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Exhibit 2.1
ASSIGNMENT AND ASSUMPTION AGREEMENT, dated as of October 4, 1996
(the "Agreement"), among Clark Refining & Marketing, Inc. ("Assignor"),
a Delaware corporation, J. ARON & COMPANY ("Assignee"), a New York
partnership, Clark USA, Inc. ("Clark USA"), a Delaware corporation,
and, solely for the limited purposes of Sections 4.06, 4.08, 4.10 and
4.12(a) hereof and no other, each of Occidental Petroleum Corporation
("OPC"), a Delaware corporation, Occidental C.O.B. Partners ("OCP"),
a Delaware general partnership, and Occidental Crude Sales, Inc.
(International) ("OCS") , a Delaware corporation.
WHEREAS, the Assignor is a party to certain agreements set forth on
Annex A and it desires to assign to Assignee, and Assignee desires
to assume from Assignor, such agreements.
WHEREAS, the Assignor acquired such agreements from Clark USA pursuant
to an Assignment and Assumption Agreement dated as of October 3, 1996
between Clark USA and Assignor (the "USA Assignment" and, together with
this Agreement, the "Agreements").
NOW THEREFORE, in consideration of the foregoing and the respective
representations, warranties, covenants and agreements set forth in this
Agreement, the parties agree as follows:
I. ASSIGNMENT AND ASSUMPTION
SECTION 1.01. Assignment and Assumption. (a) For and in consideration
of the Purchase Price (as defined below) the receipt whereof is hereby
acknowledged by the Assignor, the Assignor does hereby sell, assign and
transfer to the Assignee, effective as of 11:59 p.m. (the "Effective
Time") on October 3, 1996 (the "Effective Date"), all of the Assignor's
right, title and interest (i) in the agreements listed on Annex A annexed
hereto (hereinafter referred to, individually and collectively, as the
"Instruments") and (ii) in the USA Assignment.
(b) The Assignee does hereby, for the benefit of the Assignor and the
other parties to the Instruments, accept this assignment and expressly
assume and agree to hereafter perform, observe and abide by all of the
terms, covenants, conditions and obligations under the Instruments on the
part of the Assignor to be kept, observed and performed thereunder, and
the Assignee does hereby agree to defend and indemnify the Assignor, and
save the Assignor and its successors harmless, of and from any and all
demands, claims, actions or causes of action, assessments, expenses,
costs, damages, losses and liabilities, including reasonable attorneys'
fees and disbursements, that the Assignor or the Assignor's successors
may sustain or incur as a result of the failure of the Assignee, or
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those claiming under or through the Assignee, from and after the
Effective Time on the Effective Date, to keep, observe and perform any
of the terms, covenants, conditions and obligations under the
Instruments that are to be observed or performed from and after the
Effective Time.
SECTION 1.02. Purchase Price. The "Purchase Price" is $235,400,000.00
in immediately available funds delivered by wire transfer to an account
designated by Assignor.
II. REPRESENTATIONS AND WARRANTIES OF ASSIGNOR
As an inducement to Assignee to enter into this Agreement, each of
Assignor and Clark USA hereby represents and warrants to Assignee as of
the Effective Time on the Effective Date as follows (such
representations and warranties to survive (i) for a period of six
months after the Effective Time on the Effective Date in the case of
Sections 2.01, 2.02, 2.03, 2.04 and 2.06, and (ii) into perpetuity in
the case of Section 2.05) (provided, however, that the representations
and warranties made by Assignor with respect to Sections 2.01, 2.02,
2.03 and 2.04 are made only with respect to itself):
SECTION 2.01. Organization and Authority of Assignor. Each of
Assignor and Clark USA is a corporation duly organized, validly existing
and in good standing under the laws of Delaware and has all necessary
power and authority to enter into this Agreement and the USA Agreement,
to carry out its obligations hereunder and thereunder and to consummate
the transactions contemplated hereby and thereby. The execution and
delivery of each of the Agreements by Assignor and Clark USA, the
performance by Assignor and Clark USA of its obligations under the
Agreements and the consummation by Assignor and Clark USA of the
transactions contemplated by the Agreements have been duly authorized
by all requisite action on the part of Assignor and Clark USA. Each
Agreement has been duly executed and delivered by Assignor and Clark
USA, and (assuming due authorization, execution and delivery by the
other parties hereto in the case of this Agreement) each Agreement
constitutes legal, valid and binding obligations of Assignor and Clark
USA enforceable against Assignor and Clark USA in accordance with its
terms.
SECTION 2.02. No Conflict. The execution, delivery and performance
of the Agreements by Assignor and Clark USA does not and will not (a)
violate, conflict with or result in the breach of any provision of the
certificate of incorporation or by-laws of Assignor or Clark USA, (b)
conflict with or violate any law or governmental order applicable to
Assignor or Clark USA, or (c) conflict with, result in any breach of,
constitute a default (or event which with the giving of notice or lapse
of time, or both, would become a default) under, require any consent
under, or give to others any rights of termination,
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amendment, acceleration, suspension, revocation or cancellation of any
of the Instruments or of any other agreement binding on or affecting
Assignor or Clark USA or any of either of their assets.
SECTION 2.03. No Default. Each of the Instruments to which Assignor
or Clark USA is a party is in full force and effect and is Assignor's
or Clark USA's, as applicable, legal, valid and binding obligation,
enforceable against Assignor or Clark USA, as applicable, in accordance
with the terms thereof. To Assignor's and Clark USA's best knowledge, no
party to an Instrument is in default thereunder or has breached any
terms or provisions thereof. No third party has given Assignor or Clark
USA notice of any claim, dispute or controversy with respect to any of
the Instruments nor has Assignor or Clark USA received notice of alleged
nonperformance, or other noncompliance by Assignor or Clark USA with
respect to Assignor's and Clark USA's obligations under any of the
Instruments. Neither Assignor or Clark USA is in default under any of
the Instruments or has breached any terms or provisions thereof. The
Instruments have not been amended or supplemented by agreement, course
of conduct or otherwise, other than (i) by the Agreements, (ii) the
reports and notices referenced in Section 2.06 hereof and (iii) notices
delivered to Clark USA in connection with the matters referred to in
Section 4.08 and no waivers have been granted thereunder. There are no
other agreements or instruments that vary the terms of any of the
Instruments. Attached hereto as Annex B are true, correct and complete
copies of the Instruments.
SECTION 2.04. Title; No Liens (a) Immediately prior to the
Effective Time on the Effective Date, Assignor had good and marketable
title to each of the Instruments free and clear of any liens, claims
or encumbrances of any kind (each, a "Lien"), including but not limited
to any Lien of Universal Exchange Corporation ("UEC"), and the Assignor
is hereby transferring to the Assignee pursuant to this Agreement, good
and marketable title to each of the Instruments free and clear of any
Liens.
(b) Immediately prior to the execution and delivery of the USA
Assignment, Clark USA had good and marketable title to each of the
Instruments free and clear of any Liens, including but not limited to
any Lien of UEC, and by executing and delivering the USA Assignment
Clark USA transferred to Assignor good and marketable title to each of
the Instruments free and clear of any Liens.
SECTION 2.05. Delivery of Crude Oil. As of August 31, 1996, 1,452,000
barrels (in barrels of WTI) will have been delivered under the
Instruments at an average WTI Reference Price of $20.03 per barrel
(after deduction of the marketing fee of $0.25 per barrel)
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SECTION 2.06. Reports and Information. Attached hereto as Annex C are
true, correct and complete copies of all reports and notices furnished
to Assignor or Clark USA in connection with the Instruments. The
Assignor has no reason to believe that such information is not accurate
in all material respects.
III. REPRESENTATIONS AND WARRANTIES OF ASSIGNEE
As an inducement to Assignor and Clark USA to enter into this
Agreement, Assignee hereby represents and warrants to Assignor and Clark
USA as of the Effective Time on the Effective Date as follows (such
representations and warranties to survive for a period of six months
after the Effective Time on the Effective Date):
SECTION 3.01. Organization and Authority of Assignee. Assignee is a
partnership duly organized, validly existing and in good standing under
the laws of the State of New York and has all necessary power and
authority to enter into this Agreement, to carry out its obligations
hereunder and to consummate the transactions contemplated hereby. The
execution and delivery of this Agreement by Assignee, the performance
by Assignee of its obligations hereunder and the consummation by
Assignee of the transactions contemplated hereby have been duly
authorized by all requisite action on the part of Assignee. This
Agreement has been duly executed and delivered by Assignee and
(assuming due authorization, execution and delivery by the other parties
hereto) this Agreement constitutes legal, valid and binding obligations
of Assignee, enforceable against Assignee in accordance with its terms.
SECTION 3.02. No Conflict. The execution, delivery and performance of
this Agreement by Assignee do not and will not (a) violate, conflict
with or result in the breach of any provision of the partnership
agreement or organizational documents of Assignee or (b) conflict with
or violate any law or governmental order applicable to Assignee.
SECTION 3.03. Assignee Business. Assignee is not, and is not an
affiliate of, one of the twenty (20) largest international oil
companies, as measured by revenue, as of the most recent calendar year
for which such information is available.
IV. MISCELLANEOUS
SECTION 4.01. Expenses. Except as otherwise specified in this
Agreement, all costs and expenses, including, without limitation, fees
and disbursements of counsel, financial advisors and accountants,
incurred in connection with this
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Agreement and the transactions contemplated hereby shall be paid
by the party incurring such costs and expenses.
SECTION 4.02. Notices. All notices, requests, claims, demands and
other communications hereunder shall be in writing and shall be given
or made (and shall be deemed to have been duly given or made upon
receipt) by delivery in person, by courier service, by facsimile, or
by registered or certified mail (postage prepaid, return receipt
requested) to the parties at the following addresses (or at such other
address for a party as shall be specified in a notice given in
accordance with this Section 4.02):
(a) if to Assignor:
Clark Refining & Marketing, Inc.
8182 Maryland Avenue
St. Louis, Missouri 63105-3721
Attn: Maura Clark
Facsimile: (314) 854-1580
(b) If to Clark USA
Clark USA, Inc.
8182 Maryland Avenue
St. Louis, Missouri 63105-3721
Attn: Maura Clark
Facsimile: (314) 854-1580
(c) if to Assignee:
J. Aron & Company
85 Broad Street
New York, New York 10004
Attn: W. Thaddeus Miller
Facsimile: 212-902-3876
(d) if to OPC:
Occidental Petroleum Corporation
10889 Wilshire Blvd.
Los Angeles, California 90024
Attn: Treasurer
Facsimile: (310) 443-6661
(e) if to OCS:
Occidental Crude Sales, Inc. (International)
1200 Discovery Drive
Bakersfield, California 93309-7008
Attn: Lynn T. Boulware,
Director of Financial Services
Facsimile: (805) 321-6829
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(f) if to OCP:
OXY USA, Inc.
1200 Discovery Drive
Bakersfield, California 93309-7008
Attn: Lynn T. Boulware,
Director of Financial Services
Facsimile: (805) 321-6829
SECTION 4.03. Headings. The descriptive headings contained in this
Agreement are for convenience of reference only and shall not affect
in any way the meaning or interpretation of this Agreement.
SECTION 4.04. Severability. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any
law or public policy, all other terms and provisions of this Agreement
shall nevertheless remain in full force and effect so long as the
economic or legal substance of the transactions contemplated hereby is
not affected in any manner materially adverse to any party. Upon such
determination that any term or other provision is invalid, illegal or
incapable of being enforced, the parties hereto shall negotiate in good
faith to modify this Agreement so as to effect the original intent of
the parties as closely as possible in an acceptable manner in order
that the transactions contemplated hereby are consummated as originally
contemplated to the greatest extent possible.
SECTION 4.05. Entire Agreement. This Agreement constitutes the entire
agreement of the parties hereto with respect to the subject matter
hereof and supersedes all prior agreements and undertakings, both
written and oral, between the parties with respect to the subject
matter hereof.
SECTION 4.06. Assignment; Parties in Interest. No party to this
Agreement (or any assignee of a party to this Agreement or any assignee
of such assignee) shall have the right to assign its rights and
obligations under this Agreement without the prior written consent of
each other party (which consent shall not be unreasonably withheld);
provided, however, that, without any consent of any other party to this
Agreement being necessary, (i) Assignee may assign all or any portion
of its rights and obligations under this Agreement to The Goldman Sachs
Group, L.P. (including any successor entity, "Group") or any company a
majority of the voting interests in which are owned or controlled by
Group and (ii) in connection with any securitization of this Agreement
(the "Securitization") Assignee and any Securitization vehicle shall
have the right to assign or otherwise transfer all or any portion of
its rights and obligations under this Agreement to any Securitization
vehicle that assumes such obligations. This Agreement shall be binding
upon and inure solely to the benefit of the parties hereto (and any
Securitization vehicle or other proper assignee of the Assignee or any
Securitization vehicle in accordance with this Section 4.06), and
nothing in this Agreement, express or implied, is intended to or shall
confer upon any other person any right, benefit or remedy of any nature
whatsoever under or by reason of this Agreement provided that the
provisions of Section 1.01(b) and Section 3.03 shall also be for the
benefit of the other parties to the Instruments. Each party to this
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Agreement acknowledges and agrees that the provisions of this Section
4.06 pertain only to assignments of the rights and obligations of the
parties under this Agreement and do not pertain, and have no effect on,
the right of the Assignee to assign or otherwise dispose of the
Instruments (it being understood that the right of the Assignee or any
successor to assign or otherwise dispose of the Instruments or any of
its rights or obligations thereunder shall be governed solely by the
terms of the Instruments).
SECTION 4.07. Governing Law. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York. With
respect to any suit, action or proceedings relating to this Agreement,
each party irrevocably submits to the non-exclusive jurisdiction of the
courts of the State of New York and federal courts located in the
Borough of Manhattan in New York City and of the courts of the State of
Missouri and federal courts located in St. Louis.
SECTION 4.08. Contract Crude Oil. OCP acknowledges that (i) the
provisions of Section 2.04 of the Purchase Contract (as defined in
Annex A) shall be of no force or effect, and (ii) it has no, and waives
any, right pursuant to Section 2.04 of the Purchase Contract to reduce
the number of Barrels of Contract Crude Oil (both as defined in such
Purchase Contract) it is obligated to deliver.
SECTION 4.09. Indemnification. Each of the Assignor and the Assignee
agrees to indemnify the other from and hold it harmless against any and
all losses, damages, liabilities, claims and costs (including attorneys
fees) which the indemnified party may sustain by reason of any breach by
the indemnifying party of any of the representations, warranties and
agreements by the indemnifying party contained in this Agreement. Each
of the Assignor and the Assignee acknowledges that its obligations under
this Section 4.09 shall survive any assignment of its rights and
obligations under this Agreement made in accordance with Section 4.06.
SECTION 4.10. Further Assurances. Each of Assignor, Clark USA, OPC,
OCS and OCP agrees to execute and deliver such additional documents, and
take such additional steps, as either Assignee or any proper transferee
from Assignee in accordance with Section 4.06 (including a
Securitization vehicle) may reasonably request in order to more fully
give effect to the
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sale, assignment, transfer and assumption provided
for in Article I and to assist in the consummation of the
Securitization, provided, however, that neither OPC, OCS or OCP shall
be required to execute and deliver any document or take any action if
the result thereof is to (i) cause such party to incur any expense which
is not reimbursed to it by Assignee or a proper transferee of Assignee
in accordance with Section 4.06 or (ii) subject OPC, OCS or OCP to
liability. Each of OCP, OCS and OPC also acknowledges that Assignee
is planning a Securitization and will make a standard non-petition
covenant with respect to any bankruptcy remote Securitization vehicle
upon the request of one or more rating agencies.
SECTION 4.11. Interpretations. (a) It is Assignor's and Clark USA's
understanding that for purposes of Section 1 of the L/C Agreement (as
defined in Annex A), if an amount is drawn under the L/C (as defined in
Annex A), and it is determined (through arbitration, by agreement of the
parties or otherwise) that a portion of such draw was made for a purpose
permitted under the L/C Agreement (the "Permitted Amount") and that the
balance of such draw was not made for a purpose permitted under the L/C
Agreement (the "Impermissible Amount") , OPC (i) shall be required in
accordance with the terms of the L/C Agreement to cause the amount
available to be drawn under the L/C to be increased by an amount equal
to the Permitted Amount and (ii) shall be entitled to receive a refund
of an amount equal to the Impermissible Amount from the person that
drew it.
(b) It is Assignor's and Clark USA's understanding that all
references to "WTI (at Cushing, Oklahoma), as published in Platt's" in
the definition of "WTI Reference Price" in any of the Instruments refers
to the WTI price on line 1 in Platt's Oilgram Price Report.
SECTION 4.12. Miscellaneous. (a) Each of OCS and OCP shall deliver to
Assignee (with a copy to Assignor) (in each case in accordance with
Section 4.02) information (including, without limitation, monthly
statements) of the type and content that have been furnished to Clark
USA in connection with any of the Instruments on a similar schedule.
(b) Assignor agrees to instruct OCS and OCP (i) to make all payments
that OCS is obligated to make pursuant to the Marketing Contract
(as defined in Annex A) in respect of Delivery Dates (as defined in the
Marketing Contract) on
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or after September 1, 1996 to Assignee and (ii) to replace Assignor with
Assignee in all oil contracts entered into pursuant to the Purchase
Contract and the Marketing Contract (both as defined in Annex A) after
the Effective Date.
SECTION 4.13. Use of Proceeds Assignor agrees to use and apply all
amounts received pursuant to Section 1.02 hereof in accordance with the
terms of each agreement binding on or affecting Assignor or Clark USA
or any of their respective assets, including, without limitation, the
following: (i) the Indenture dated as of September 15, 1992, as amended,
between Assignor and Nationsbank of Virginia, N.A., as Trustee,
relating to $175,000,000 9-1/2% Senior Notes due September 15, 2004;
(ii) the Indenture dated as of December 1, 1991, between Assignor and
Sovran Bank, NA., as Trustee, relating to $225,000,000 10-1/2% Senior
Notes due December 1, 2001; (iii) the Indenture dated as of May 15,
1993, as amended, between Clark USA and Bankers Trust Company, as
Trustee, relating to $264,000,000 Senior Secured Zero Coupon Notes due
2000; and (iv) the Indenture dated as of December 1, 1995, between
Clark USA and The Chase Manhattan Bank, N.A., as Trustee, relating to
$175,000,000 Senior Notes due 2005.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed as of the date first written above by their respective officers
thereunto duly authorized.
CLARK REFINING & MARKETING, INC.
By: /s/ M. J. Clark
Name: Maura J. Clark
Title: Executive Vice President
& Chief Financial Officer
CLARK USA, INC.
By: /s/ M. J. Clark
Name: Maura J. Clark
Title: Executive Vice President
& Chief Financial Officer
J. ARON & COMPANY
By: /s/ Steven M. Schultz
Name: Steven M. Schultz
Title: Partner
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As of the date first written above, the undersigned hereby consent to the terms
hereof, and on their own behalf acknowledge and agree to the provisions of
Sections 4.06, 4.08, 4.10 and 4.12(a).
OCCIDENTAL PETROLEUM CORPORATION
By: /s/ John W. Alden
Name: John W. Alden
Title: Assistant Secretary and
Assistant Treasurer
OCCIDENTAL C.O.B. PARTNERS
By OXY USA, Inc., its Managing Partner
By: /s/ John W. Alden
Name: John W. Alden
Title: Assistant Secretary
OCCIDENTAL CRUDE SALES, INC.
(INTERNATIONAL)
By: /s/ Linda S. Peterson
Name: Linda S. Peterson
Title: Vice President and Secretary
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Annex A
1. Crude Oil Purchase Contract (the "Purchase Contract"), dated as of
December 1, 1995, between Occidental C.O.B. Partners and Clark U.S.A., Inc.
2. Crude Oil Marketing Contract (the "Marketing Contract"), dated as of
December 1, 1995, between Clark U.S.A., Inc. and Occidental Crude Sales, Inc.
(International) ("OCS").
3. Guaranty, dated as of December 1, 1995 (the "Guaranty"), from Occidental
Petroleum Corporation in favor of Clark U.S.A., Inc. of the obligations of
OCP and OCS under the Purchase Contract and the Marketing Contract,
respectively.
4. Letter of Credit Agreement (the "L/C Agreement"), dated as of December 1,
1995, between Clark U.S.A., Inc. and Occidental Petroleum Corporation.
5. Designation Agreement, dated as of December 1, 1995, between Clark USA,
Inc. and Occidental C.O.B. Partners.
6. Irrevocable Letter of Credit No. LASB-226690 dated (the "L/C") November
28, 1995, as amended, issued by the Bank of America National Trust and Savings
Association in favor of Clark USA, Inc.