▇▇▇-▇▇▇▇
12
To SCTSC:
Name: Standard Chartered Trade Services
Corporation
Address: ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Vice President & Manager
Telefax: (▇▇▇) ▇▇▇-▇▇▇▇
B. Continuous Conditions
SCTSC's obligations shall be subject at all times to
appropriate and satisfactory credit support documentation
relating to the Buyer being provided to SCTSC. The Seller
agrees that it is familiar with the Buyer and that Goods
provided to the Buyer by the Seller shall continue to meet all
requirements of the Buyer.
C. Further Assurances
Each party hereto represents and warrants that (i) it has the
capacity and has taken all necessary action (corporate and
otherwise) to enable it to enter into and perform its
obligations under this Agreement; (ii) upon execution of this
Agreement by or on behalf of such party, this Agreement
constitutes a legal, valid and binding obligation of such
party; and (iii) execution and delivery by such party of this
Agreement and the consummation of each transaction herein
contemplated by such party is binding upon such party. In
addition, the Seller represents and warrants that none of the
Qualified Receivable(s) which are the subject of any
transaction hereunder will be, at the time of such transaction
or thereafter, subject to any lien or security interest held
by any third party (other than SCTSC), including, but not
limited to, any security filing under the Uniform Commercial
Code or any similar filing and that the Seller is the sole and
beneficial owner of all Qualified Receivable(s), except for
liens in favor of the Collateral Agent as provided in the
Orders and the Intercreditor Agreement.
D. Integration
This Agreement shall supersede any prior agreements or
understandings between the parties as to the subject matter
hereof. The parties may from time to time elect by mutual
agreement to enter into transactions on terms different from
those contained herein, provided, that any such agreement
shall be evidenced by a writing signed by both parties.
E. Waivers and Amendments
Any waiver of any right hereunder shall be in writing and
shall be effective when signed by the party granting the
waiver. No amendment of any provision of this Agreement shall
be effective unless it is in writing and is signed by the
Seller and SCTSC. No such amendment shall take effect during
the pendency of the Case absent the entry of an order
authorizing such amendment.
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F. Taxes
All payments relating to the transactions contemplated by this
Agreement shall be made free and clear of and without
deduction or withholding for any present or future taxes,
levies, imposts or duties imposed by any governmental
authority in any jurisdiction or by any political subdivision
or taxing authority thereof or therein. If any such taxes,
levies, imposts or duties are required to be withheld from any
payments made hereunder, the amounts so payable shall be
increased to the extent necessary to yield to SCTSC (after
deduction of all such taxes, levies, imposts or duties)
interest or any such other amounts as specified herein.
G. Assignment and Delegation
The parties hereto may assign this Agreement and their
respective rights, duties and obligations hereunder solely
upon the written consent of the other; provided, however, that
SCTSC may freely assign this Agreement and its rights, duties
and obligations to any entity that is an affiliate of Standard
Chartered Bank upon notice to the Seller, provided that such
assignment does not result in additional costs to the Seller.
The parties agree that this Agreement shall inure to the
benefit of any successor to the parties; provided, however,
that this Agreement shall not inure to the benefit of any
trustee of the Seller's estate in a case under Chapter 7 of
the Bankruptcy Code.
H. Agreement not Exclusive
The rights to indemnification and recourse to the Seller
provided to SCTSC under this Agreement shall be independent
of, and neither subject to nor in derogation of, any other
rights to which SCTSC may be entitled, including, without
limitation, any such rights which may be assertable under the
General Corporation Law of New York.
I. Severability
Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall not invalidate the
remaining provisions hereof, which shall remain in full force
and effect, and any such prohibition or unenforceability in
any jurisdiction shall not invalidate or render unenforceable
such provision in any other jurisdiction.
J. Disclaimer of Warranty
SCTSC does not make and shall not be deemed to have made any
representation or warranty of any kind in favor of the Buyer
or any other person, including without limitation: any
representation concerning the title of SCTSC to the Goods; any
representation that SCTSC is a manufacturer, merchant or
dealer in goods; any representation or warranty, express or
implied, as to the merchantability, compliance with
specifications, design, operation, freedom from patent or
trademark infringement, absence of latent defects or fitness
for use of
14
the Goods, or any other representations, express or implied,
with respect to the Goods. SCTSC shall not be liable for any
consequential damages.
K. Governing Law and Jurisdiction
THIS AGREEMENT SHALL BE GOVERNED AND CONSTRUED UNDER THE LAWS
OF THE STATE OF NEW YORK. THE SELLER HEREBY IRREVOCABLY AND
UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE
NONEXCLUSIVE JURISDICTION OF THE BANKRUPTCY COURT AND/OR THE
COURTS OF NEW YORK STATE OR FEDERAL COURT OF THE UNITED STATES
OF AMERICA SITTING IN NEW YORK CITY, WHETHER TRIAL OR
APPELLATE, IN ANY ACTION OR PROCEEDING ARISING OUT OF, OR
RELATING TO, THIS AGREEMENT, OR FOR RECOGNITION OR ENFORCEMENT
OF ANY JUDGMENT IN RESPECT THEREOF, AND THE SELLER HEREBY
IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN
RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND
DETERMINED IN THE BANKRUPTCY COURT AND/OR ANY SUCH NEW YORK
STATE COURT OR, TO THE EXTENT PERMITTED BY LAW, IN SUCH
FEDERAL COURT AND CONSENTS THAT ANY SUCH ACTION OR PROCEEDING
MAY BE BROUGHT IN SUCH COURTS AND WAIVES TO THE FULLEST EXTENT
PERMITTED BY LAW ANY OBJECTION OR CLAIM THAT IT MAY NOW OR
HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING
IN ANY SUCH COURT OR THAT SUCH ACTION OR PROCEEDING WAS
BROUGHT IN AN INCONVENIENT COURT AND AGREES NOT TO PLEAD OR
CLAIM THE SAME. THE SELLER HEREBY AGREES THAT A FINAL JUDGMENT
IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY
BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR
IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS AGREEMENT
SHALL AFFECT ANY RIGHT THAT ANY PARTY MAY OTHERWISE HAVE TO
BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT IN
THE COURTS OF ANY JURISDICTION. THE SELLER HEREBY IRREVOCABLY
WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM ARISING OUT OF, OR RELATING TO, THIS AGREEMENT OR
THE ACTIONS OF SCTSC IN THE NEGOTIATION, ADMINISTRATION,
PERFORMANCE OR ENFORCEMENT THEREOF.
L. Amendment and Restatement
This Agreement amends and restates the Prior Agreement in its
entirety, and nothing in this Agreement shall be deemed to
constitute a novation of the Prior Agreement.
15
IN WITNESS WHEREOF, the Seller, SCTSC and the Collateral Agent have each caused
this Agreement to be executed by a duly authorized officer(s) as of the date
first written above.
EOTT ENERGY OPERATING LIMITED
PARTNERSHIP
By: EOTT ENERGY GENERAL PARTNER, L.L.C., its General Partner
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇
----------------------------------------
Title: Treasurer
----------------------------------------
STANDARD CHARTERED TRADE STANDARD CHARTERED TRADE
SERVICES CORPORATION SERVICES CORPORATION
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇ By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------------------------- ------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇ Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------------------------- ----------------------------------------
Title: CEO Title: Assistant Vice President
---------------------------------------- ----------------------------------------
STANDARD CHARTERED BANK, as Collateral Agent
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------------------
Title: Senior Vice President
----------------------------------------
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇
----------------------------------------
Title: S.V.P.
----------------------------------------
16
APPENDIX A
SELLER'S LETTERHEAD
Date: [Month day, 2002]
Standard Chartered Trade Services Corporation
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Reference: Qualified Buyer
Ladies and Gentlemen:
The following entity shall be deemed a Buyer under the terms of the Amended and
Restated
Receivables Purchase Agreement between ourselves dated as of the ___
day of October, 2002 (the "Agreement"), subject to your approval as evidenced by
your signature below.
BUYER ADDRESS TYPE OF GOODS CREDIT TERMS
1. ▇▇▇▇ Petroleum Group L.P. Crude Oil Industry Norm
(The 20th day of each month)
The Buyer is hereby authorized and will be instructed by us both in our
Pro-Forma Invoice and in our Final Invoice and prior thereto by means of the
Notice of Assignment mailed by us to the Buyer in the form of Appendix "B" to
our Agreement to make payment directly to you or your designee (upon receipt of
written notice from you to do so) of all Qualified Receivable(s) (as defined in
the Agreement) and any such payment, to the extent thereof, shall satisfy such
Buyer's obligations to us.
This list will remain in effect until it is replaced or modified in accordance
with the terms of the Agreement.
Very truly yours,
EOTT Energy Operating Limited
Partnership
By: EOTT ENERGY CORP., its General Partner
By: __________________________________
Name: ________________________________
Title: _______________________________
READ, AGREED TO AND ACCEPTED ON _________:
STANDARD CHARTERED TRADE SERVICES CORPORATION STANDARD CHARTERED TRADE SERVICES CORPORATION
By: __________________________________ By: __________________________________
Name: ________________________________ Name: ________________________________
Title: _______________________________ Title: ________________________________
APPENDIX B
NOTICE OF ASSIGNMENT
For those pro-forma and final invoices of EOTT Energy Operating Limited
Partnership ("the Seller") covering sales of crude oil ("Goods") to ▇▇▇▇
Petroleum Group L.P. ("Buyer") accepted by, sold and assigned to Standard
Chartered Trade Services Corporation ("SCTSC"), or its successors, the Seller
shall maintain all existing responsibilities including, but not limited to,
negotiating all prices and terms with the Buyer, arranging shipment of the Goods
and all product responsibility and liability. the Seller hereby sells and
assigns to SCTSC all of the Seller's rights, title and interest in, to and under
the above mentioned invoices; provided, however, that SCTSC does not hereby
assume any obligations, duties or liabilities whatsoever of the Seller under the
invoices.
Each of the Seller's pro-forma and final invoices to the Buyer shall contain the
following statement:
"THIS INVOICE HAS BEEN SOLD AND ASSIGNED FOR THE PURPOSE OF COLLECTION
TO STANDARD CHARTERED TRADE SERVICES CORPORATION OR ITS SUCCESSORS
(THE "ASSIGNEE"). ALL PAYMENTS HEREUNDER SHALL BE MADE TO THE
ASSIGNEE BY REMITTING FUNDS, BY WIRE TRANSFER, TO STANDARD CHARTERED
BANK, NEW YORK BRANCH, ABA NO. ▇▇▇▇▇▇▇▇▇, FOR CREDIT TO A/C
#▇▇▇▇-▇▇▇▇▇▇-▇▇▇ OF EOTT ENERGY OPERATING LIMITED PARTNERSHIP, TO THE
ATTENTION OF ▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇. THE ACCOUNT EVIDENCED BY THIS
INVOICE WILL ONLY BE SATISFIED BY PAYMENT TO THE ASSIGNEE AS INDICATED
IN THE PRECEDING SENTENCE."
Agreed and accepted this [day] day of [Month], 2002.
By: EOTT ENERGY OPERATING LIMITED PARTNERSHIP
By: __________________________________
Name: ________________________________
Title: _______________________________
STANDARD CHARTERED TRADE SERVICES CORPORATION STANDARD CHARTERED TRADE SERVICES CORPORATION
By: __________________________________ By: __________________________________
Name: ________________________________ Name: ________________________________
Title: _______________________________ Title: ________________________________
APPENDIX C-1
Seller's Letterhead
Date: [Month day, 2002]
Standard Chartered Trade Services Corporation
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Reference: Transaction Confirmation of Qualified Receivable(s)
Dear Sirs:
We hereby inform you of our desire to sell new Qualified Receivable(s) to you,
as described in Section 1.B of the Amended and Restated
Receivables Purchase
Agreement dated as of October 18, 2002 between EOTT Energy Operating Limited
Partnership and Standard Chartered Trade Services Corporation ("SCTSC"), as
follows:
Qualified Receivable(s) totaling: US$_________________
EOTT Energy Operating Limited Partnership has caused copies of the invoices to
the Buyer and the relevant title documents, as may be required by SCTSC, as
evidenced by transport documents, pipeline tickets, receipts and/or nominations,
truck ▇▇▇▇(s) of lading, marine ▇▇▇▇(s) of lading or any other title document as
may be acceptable to SCTSC, to be attached hereto, which contain all the
information required by SCTSC, including a description of the Goods, their
quantity, type, value and other relevant terms and conditions.
Kindly remit funds, by wire transfer, to Standard Chartered Bank, New York
Branch, ABA #▇▇▇▇▇▇▇▇▇, Attn: _____________, for credit to A/C #____________ of
Please indicate your acceptance by signing below.
Very truly yours,
EOTT Energy Operating Limited
Partnership
By: EOTT ENERGY CORP., its General Partner
By: __________________________________
Name: ________________________________
Title: _______________________________
READ, AGREED TO AND ACCEPTED ON _________:
STANDARD CHARTERED TRADE SERVICES CORPORATION STANDARD CHARTERED TRADE SERVICES CORPORATION
By: __________________________________ By: __________________________________
Name: ________________________________ Name: ________________________________
Title: _______________________________ Title: ________________________________