ACCESS AND USE AGREEMENT
EXHIBIT
10.8
THIS
ACCESS AND USE AGREEMENT (this “Agreement”)
is entered into on April 7, 2009 to be effective as of 11:59 PM CDT March 31,
2009 (the “Effective
Date”), by and between SemMaterials, L.P., an Oklahoma limited
partnership (“SemMaterials”),
and SemMaterials Energy Partners, L.L.C., a Delaware limited liability company
(“SMEP”). SemMaterials
and SMEP are sometimes herein referred to individually as a “Party” and
collectively as the “Parties.”
W
I T N E S S E T H:
WHEREAS, SemMaterials and SMEP entered
into that certain Terminal Access and Use Agreement, dated as of January 28,
2008 (the “Terminal
Agreement”) which set forth certain rights, obligations, terms,
conditions and restrictions associated with and necessary for SemMaterials to
access the Terminals to facilitate the processing, sale, delivery, and/or
removal of asphalt cement, residual fuel oil or other product or
inventory;
WHEREAS,
commencing on July 22, ▇▇▇▇, ▇▇▇▇▇▇▇▇, L.P., an Oklahoma limited partnership
(“SemGroup”)
and certain of its Affiliates (including SemMaterials), filed voluntary
petitions for relief under chapter 11 of the Bankruptcy Code (as defined
herein);
WHEREAS,
on March 6, 2009, SemGroup and certain of its Affiliates (including
SemMaterials) and SemGroup Energy Partners, L.P., a Delaware limited partnership
(“SGLP”) and
certain of its Affiliates (including SMEP) entered into a term sheet regarding
the principal terms of a settlement agreement (the “Settlement”)
between SemGroup and SGLP;
WHEREAS,
pursuant to the terms of the Settlement, SemGroup and its Affiliates agreed to
transfer the Asphalt Transferred Assets (as defined herein) to SGLP and its
Affiliates;
WHEREAS, as part of the Settlement
SemMaterials will reject the Terminal Agreement in the Bankruptcy Cases and
liquidate the Existing Asphalt Inventory (as defined herein); and
WHEREAS,
the Parties desire to agree upon and set forth certain rights, obligations,
terms, conditions and restrictions associated with and necessary for
SemMaterials to access the Terminals and the Asphalt Transferred Assets, as
necessary, to facilitate the processing, sale, delivery and/or removal of the
Existing Asphalt Inventory during the Liquidation Period (as defined
herein).
NOW
THEREFORE, in consideration of the mutual promises and covenants contained
herein and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the Parties hereby agree as follows:
1. Definitions. In
addition to terms defined elsewhere in this Agreement, where capitalized, the
following words and phrases in this Agreement shall be defined as
follows:
(a) “Affiliate”
means, with respect to any entity, any other entity that, directly or
indirectly, controls, is controlled by or is under common control with, such
specified entity through one or more intermediaries or otherwise; provided that, for purposes
of this Agreement, (i) SemGroup Energy Partners G.P., L.L.C., SemGroup Energy
Partners, L.P. and their subsidiaries (the “SGLP
Parties”) shall not be deemed to be Affiliates of SemGroup G.P., L.L.C.,
SemGroup, L.P. and their subsidiaries (other than the SGLP Parties) (the “SemGroup
Parties”) and (ii) the SemGroup Parties and its subsidiaries shall not be
deemed to be Affiliates of the SGLP Parties. For the purposes of this
definition, “control” means, where used with respect to any entity, the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such entity, whether through the
ownership of voting securities, by contract or otherwise, and the terms
“controlling” and “controlled” have correlative meanings.
(b) “Asphalt
Transferred Assets” means, collectively, (i) the “Asphalt Processing
Assets” as defined in the Contribution Agreement, (ii) the “Prior Retained
Easements” as defined in the Contribution Agreement and (iii) the “Prior
Retained Leasehold Agreements” as defined in the Contribution
Agreement.
(c) “Bankruptcy
Cases” means the chapter 11 cases commenced by SemGroup and certain of
its direct and indirect subsidiaries on July 22, 2008 (including any case
commenced after the date of this Agreement), jointly administered under Case No.
08-11525 (BLS).
(d) “Bankruptcy
Code” means Title 11 of the United States Code, as amended.
(e) “Bankruptcy
Court” means the United States Bankruptcy Court for the District of
Delaware or any other court having jurisdiction over the Bankruptcy Cases from
time to time.
(f) “Contribution
Agreement” means that certain Contribution, Conveyance, Assignment and
Assumption Agreement, dated as of the Effective Date, by and among SemMaterials,
K.C. Asphalt L.L.C., SemMaterials Energy Partners, L.L.C. and SGLP Asphalt,
L.L.C.
(g) “Existing Asphalt
Inventory” means any of SemMaterials’ or its Affiliates’ asphalt cement,
residual fuel oil or other product or inventory that is owned on its own behalf
or held on behalf of third parties and that is stored in the Asphalt Transferred
Assets or in SGLP’s or its Affiliates’ liquid asphalt cement facilities as of
the Effective Date.
(h) “Liquidation
Period” means the period commencing as of the Effective Date and ending
on October 31, 2009.
(i) “SMEP Owned Real
Property” means that certain land owned in fee by SMEP at which some of
the Terminals are located as more particularly described on Schedule 1(i)
attached hereto.
(j) “SMEP Leased Real
Property” means that certain land leased by SMEP at which some of the
Terminals are located as more particularly described on Schedule 1(i)
attached hereto.
(k) “Terminal
Assets” means all of the property of SMEP at and comprising the Terminals
including the SMEP Owned Real Property, the SMEP Leased Real Property and all of
those certain asphalt and residual fuel oil storage tanks and related equipment,
facilities, buildings, loading facilities, controls and other assets located at
or used in connection with the Terminals, all as more particularly described on
Schedule 1(k)
attached hereto.
(l) “Terminals”
means those certain terminals described in Schedule 1(i)
which include the Terminal Assets, the SMEP Owned Real Property or SMEP Leased
Real Property, as applicable, and the Asphalt Transferred Assets.
2. Reservation
and Recognition of Access and Use Rights. SemMaterials hereby reserves
and retains the rights to access and use SMEP’s Terminal Assets and the Asphalt
Transferred Assets, to the extent necessary (a) to permit the processing, sale,
delivery and/or removal of the Existing Asphalt Inventory during the Liquidation
Period in accordance with customary industry practice and in a manner consistent
with historical practice, and (b) to permit the fulfillment by the Parties of
their obligations under Section 10 of
this Agreement, and (c) to park mobile equipment including trucks, trailers, and
paving related equipment to the extent such parking does not interfere with the
operation of the Terminals. SMEP hereby recognizes and agrees to
provide and accommodate the access rights of SemMaterials under this Agreement
subject to, and agrees to perform and abide by, the terms and conditions set
forth in this Agreement. SemMaterials expressly disclaims the right
to use Terminal Assets which relate solely to SMEP’s asphalt cement and residual
fuel oil terminalling and storage business and operations and which are not
needed in connection with the processing, sale, delivery and/or removal of the
Existing Asphalt Inventory during the Liquidation Period.
3. Term. This
Agreement shall commence on the Effective Date and shall remain in effect
separately with respect to each Terminal until the earlier of conclusion of the
Liquidation Period or the date on which all Existing Asphalt Inventory is
removed from each Terminal and Customer provides a written notice to Owner
stating all Product is removed (the “Term”). Such
written notice can be delivered via electronic mail or facsimile.
4. Operation
and Maintenance of Terminal and Assets; Sharing of Common
Costs.
(a) Apportionment
and Sharing of Costs. Except as provided in this Section 4, SMEP shall
be solely responsible for and shall pay and discharge when due and payable all
costs and expenditures relating to the ownership and operation of Terminal
Assets, SMEP Owned Real Property, SMEP Leased Property and Asphalt Transferred
Assets. SemMaterials shall be solely responsible for those costs and
expenditures that directly relate to processing, storage and distribution
activities with respect to the Existing Asphalt Inventory during the Liquidation
Period, which costs shall be prorated for the portion of the month or other time
period the Terminal Assets or Asphalt Transferred Assets are used by
SemMaterials. Notwithstanding anything to the contrary herein,
SemMaterials shall not be responsible for any portion of SMEP’s overhead
costs.
(b) Payment
and Discharge of Apportioned Costs; Audit Rights. SMEP shall
be obligated to pay all costs associated with the ownership and operation of the
Terminals and the Asphalt Transferred Assets and shall invoice SemMaterials for
its respective share of operating costs under Section 4(a) on
a monthly basis during the Liquidation Period with reasonable supporting
documentation for each cost item described in the invoice. Such cost
allocation will also comply with the terms of the Transition Services Agreement
between the Parties. Such invoices shall be payable within fifteen
(15) days after receipt. SMEP shall keep such books and records
(which shall be maintained on a consistent basis and substantially in accordance
with generally accepted accounting principles) and shall readily disclose the
basis for any charges or costs or credits, ordinary or extraordinary, billed or
due to the other Party under this Agreement and shall make them available for
examination, audit, and reproduction by the other Party and its agents for a
period of eighteen (18) months after such charge or credit is billed or
due.
(c) Disputed
Amounts.
If
SemMaterials disputes the amount reflected in any statement or invoice delivered
pursuant to Section
4(b) of this Agreement, then SemMaterials may, within thirty (30) days
after receipt of such statement or invoice, deliver a written notice to SMEP
(the “Dispute
Notice”) setting forth the items in dispute in reasonable detail (the
“Disputed
Items”). During the thirty (30) day period following delivery
of the Dispute Notice (the “Resolution
Period”), the Parties will use their commercially reasonable efforts to
reach agreement on the Disputed Items set forth in the Dispute
Notice. If the Parties are unable to reach an agreement during the
Resolution Period, then they will appoint a mutually acceptable independent
party to review the Dispute Notice and determine the final amount of the
Disputed Items. If the Parties are unable to agree on a single
independent party within fifteen (15) days after the end of the Resolution
Period, then the Parties will each appoint one (1) independent party, who will
jointly select a third independent party (singly or collectively, the “Referee”),
within thirty (30) days after the end of the Resolution Period. The
Referee shall deliver its determination to the Parties within thirty (30) days
from the date of its engagement. The Referee’s report shall be final
and binding upon the Parties. The cost of the Referee’s engagement
and report shall be shared fifty percent (50%) by Owner and fifty percent (50%)
by Customer.
5. Health
and Safety. In use of SMEP’s Terminal Assets and the Asphalt
Transferred Assets and the exercise of its rights hereunder, SemMaterials shall
conduct safe operations and shall comply with all applicable federal, state, and
local rules, regulations and orders and SMEP job-site rules and regulations
regarding safety, health and fire protection. SMEP shall provide
SemMaterials with copies of all manuals, pamphlets and brochures and obtain
other information regarding SMEP’s safety and emergency policies, procedures and
rules. SemMaterials shall familiarize themselves and their employees,
agents, contractors and invitees with such safety and emergency information and
shall be responsible for providing any required
training. SemMaterials shall provide all such appropriate protective
equipment and clothing as may be required, and all persons accessing the
Terminals shall wear such required protective equipment and clothing at all
times while thereon. SemMaterials will access and use the Terminals,
Terminal Assets and the Asphalt Transferred Assets in a manner that will not
unreasonably interfere with SMEP’s operations at such Terminals or create an
unreasonable safety risk or hazard. No smoking or open flame or
matches or lighters shall be permitted on the Terminal property without SMEP’s
express prior approval. SemMaterials shall ensure that the Terminals
are at all times kept free of waste and are left clean and
orderly. Equipment placement and material storage shall be at
locations satisfactory to SMEP. SMEP shall have no duty to monitor
compliance by SemMaterials or any contractors, employees or other third parties
with any safety rules, regulations or requirements; provided, however, if SMEP
becomes aware of any such violation of safety rules, regulations or
requirements, SMEP may require SemMaterials to correct violations immediately,
and in the event of aggravated or repeated violations, SMEP may refuse to allow
any person or persons committing such violations to have continuing access to
the Terminal, Terminal Assets or the Asphalt Transferred
Assets. SemMaterials shall use commercially reasonable efforts to
prevent and minimize hazardous conditions arising as a result of its use of the
Terminals and the Asphalt Transferred Assets and shall promptly correct any
unsafe or hazardous condition at the Terminals or relating to any of the Asphalt
Transferred Assets caused by SemMaterials or its respective employees or agents
of which they are aware. SMEP shall promptly correct any unsafe or
hazardous condition at the Terminals caused by SMEP or its employees or agents
of which SMEP is aware which could materially interfere with the use by
SemMaterials of the Terminals, Terminal Assets or the Asphalt Transferred Assets
for the purposes described herein.
6. Security. SemMaterials
and its employees, agents, invitees and contractors shall comply with SMEP’s
security requirements applicable to each Terminal and shall obey the applicable
directions of SMEP’s security personnel and contractors. SMEP may
impose reasonable restrictions and limitations upon access to all or any portion
of the Terminal, Terminal Assets or the Asphalt Transferred Assets, including
restrictions as to time and place of access at any particular time or location
to the extent it does not materially interfere with exercise of rights by
SemMaterials hereunder. All persons shall abide by all such
restrictions and limitations. Any person found in violation of any
such restrictions and limitations may be removed from the Terminal by SMEP, and
SMEP may refuse to allow such person any further access to the
Terminal. Unless otherwise specifically provided in writing, SMEP
shall have no duty to provide any security for protection of the persons or
property of SemMaterials or any contractors, employees, agents or
invitees. SMEP may issue passes or visitor identification cards to
employees, contractors, or representatives of SemMaterials, which must be
presented upon request before entry into Terminals and surrendered upon demand
or upon any termination or expiration of this Agreement. Passes or
other identification shall be issued only to persons meeting any reasonable
security criteria applicable at the relevant Terminal.
7. Wastes;
Hazardous Materials. Each Party shall at all times keep those
areas within the Terminal used by such Party pursuant to this Agreement free
from accumulations of waste material or rubbish resulting from such Party’s use
thereof, and each Party shall remove at their own expense all temporary
structures, rubbish and waste materials resulting therefrom. Each
Party shall take all commercially reasonable steps to eliminate or minimize the
generation of Hazardous Materials in connection with its use of the
Terminals. Each Party shall be responsible for safely and properly
handling, removing and disposing of all Hazardous Materials used, stored or
generated in conjunction with any use of the Terminals, the Asphalt Transferred
Assets or their other respective assets, including, without limitation, the
Existing Asphalt Inventory, in accordance with all applicable Hazardous
Materials Laws. Upon completion of any work on or about a Terminal,
each Party shall leave the work site in a clean and orderly condition, free from
trash, rubbish, debris and other wastes. “Hazardous
Materials,” as used herein, shall mean, without limitation, those
materials defined or regulated as hazardous substances, extremely hazardous
substances, hazardous chemicals, hazardous materials, toxic substances, toxic
chemicals, air pollutants, toxic pollutants, hazardous wastes, extremely
hazardous wastes, radioactive materials or restricted hazardous waste by
Hazardous Materials Law. The term “Asbestos”
as used herein shall mean any asbestos or material containing
asbestos. The term “Hazardous
Materials Law” as used herein means any federal, state, or local law
(including common law), ordinance or regulation or any court judgment or order
of any federal, state or local agency or regulatory body applicable to the
Terminal relating to industrial hygiene or to environmental or unsafe conditions
including, but not limited to, those relating to the generation, manufacture,
storage, use, handling, transportation, recycling, disposal, release, emission
or discharge of Hazardous Materials and Asbestos, those in connection with the
construction, fuel supply, power generation and transmission, waste disposal or
any other operations or processes relating to the Terminal, and those relating
to the atmosphere, soil, surface and ground water, wetlands, stream sediments
and vegetation on, under, in or about each Terminal. Each Party shall
use commercially reasonable efforts to reduce and minimize accidents arising in
connection with use of the Terminal and shall promptly report to the other Party
all accidents or occurrences resulting in injuries to the employees of
SemMaterials or third parties and damage to the other Party’s property or third
parties, arising out of such Party’s use of a Terminal. SemMaterials
and SMEP shall provide each other a detailed written incident report and shall
furnish such other Party with a copy of non-privileged reports made by the
reporting Party to such Party’s insurers, governmental entities or to others of
such accidents or occurrences. Each Party shall promptly report any
governmental inspections relative to such Party’s operations conducted at the
Terminal and the results of the inspections. Where advance notice of
an inspection is given, each Party shall promptly notify the other Party using
the Terminal of the same. Each Party shall inform the other Party of
any notices, warnings, or asserted violations issued by any governmental
agencies relative to any activities performed by such Party at the
Terminal.
8. Reserved.
9. Personnel,
Contractor Prohibitions and Restrictions. The possession, use,
manufacture, distribution, transfer of, or being under the influence of any
unauthorized, prohibited, illegal or controlled substance, or drug
paraphernalia, or possession of any firearm, weapon, explosive or ammunition is
prohibited at the Terminals. As used in this provision, “substance”
refers to alcohol, drug(s), chemical(s), illegal or prescribed, that may be
inhaled, injected, absorbed or taken by mouth that may, in the SMEP’s opinion,
impair an individual. SemMaterials shall not allow and shall take all
steps reasonably necessary to prevent the possession of any unauthorized,
prohibited, illegal, or controlled substance, illegal weapon or firearm by one
of its employees, agents, contractors or invitees at the
Terminal. Any employees, agents, invitees or contractors of
SemMaterials who violate this prohibition are subject to immediate removal from
the Terminal and such removal shall not constitute any cause for claim or
damages against SMEP, and SMEP may prevent such persons from returning to the
Terminal. Prohibited items and substances may be confiscated and
transferred to appropriate law enforcement authorities. SMEP shall
enforce the prohibitions and restrictions described in this paragraph against
its own personnel, contractors or visitors, or other users of the
Terminals.
10. Regulatory
Matters and Compliance. SMEP and SemMaterials and their
respective employees, agents and invitees shall comply with all applicable
federal, state, and local laws, rules, regulations and orders in connection with
their respective use of the Terminals. Each Party shall secure and
maintain current all required permits, licenses, certificates, and approvals
relating to its use of the Terminals or the Asphalt Transferred Assets, as
applicable and in accordance with the terms of the Transition Services
Agreement. SMEP shall comply with all applicable federal, state, and
local laws, rules, regulations and orders pertaining to the operation of the
Terminal and the Asphalt Transferred Assets to the extent reasonably necessary
to enable SemMaterials to exercise the rights provided
hereunder. SemMaterials and SMEP shall reasonably cooperate and
coordinate with each other with respect to permits, environmental prevention
plans and storm water permitting.
11. Notice of
Damage; Emergency Management. SemMaterials shall promptly
notify SMEP of any matters pertaining to any damage or impending damage to or
loss of any of the SMEP’s assets or facilities that are known to such
Party. SMEP shall promptly notify SemMaterials of any damage or
impending damage to or loss of any of their assets or facilities, including any
unpermitted release or threat of release of Hazardous Materials, that are known
to SMEP. In the event of an emergency occurring at any Terminal, SMEP
and SemMaterials shall diligently cooperate in good faith to appropriately
manage the emergency situation in a timely and effective manner. Such
cooperation shall include, but not be limited to, providing of necessary access
to all portions of the Terminal and the improvements thereon.
12. Access to
Terminals and Asphalt Transferred Assets. SemMaterials shall
have access to the Terminals and the Asphalt Transferred Assets for the exercise
of its rights granted hereunder during each such Terminal’s normal business
hours in accordance with its ordinary course of business and consistent with
past practice, subject to the terms and
conditions set forth in this Agreement and to reasonable Terminal shutdowns or
restrictions to address emergency or hazardous situations or as reasonably
necessary to protect SMEP’s assets or operations. SMEP may reasonably
designate certain areas within the Terminals as private and restrict the access
of SemMaterials thereto to the extent such areas do not relate to SemMaterials’
business activities or unduly impede SemMaterials’ access to the Asphalt
Transferred Assets. In the event SemMaterials needs access to any
such restricted areas at a particular Terminal, SemMaterials shall provide SMEP
with advance notice and SMEP shall provide an escort for such
access.
13. Reserved.
14. Standards
of Operation; Prevention of Interference with Other Party’s
Operations. Except as otherwise set forth herein, for purposes
of this Agreement, the normal and customary standards of performance within the
asphalt industry shall be the measure of whether a Party’s performance is
reasonable and timely and each Party shall conduct its business, operations and
other activities undertaken at the Terminals pursuant to this Agreement in
accordance with such standards. Neither SemMaterials nor SMEP shall
use equipment, technologies, or methods of operation that adversely interfere or
affect the operations or assets of the other Party using the
Terminal. Each Party shall take all reasonable precautions to prevent
damage to the Terminals or any of the assets located thereon.
15. Reserved.
16. Reserved.
17. Indemnification.
(a) SemMaterials,
for itself, its successors and assigns hereby (i) waives its right to bring any
claim or cause of action against SMEP, its agents and employees and (ii) agrees
to indemnify, defend and hold harmless SMEP for any claim or cause of action for
any loss, damage, injury, or other casualty of whatsoever kind or by whomsoever
caused, to the person or property arising out of, or resulting from
SemMaterials' use, possession or operation thereof, or from its installation,
existence, use, maintenance, conditions, repair, alteration, removal or
replacements of any improvements thereof, unless due to the gross negligence or
willful misconduct of SMEP, its agents or employees.
(b) SemMaterials
agrees to indemnify and save SMEP harmless from and against any and all
liabilities, claims, demands, suits, judgments, damages or losses, including
costs, fees and expenses, in connection therewith, or incidental thereto, in any
manner arising from or in connection with, any actual or threatened pollution or
threatened pollution or contamination, in any manner, resulting from: (i)
SemMaterials’ access and use of the Terminals under this Agreement and (ii) the
performance of any of the obligations set forth in this Agreement by
SemMaterials, its invitees, or persons, firms, or corporations doing work for
SemMaterials or by the agents, servants or employees of any of
them.
18. Limitation
of Liability. Notwithstanding any other provision,
SemMaterials shall not be liable to the other Party for special, punitive,
exemplary, consequential, or indirect losses or damages suffered by SMEP as a
result of the performance or nonperformance of its obligations under this
Agreement, or its acts or omissions related to this Agreement or its use of the
system, whether or not arising from sole, joint or concurrent negligence, strict
liability, violation of law, breach of contract, breach of warranty, or any
other source whether or not foreseeable and even if the Parties have been
advised of the possibility of such damages.
19. Insurance.
(a) Obligation
to Obtain. During the Term, the Parties (or their agents)
shall each obtain and/or maintain not less than the following
insurance:
(i) Commercial
General Liability Insurance with a combined single limit of $1,000,000 for
bodily injury and property damage per occurrence and in the
aggregate.
(ii) If a
Party has employees, Worker’s Compensation Insurance (including Occupational
Disease coverage) in amounts required by applicable law and Employers Liability
Insurance (including Occupational Disease coverage) with limits not less than
$500,000 each accident. If work is to be performed in North Dakota,
Ohio, Washington, Wyoming, or West Virginia, the Party shall participate in the
appropriate state fund(s) to cover all eligible employees and provide a stop gap
endorsement.
(iii) Automobile
Liability Insurance with a combined single limit of $1,000,000 for bodily injury
and property damage per occurrence, to include coverage for all owned,
non-owned, and hired vehicles.
(iv) Excess
(or Umbrella) Liability Insurance with a combined single limit of $9,000,000 for
bodily injury and property damage per occurrence, such insurance providing
excess or umbrella liability coverage above primary liability limits set forth
in Subsections (i), (ii), and (iii) of this Section.
(v) Insurance
on an all risk basis for the replacement value of such Party’s property
(including fixtures, improvements and equipment) located at the Terminals and
any other insurance against other perils and in such amounts as the Parties
agree from time to time should be reasonably required.
The
limits set forth above are minimum coverage amounts and are not intended and
shall not be construed to limit the liability of either Party under this
Agreement. Failure of either Party to demand such certificate or
other evidence of full compliance with these insurance requirements or failure
of either party to identify a deficiency from evidence that is provided shall
not be construed as a waiver of either Party’s obligation to maintain such
insurance.
(b) Policy
Requirements. All insurance required hereunder shall be
maintained with responsible, solvent and reputable insurance companies with an
A.M. Best rating of A-IX or better that are qualified to do business in the
State of Oklahoma. Each Party shall provide the other Party with an
insurance certificate confirming compliance with the insurance requirements of
this Article. SemMaterials shall, in addition to and without
limitation of the requirements of this Section 20, cause the
insurance policies described in Sections 20(a)(i) and
20(a)(iii) to
include SMEP as an additional insured. All insurance required
hereunder and provided by SemMaterials shall be primary to any other insurance
coverage of SMEP and shall apply and be in full force and effect regardless of
the existence of other insurance. The insurance certificate shall
indicate that the other Party shall be notified not less than ten (10) calendar
days prior to any cancellation in coverage; provided, however, that with
respect to the policies described in Sections 20(a)(i) and
20(a)(iii), the
insurance certificate shall provide that SMEP shall be notified not less than
thirty (30) calendar days prior to any cancellation in coverage. If
either Party provides any of the foregoing coverages through a claims-made
policy basis, that Party shall endeavor to maintain, for at least three years
beyond the expiration of this Agreement, a tail policy.
(c) Waiver of
Claims; Waiver of Subrogation. Each Party hereto hereby waives
any and all claims for recovery which such Party or anyone claiming through such
Party may have against the other Party hereto (or such other Party’s officers,
agents or employees) for or with respect to any loss of or damage to such
waiving Party’s property which is (i) insured under valid insurance policies, to
the extent of any recovery actually collectible under such insurance policies,
or (ii) required by this Agreement to be insured, to the extent any recovery
would be collectible if such insurance policies were obtained and maintained as
required by this Agreement, whether or not such loss or damage is caused by the
negligence of such other Party or such other Party’s agents, employees or
contractors or of any other person or persons for whose actions such other Party
may be responsible or liable. SMEP and SemMaterials each agree to
obtain from the insurance companies providing its insurance applicable hereto
permission to allow SMEP and SemMaterials to waive their respective insurance
companies’ rights of subrogation. SMEP and SemMaterials shall each
provide to the other written proof of the waiver of said claims by said
insurance companies.
(d) Blanket
Policies. Nothing in this Agreement shall be construed to
prevent either Party from satisfying its insurance obligations pursuant to this
Agreement under a blanket policy or policies of insurance that meet or exceed
the requirements of this Article.
(e) Diligent
Pursuit of Claims. In the event coverage is denied or
reimbursement of a properly presented claim is disputed by the carrier for
insurance required by this section, the Party carrying such coverage shall make
commercially reasonable efforts to pursue such claim with its
carrier.
20. Reserved.
21. Reserved.
22. Default. A
Party shall not be in default under this Agreement unless and until the
non-defaulting Party provides it written notice of such default and the
defaulting Party fails to cure the same within thirty (30) calendar days after
receipt of such notice (or, with respect to monetary defaults, within ten (10)
business days after receipt of such notice); provided, however, that where
a non-monetary default cannot reasonably be cured within such thirty (30) day
period, if the defaulting Party proceeds promptly to cure the default with due
diligence, the time for curing such default shall be extended for such period of
time as may be reasonably necessary to complete such curing. Any
event of default may be waived at the non-defaulting Party’s
option. Upon the failure of a Party to timely cure any such default
after notice thereof from the other Party and expiration of the above cure
periods, then the non-defaulting Party may pursue any legal remedies it may have
under applicable law or principles of equity relating to such
default. Either Party may seek equitable remedies prior to expiration
of the above cure period to prevent irreparable harm.
23. Reserved.
24. Force
Majeure. No Party shall be in default under this Agreement
with respect to any delay in its performance caused by any of the following
conditions (each a “Force Majeure
Event”): (a) act of God; (b) fire; (c) flood; (d) material
shortage or unavailability not resulting from the responsible Party’s failure to
timely place orders or take other necessary actions therefor; (e) war or civil
disorder; or (f) any other cause beyond the reasonable control of such
Party. The Party claiming relief under this Article shall
promptly notify the other in writing of the existence of the Force Majeure Event
relied on, the expected duration of the Force Majeure Event, and the cessation
or termination of the Force Majeure Event. The Party claiming relief
under this Article shall exercise commercially reasonable efforts to
minimize the time for any such delay.
25. Notice. Unless
otherwise provided in this Agreement, all notices and communications concerning
this Agreement shall be in writing and addressed to the other Party as
follows:
|
If
to SMEP:
|
SemMaterials
Energy Partners, L.L.C.
Attn: President
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▇▇▇▇▇,
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Facsimile
No. (▇▇▇) ▇▇▇-▇▇▇▇
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With
a copy to:
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▇▇▇▇▇ L.L.P.
Attn: ▇▇▇▇
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Facsimile
No.: (▇▇▇) ▇▇▇-▇▇▇▇
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If
to SemMaterials:
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SemMaterials,
L.P.
Attn: President
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▇▇▇▇▇,
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Facsimile
No. (▇▇▇) ▇▇▇-▇▇▇▇
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With
a copy to:
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Weil,
Gotshal & ▇▇▇▇▇▇, LLP
Attn: ▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇, Esq.
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▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
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Facsimile
No.: (▇▇▇) ▇▇▇-▇▇▇▇
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or at
such other address as may be designated in writing to the other
Party.
Unless
otherwise provided herein, notices and invoices shall be hand delivered, sent by
registered or certified U.S. Mail, postage prepaid, or by commercial
overnight delivery service, or transmitted by electronic mail or facsimile, and
shall be deemed served or delivered to the addressee or its office when received
at the address for notice specified above when hand delivered, upon confirmation
of sending when sent by electronic mail or facsimile, on the day after being
sent when sent by overnight delivery service, or three United States Postal
Service business days after deposit in the mail when sent by
U.S. mail.
26. Reserved.
27. Miscellaneous.
(a) Headings. The
headings of the sections and subsections of this Agreement are for convenience
only and shall not be used in the interpretation of this Agreement.
(b) Standards
of Performance. Except as otherwise set forth herein, for the
purpose of this Agreement the normal standards of performance within the asphalt
storage and manufacturing industry in the relevant market shall be the measure
of whether a Party’s performance is reasonable and timely.
(c) Section
References. Except as the context otherwise indicates, all
references to Exhibits, Sections, and Subsections refer to provisions of this
Agreement. The words hereof, herein, hereunder or similar words refer
to this Agreement as a whole and not to any particular provision, paragraph or
Section.
(d) Amendment
or Waiver. This Agreement may not be amended, modified or
waived except by written instrument executed by officers or duly authorized
representatives of the respective Parties. The Parties hereby
acknowledge and agree that a material amendment to this Agreement requires the
approval of the Bankruptcy Court prior to the effective date of the plan of
reorganization in the Bankruptcy Cases. No waiver or failure of
enforcement by any Party of any default by any other Party in the performance of
any provision, condition or requirement herein shall be deemed to be a waiver
of, or in any manner a release of the defaulting Party from, performance of any
other provision, condition or requirement herein, nor deemed to be a waiver of,
or in any manner a release of the defaulting Party from, future performance of
the same provision, condition or requirement; nor shall any delay or omission of
any non-defaulting Party to exercise any right hereunder in any manner impair
the exercise of any such right or any like right accruing to it
thereafter.
(e) Severability. Any
provision of this Agreement that is prohibited or not enforceable in any
jurisdiction shall, as to that jurisdiction, be ineffective only to the extent
of the prohibition or lack of enforceability without invalidating the remaining
provisions of this Agreement, or affect the validity or enforceability of those
provisions in another jurisdiction or the validity or enforceability of this
Agreement as a whole.
(f) Assignment. No
Party hereto may assign this Agreement, in whole or in part, except with the
prior written approval of each other Party, which approval shall not be
unreasonably withheld; provided, however, that a Party
may assign this Agreement to an Affiliate or any purchaser of or successor to
all or substantially all of the asphalt assets or business of such Party; provided, further that
SemMaterials has pledged, and may continue to pledge, its ownership interest in
the Existing Asphalt Inventory for the benefit of its creditors to the extent
permitted by Applicable Law. This Agreement shall inure to the
benefit of, and shall be binding upon, the Parties and their respective
permitted successors and assigns, including with respect to SemMaterials, any
reorganized debtor entity appointed pursuant to the plan of reorganization of
SemMaterials.
(g) Entire
Agreement and Conflict with Attachments. This Agreement
(including Attachments) contains the entire and exclusive agreement between the
Parties with respect to the subject matter hereof, and there are no other
promises, representations, or warranties affecting it. The terms of
this Agreement may not be contradicted, explained or supplanted by any usage of
trade, course of dealing or course of performance and any other representation,
promise, statement or warranty made by either Party or their agents that differs
in any way from the terms contained herein will be given no force or
effect. In the case of any conflict between the body of this
Agreement and any of its Attachments, the terms contained in the Attachments
will govern.
(h) Governing
Law. THIS AGREEMENT, THE RIGHTS AND OBLIGATIONS OF THE PARTIES
UNDER THIS AGREEMENT, AND ANY CLAIM OR CONTROVERSY DIRECTLY OR INDIRECTLY BASED
UPON OR ARISING OUT OF THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS
AGREEMENT (WHETHER BASED ON CONTRACT, TORT, OR ANY OTHER THEORY), INCLUDING ALL
MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, SHALL IN ALL RESPECTS BE
GOVERNED BY AND INTERPRETED, CONSTRUED, AND DETERMINED IN ACCORDANCE WITH, THE
APPLICABLE PROVISIONS OF THE BANKRUPTCY CODE AND THE INTERNAL LAWS OF THE STATE
OF OKLAHOMA (WITHOUT REGARD TO ANY CONFLICTS OF LAW PROVISION THAT WOULD REQUIRE
THE APPLICATION OF THE LAW OF ANY OTHER JURISDICTION).
(i) Jurisdiction.
(i) Without
limiting any Party’s right to appeal any Order of the Bankruptcy Court, (i) the
Bankruptcy Court shall retain exclusive jurisdiction to enforce the terms of
this Agreement and to decide any claims or disputes which may arise or result
from, or be connected hereby, and (ii) any and all Actions related to the
foregoing shall be filed and maintained only in the Bankruptcy Court, and the
Parties hereby consent to and submit to the jurisdiction and venue of the
Bankruptcy Court and shall receive notices at such locations as indicated in
Section 25;
provided, however, that if a
plan of reorganization has become effective in the Bankruptcy Cases, the Parties
agree to unconditionally and irrevocably submit to the exclusive jurisdiction of
the federal or state courts in Oklahoma City, Oklahoma for the resolution of any
such claim or dispute.
(ii) The
Parties hereby unconditionally and irrevocably waive, to the fullest extent
permitted by Applicable Law, any objection which they may now or hereafter have
to the laying of venue or any dispute arising out of or relating to this
Agreement or any of the transactions contemplated hereby brought in any court
specified in paragraph (a) above, or any defense of inconvenient forum of the
maintenance of such dispute. Each of the Parties hereto agrees that a
judgment in any such dispute may be enforced in other jurisdictions by suit on
the judgment or in any other manner provided by law.
(iii) Each of
the Parties hereto consents to process being served by any Party to this
Agreement in any suit, Action or proceeding by the mailing of a copy thereof in
accordance with the provisions of Section
25.
(j) Counterparts. This
Agreement may be executed in any number of counterparts each of which, when so
executed and delivered (including by facsimile or electronic mail transmission),
will be deemed original but all of which together will constitute one and the
same instrument.
(k) Further
Assurances. Subject to the terms and conditions of this
Agreement, each of the Parties hereto will use commercially reasonable efforts
to take, or cause to be taken, all action, and to do, or cause to be done, all
things necessary under applicable laws and regulations to consummate the
transactions contemplated by this Agreement.
(l) No
Third-Party Beneficiaries. Except as provided in Section 17, nothing
contained in this Agreement, expressed or implied, is intended or shall be
construed to confer upon or give to any Person (including any limited partners
of SGLP) other than the Parties hereto and their successors or permitted
assigns, any rights or remedies under or by reason of this
Agreement.
(m) No Strict
Construction. The Parties to this Agreement have participated
jointly in the negotiation and drafting of this Agreement. In the event an
ambiguity or question of intent or interpretation arises with respect to this
Agreement, this Agreement shall be construed as if drafted jointly by the
Parties, and no presumption or burden of proof shall arise favoring or
disfavoring a Party by virtue of the authorship of any of the provisions of this
Agreement.
[REMAINDER
OF THIS PAGE INTENTIONALLY LEFT BLANK]
IN
WITNESS WHEREOF, duly authorized representatives of SemMaterials and SMEP have
executed this Agreement as of the date hereof to be effective as of the
Effective Date.
SEMMATERIALS
ENERGY PARTNERS, L.L.C.
By:/s/ ▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇
Name:
▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇
Title: Chief Financial Officer and
Secretary
SEMMATERIALS,
L.P.
By: SemOperating
G.P., L.L.C.,
its
general partner
By:/s/ ▇▇▇▇▇▇▇▇
▇▇▇▇▇
Name:
▇▇▇▇▇▇▇▇
▇▇▇▇▇
Title: President &
CEO
SCHEDULE
1(i)
DESCRIPTION OF TERMINALS,
SMEP OWNED REAL
PROPERTY AND SMEP LEASED
REAL PROPERTY
|
TERMINAL
|
Street
Address
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Land
Owned
or
Leased
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Ardmore,
OK
|
▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇
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▇
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|
▇▇▇▇▇▇,
▇▇
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▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
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▇
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▇▇▇
▇▇▇▇, ▇▇
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▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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▇
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|
▇▇▇▇▇▇▇▇,
▇▇
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▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇
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▇
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▇▇▇▇▇,
▇▇
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4303
Gekeler Lane
|
O
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Catoosa,
OK (Emulsion plt)
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▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇
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▇
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▇▇▇▇▇▇▇,
▇▇ (Port 33)
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▇▇▇ ▇.
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇▇▇▇
▇▇ ▇▇▇▇▇▇▇
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▇▇▇▇ ▇.
▇▇▇▇▇▇▇ ▇▇▇▇
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▇▇▇▇▇▇▇,
▇▇ Marine Oil
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▇▇▇▇ ▇.
▇▇▇▇ ▇▇▇▇▇▇
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▇
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▇▇▇▇▇▇▇▇,
▇▇
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3737
▇▇▇▇▇▇ Road
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O
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Denver
C, CO
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▇▇▇▇ ▇.
▇▇▇▇ ▇▇▇▇▇▇
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▇
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▇▇▇▇▇▇
▇, ▇▇
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▇▇▇▇ ▇.
▇▇▇▇ ▇▇▇▇▇▇
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▇
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▇▇▇▇▇
▇▇▇▇, ▇▇
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▇▇▇▇
▇▇▇▇▇▇ & ▇▇▇ ▇▇▇▇
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▇
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▇▇
▇▇▇▇▇▇, ▇▇
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▇▇▇ ▇.
▇▇▇▇ ▇▇▇▇▇▇
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▇
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▇▇▇▇▇,
▇▇
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▇▇▇
▇▇▇▇▇ ▇▇▇▇
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▇
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▇▇▇▇▇▇▇,
▇▇
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▇▇▇▇▇
▇▇▇▇▇▇ Avenue
|
O
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Garden
City Plant PMAC/CB
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▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇
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▇
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▇▇▇▇▇▇▇▇▇▇
▇▇▇▇, ▇▇
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King
Street & Jersey Avenue
|
O
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Grand
Island, NE
|
▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇
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▇
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|
▇▇▇▇▇
▇▇▇, ▇▇
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▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇
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▇
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|
▇▇▇▇▇▇▇▇,
▇▇
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▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
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▇
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▇▇▇
▇▇▇▇▇, ▇▇
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▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇ ▇▇▇
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▇,▇
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Lawton,
OK
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▇▇▇▇
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
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▇
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▇▇▇▇▇▇
▇▇▇▇, ▇▇
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▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
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▇
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▇▇▇▇▇▇▇,
▇▇
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▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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▇,▇
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Memphis
Emulsion, TN
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▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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▇,▇
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Memphis
TN
|
▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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▇
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▇▇▇▇▇▇▇▇
▇▇▇▇, ▇▇
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▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
|
L
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Muskogee,
OK
|
▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
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▇
|
|
▇▇▇
▇▇▇▇▇▇, ▇▇
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#▇▇▇
▇▇▇ ▇▇ ▇▇▇▇▇
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▇
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▇▇▇▇▇▇▇
▇▇▇▇, ▇▇
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▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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▇
|
|
▇▇▇▇▇▇▇▇▇▇▇▇▇▇,
▇▇
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4th
& ▇▇▇▇
|
▇
|
|
▇▇▇▇▇▇▇,
TN
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5445
▇▇▇ ▇▇▇ ▇▇▇▇
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▇
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|
▇▇▇▇▇,
▇▇
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▇▇▇▇
▇▇▇▇▇ Landing
|
L
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Pekin,
IL
|
▇▇▇ ▇.
▇▇▇▇▇ ▇▇▇▇
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▇
|
|
▇▇▇▇▇▇,
▇▇
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▇▇▇
▇▇▇▇ ▇ ▇▇▇▇▇▇
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▇
|
|
▇▇▇▇▇▇▇,
▇▇
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▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
|
▇
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|
▇▇▇▇▇▇▇,
▇▇
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▇▇▇
▇▇▇▇▇▇ ▇▇▇▇
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▇,▇
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▇▇▇▇▇▇,
▇▇
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▇▇▇▇ ▇.
▇▇▇▇▇ ▇▇▇▇▇▇
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▇
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▇▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇
|
95
West, ▇▇▇▇ ▇▇▇▇▇
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▇
|
|
▇▇▇▇▇▇▇,
▇▇
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▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
|
▇
|
|
▇▇▇▇▇▇▇,
▇▇ (▇▇▇▇▇▇▇▇)
|
▇▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
|
▇
|
|
▇▇▇▇▇▇▇,
▇▇ (Valley)
|
E
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
|
▇
|
|
▇▇.
▇▇▇▇▇, ▇▇
|
▇▇▇
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
|
O
|
|
Warsaw,
IN
|
▇▇▇▇ ▇.
▇▇▇▇▇▇ ▇▇▇▇▇▇
|
▇
|
|
▇▇▇▇▇
▇▇▇▇▇, ▇▇
|
991 W.
1500
|
O
|
SCHEDULE
1(k)
DESCRIPTION OF SMEP’S
TERMINAL ASSETS
Land and
Land Improvements
Buildings
Furniture
and Fixtures
Machinery
and Equipment
Storage
Tanks – AC and Residual Fuels
Piping,
Electrical, Boilers and related Equipment