Exhibit 10.25
AMENDED AND RESTATED AGREEMENT OF SUB-LEASE
(PERNIS)
The undersigned
Shell Nederland Raffinaderij B.V., (formerly named Shell Nederland Raffinaderij
N.V.) a company organised under the laws of the Netherlands, having its offices
at 601 Vondelingenweg, 3196 KK Vondelingenplaat, Rotterdam (hereinafter referred
to as "SNR"), of the one part,
and
Shell Epoxy Resins Nederland B.V., a company organised under the laws of the
Netherlands, having its offices at 601 Vondelingenweg, 3196 KK Vondelingenplaat,
Rotterdam (hereinafter referred to as "Newco"), of the other part,
(A) Whereas Shell Nederland Chemie B.V. ("SNC") and Newco have executed
agreements regarding the contribution of the plants for the production of
Resins and Versatics ("Plants");
(B) Whereas, SNC and Newco have executed an agreement for the provision by SNC
of Services, Utilities, Materials and Facilities as amended by that certain
First Amended and Restated Site Services, Utilities, Materials and
Facilities Agreement dated the date hereof (the "SNC SUMF Agreement") and
SNR and Newco have also executed an agreement for the provision by SNR of
Services, Utilities, Materials and Facilities as amended by that certain
First Amended and Restated Site Services, Utilities, Materials and
Facilities Agreement dated the date hereof (the "SNR SUMF Agreement"). The
SNC SUMF Agreement and the SNR SUMF Agreement are herein referred to as the
"SUMF Agreements");
(C) Whereas SNR has leased its premises at ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇ ("The Pernis Site") from the municipality of Rotterdam, which
agreement is attached to this Agreement as Exhibit A ("Lease Agreement");
(D) Whereas, SNR and Newco have entered into an Agreement of Sub-Lease dated
October 29, 1999 for a portion of the Pernis site (the "Original Sub-
Lease");
(E) Whereas, SNR and Newco desire to amend and restate the Original Sub-Lease
on the terms contained herein;
(F) Whereas in accordance with article 15 of the Lease Agreement the
municipality of Rotterdam has approved the Sub-Lease of the Area (as
hereinafter defined) which approval is evidenced by a document which is
attached to this Agreement as Exhibit B.
Accordingly, the parties have agreed to the following Amended and Restated Sub-
Lease (hereinafter referred to as "the Agreement" or "the Sub-Lease"):
ARTICLE 1. SUB-LEASE
1.1. SNR hereby grants and Newco hereby takes on by way of sublease two parcels
of land. One parcel of land contains the Resins Plant and its related
facilities (the "Resins Parcel") and the other parcel of land contains the
Versatics Plant and its related facilities (the "Versatics Parcel") with
both the Resins Parcel and the Versatics Parcel being described in Exhibit
C hereto (hereinafter referred to collectively as the "Area"). The Area
forms part of SNR's Pernis Site leased by SNR pursuant to the Lease
Agreement from the municipality of Rotterdam. The Area shall exclusively be
used to maintain and operate the Plants or replacement plants with related
facilities for resins or versatics production. If Newco wishes to change
the use of either Plant it shall first obtain the consent of SNR, which
consent shall not be unreasonably withheld or delayed.
1.2. The rent to be paid by Newco to SNR shall be equal to the rent to be paid
by SNR to the municipality of Rotterdam for the Area, (the "Rent").
ARTICLE 2. COMPLIANCE WITH LEASE AGREEMENT CONDITIONS
2.1. Newco shall be entitled to the same rights and subject to the same
conditions with respect to use of the Area and conduct of operations
thereon as are enjoyed by and required of SNR under the Lease Agreement.
2.2. SNR and Newco shall consult with each other in a timely manner with respect
to such conditions and co-operate with each other to the extent necessary
or useful to ensure compliance with the Lease Agreement. Notwithstanding
SNR's audit right under 3.1 of Schedule 1, the Newco shall grant SNR access
to the Area and facilities thereon for the purpose of assessing proper
compliance by Newco with such conditions, subject, however, to reasonable
notice and without interference by SNR in the business operations of Newco.
2.3. If SNR incurs costs or expenses in relation to a claim by a third party or
incurs third party liability of any nature whatsoever arising out or
connected with the performance by Newco of this Agreement then Newco shall
indemnify SNR against such third party liability and costs and expenses
relating thereto.
ARTICLE 3. TERM AND TERMINATION
3.1. This Sub-Lease shall be effective as from 1 November, 2000 ("Effective
Date"). The term of this Sub-Lease shall be for twenty (20) years from the
Effective Date and Newco shall have the right to three (3) renewal terms of
five (5) years each; provided, however, that if the term of either or both
of the SUMF Agreements is extended, the term of the Sub-Lease shall be
automatically extended for the same time period, but in no event shall the
extension be for a period of time beyond June 30, 2044. In accordance with
the Lease Agreement, SNR's current lease of the Pernis Site will expire on
June 30, 2024. Pursuant to a Renewal Option dated April 9, 1986, SNR has
the option to renew the Lease Agreement for a further period ending on June
30, 2044. SNR shall give Newco written notice at least six months prior to
the expiration of SNR's option to extend the Lease Agreement to June 30,
2044. If Newco during such six-month notice period gives SNR notice that it
is extending the Sub-Lease beyond the original term of the Lease (June 30,
2024) then SNR shall exercise its option to extend the Lease to June 30,
2044.
2
3.2. The Agreement can only be unilaterally terminated by SNR in the following
cases:
3.2.1. If the Contract of lease between the municipality of Rotterdam and SNR in
respect of the Area is unilaterally terminated by the former: the
Agreement shall be terminated at the date on which the Lease Agreement
terminates.
3.2.2. If the Lease Agreement is not extended by the municipality of Rotterdam
after the date of its expiration: the Agreement shall be terminated at
the date on which the Lease Agreement expires.
3.2.3 If Newco does not operate either Plant in accordance with generally
accepted European industry standards, with the Shell Chemicals Limited
HSE standards or with other standards as agreed between the Parties and
with the requirements of Site permits (collectively being referred to as
"SNR/Pernis Standards" and with any failure to comply referred to as a
"Non-Compliant Act"), then SNR shall have the right to terminate this
Agreement if such Non-Compliant Act is not ceased by Newco (x) within ten
10) days (or such longer period as may be approved in writing by SNR,
with such approval not to be unreasonably withheld if the total period is
20 or fewer days) or, (y) if the Non-Compliant Act is in relation to a
standard adopted after the Effective Date and is not required by any
relevant Government Authority, within sixty (60) days or (z) if the
standard is required by a relevant Government Authority, within such
period as is required by such authority, in each case after delivery of
written notice to Newco specifically describing such Non-Compliant Act or
acts and directing Newco to cease such non-compliance ("Non-Compliant Act
Notice"); provided that in all events the maximum period for ceasing the
Non-Compliant Act shall not exceed the period prescribed by any relevant
Government Authority. If Newco has not ceased the Non-Compliant Act
described in the Non-Compliant Act Notice within the period as above-
determined, then SNR may terminate this Agreement by delivery of written
notice to Newco ("Termination Notice"), with such termination being
effective six months after delivery of the Termination Notice. From and
after the delivery of any Termination Notice (including, if applicable,
during any dispute by Newco as to the existence of any Non-Compliant Act)
Newco shall cease and not continue the conduct giving rise to such
Termination Notice. If, notwithstanding the delivery of any Termination
Notice, Newco shall not cease the Non-Compliant Act or Acts, SNR may
terminate this Agreement with ten (10) days notice or such other shorter
period of notice as may be prescribed by any relevant Government
Authority. SNR's right to terminate the Lease Agreement pursuant to this
Article 3.2.3 is conditional upon the standards referred to above not
being applied by SNR in a manner which discriminates against Newco's
operations compared with other operations on the SNR Pernis Site,
including operations conducted by SNR or an SNR Affiliate. If it is not
possible to identify other operations on the SNR/Pernis Site that are
subject to the SNR/Pernis Standards that are being applied to the
operations of Newco, the enforcement of any such SNR/Pernis Standards
shall be made by SNR in a manner having the least disruption or
deleterious effect upon the operations of Newco that are reasonable under
the circumstances. As of the Effective Date and for twelve months prior
to that date, it is assumed each Plant was operated with no Non-Compliant
Act.
3
3.2.4. If a Bankruptcy Event occurs and is continuing in relation to Newco and
Newco does not provide SNR with adequate assurance (such as a priority
lien, advance payment or letter of credit) of continued payment of any
undisputed amount of any sums owed by Newco under this Sub-Lease within
thirty (30) days of the occurrence of the Bankruptcy Event;
3.2.5. If Newco without proper justification fails to pay any undisputed amount
of any sums owed by Newco hereunder within three (3) months of the date
when such payment became due, and such failure continues thereafter for a
period of sixty (60) days after written notice from SNR.
3.2.6. If Newco, without SNR's consent (which consent shall not be unreasonably
withheld), should put the Area to another use than that mentioned in
Article 1.1.
3.3 Newco may, in addition to its other remedies, terminate this Sub-Lease in
its entirety or with respect to a portion of the Area with no less than
twelve (12) months' prior written notice:
(a) following the decision by Newco to discontinue all its operations at
the Plant and the Area, Newco may terminate the Sub-Lease in its
entirety; or
(b) following a decision by Newco to terminate the Versatics Plant
production at the Site, Newco may terminate the Sub-Lease with
respect to that portion of the Area on which Newco produces
Versatics; or
(c) following a decision by Newco to terminate the Resins Plant
production at the Site, Newco may terminate the Sub-Lease with
respect to that portion of the Area on which Newco produces Resins.
3.4. In case the Sub-Lease is terminated with respect to the Area, or is
terminated with respect to either the Versatics Parcel or the Resins
Parcel, Newco, at its cost, shall place at SNR's disposal the Area (or in
the case of a termination of either the Versatics Parcel or the Resins
Parcel, the respective parcel which is the subject of the termination) in
its Original State reasonable wear and tear and changes made to the
Original State by Newco in accordance with the terms of this Sub-Lease
during the term of the Sub-Lease excepted or, at SNR's option, clear off
the Area and remove all above-ground facilities and installations.
3.5. Unless SNR or Newco has exercised its option in Article 3.4 to the Area or
with respect to either the Versatics Parcel or the Resins Parcel if the
Area or the relevant Parcel is not placed at SNR's disposal in its
Original State any reasonable expenses made by SNR to restore the Area or
the relevant parcel to the Original State reasonable wear and tear and
changes made to the Original State by Newco in accordance with the terms
of this Sub-Lease during the term of the Sub-Lease excepted, shall be
refunded by Newco on demand, in accordance with SNR's statement of the
expenses.
ARTICLE 4 ORIGINAL STATE
4.1. The Area will be made available to Newco in its current physical condition
as of the Effective Date (the "Original State"). By taking into use the
Area, Newco indicates that the Area is in the Original State. Newco is
obliged to keep the Area in such state and subject to Article 3.4 return
it to SNR in its Original State, reasonable wear and tear and changes to
the Original State by Newco during the term of the Sub-Lease excepted.
4
ARTICLE 5 TAXES ETC.
5.1. All taxes, other impositions and costs arising out of the Lease Agreement
due in respect of the Area and/or the Plants and not the balance of the
Pernis Site shall be for Newco's account.
5.2. A fair proportion of all such rates, taxes, assessments, duties, charges,
impositions and outgoings on the land, shall be divided on a pro rata basis
based upon the valuation assessed by the governmental authority having
jurisdiction or if no such valuation assessment has been made, based upon
the respective square footage of the Area and SNR's Pernis Site. Newco
shall have the right to withhold from payments to SNR that part of the
amount of rates, taxes, assessments, duties, charges, impositions and
outgoings which is disputed by Newco until such dispute is resolved
pursuant to Article 14 hereof.
ARTICLE 6 RIGHTS OF WAY.
6.1. SNR, also acting on behalf of other third parties vested on the Pernis Site
(including its contractors), will have the right of way ("recht van
overpad") to the Area and is entitled to lay and maintain, at locations
reasonably determined by Newco, pipes, cables etc. through the Area, always
provided however that no substantial hindrance, interruption of operations
and/or additional costs are caused for Newco.
6.2. SNR is entitled, subject to Newco's approval, such approval not to be
unreasonably withheld, to build and maintain new shared facilities (such as
flares, cooling water towers, etc.) or expand facilities existing on the
Area always provided however that no substantial hindrance, interruption of
operations and/or additional costs are caused for Newco and SNR will hold
Newco harmless accordingly.
6.3. Newco will have the right of way to the Plants and SNR warrants Newco's
right to have access thereto, subject to Newco adhering to the Pernis Site
HSE Standards in exercising such right of way.
6.4. Newco and its contractors will have right of way to the Pernis Site and
Newco is entitled to lay and maintain, at locations reasonably determined
by SNR, pipes, cables etc., required for the operation of the Plants,
through the Pernis Site always provided, however, that no substantial
hindrance, interruption of operations and/or additional costs are caused
for SNR (including the cost of measures necessary for the protection of the
health of Newco's personnel, contractors or agents for the execution of
earth works, which will be for Newco's account) and subject to Newco
adhering to the Pernis Site HSE Standards in exercising such right of way
and in laying and maintaining pipes and cables etc.
ARTICLE 7 EMERGENCIES.
7.1. SNR shall be entitled to enter the Area e.g., in case of an emergency such
as a fire has broken out or an explosion has taken place on the Pernis
Site, so as to be in a position to take any measures it thinks fit to take.
ARTICLE 8 PAYMENT TERMS
8.1. The amounts that Newco will have to pay to SNR in accordance with this
Agreement shall be paid in advance on or before the first day of each
calendar quarter. SNR will invoice Newco accordingly.
5
Invoices will be paid within 30 days after date of the invoice. The amounts
will be increased with the applicable VAT. The parties will jointly opt for
taxed rent (`belaste verhuur').
ARTICLE 9. SOIL PROTECTION SERVICES AND ENVIRONMENTAL LIABILITIES
9.1. SNR agrees to provide and Newco agrees to accept the Soil Protection
Services (as hereinafter defined) in accordance with the terms and
conditions set out in Schedule 1 to this Agreement.
9.2. SNR and Newco agree that the obligations for clean up and environmental
liability in relation to the Area shall be in accordance with the terms
and conditions set out in Schedule 1 to this Agreement subject to the
Environmental Agreement to the extent provided in Article 9.3.
9.3. Newco and SNR acknowledge that notwithstanding any provision to the
contrary in this Lease, the provisions of Clause 10.3 of the Environmental
Agreement between Shell Petroleum N.V. and Shell Epoxy Resins, Inc. for
the Non-U.S. properties dated the date hereof (the "Environmental
Agreement") shall apply as between any Seller Indemnified Party (as
defined in the Environmental Agreement) and SER Indemnified Party (as
defined in the Environmental Agreement) and any person to whom a transfer
or assignment is made in accordance with Clause 11.1 of the Environmental
Agreement. Any obligation or liability of any SER Indemnified Party or
Seller Indemnified Party under this Agreement shall be without prejudice
to the rights, if any, of the relevant party to claim Environmental
Damages (as defined under the Environmental Agreement) under the
Environmental Agreement. A copy of the Environmental Agreement is attached
to this Agreement for reference at Exhibit E.
ARTICLE 10. RELINQUISHMENT.
10.1. Newco shall not, without SNR's prior approval, be permitted to relinquish
all or part of the Area to any third party through leasing, submitting or
allowing use thereof.
ARTICLE 11 - INTENTIONALLY LEFT BLANK
ARTICLE 12 ASSIGNMENT
12.1 Newco shall be entitled to assign this Sub-Lease to an Affiliate (as
defined in the SUMF Agreements) or to a lender or lenders for security
purposes so long as such lender is a bona fide financial institution with
a business that includes lending money and has a net worth in excess of
100,000,000 US Dollars, without the prior written consent thereto of SNR
(and such lender or lenders shall have the right [without such prior
written consent] to further assign this Sub-Lease in connection with the
exercise of their rights and remedies pursuant to such security
agreements). Newco shall provide SNR with notice of such assignment
promptly after any such assignment, but in any event within sixty (60)
days of such assignment. Except as provided above in this Section, any
other assignment of the Sub-Lease by Newco to a third party shall require
the consent of SNR, such consent not to be unreasonably withheld or
delayed. Notwithstanding the foregoing, in no event may this Sub-Lease be
assigned or further assigned without the prior written consent of the
municipality of Rotterdam. SNR stipulates by way of third party
stipulation (in Dutch: "derdenbeding") for the benefit of a lender which
is an assignee of Newco under this Lease, that, in the event of a default
by Newco under the Lease, it shall accept any curative acts undertaken by
or at the instigation of such lender as if they had been undertaken by
Newco.
ARTICLE 13 NOTICES
6
13.1. All notices, requests, waivers, demands, directions and other
communications required or permitted to be given under this Agreement
shall be in writing and in English. This provision shall not prevent
communications relating to the operations of the Area and the Plants from
being made in the language spoken in the jurisdiction in which the Area
and the Plants are situated. Notices may be given in electronic form
(including facsimile transmission and telex communications and e-mail) and
shall be delivered personally, sent by facsimile transmission, or e-mail,
sent by nationally recognized overnight courier or mailed by registered or
certified mail (return receipt requested), postage prepaid, to the other
Parties at their addresses set forth in the introductory paragraphs of
this Agreement (or such other address for a Party as shall be specified by
like notice from such Party to the other Party) and, in the case of Newco,
to the attention of the Site Manager, with copies to:
Shell Epoxy Resins, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇/▇▇/ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: President
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Shell Epoxy Resins Nederland B.V.
▇▇ ▇▇▇ ▇▇▇
▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Resin Acquisition LLC
c/o Apollo Management IV, L.P.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
All such notices and other communications shall be deemed to have been
given and received, (i) in the case of personal delivery, delivery by
facsimile transmission or e-mail, on the date of delivery, if delivered
during business hours on a business day or, if not so delivered, the next
succeeding business day (ii) in the case of delivery by nationally
recognized overnight courier, on the second business day following
dispatch and (iii) in the case of mailing, on the fifth business day
following such mailing.
13.2 A Party may change its notice details on giving notice to the other Party
of the change in accordance with this Article 13. That notice shall only
be effective on the date falling three (3) clear business days after the
notification has been received or such later date as may be specified in
the notice. Any notice so delivered will comply with the terms of this
Article 13.
ARTICLE 14 APPLICABLE LAW AND DISPUTE RESOLUTION.
14.1. This Agreement shall be governed by and construed in accordance with
Netherlands law.
14.2. Any dispute arising out of or in connection with this Lease, including any
question regarding the existence, validity or termination of this Lease,
shall be exclusively processed
7
in accordance with this Article 14.
14.3. In the event of a dispute between the parties, the parties shall, within
(10) days of a written request by either party to the other party, meet in
good faith to resolve such dispute or differences.
14.4 Any dispute which cannot be resolved by the parties shall be submitted to
the Joint Operating Committee to be established under the SNR SUMF
Agreement which shall endeavor to amicably resolve the dispute. The
parties shall provide the Joint Operating Committee with such information
as it reasonably requires to enable it to determine the issues relevant to
the dispute.
14.5 Any dispute which cannot be resolved by the Joint Operating Committee
shall be submitted to the Steering Committee to be established under the
SNR SUMF Agreement, which shall endeavor to amicably resolve the dispute.
The parties shall provide the Steering Committee with such information as
it reasonably requires to enable it to determine the issues relevant to
the dispute.
14.6 Any dispute which cannot be resolved by the Steering Committee shall be
submitted to mediation before a mediator selected by the Steering
Committee. The parties shall bear their own costs for mediation and the
cost of the mediator shall be borne equally.
14.7 If the parties are unable to select a mediator within fifteen (15) days or
if the dispute is not resolved as a result of the mediation within sixty
(60) days (or such other period as may be agreed by the parties), either
party may submit the matter to arbitration for final, binding and
exclusive settlement by three arbitrators in accordance with the UNCITRAL
Arbitration Rules, with the President of the ICC Court of International
Arbitration to act as the appointing authority, such arbitration to be
held in Rotterdam, Netherlands. Any arbitration decision pursuant to this
Article 14 shall be final and binding upon the parties and judgment
thereon may be entered in any court of competent jurisdiction. Costs
incurred by the parties in carrying on any arbitration proceeding
hereunder (including reasonable attorneys' fees and arbitration fees)
shall be borne by the non-prevailing party or apportioned by the
arbitrator based on fault.
14.8 Pending resolution of any dispute between the parties, the parties shall
continue to perform in good faith their respective obligations under this
Sub-Lease based upon the last agreed performance demonstrated prior to the
dispute.
14.9 Resolution of any dispute between the parties involving payment of money
by one party to the other shall include payment of interest, if any, at
the Interest Rate (as defined in the SNR SUMF Agreement) from the original
due date of such amount.
14.10 Each party shall, in addition to all rights provided herein or provided by
law, be entitled to the remedies of specific performance and injunction to
enforce its rights hereunder.
14.11 The fact that the dispute resolution procedures specified in this Article
14 shall have been or may be invoked shall not excuse any party from
performing its obligations under this Sub-Lease, and during the pendency
of any such procedure all parties shall continue to perform their
respective obligations in good faith.
8
ARTICLE 15 GENERAL.
15.1 This Agreement (together with its Exhibits) constitutes the entire
agreement between the parties with reference to its subject matter and
supersedes any agreements, contracts, representations and understandings
(oral or written) made prior to or at the signing of this Agreement.
15.2 In the event that there is a discrepancy between the provisions of this
Agreement and the provisions of the Exhibits then in respect of any
particular Service the provisions of the Exhibit shall prevail.
15.3 No amendment, alteration, modification or waiver of any of the provisions
of this Agreement or its Exhibits, or the rights or obligations of the
parties shall be valid and effective unless it:
a) is agreed to and signed by each of the parties concerned; and
b) specifically refers to this Agreement.
15.4 The headings of Articles and sub-Articles are inserted for convenience
only and shall not affect the meaning or operation of the Agreement.
9
IN WITNESS WHEREOF, this Agreement has been executed by duly authorized
representatives of each of the Parties as of the date first above written.
SHELL PETROLEUM N.V.
By: /s/ [ILLEGIBLE]
----------------------
Name:_____________________
Title:____________________
SHELL EPOXY RESINS, LLC
By: /s/ [ILLEGIBLE]
----------------------
Name:_____________________
Title:____________________
1