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DEUTSCHE BANK AG LONDON
UBS AG, acting through its business
group UBS WARBURG
PREEM HOLDINGS AB (PUBL)
EURO 250,000,000
10.625% Senior Secured Notes due 2011
PURCHASE AGREEMENT
April 3, 2001
DEUTSCHE BANK AG LONDON
Winchester House
1 Great Winchester Street
London EC2N 2DB
England
UBS AG, acting through its
business group UBS WARBURG
1 Finsbury Avenue
London EC2M 2PP
Ladies and Gentlemen:
Preem Holdings AB (publ), a Swedish corporation (the
"COMPANY"), proposes to issue and sell EURO 250,000,000 aggregate principal
amount of its 10.625% Senior Secured Notes due 2011 (the "SECURITIES"). The
Securities will be issued pursuant to an Indenture to be dated as of April
10, 2001 (the "INDENTURE") between the Company and Bankers Trust Company, as
trustee (the "TRUSTEE"). The Company hereby confirms its agreement with
Deutsche Bank AG London and UBS AG, acting through its business group UBS
Warburg (collectively, the "INITIAL PURCHASERS") concerning the purchase of
the Securities from the Company by the Initial Purchasers.
The Securities will be offered and sold to the Initial
Purchasers without being registered under the Securities Act of 1933, as amended
(the "SECURITIES ACT"), in reliance upon an exemption therefrom, and resold by
the Initial Purchasers (i) in the United States pursuant to Rule 144A under
Securities Act (the "U.S. Offering") and (ii) outside the United States in
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reliance on Regulation S under the Securities Act (the "International Offering,"
and together with the U.S. Offering, the "Offering"). The Company has prepared a
preliminary offering memorandum dated March 19, 2001 (the "PRELIMINARY OFFERING
MEMORANDUM") and will prepare an offering memorandum dated the date hereof (the
"OFFERING MEMORANDUM") setting forth information concerning the Company and the
Securities. Copies of the Preliminary Offering Memorandum have been, and copies
of the Offering Memorandum will be, delivered by the Company to the Initial
Purchasers pursuant to the terms of this Agreement. Any references herein to the
Preliminary Offering Memorandum and the Offering Memorandum shall be deemed to
include all amendments and supplements thereto, unless otherwise noted. The
Company hereby confirms that it has authorized the use of the Preliminary
Offering Memorandum and the Offering Memorandum in connection with the offering
and resale of the Securities by the Initial Purchasers in accordance with
Section II.
Holders of the Securities (including the Initial Purchasers
and their respective direct and indirect transferees) will be entitled to the
benefits of an Exchange and Registration Rights Agreement, substantially in the
form attached hereto as Annex A (the "REGISTRATION RIGHTS AGREEMENT"), pursuant
to which the Company will agree to file with the Securities and Exchange
Commission (the "COMMISSION") a registration statement under the Securities Act
(the "EXCHANGE OFFER REGISTRATION STATEMENT") registering an issue of senior
secured notes of the Company (the "EXCHANGE SECURITIES") which are identical in
all material respects to the Securities (except that the Exchange Securities
will not contain terms with respect to transfer restrictions) and under certain
circumstances, a shelf registration statement pursuant to Rule 415 under the
Securities Act (the "SHELF REGISTRATION STATEMENT").
Pursuant to the Share Pledge Agreement, dated as of the
Closing Date, between the Company and Bankers Trust Company as Trustee (the
"SHARE PLEDGE AGREEMENT") and the Security Assignment Agreement, dated as of the
Closing Date, between the Company and Bankers Trust Company as Trustee (the
"SECURITY ASSIGNMENT AGREEMENT," and together with the Share Pledge Agreement,
the "SECURITY AGREEMENTS"), the Securities will be secured by a first priority
security interest in the capital stock of Preem Petroleum AB and certain
proceeds from time to time received, receivable or otherwise distributed in
respect thereof, and a first priority assignment of a subordinated shareholder
loan (collectively, the "COLLATERAL"). The Company and certain of its creditors,
including the Trustees acting on behalf of the holders of the Securities, will
enter into certain debt restructuring agreements substantially in the form
attached hereto as Annex B (the "RESTRUCTURING AGREEMENTS"), pursuant to which
the creditor parties thereto will establish their relative rights regarding
repayment of indebtedness owed by the Company to each such creditor and the
treatment of certain shareholder loans.
Capitalized terms used but not defined herein shall have the
meanings given to such terms in the Offering Memorandum.
I. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE COMPANY. The Company
represents and warrants to, and agrees with, each Initial Purchaser on
and as of the date hereof and the Closing Date (as defined in Section
III) that:
1. Each of the Preliminary Offering Memorandum and the Offering
Memorandum, as of its respective date, did not, and on the
Closing Date the Offering
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Memorandum will not, contain any untrue statement of a
material fact or omit to state a material fact required to
be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under
which they were made, not misleading; PROVIDED that the
Company makes no representation or warranty as to
information contained in or omitted from the Preliminary
Offering Memorandum or the Offering Memorandum in reliance
upon and in conformity with written information relating to
the Initial Purchasers furnished to the Company by or on
behalf of the Initial Purchasers specifically for use
therein (the "INITIAL PURCHASERS' INFORMATION").
2. Each of the Preliminary Offering Memorandum and the Offering
Memorandum, as of its respective date, contains all of the
information that, if requested by a prospective purchaser of
the Securities, would be required to be provided to such
prospective purchaser pursuant to Rule 144A(d)(4) under the
Securities Act.
3. Assuming the accuracy of the representations and warranties of
the Initial Purchasers contained in Section II and their
compliance with the agreements set forth therein, it is not
necessary, in connection with the issuance and sale of the
Securities to the Initial Purchasers and the offer, resale and
delivery of the Securities by the Initial Purchasers in the
manner contemplated by this Agreement and the Offering
Memorandum, to register the Securities under the Securities
Act or to qualify the Indenture under the Trust Indenture Act
of 1939, as amended (the "TRUST INDENTURE ACT").
4. The Company and each of its subsidiaries (except for certain
immaterial subsidiaries which the Company is in the process of
dissolving) have been duly incorporated and are validly
existing as corporations under the laws of their respective
jurisdictions of incorporation, are duly qualified to do
business as foreign corporations in each jurisdiction in which
their respective ownership or lease of property or the conduct
of their respective businesses requires such qualification,
and have all power and authority necessary to own or hold
their respective properties and to conduct the businesses in
which they are engaged, except where the failure to so qualify
or have such power or authority would not, singularly or in
the aggregate, have a material adverse effect on the condition
(financial or otherwise), results of operations, business or
prospects of the Company and its subsidiaries taken as a whole
(a "MATERIAL ADVERSE EFFECT").
5. The information set forth set forth in the Offering Memorandum
under the heading "Capitalization" is accurate and all of the
outstanding shares of capital stock of the Company have been
duly and validly authorized and issued and are fully paid and
non-assessable. Except as expressly set forth in the Offering
Memorandum, all of the outstanding shares of capital stock of
each material subsidiary of the Company have been duly and
validly authorized and issued, are fully paid and
non-assessable and are owned directly or indirectly by the
Company, free and clear of any lien, charge, encumbrance,
security interest, restriction upon voting or transfer or any
other claim of any third party, except for
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such liens, charges, encumbrances, security interests,
restrictions and claims which would not, singularly or in
the aggregate, have a Material Adverse Effect.
6. The Company has full corporate power and authority to execute
and deliver this Agreement, the Indenture, the Securities, the
Registration Rights Agreement, the Security Agreements and the
Restructuring Agreements (collectively, the "TRANSACTION
DOCUMENTS") and to perform its obligations hereunder and
thereunder; and all corporate action required to be taken by
the Company and, to the extent relevant, its shareholders,
subsidiaries and affiliates, for the due and proper
authorization, execution and delivery of each of the
Transaction Documents and the consummation of the transactions
contemplated thereby have been duly and validly taken.
7. This Agreement has been duly authorized, executed and
delivered by the Company.
8. The Registration Rights Agreement has been duly authorized by
the Company and, when duly executed and delivered in
accordance with its terms by each of the parties thereto, will
constitute a valid and legally binding agreement of the
Company enforceable against the Company in accordance with its
terms, except to the extent that such enforceability may be
limited by applicable bankruptcy, insolvency, fraudulent
conveyance or transfer, reorganization, moratorium and other
similar laws affecting creditors' rights generally and by
general equitable principles (whether considered in a
proceeding in equity or at law) and except that rights to
indemnification and contribution may be limited by concerns of
public policy.
9. Each of the Security Agreements has been duly authorized by
the Company and, when duly executed and delivered in
accordance with its respective terms by each of the parties
thereto, will create a valid security interest over, and upon
delivery of the share certificates of Preem Petroleum AB
pursuant to the Share Pledge Agreement and delivery of the
original Loan Note pursuant to the Security Assignment
Agreement, the Security Agreements will constitute a perfected
security interest in, all right, title and interest of the
Company in the Collateral and will constitute a valid and
legally binding agreement of the Company enforceable against
the Company in accordance with its terms, except to the extent
that such enforceability may be limited by applicable
bankruptcy, insolvency, fraudulent conveyance or transfer,
reorganization, moratorium and other similar laws affecting
creditors' rights generally and by general equitable
principles (whether considered in a proceeding in equity or at
law).
10. The Indenture has been duly authorized by the Company and,
when duly executed and delivered in accordance with its terms
by the Trustee thereunder, will constitute a valid and legally
binding agreement of the Company enforceable against the
Company in accordance with its terms, except to the extent
that such enforceability may be limited by applicable
bankruptcy, insolvency, fraudulent conveyance or transfer,
reorganization, moratorium and other similar laws
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affecting creditors' rights generally and by general equitable
principles (whether considered in a proceeding in equity or at
law). On the Closing Date, the Indenture will conform in all
material respects to the requirements of the Trust Indenture
Act and the rules and regulations of the Commission applicable
to an indenture which is qualified thereunder.
11. The Securities have been duly authorized by the Company and,
when duly executed, authenticated, issued and delivered as
provided in the Indenture and paid for as provided herein,
will be duly and validly issued and outstanding and will
constitute valid and legally binding obligations of the
Company entitled to the benefits of the Indenture and
enforceable against the Company in accordance with their
terms, except to the extent that such enforceability may be
limited by applicable bankruptcy, insolvency, fraudulent
conveyance or transfer, reorganization, moratorium and other
similar laws affecting creditors' rights generally and by
general equitable principles (whether considered in a
proceeding in equity or at law).
12. Each of the Restructuring Agreements has been duly authorized,
executed and delivered by the Company and, when duly executed
and delivered in accordance with its terms by each of the
parties thereto, will constitute a valid and legally binding
agreement of the Company enforceable against the Company in
accordance with its terms, except to the extent that such
enforceability may be limited by applicable bankruptcy,
insolvency, fraudulent conveyance or transfer, reorganization,
moratorium and other similar laws affecting creditors' rights
generally and by general equitable principles (whether
considered in a proceeding in equity or at law).
13. Each Transaction Document conforms in all material respects to
the description thereof contained in the Offering Memorandum.
14. The execution, delivery and performance by the Company of each
of the Transaction Documents, the issuance, authentication,
sale and delivery of the Securities and compliance by the
Company with the terms thereof and the consummation of the
transactions contemplated by the Transaction Documents will
not (i) conflict with or result in a breach or violation of
any of the terms or provisions of, or (ii) constitute a
default under, or (iii) result in the creation or imposition
of any lien, charge or encumbrance upon any property or assets
of the Company or any of its subsidiaries (except for the
liens, charges and encumbrances created by the Security
Agreements) pursuant to, in each case, any indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Company or any of its subsidiaries is
a party or by which the Company or any of its subsidiaries is
bound or to which any of the property or assets of the Company
or any of its subsidiaries is subject, except for such
conflicts, breaches, defaults, liens, charges and encumbrances
which would not, singularly or in the aggregate, have a
Material Adverse Effect, nor will such actions result in any
violation of the provisions of the memorandum of association
(if applicable) or articles of association (or other similar
organizational document)
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of the Company or any of its subsidiaries or any statute or
any judgment, order, decree, rule or regulation of any
court or arbitrator or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries or
any of their material properties or assets, except for such
violations of statutes, judgments, orders, decrees, rules
and regulations which would not, singularly or in the
aggregate, have a Material Adverse Effect; and no consent,
approval, authorization, order, decree, registration or
qualification of or filing of or with any court or
arbitrator or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries or
any of their respective material properties or assets under
any such statute, judgment, order, decree, rule or
regulation is required for the execution, delivery and
performance by the Company of each of the Transaction
Documents, the issuance, authentication, sale and delivery
of the Securities and compliance by the Company with the
terms thereof and the consummation of the transactions
contemplated by the Transaction Documents, except for such
consents, approvals, authorizations, orders, decrees,
registrations, qualifications or filings which shall have
been obtained or made prior to the Closing Date and as may
be required to be obtained or made with respect to the
Registration Rights Agreement under the Securities Act, and
applicable state securities laws as provided in that
agreement.
15. KPMG, Stockholm are independent certified public accountants
with respect to the Company and its subsidiaries within the
meaning of Rule 101 of the Code of Professional Conduct of the
American Institute of Certified Public Accountants ("AICPA")
and its interpretations and rulings thereunder. The historical
financial statements (including the related notes) of Preem
Petroleum AB and Preem Holdings AB contained in the Offering
Memorandum comply in all material respects with the
requirements applicable to a registration statement on Form
F-1 under the Securities Act; such financial statements and
related notes have been prepared in accordance with generally
accepted accounting principles in Sweden consistently applied
throughout the periods covered thereby and fairly present the
financial position of the entities purported to be covered
thereby at the respective dates indicated and the results of
their operations and their cash flows for the respective
periods indicated; and the financial information contained in
the Offering Memorandum under the headings "Summary--Summary
Consolidated Financial Information", "Capitalization,"
"Selected Consolidated Financial Data" and "Management's
Discussion and Analysis of Financial Conditions and Results of
Operations" are derived from the accounting records of Preem
Petroleum AB and Preem Holdings AB and their respective
subsidiaries and fairly present the information purported to
be shown thereby. The PRO FORMA financial information
contained in the Offering Memorandum has been prepared on a
basis consistent with the historical financial statements
contained in the Offering Memorandum (except for the PRO FORMA
adjustments specified therein), includes all material
adjustments to the historical financial information required
by Rule 11-02 of Regulation S-X under the Securities Act and
the Exchange Act of 1934, as amended (the "EXCHANGE ACT") to
reflect the transactions described in the Offering Memorandum,
gives effect to assumptions made on a reasonable basis and
fairly presents the historical and proposed transactions
contemplated by the Offering Memorandum and the
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Transaction Documents. The other historical financial and
statistical information and data included in the Offering
Memorandum are, in all material respects, fairly presented.
16. Except as described in the Offering Memorandum, there are no
judicial, legal, arbitral, rule-making, administrative or
governmental proceedings pending to which the Company or any
of its subsidiaries is a party or of which any property or
assets of the Company or any of its subsidiaries is the
subject which, (A) singularly or in the aggregate, if
determined adversely to the Company or any of its
subsidiaries, could reasonably be expected to have a Material
Adverse Effect or (B) question the validity or enforceability
of any of the Transaction Documents or any action taken or to
be taken pursuant thereto. To the best knowledge of the
Company, no such proceedings are threatened or contemplated by
governmental authorities or others.
17. No action has been taken and no statute, rule, regulation or
order has been enacted, adopted or issued by any governmental
agency or body having jurisdiction over the Company which
prevents the issuance of the Securities or suspends the sale
of the Securities in any jurisdiction; no injunction,
restraining order or order of any nature by any federal or
state court of competent jurisdiction has been issued with
respect to the Company or any of its subsidiaries that would
prevent or suspend the issuance or sale of the Securities or
the use of the Preliminary Offering Memorandum or the Offering
Memorandum in any jurisdiction; and the Company has complied
with any and all requests to it by any securities authority in
any jurisdiction for additional information to be included in
the Preliminary Offering Memorandum and the Offering
Memorandum.
18. Neither the Company nor any of its subsidiaries is in
violation of its memorandum of association (if applicable) or
articles of association (or other similar organizational
document) or in default, and no event has occurred which, with
notice or lapse of time or both, would constitute a default,
in the due performance or observance of any term, covenant or
condition contained in any indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument to which it is
a party or by which it is bound or to which any of its
property or assets is subject or in violation in any respect
of any law, ordinance, governmental rule, regulation or court
decree to which it or its property or assets may be subject,
except where such violation or default, as the case may be,
would not, singularly or in the aggregate, have a Material
Adverse Effect.
19. The Company and each of its subsidiaries possess all material
licenses, certificates, authorizations and permits issued by,
and have made all declarations and filings with, the
appropriate supra-national, federal, regional, local or
foreign regulatory agencies or bodies which are necessary or
desirable for the ownership of their respective properties or
the conduct of their respective businesses as described in the
Offering Memorandum, except where the failure to possess or
make the same would not, singularly or in the aggregate, have
a Material Adverse Effect, and neither the Company nor any of
its subsidiaries has received
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notification of any revocation or modification of any such
license, certificate, authorization or permit or has any
reason to believe that any such license, certificate,
authorization or permit will not be renewed in the ordinary
course.
20. Except as described in the Offering Memorandum, the Company
and each of its subsidiaries have filed (or have received an
extension for filing with respect to) all supra-national,
federal, regional, local and foreign income and franchise tax
returns required to be filed through the date hereof (except
when any failure to so file would not be likely to have a
Material Adverse Effect) and have paid (or made adequate
reserves for) all taxes shown to be due thereon, and no tax
deficiency has been determined adversely to the Company or any
of its subsidiaries which has had (nor does the Company or any
of its subsidiaries have any knowledge of any tax deficiency
which, if determined adversely to the Company or any of its
subsidiaries, could reasonably be expected to have) a Material
Adverse Effect.
21. Neither the Company nor any of its subsidiaries is subject to
regulation as an "investment company" under the Investment
Company Act of 1940, as amended (the "INVESTMENT COMPANY
ACT"), and the rules and regulations of the Commission
thereunder, or a company "controlled by" an investment company
subject to regulation under the Investment Company Act and the
rules and regulations of the Commission thereunder, or a
"holding company" or a "subsidiary company" of a holding
company or an "affiliate" thereof within the meaning of the
Public Utility Holding Company Act of 1935, as amended.
22. The Company and each of its material subsidiaries maintains a
system of internal accounting controls sufficient to provide
reasonable assurance that: transactions are executed in
accordance with management's general or specific
authorizations; transactions are recorded as necessary to
permit preparation of financial statements in conformity with
generally accepted accounting principles in Sweden and to
maintain asset accountability; access to assets is permitted
only in accordance with management's general or specific
authorization; and the recorded accountability for assets is
compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any difference.
23. The Company and each of its subsidiaries have insurance
covering their respective properties, operations, personnel
and businesses, which insurance is in amounts and insures
against such losses and risks as the Company has reasonably
concluded is sufficient based upon experience and industry
practice. Neither the Company nor any of its subsidiaries has
received notice from any insurer or agent of such insurer that
material capital improvements or other material expenditures
are necessary to be made in order to continue insurance at
substantially current levels.
24. The Company and each of its subsidiaries own or possess
adequate rights to use all material patents, patent
applications, trademarks, service marks, trade names,
trademark registrations, service mark registrations,
copyrights, licenses and know-
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how (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information,
systems or procedures) necessary for the conduct of their
respective businesses; and the conduct of their respective
businesses will not conflict in any respect with, and the
Company and its subsidiaries have not received any notice
of any claim of conflict with, any such rights of others
which singularly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would result in a
Material Adverse Effect.
25. The Company and each of its subsidiaries have good and
marketable title to, or have valid rights to lease or
otherwise use, all items of real and personal property which
are material to the business of the Company and its
subsidiaries, in each case free and clear of all liens (except
liens created pursuant to the Security Agreements),
encumbrances, claims and defects and imperfections of title
except such as do not materially interfere with the use made
and proposed to be made of such property by the Company and
its subsidiaries or could not reasonably be expected to have a
Material Adverse Effect.
26. No labor disturbance by or dispute with the employees of the
Company or any of its subsidiaries exists or, to the best
knowledge of the Company, is threatened.
27. Except as described in the Offering Memorandum, there has been
no storage, generation, transportation, handling, treatment,
disposal, discharge, emission or other release of any kind of
Hazardous Materials by, due to or caused by the Company or any
of its subsidiaries (or, to the best knowledge of the Company,
any other entity (including any predecessor) for whose acts or
omissions the Company or any of its subsidiaries is or could
reasonably be expected to be liable) upon any of the property
now or previously owned or leased by the Company or any of its
subsidiaries, or upon any other property in violation of any
statute or any ordinance, rule, regulation, order, judgment,
decree or permit or which would, under any applicable statute
or any ordinance, rule (including rule of common law),
regulation, order, judgment, decree or permit, give rise to
any liability, except for any violation or liability that
could not reasonably be expected to have, singularly or in the
aggregate with all such violations and liabilities, a Material
Adverse Effect; and except as described in the Offering
Memorandum, there has been no disposal, discharge, emission or
other release of any kind onto such property or into the
environment surrounding such property of any Hazardous
Materials with respect to which the Company has any knowledge,
except for any such disposal, discharge, emission or other
release of any kind which could not reasonably be expected to
have, singularly or in the aggregate with all such discharges
and other releases, a Material Adverse Effect. The term
"Hazardous Materials" includes, without limitation, (a) any
petroleum or petroleum product, (b) any polychlorinated
biphenyl and (c) any pollutant or contaminant or hazardous,
dangerous or toxic chemical, material, waste or substance
regulated under or within the meaning of any other
Environmental Law. The term "Environmental Law" means every
supra-national, federal, regional, local and foreign law and
regulation relating to the protection of human health or the
environment or imposing liability or requiring standards of
conduct concerning
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any occupational safety and health, wages, hours or terms
of employment. Except as disclosed in the Offering
Memorandum and except as would not singularly or in the
aggregate, reasonably be expected to have a Material
Adverse Effect, the Company and each of its subsidiaries is
in material compliance with all applicable existing
Environmental Laws. Except as disclosed in the Offering
Memorandum, none of the Company or any of its subsidiaries
has received any written notice and there is no pending or,
to the best knowledge of the Company, threatened action,
suit or proceeding before or by any court or governmental
agency or body alleging liability (including, without
limitation, alleged or potential liability for
investigatory costs, cleanup costs, governmental response
costs, natural resources damages, property damages,
personal injuries, or penalties) of the Company or any of
its subsidiaries arising out of, based on or resulting from
(A) the presence or release into the environment of any
Hazardous Material at any location owned or operated by the
Company or any of its subsidiaries or previously owned by
the Company or any of its subsidiaries or (B) any violation
or alleged violation of any Environmental Law, in either
case which alleged or potential liability, singularly or in
the aggregate, would reasonably be expected to have a
Material Adverse Effect.
28. Neither the Company, any of its subsidiaries, any of its
direct or indirect shareholders, nor any director, officer,
agent, employee or other person acting on behalf of the
Company or any of its subsidiaries has (i) used any corporate
funds for any unlawful contribution, gift, entertainment or
other unlawful expense relating to political activity, (ii)
made any direct or indirect unlawful payment to any foreign or
domestic government official or employee from corporate funds
or (iii) made any unlawful bribe, rebate, payoff, influence
payment, kickback or other unlawful payment.
29. On and immediately after the Closing Date, the Company (after
giving effect to the issuance of the Securities and to the
other transactions related thereto as described in the
Offering Memorandum) will be Solvent. As used in this
paragraph, the term "Solvent" means, with respect to a
particular date, that on such date, the present fair market
value (or present fair saleable value) of the assets of the
Company is not less than the total amount required to pay the
probable liabilities of the Company on its total existing
debts and liabilities (including contingent liabilities) as
they become absolute and matured; the Company is able to
realize upon its assets and pay its debts and other
liabilities, contingent obligations and commitments as they
mature and become due in the normal course of business,
assuming the sale of the Securities as contemplated by this
Agreement and the Offering Memorandum; the Company is not
incurring debts or liabilities beyond its ability to pay as
such debts and liabilities mature; and the Company is not
engaged in any business or transaction, and is not about to
engage in any business or transaction, for which its property
would constitute unreasonably small capital after giving due
consideration to the prevailing practice in the industry in
which the Company is engaged. In computing the amount of such
contingent liabilities at any time, it is intended that such
liabilities will be computed at the amount that, in the light
of all the facts and circumstances
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existing at such time, represents the amount that can
reasonably be expected to become an actual or matured
liability.
30. Except as set forth in the Offering Memorandum, neither the
Company nor any of its subsidiaries is a party to any
contract, agreement or understanding with any person that
would give rise to a valid claim against the Company or any
Initial Purchaser for a brokerage commission, finder's fee or
like payment in connection with the offering and sale of the
Securities.
31. The Securities satisfy the eligibility requirements of Rule
144A(d)(3) under the Securities Act.
32. None of the Company, any of its affiliates or any person
acting on its or their behalf has engaged or will engage in
any directed selling efforts (as such term is defined in
Regulation S under the Securities Act ("REGULATION S")), and
all such persons have complied and will comply with the
offering restrictions requirement of Regulation S to the
extent applicable. The Company reasonably believes there is no
"substantial U.S. market interest" (within the meaning of
Regulation S).
33. Neither the Company nor any of its affiliates (as defined in
Rule 501(b) of Regulation D under the Securities Act
("REGULATION D")) has, directly or through any agent, sold,
offered for sale, solicited offers to buy or otherwise
negotiated in respect of, any security (as such term is
defined in the Securities Act), which is or will be integrated
with the sale of the Securities in a manner that would require
registration of the Securities under the Securities Act.
34. None of the Company or any of its affiliates (as defined in
Rule 501(b) of Regulation D) or any other person acting on its
or their behalf has engaged, in connection with the Offering
in any form of general solicitation or general advertising
within the meaning of Rule 502(c) under the Securities Act.
35. There are no securities of the Company registered under the
United States Securities Exchange Act of 1934, as amended (the
"EXCHANGE ACT") or listed on a United States national
securities exchange or quoted in a U.S. automated inter-dealer
quotation system. No holder of securities of the Company
(other than holders of the Securities) will be entitled to
have such securities registered under either the Exchange
Offer Registration Statement or the Shelf Registration
Statement.
36. The Company believes that no forward-looking statement (within
the meaning of Section 27A of the Securities Act and Section
21E of the Exchange Act) contained in the Preliminary Offering
Memorandum or the Offering Memorandum has been made or
reaffirmed without a reasonable basis or has been disclosed
other than in good faith.
37. The indemnification and contribution provisions set forth in
Sections IX and X of this Agreement do not contradict Swedish
law or public policy.
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38. Since the date as of which information is given in the
Offering Memorandum, except as otherwise disclosed therein:
there has been no material adverse change or any development
involving a prospective material adverse change in the
condition, financial or otherwise, or in the earnings,
business affairs, management or business prospects of the
Company and its subsidiaries, taken as a whole, whether or not
arising in the ordinary course of business; neither the
Company nor any of its subsidiaries has incurred any liability
or obligation, direct or contingent, that is material to the
Company and its subsidiaries as a whole other than in the
ordinary course of business; neither the Company nor any of
its subsidiaries has entered into any transaction other than
in the ordinary course of business that is material to the
Company and its subsidiaries as a whole; and there has not
been any change in the capital stock or long-term debt of the
Company, or the consolidated long-term debt of the Company and
its subsidiaries taken as a whole, or any dividend or
distribution of any kind declared, paid or made by the Company
on any class of its capital stock that is material to the
Company and its subsidiaries as a whole.
39. No stamp or other issuance or transfer taxes or duties,
value-added tax, documentary tax, registration tax and no
withholding or other taxes are payable by or on behalf of the
Initial Purchasers in connection with (a) the issuance of
Securities, (b) the sale, transfer and delivery of the
Securities to the Initial Purchasers pursuant to this
Agreement or for the resale of the Securities placed by or at
the direction of the Initial Purchasers or (c) the execution
and delivery of this Agreement or any of the other Transaction
Documents or the consummation of any of the transactions
contemplated hereby or thereby.
40. Under the laws of the Kingdom of Sweden, the submission by the
Company to the jurisdiction of any United States federal or
state court sitting in the State of New York and the
designation of the law of the State of New York to apply to
this Agreement and the other Transaction Documents will be
binding upon the Company and would be the basis of a judgment
in any related judicial or administrative proceeding initiated
in the Kingdom of Sweden.
41. The form of certificates for the Securities to be sold
pursuant to this Agreement conforms to the corporate law of
the Kingdom of Sweden.
42. To the extent applicable, none of the Company, its
subsidiaries, nor any person or entity controlling the Company
has made an "investment," as defined in the United States
federal Iran And Libya Sanctions Act of 1996 (the "SANCTIONS
ACT"), subject to the Sanctions Act. To the extent applicable,
none of the Company, its subsidiaries, nor any person or
entity controlling the Company has exported, transferred or
otherwise provided to Libya or any agency or instrumentality
of Libya any goods, services, technology or other items
subject to the Sanctions Act. To the extent applicable, none
of the Company, its subsidiaries, nor any person or entity
controlling the Company has taken any
<Page>
13
action in violation of the Iraq Sanctions Act of 1990, or
applicable regulations or orders thereunder.
43. Except as otherwise disclosed in the Offering Memorandum,
there are no business relationships or other related-party
transactions of the nature described in Item 7.B of Form 20-F
of the Commission ("ITEM 7.B") involving the Company or any
other party referred to in Item 7.B, except for transactions
that would be considered immaterial under Item 7.B.
II. PURCHASE AND RESALE OF THE SECURITIES. On the basis of the
representations, warranties and agreements contained herein, and
subject to the terms and conditions set forth herein, the Company
agrees to issue and sell to the Initial Purchasers, and each Initial
Purchaser agrees, severally and not jointly, to purchase from the
Company, the principal amount of Securities set forth opposite the name
of such Initial Purchaser on Schedule 1 hereto at a purchase price
equal to 97.50% of the principal amount thereof for each Note. The
Company shall not be obligated to deliver any of the Securities except
upon payment for all of the Securities to be purchased as provided
herein.
1. The Initial Purchasers have advised the Company that they
propose to offer the Securities for resale upon the terms and
subject to the conditions set forth herein and in the Offering
Memorandum. Each Initial Purchaser represents, warrants and
agrees that (i) it is purchasing the Securities pursuant to a
private sale exempt from registration under the Securities
Act, (ii) it has not solicited offers for, or offered or sold,
and will not solicit offers for, or offer or sell, the
Securities by means of any form of general solicitation or
general advertising within the meaning of Rule 502(c) of
Regulation D or in any manner involving a public offering
within the meaning of Section 4(2) of the Securities Act and
(iii) it has solicited and will solicit offers for the
Securities only from, and has offered or sold and will offer,
sell or deliver the Securities, as part of their initial
offering, only (A) within the United States to persons whom it
reasonably believes to be qualified institutional buyers
("QUALIFIED INSTITUTIONAL BUYERS"), as defined in Rule 144A
under the Securities Act ("RULE 144A"), or if any such person
is buying for one or more institutional accounts for which
such person is acting as fiduciary or agent, only when such
person has represented to it that each such account is a
Qualified Institutional Buyer to whom notice has been given
that such sale or delivery is being made in reliance on Rule
144A and in each case, in transactions in accordance with Rule
144A and (B) outside the United States to persons other than
U.S. persons in reliance on Regulation S.
2. In connection with the offer and sale of Securities in
reliance on Regulation S, each Initial Purchaser represents,
warrants and agrees that:
A. The Securities have not been registered under the
Securities Act and may not be offered or sold within
the United States or to, or for the account or
benefit of, U.S. persons except pursuant to an
exemption from, or in transactions not subject to,
the registration requirements of the Securities Act.
<Page>
14
B. It has offered and sold the Securities, and will
offer and sell the Securities, (A) as part of its
distribution at any time and (B) otherwise until 40
days after the later of the commencement of the
offering of the Securities and the Closing Date, only
in accordance with Rule 903 of Regulation S or Rule
144A or any other available exemption from
registration under the Securities Act.
C. Neither such Initial Purchaser nor any of its
affiliates or any other person acting on its or their
behalf has engaged or will engage in any directed
selling efforts with respect to the Securities, and
all such persons have complied and will comply with
the offering restrictions requirement of Regulation
S.
D. At or prior to the confirmation of sale of any
Securities sold in reliance on Regulation S, it will
have sent to each distributor, dealer or other person
receiving a selling concession, fee or other
remuneration that purchase Securities from it during
the restricted period a confirmation or notice to
substantially the following effect:
"The Securities covered hereby have not been
registered under the U.S. Securities Act of 1933, as
amended (the "SECURITIES ACT"), and may not be
offered or sold within the United States or to, or
for the account or benefit of U.S. persons (i) as
part of their distribution at any time or (ii)
otherwise until 40 days after the later of the
commencement of the offering of the Securities and
the date of original issuance of the Securities,
except in accordance with Regulation S or Rule 144A
or any other available exemption from registration
under the Securities Act. Terms used above have the
meanings given to them by Regulation S."
E. It has not and will not enter into any contractual
arrangement with any distributor with respect to the
distribution of the Securities, except with its
affiliates or with the prior written consent of the
Company.
Terms used in this Section II(2) have the meanings given to them by
Regulation S.
3. Each Initial Purchaser represents, warrants and agrees that
(i) it has not offered or sold and prior to the date six
months after the Closing Date will not offer or sell any
Securities to persons in the United Kingdom except to persons
whose ordinary activities involve them in acquiring, holding,
managing or disposing of investments (as principal or agent)
for the purposes of their businesses or otherwise in
circumstances which have not resulted and will not result in
an offer to the public in the United Kingdom within the
meaning of the Public Offers of Securities Regulations 1995;
(ii) it has complied and will comply with all applicable
provisions of the Financial Services Act 1986 and the Public
Offers of Securities Regulations 1995 with respect to anything
done by it in relation to the Securities in, from or otherwise
involving the United Kingdom; and (iii) it has
<Page>
15
only issued or passed on and will only issue or pass on in
the United Kingdom any document received by it in
connection with the issue of the Securities to a person who
is of a kind described in Article 11(3) of the Financial
Services Act 1986 (Investment Advertisements) (Exemptions)
Order 1996 or is a person to whom such document may
otherwise lawfully be issued or passed on.
4. Each Initial Purchaser agrees that, prior to or simultaneously
with the confirmation of sale by it to any purchaser of any of
the Securities purchased by such Initial Purchaser from the
Company pursuant hereto, such Initial Purchaser shall furnish
to that purchaser a copy of the Offering Memorandum (and any
amendment or supplement thereto that the Company shall have
furnished to such Initial Purchaser prior to the date of such
confirmation of sale). In addition to the foregoing, each
Initial Purchaser acknowledges and agrees that the Company
and, for purposes of the opinions to be delivered to the
Initial Purchasers pursuant to Section V(4) and (7), counsel
for the Company and for the Initial Purchasers, respectively,
may rely upon the accuracy of the representations and
warranties of such Initial Purchaser and its compliance with
its agreements contained in this Section II, and each Initial
Purchaser hereby consents to such reliance.
5. The Company acknowledges and agrees that the Initial
Purchasers may sell Securities to any of their affiliates and
that any such affiliate may sell Securities purchased by it to
any Initial Purchaser.
6. Each Initial Purchaser agrees that it will not directly or
indirectly purchase, offer, sell or deliver any Securities or
have in its possession or distribute or publish the
Preliminary Offering Memorandum or Offering Memorandum (or any
amendment or supplement thereto) or any other offering
material in or from any country or jurisdiction except under
circumstances that will result in compliance with any
applicable laws and regulations.
7. Each Initial Purchaser represents, warrants and agrees that,
because neither the Preliminary Offering Memorandum nor the
Offering Memorandum has or will be registered with the Swedish
Financial Supervisory Authority: (i) neither the Preliminary
Offering Memorandum nor the Offering Memorandum shall be made
available, and (ii) the Securities shall not otherwise be
marketed or offered for sale in Sweden, unless any of the
foregoing actions are deemed not to be an offer to the public
in Sweden under the Financial Instruments Trading Act
(1991:980).
III. DELIVERY OF AND PAYMENT FOR THE SECURITIES. Delivery of and payment for
the Securities shall be made at the offices of Simpson Thacher &
Bartlett, London, England, or at such other place as shall be agreed
upon by the Initial Purchasers and the Company, at 10:00 A.M., London
time, on April 10, 2001, or at such other time or date, not later than
seven full business days thereafter, as shall be agreed upon by the
Initial Purchasers and the Company (such date and time of payment and
delivery being referred to herein as the "CLOSING DATE").
<Page>
16
1. On the Closing Date, payment of the purchase price for the
Securities shall be made to the Company by wire or book-entry
transfer of same-day funds in Euro to such account or accounts
as the Company shall specify prior to the Closing Date or by
such other means as the parties hereto shall agree prior to
the Closing Date against delivery to the Initial Purchasers of
the certificates evidencing the Securities. Time shall be of
the essence, and delivery at the time and place specified
pursuant to this Agreement is a further condition of the
obligations of the Initial Purchasers hereunder. Upon
delivery, the Securities shall be in global form, registered
in such names and in such denominations as the Initial
Purchasers shall have requested in writing not less than two
full business days prior to the Closing Date. The Company
agrees to make one or more global certificates evidencing the
Securities available for inspection by the Initial Purchasers
in London, England at least 24 hours prior to the Closing
Date.
IV. FURTHER AGREEMENTS OF THE COMPANY. The Company agrees with each Initial
Purchaser:
1. prior to the completion of the Offering of the Securities by
the Initial Purchasers, to advise each Initial Purchaser
promptly and, if requested, confirm such advice in writing, of
the happening of any event which makes any statement of a
material fact made in the Offering Memorandum untrue or which
requires the making of any additions to or changes in the
Offering Memorandum (as amended or supplemented from time to
time) in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading;
to advise each Initial Purchaser promptly of any order
preventing or suspending the use of the Offering Memorandum,
of any suspension of the qualification of the Securities for
offering or sale in any jurisdiction and of the initiation or
threatening of any proceeding for any such purpose; and to use
its best efforts to prevent the issuance of any such order
preventing or suspending the use of the Offering Memorandum or
suspending any such qualification and, if any such suspension
is issued, to obtain the lifting thereof at the earliest
possible time;
2. to furnish promptly to each Initial Purchaser and counsel for
each Initial Purchaser, without charge, as many copies of the
Preliminary Offering Memorandum and the Offering Memorandum
(and any amendments or supplements thereto) as may be
reasonably requested;
3. prior to making any amendment or supplement to the Offering
Memorandum, to furnish a copy thereof to each Initial
Purchaser and counsel for each Initial Purchaser and not to
effect any such amendment or supplement to which such Initial
Purchaser shall reasonably object by notice to the Company
after a reasonable period to review;
4. if, at any time prior to completion of the Offering of the
Securities by the Initial Purchasers, any event shall occur or
condition exist as a result of which it is necessary, in the
opinion of counsel for the Initial Purchasers or counsel for
the Company, to amend or supplement the Offering Memorandum in
order that the
<Page>
17
Offering Memorandum will not include an untrue statement of
a material fact or omit to state a material fact necessary
in order to make the statements therein, in the light of
the circumstances existing at the time it is delivered to a
purchaser, not misleading, or if it is necessary to amend
or supplement the Offering Memorandum to comply with
applicable law, promptly to prepare such amendment or
supplement as may be necessary to correct such untrue
statement or omission or so that the Offering Memorandum,
as so amended or supplemented, will comply with applicable
law;
5. for so long as the Securities are outstanding and are
"restricted securities" within the meaning of Rule 144(a)(3)
under the Securities Act, to furnish to holders of the
Securities and prospective purchasers of the Securities
designated by such holders, upon request of such holders or
such prospective purchasers, the information required to be
delivered pursuant to Rule 144A(d)(4) under the Securities
Act, unless the Company is then subject to and in compliance
with Section 13 or 15(d) of the Exchange Act or exempt from
reporting pursuant to Rule 12g3-2(b) thereunder (the foregoing
agreement being for the benefit of the holders from time to
time of the Securities and prospective purchasers of the
Securities designated by such holders);
6. prior to completion of the Offering of the Securities,
promptly to take from time to time such actions as the Initial
Purchasers may reasonably request to qualify the Securities
for offering and sale under the securities or Blue Sky laws of
such jurisdictions as the Initial Purchasers may designate and
to continue such qualifications in effect for so long as
required for the resale of the Securities; and to arrange for
the determination of the eligibility for investment of the
Securities under the laws of such jurisdictions as the Initial
Purchasers may reasonably request; PROVIDED that the Company
and its subsidiaries shall not be obligated to qualify as
foreign corporations in any jurisdiction in which they are not
so qualified or to file a general consent to service of
process in any jurisdiction;
7. [Intentionally left blank]
8. to cause the Securities to be listed on the Luxembourg Stock
Exchange in accordance with the rules and regulations thereof
as promptly as practicable and to maintain the listing of the
Securities on such exchange for so long as any Security is
outstanding (or on such other exchange as is reasonably
acceptable to the applicable Trustee);
9. not to, and to cause its affiliates not to, sell, offer for
sale or solicit offers to buy or otherwise negotiate in
respect of any security (as such term is defined in the
Securities Act) which could be integrated with the sale of the
Securities in a manner which would require registration of the
Securities under the Securities Act;
10. except following the effectiveness of the Exchange Offer
Registration Statement or the Shelf Registration Statement, as
the case may be, not to, and to cause its
<Page>
18
affiliates not to, and not to authorize or knowingly permit
any person acting on their behalf to, solicit any offer to
buy or offer to sell the Securities by means of any form of
general solicitation or general advertising within the
meaning of Regulation D or in any manner involving a public
offering within the meaning of Section 4(2) of the
Securities Act; and not to offer, sell, contract to sell or
otherwise dispose of, directly or indirectly, any
securities under circumstances in which such offer, sale,
contract or disposition would cause the exemption afforded
by Section 4(2) of the Securities Act to cease to be
applicable to the offering and sale of the Securities as
contemplated by this Agreement and the Offering Memorandum;
11. other than pursuant to and in accordance with the Registration
Rights Agreement, for a period of 180 days from the date of
the Offering Memorandum, not to offer for sale, sell, contract
to sell or otherwise dispose of, directly or indirectly, or
file a registration statement for, or announce any offer,
sale, contract for sale of or other disposition of any debt
securities issued or guaranteed by the Company or any of its
subsidiaries (other than the Securities) without the prior
written consent of the Initial Purchasers;
12. during the period from the Closing Date until two years after
the Closing Date, without the prior written consent of each of
the Initial Purchasers, not to, and not permit any of its
affiliates (as defined in Rule 144 under the Securities Act)
to, resell any of the Securities that have been reacquired by
them, except for Securities purchased by the Company or any of
its affiliates and resold in a transaction registered under
the Securities Act, or in a transaction outside the United
States in accordance with Regulation S;
13. not to, for so long as the Securities are outstanding, be or
become, or be or become owned by, an open-end investment
company, unit investment trust or face-amount certificate
company that is or is required to be registered under Section
8 of the Investment Company Act, and not to be or become, or
be or become owned by, a closed-end investment company
required to be registered, but not registered thereunder;
14. in connection with the offering of the Securities, until the
Initial Purchasers shall have notified the Company of the
completion of the offering of the Securities, not to, and to
cause its affiliated purchasers (as defined in Regulation M
under the Exchange Act) not to, either alone or with one or
more other persons, bid for or purchase, for any account in
which it or any of its affiliated purchasers has a beneficial
interest, any Securities, or attempt to induce any person to
purchase any Securities; and not to, and to cause its
affiliated purchasers not to, make bids or purchase for the
purpose of creating actual, or apparent active trading in or
of raising the price of the Securities;
15. to furnish to the Initial Purchasers on the date hereof a copy
of the independent accountants' report included in the
Offering Memorandum signed by the accountants rendering such
report;
<Page>
19
16. to do and perform all things required to be done and performed
by it under this Agreement that are within its control prior
to or after the Closing Date, and to use its best efforts to
satisfy all conditions precedent on its part to the delivery
of the Securities;
17. except as expressly contemplated by the Offering Memorandum,
to not take any action from the date hereof until the
execution and delivery of the Indenture which, if taken after
such execution and delivery, would have violated any of the
covenants contained in the Indenture;
18. to not take any action prior to the Closing Date which would
require the Offering Memorandum to be amended or supplemented
pursuant to Section IV(4);
19. from the date hereof until the Closing Date, not to issue any
press release or other communication directly or indirectly or
hold any press conference with respect to the Company, its
condition, financial or otherwise, or earnings, business
affairs or business prospects (except for routine oral
marketing communications in the ordinary course of business
and consistent with the past practices of the Company and of
which each Initial Purchaser is notified), without the prior
written consent of the Initial Purchasers, unless in the
judgment of the Company and its counsel, and after
notification to each Initial Purchaser, such press release or
communication is required by law;
20. to apply the net proceeds from the sale of the Securities as
set forth in the Offering Memorandum under the heading "Use of
Proceeds"; and
21. to pay and, to the extent permitted by applicable law,
indemnify and hold harmless each Initial Purchaser against any
stamp or other issuance or transfer taxes or duties,
value-added tax, documentary tax, registration tax,
withholding or other taxes are payable by or on behalf of any
Initial Purchaser in connection with (i) the issuance of
Securities, (ii) the sale, transfer and delivery of the
Securities to the Initial Purchasers pursuant to this
Agreement or for the resale of the Securities placed by or at
the direction of the Initial Purchasers or (iii) the execution
and delivery of this Agreement or any of the other Transaction
Documents or the consummation of any of the transactions
contemplated hereby or thereby.
V. CONDITIONS OF INITIAL PURCHASERS' OBLIGATIONS. The obligations of the
Initial Purchasers hereunder are subject to the accuracy, on and as of
the date hereof and the Closing Date, of the representations and
warranties of the Company contained herein, to the accuracy of the
statements of the Company and its officers made in any certificates
delivered pursuant hereto, to the performance by the Company of its
obligations hereunder, and to each of the following additional terms
and conditions:
1. The Offering Memorandum (and any amendments or supplements
thereto) shall have been printed and copies distributed to the
Initial Purchasers as promptly as practicable on or following
the date of this Agreement or at such other date
<Page>
20
and time as to which the Initial Purchasers may agree; and
no stop order suspending the sale of the Securities in any
jurisdiction shall have been issued and no proceedings for
such purpose shall have been commenced or shall be pending
or threatened.
2. The Initial Purchasers shall not have discovered and disclosed
to the Company on or prior to the Closing Date that the
Offering Memorandum or any amendment or supplement thereto
contains an untrue statement of a fact which, in the opinion
of counsel for the Initial Purchasers, is material or omits to
state any fact which, in the opinion of such counsel is
material and is required to be stated therein or is necessary
to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
3. All corporate proceedings and other legal matters incident to
the authorization, form and validity of each of the
Transaction Documents and the Offering Memorandum, and all
other legal matters relating to the Transaction Documents and
the transactions contemplated thereby, including all such
corporate proceedings and legal matters in relation to the
Company, Corral Petroleum Holdings AB and Preem Petroleum AB,
shall be satisfactory in all material respects to the Initial
Purchasers, and the Company, Corral Petroleum Holdings AB and
Preem Petroleum AB shall have furnished to each Initial
Purchaser all documents and information that it or their
counsel may reasonably request to enable them to pass upon
such matters.
4. Akin, Gump, Strauss, Hauer & Feld shall have furnished to the
Initial Purchasers their written opinion, as counsel to the
Company, addressed to the Initial Purchasers and dated the
Closing Date, in form and substance reasonably satisfactory to
the Initial Purchasers, substantially to the effect set forth
in Annex C hereto.
5. Mannheimer & Swartling Advokatbyra AB shall have furnished to
the Initial Purchasers their written opinion, as special
Swedish counsel to the Company, addressed to the Initial
Purchasers and dated the Closing Date, in form and substance
reasonably satisfactory to the Initial Purchasers,
substantially to the effect set forth in Annex D hereto.
6. Per Behm shall have furnished to the Initial Purchasers his
written opinion, as in-house counsel to Preem Holdings AB,
addressed to the Initial Purchasers and dated the Closing
Date, in form and substance reasonably satisfactory to the
Initial Purchasers, substantially to the effect set forth in
Annex E hereto.
7. The Initial Purchasers shall have received from Simpson
Thacher & Bartlett, counsel for the Initial Purchasers, such
opinion or opinions, dated the Closing Date, with respect to
such matters as the Initial Purchasers may reasonably require,
and the Company shall have furnished to such counsel such
documents and information as they request for the purpose of
enabling them to pass upon such matters.
<Page>
21
8. The Company shall have furnished to the Initial Purchasers a
letter (the "INITIAL LETTER") of KPMG, Stockholm, addressed to
the Initial Purchasers and dated the date hereof, in form and
substance satisfactory to the Initial Purchasers,
substantially to the effect set forth in Annex F hereto.
9. The Company shall have furnished to the Initial Purchasers a
letter (the "BRING-DOWN LETTER") of KPMG, Stockholm, addressed
to the Initial Purchasers and dated the Closing Date,
confirming that they are independent public accountants with
respect to the Company and its subsidiaries within the meaning
of Rule 101 of the Code of Professional Conduct of the AICPA
and its interpretations and rulings thereunder, stating, as of
the date of the Bring-Down Letter (or, with respect to matters
involving changes or developments since the respective dates
as of which specified financial information is given in the
Offering Memorandum, as of a date not more than three business
days prior to the date of the Bring-Down Letter), that the
conclusions and findings of such accountants with respect to
the financial information and other matters covered by the
Initial Letter are accurate and confirming in all material
respects the conclusions and findings set forth in the Initial
Letter.
10. The Company and Preem Petroleum AB shall each have furnished
to the Initial Purchasers a certificate, dated the Closing
Date, of their respective chief executive officers and its
chief financial officers, stating that (A) such officers have
carefully examined the Offering Memorandum, (B) in their
opinion, the Offering Memorandum, as of its date, did not
include any untrue statement of a material fact and did not
omit to state a material fact required to be stated therein or
necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not
misleading, and since the date of the Offering Memorandum, no
event has occurred which should have been set forth in a
supplement or amendment to the Offering Memorandum so that the
Offering Memorandum (as so amended or supplemented) would not
include any untrue statement of a material fact and would not
omit to state a material fact required to be stated therein or
necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not
misleading and (C) as of the Closing Date, the representations
and warranties of the Company in this Agreement are true and
correct and the Company has complied with all agreements and
satisfied all conditions on its part to be performed or
satisfied hereunder on or prior to the Closing Date.
11. The Initial Purchasers shall have received a counterpart of
the Registration Rights Agreement which shall have been
executed and delivered by a duly authorized officer of the
Company.
12. Each of the Security Agreements shall have been duly executed
and delivered by the Company and the other parties thereto by
duly authorized officers of the Company and such parties, and
the Company shall have furnished to the Initial Purchasers a
certificate, dated the Closing Date, of the Company's
corporate
<Page>
22
secretary stating that such execution and delivery has been
duly authorized and attaching the resolutions authorizing
such execution and delivery; and all actions contemplated
by each Security Document to have been completed on or
before the Closing Date shall have been consummated in
accordance with the provisions of such documents and
without waiver thereof.
13. Each of the Restructuring Agreements shall have been duly
executed and delivered by the Company and the other parties
thereto by duly authorized officers of the Company and such
parties, and the Initial Purchasers shall have received from
each of such parties as are affiliated with the Company a
certificate, dated the Closing Date, of such party's corporate
secretary stating that such execution and delivery has been
duly authorized and attaching the resolutions authorizing such
execution and delivery; and all actions contemplated by each
of the Restructuring Agreements to have been completed on or
before the Closing Date shall have been consummated in
accordance with the provisions of such agreements and without
waiver thereof.
14. The Indenture shall have been duly executed and delivered by
the Company and the Trustee thereunder, and the Securities
shall have been duly executed and delivered by the Company and
duly authenticated by the applicable Trustee.
15. [Intentionally left blank]
16. The Securities shall have been approved for listing on the
Luxembourg Stock Exchange.
17. If any event shall have occurred that requires the Company
under Section IV(4) to prepare an amendment or supplement to
the Offering Memorandum, such amendment or supplement shall
have been prepared, the Initial Purchasers shall have been
given a reasonable opportunity to comment thereon, and copies
thereof shall have been delivered to each Initial Purchaser
reasonably in advance of the Closing Date.
18. Subsequent to the execution and delivery of this Agreement or,
if earlier, the dates as of which information is given in the
Offering Memorandum (exclusive of any amendment or supplement
thereto), except as expressly contemplated by the Offering
Memorandum, there shall not have been any change in the
capital stock or long-term debt or any change, or any
development involving a prospective change, in or affecting
the condition (financial or otherwise), results of operations,
business or prospects of the Company and its subsidiaries
taken as a whole, the effect of which, in any such case
described above, is, in the judgment of the Initial
Purchasers, so material and adverse as to make it
impracticable or inadvisable to proceed with the sale or
delivery of the Securities on the terms and in the manner
contemplated by this Agreement and the Offering Memorandum
(exclusive of any amendment or supplement thereto).
<Page>
23
19. No action shall have been taken and no statute, rule,
regulation or order shall have been enacted, adopted or issued
by any governmental agency or body which would, as of the
Closing Date, prevent the issuance or sale of the Securities
as contemplated by the Offering Memorandum; and no injunction,
restraining order or order of any other nature by any
supra-national, federal, regional, local or foreign court of
competent jurisdiction shall have been issued as of the
Closing Date which would prevent the issuance or sale of the
Securities.
20. Subsequent to the execution and delivery of this Agreement, no
downgrading shall have occurred in the rating accorded the
Securities or any of the Company's other debt securities or
preferred stock by a "nationally recognized statistical rating
organization," as such term is defined by the Commission for
purposes of Rule 436(g)(2) of the rules and regulations of the
Commission under the Securities Act, and no such organization
shall have publicly announced that it has under surveillance
or review (other than an announcement with positive
implications of a possible upgrading), its rating of the
Securities or any of the Company's other debt securities or
preferred stock.
21. Subsequent to the execution and delivery of this Agreement,
there shall not have occurred any of the following: (i)
trading in securities generally on the Stockholm Stock
Exchange, the Luxembourg Stock Exchange, the New York Stock
Exchange, the American Stock Exchange or the over-the-counter
markets in the United States shall have been suspended or
limited, or minimum prices shall have been established on any
such exchange or market by the Commission, by any such
exchange or by any other regulatory body or governmental
authority having jurisdiction; (ii) trading in any securities
of the Company on any exchange or in the over-the-counter
market shall have been suspended; (iii) any moratorium on
commercial banking activities shall have been declared by
Swedish, Luxembourg or United States federal, regional and
local authorities; (iv) an outbreak or escalation of
hostilities or a declaration by the United States, Sweden or
Luxembourg of a national emergency or war; or (v) (I) a
material adverse change in general economic, political or
financial conditions the effect of which is, or (II) the
effect of international conditions on the financial markets in
the United States, Sweden or Luxembourg is, in the case of
this clause (v), in the judgment of the Initial Purchasers, so
material and adverse as to make it impracticable or
inadvisable to proceed with the sale or the delivery of the
Securities on the terms and in the manner contemplated by this
Agreement and in the Offering Memorandum (exclusive of any
amendment or supplement thereto).
22. The Initial Purchasers shall have received evidence reasonably
satisfactory to them that the appointment of CT Corporation
System as agent for service of process of the Company pursuant
to Section XVIII hereof and under the Indenture has been
accepted by such agent.
On or before the Closing Date, the Initial Purchasers and their counsel
shall have received such further documents, opinions, certificates,
letters, schedules, evidence or instruments relating to the business,
corporate, legal or financial affairs of the Company
<Page>
24
as they shall have heretofore reasonably requested in connection with
the consummation of the transactions contemplated hereby and by the
other Transaction Documents.
All documents, opinions, certificates, letters, schedules, evidence or
instruments mentioned above or elsewhere in this Agreement shall be
deemed to be in compliance with the provisions hereof only if they are
in form and substance reasonably satisfactory to counsel for the
Initial Purchasers.
VI. TERMINATION. The obligations of the Initial Purchasers hereunder may be
terminated by the Initial Purchasers, in their absolute discretion, by
notice given to and received by the Company prior to delivery of and
payment for the Securities if, prior to that time, any of the events
described in Section V (19), (20), (21) or (22) shall have occurred and
be continuing.
VII. DEFAULTING INITIAL PURCHASERS. If, on the Closing Date, either Initial
Purchaser defaults in the performance of its obligations under this
Agreement, the non-defaulting Initial Purchaser may make arrangements
for the purchase of the Securities which such defaulting Initial
Purchaser agreed but failed to purchase by other persons satisfactory
to the Company and the non-defaulting Initial Purchasers, but if no
such arrangements are made within 36 hours after such default, this
Agreement shall terminate without liability on the part of the
non-defaulting Initial Purchasers or the Company, except that the
Company will continue to be liable for the payment of expenses to the
extent set forth in Sections IX and XII and except that the provisions
of Sections IX and X shall not terminate and shall remain in effect. As
used in this Agreement, the term "Initial Purchasers" includes, for all
purposes of this Agreement unless the context otherwise requires, any
party not listed in Schedule 1 hereto that, pursuant to this Section
VII, purchases Securities which a defaulting Initial Purchaser agreed
but failed to purchase. Nothing contained herein shall relieve a
defaulting Initial Purchaser of any liability it may have to the
Company or any non-defaulting Initial Purchaser for damages caused by
its default. If other persons are obligated or agree to purchase the
Securities of a defaulting Initial Purchaser, either the non-defaulting
Initial Purchasers or the Company may postpone the Closing Date for up
to seven full business days in order to effect any changes that in the
opinion of counsel for the Company or counsel for the Initial
Purchasers may be necessary in the Offering Memorandum or in any other
document or arrangement, and the Company agrees to promptly prepare any
amendment or supplement to the Offering Memorandum that effects any
such changes.
VIII. REIMBURSEMENT OF INITIAL PURCHASERS' EXPENSES. If (a) this Agreement
shall have been terminated pursuant to Section VI, (b) the Company
shall fail to tender the Securities for delivery to the Initial
Purchasers for any reason permitted under this Agreement or (c) the
Initial Purchasers shall decline to purchase the Securities for any
reason permitted under this Agreement, the Company shall reimburse the
Initial Purchasers for such out-of-pocket expenses (excluding fees and
disbursements of counsel) as shall have been reasonably incurred by the
Initial Purchasers in connection with this Agreement and the proposed
purchase and resale of the Securities.
<Page>
25
IX. INDEMNIFICATION.
1. The Company shall indemnify and hold harmless each Initial
Purchasers, its respective affiliates, their respective
officers, directors, employees, representatives and agents,
and each person, if any, who controls any Initial Purchaser
within the meaning of the Securities Act or the Exchange Act
(collectively referred to for purposes of this Section IX(1)
and Section X as an Initial Purchaser), from and against any
loss, claim, damage or liability, joint or several, or any
action in respect thereof (including, without limitation, any
loss, claim, damage, liability or action relating to purchases
and sales of the Securities), to which any Initial Purchaser
may become subject, whether commenced or threatened, under the
Securities Act, the Exchange Act, any other supra-national,
federal, regional, local and foreign statutory law or
regulation, at common law or otherwise, insofar as such loss,
claim, damage, liability or action arises out of, or is based
upon, (i) any untrue statement or alleged untrue statement of
a material fact contained in the Preliminary Offering
Memorandum or the Offering Memorandum or in any amendment or
supplement thereto or in any information provided by the
Company pursuant to Section IV (5) or (ii) the omission or
alleged omission to state therein a material fact required to
be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they
were made, not misleading, and shall reimburse each Initial
Purchaser promptly upon demand for any legal or other costs,
charges and expenses reasonably incurred by any Initial
Purchaser in connection with investigating or defending or
preparing to defend against or appearing as a third party
witness in connection with any such loss, claim, damage,
liability or action as such expenses are incurred; PROVIDED,
HOWEVER, that the Company shall not be liable in any such case
to the extent that any such loss, claim, damage, liability or
action arises out of, or is based upon, an untrue statement or
alleged untrue statement in or omission or alleged omission
from any of such documents in reliance upon and in conformity
with any Initial Purchasers' Information; and PROVIDED,
FURTHER, that with respect to any such untrue statement in or
omission from the Preliminary Offering Memorandum, the
indemnity agreement contained in this Section IX(1) shall not
inure to the benefit of an Initial Purchaser to the extent
that the sale to the person asserting any such loss, claim,
damage, liability or action was an initial resale by such
Initial Purchaser and any such loss, claim, damage, liability
or action of or with respect to such Initial Purchaser results
from the fact that both (A) to the extent required by
applicable law, a copy of the Offering Memorandum was not sent
or given to such person at or prior to the written
confirmation of the sale of such Securities to such person and
(B) the untrue statement in or omission from the Preliminary
Offering Memorandum was corrected in the Offering Memorandum
unless, in either case, such failure to deliver the Offering
Memorandum was a result of non-compliance by the Company with
Section IV(2).
2. The Initial Purchasers shall, severally and not jointly,
indemnify and hold harmless the Company, its affiliates, their
respective officers, directors, employees, representatives and
agents, and each person, if any, who controls the
<Page>
26
Company within the meaning of the Securities Act or the
Exchange Act (collectively referred to for purposes of this
Section IV(2) and Section X as the Company), from and
against any loss, claim, damage or liability, joint or
several, or any action in respect thereof, to which the
Company may become subject, whether commenced or
threatened, under the Securities Act, the Exchange Act, any
other federal or state statutory law or regulation, at
common law or otherwise, insofar as such loss, claim,
damage, liability or action arises out of, or is based
upon, (i) any untrue statement or alleged untrue statement
of a material fact contained in the Preliminary Offering
Memorandum or the Offering Memorandum or in any amendment
or supplement thereto or (ii) the omission or alleged
omission to state therein a material fact required to be
stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they
were made, not misleading, but in each case only to the
extent that the untrue statement or alleged untrue
statement or omission or alleged omission was made in
reliance upon and in conformity with any Initial
Purchasers' Information, and shall reimburse the Company
for any legal or other costs, charges and expenses
reasonably incurred by the Company in connection with
investigating or defending or preparing to defend against
or appearing as a third party witness in connection with
any such loss, claim, damage, liability or action as such
expenses are incurred.
3. Promptly after receipt by an indemnified party under this
Section IX of notice of any claim or the commencement of any
action, the indemnified party shall, if a claim in respect
thereof is to be made against the indemnifying party pursuant
to Section IX(1) or IX(2), notify the indemnifying party in
writing of the claim or the commencement of that action;
PROVIDED, HOWEVER, that the failure to notify the indemnifying
party shall not relieve it from any liability which it may
have under this Section IX except to the extent that it has
been materially prejudiced (including, without limitation,
through the forfeiture of substantive rights or defenses) by
such failure; and, PROVIDED, FURTHER, that the failure to
notify the indemnifying party shall not relieve it from any
liability which it may have to an indemnified party otherwise
than under this Section IX. If any such claim or action shall
be brought against an indemnified party, and it shall notify
the indemnifying party thereof, the indemnifying party shall
be entitled to participate therein and, to the extent that it
wishes, jointly with any other similarly notified indemnifying
party, to assume the defense thereof with counsel reasonably
satisfactory to the indemnified party. After notice from the
indemnifying party to the indemnified party of its election to
assume the defense of such claim or action, the indemnifying
party shall not be liable to the indemnified party under this
Section IX for any legal or other expenses subsequently
incurred by the indemnified party in connection with the
defense thereof other than reasonable costs of investigation;
PROVIDED, HOWEVER, that an indemnified party shall have the
right to employ its own counsel in any such action, but the
fees, expenses and other charges of such counsel for the
indemnified party will be at the expense of such indemnified
party unless (1) the employment of counsel by the indemnified
party has been authorized in writing by the indemnifying
party, (2) the indemnified party has reasonably concluded
(based upon advice of counsel to the
<Page>
27
indemnified party) that there may be legal defenses
available to it or other indemnified parties that are
different from or in addition to those available to the
indemnifying party, (3) a conflict or potential conflict
exists (based upon advice of counsel to the indemnified
party) between the indemnified party and the indemnifying
party (in which case the indemnifying party will not have
the right to direct the defense of such action on behalf of
the indemnified party) or (4) the indemnifying party has
not in fact employed counsel reasonably satisfactory to the
indemnified party to assume the defense of such action
within a reasonable time after receiving notice of the
commencement of the action, in each of which cases the
reasonable fees, disbursements and other charges of counsel
will be at the expense of the indemnifying party or
parties. It is understood that the indemnifying party or
parties shall not, in connection with any proceeding or
related proceedings in the same jurisdiction, be liable for
the reasonable fees, disbursements and other charges of
more than one separate firm of attorneys (in addition to
any local counsel) at any one time for all such indemnified
party or parties. Each indemnified party, as a condition of
the indemnity agreements contained in Sections IX(1) and
IX(2), shall use all reasonable efforts to cooperate with
the indemnifying party in the defense of any such action or
claim. No indemnifying party shall be liable for any
settlement of any such action effected without its written
consent (which consent shall not be unreasonably withheld),
but if settled with its written consent or if there be a
final judgment for the plaintiff in any such action, the
indemnifying party agrees to indemnify and hold harmless
any indemnified party from and against any loss or
liability by reason of such settlement or judgment. No
indemnifying party shall, without the prior written consent
of the indemnified party (which consent shall not be
unreasonably withheld), effect any settlement of any
pending or threatened proceeding in respect of which any
indemnified party is or could have been a party and
indemnity could have been sought hereunder by such
indemnified party unless such settlement includes an
unconditional release of such indemnified party from all
liability on claims that are the subject matter of such
proceedings.
The obligations of the Company and the Initial Purchasers in this
Section IX and in Section X are in addition to any other liability that
the Company or the Initial Purchasers, as the case may be, may
otherwise have, including in respect of any breaches of
representations, warranties and agreements made herein by any such
party.
X. CONTRIBUTION. If the indemnification provided for in Section IX is
unavailable or insufficient to hold harmless an indemnified party under
Section IX(1) or IX(2), then each indemnifying party shall, in lieu of
indemnifying such indemnified party, contribute to the amount paid or
payable by such indemnified party as a result of such loss, claim,
damage or liability, or action in respect thereof, (i) in such
proportion as shall be appropriate to reflect the relative benefits
received by the Company on the one hand and the Initial Purchasers on
the other from the offering of the Securities or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative fault of
the Company on the one hand and the Initial Purchasers on the other
with respect to the statements or omissions that resulted in such
<Page>
28
loss, claim, damage or liability, or action in respect thereof, as
well as any other relevant equitable considerations. The relative
benefits received by the Company on the one hand and the Initial
Purchasers on the other with respect to such offering shall be
deemed to be in the same proportion as the total net proceeds from
the offering of the Securities purchased under this Agreement
(before deducting expenses) received by or on behalf of the Company,
on the one hand, and the total discounts and commissions received by
the Initial Purchasers with respect to the Securities purchased
under this Agreement, on the other, bear to the total gross proceeds
from the sale of the Securities under this Agreement, in each case
as set forth in the table on the cover page of the Offering
Memorandum. The relative fault shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a
material fact relates to the Company or information supplied by the
Company on the one hand or to any Initial Purchasers' Information on
the other, the intent of the parties and their relative knowledge,
access to information and opportunity to correct or prevent such
untrue statement or omissions. The Company and the Initial
Purchasers agree that it would not be just and equitable if
contributions pursuant to this Section X were to be determined by
PRO RATA allocation or by any other method of allocation that does
not take into account the equitable considerations referred to
herein. The amount paid or payable by an indemnified party as a
result of the loss, claim, damage or liability, or action in respect
thereof, referred to above in this Section X shall be deemed to
include, for purposes of this Section X, any legal or other expenses
reasonably incurred by such indemnified party in connection with
investigating or defending or preparing to defend any such action or
claim. Notwithstanding the provisions of this Section X, the Initial
Purchasers shall not be required to contribute any amount in excess
of the amount by which the total discounts and commissions received
by the Initial Purchasers with respect to the Securities purchased
by it under this Agreement exceeds the amount of any damages which
the Initial Purchasers have otherwise paid or become liable to pay
by reason of any untrue or alleged untrue statement or omission or
alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be
entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.
XI. PERSONS ENTITLED TO BENEFIT OF AGREEMENT. This Agreement shall inure to
the benefit of and be binding upon the Initial Purchasers, the Company
and their respective successors. This Agreement and the terms and
provisions hereof are for the sole benefit of only those persons,
except as provided in Sections IX and X with respect to affiliates of
the Company and the Initial Purchasers, and officers, directors,
employees, representatives, agents and controlling persons of such
affiliates, the Company and the Initial Purchasers and in Section IV(5)
with respect to holders and prospective purchasers of the Securities.
Nothing in this Agreement is intended or shall be construed to give any
person, other than the persons referred to in this Section XI, any
legal or equitable right, remedy or claim under or in respect of this
Agreement or any provision contained herein.
XII. EXPENSES. The Company agrees with the Initial Purchasers to pay (a) the
costs incident to the authorization, issuance, sale, preparation and
delivery of the Securities and any taxes payable in that connection;
(b) the costs incident to the preparation, printing and
<Page>
29
distribution of the Preliminary Offering Memorandum, the Offering
Memorandum and any amendments or supplements thereto; (c) the costs
of reproducing and distributing each of the Transaction Documents;
(d) the costs incident to the preparation, printing and delivery of
the certificates evidencing the Securities, including amounts
payable pursuant to Section IV(21) hereof; (e) the fees and expenses
of the Company's counsel and independent accountants; (f) the fees
and expenses of qualifying the Securities under the securities laws
of the several jurisdictions as provided in Section IV(6) and of
preparing, printing and distributing Blue Sky Memoranda (including
related fees and expenses of counsel for the Initial Purchaser); (g)
the costs and expenses incident to any "road show" undertaken in
connection with the marketing of the offering of the Securities; (h)
any fees charged by rating agencies in connection with rating the
Securities; (i) the fees and expenses of the Trustee or any paying
or transfer agents (including related fees and expenses of any
counsel to such parties); (j) all expenses and application and
listing fees incurred in connection with the application for the
listing of the Securities on the Luxembourg Stock Exchange and the
approval of the Securities for book-entry transfer by Euroclear
and/or Clearstream Banking; (k) all other out-of-pocket expenses
(including reasonable fees and disbursements of counsel) reasonably
incurred by the Initial Purchasers or any of their affiliates in
connection with, or arising out of, the offering and sale of the
Securities; PROVIDED, HOWEVER, that the reasonable fees and expenses
of counsel for the Initial Purchaser shall be paid or reimbursed by
the Company in an amount not to exceed US$350,000 and only if the
Closing occurs; and (l) all other costs and expenses incident to the
performance of the obligations of the Company under this Agreement
which are not otherwise specifically provided for in this Section
XII.
XIII. SURVIVAL. The respective indemnities, rights of contribution,
representations, warranties and agreements of the Company and the
Initial Purchasers contained in this Agreement or made by or on behalf
of the Company or the Initial Purchasers pursuant to this Agreement or
any certificate delivered pursuant hereto shall survive the delivery of
and payment for the Securities and shall remain in full force and
effect, regardless of any termination or cancellation of this Agreement
or any investigation made by or on behalf of any of them or any of
their respective affiliates, officers, directors, employees,
representatives, agents or controlling persons.
XIV. NOTICES, ETC. All statements, requests, notices and agreements
hereunder shall be in writing, and:
1. if to the Initial Purchasers, shall be delivered or sent by
mail or telecopy transmission to: (i) Deutsche Bank AG London,
Winchester House, 1 Great Winchester Street, London, EC2N 2DB,
England, Attention: Gareth Noonan (telecopier number:
+44-20-7547-2704); and (ii) UBS AG, acting through its
business group UBS Warburg, 1 Finsbury Avenue, London EC2M
2PP, Attention: Christianne Smart (telecopier number:
+44-20-7568-4537); or
2. if to the Company, shall be delivered or sent by mail or
telecopy transmission to the address of the Company set forth
in the Offering Memorandum, Attention: President and Chief
Executive Officer (telecopier number: +46-8-663-4923), with
<Page>
30
a copy to Akin, Gump, Strauss, Hauer & Feld, One Angel Court,
London EC2R 7HJ, Attention: Stephen Hatfield (telecopier:
+44-20-7726-9610);
PROVIDED that any notice to the Initial Purchasers pursuant to Section
IX(3) shall also be delivered or sent by mail to the Initial Purchasers
at their respective addresses set forth on the signature page hereof.
Any such statements, requests, notices or agreements shall take effect
at the time of receipt thereof.
XV. DEFINITION OF TERMS. For purposes of this Agreement, (a) the term
"business day" means any day on which the Nasdaq National Market System
is open for trading, (b) the term "subsidiary" has the meaning set
forth in Rule 405 under the Securities Act and (c) except where
otherwise expressly provided, the term "affiliate" has the meaning set
forth in Rule 405 under the Securities Act.
XVI. INITIAL PURCHASERS' INFORMATION. The parties hereto acknowledge and
agree that, for all purposes of this Agreement, the Initial Purchasers'
Information consists solely of the following information in the
Preliminary Offering Memorandum and the Offering Memorandum: the
statements concerning the Initial Purchasers contained in the first,
second and seventh paragraphs under the heading "Plan of Distribution."
XVII. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
XVIII. SUBMISSION TO JURISDICTION; APPOINTMENT OF AGENT FOR SERVICE. To the
fullest extent permitted by applicable law, the Company irrevocably
submits to the non-exclusive jurisdiction of any federal or state court
in the Borough of Manhattan in the City of New York, County and State
of New York, United States of America, in any suit or proceeding based
on or arising under this Agreement or any of the transactions
contemplated hereby, and irrevocably agrees that all claims in respect
of such suit or proceeding may be determined in any such court. The
Company, to the fullest extent permitted by applicable law, irrevocably
and fully waives the defense of an inconvenient forum to the
maintenance of such suit or proceeding and hereby irrevocably
designates and appoints CT Corporation (the "AUTHORIZED AGENT"), as its
authorized agent upon whom process may be served in any such suit or
proceeding. The Company represents that it has notified the Authorized
Agent of such designation and appointment and that the Authorized Agent
has accepted the same in writing. The Company hereby irrevocably
authorizes and directs its Authorized Agent to accept such service. The
Company further agrees that service of process upon its Authorized
Agent and written notice of said service to the Company mailed by first
class mail or delivered to its Authorized Agent shall be deemed in
every respect effective service of process upon the Company in any such
suit or proceeding. Nothing herein shall affect the right of any person
to serve process in any other manner permitted by law. The Company
agrees that a final action in any such suit or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the
judgment or in any other lawful manner. Notwithstanding the foregoing,
any action against the Company arising out of or based on this
Agreement or the transactions contemplated hereby may also be
instituted by any Initial Purchaser, its respective officers and
employees or any person who controls such
<Page>
31
Initial Purchaser within the meaning of the Securities Act in any
competent court in the Kingdom of Sweden and the Company expressly
accepts the jurisdiction of any such court in any such action.
XIX. JUDGMENT CURRENCY. The Company agrees to indemnify the Initial
Purchasers against any loss incurred as a result of any judgment or
order being given or made for any amount due under this Agreement and
such judgment or order being expressed or paid in a currency (the
"JUDGMENT CURRENCY") other than Euros and as a result of any variation
as between (i) the rate of exchange at which the Euro amount is
converted into such Judgment Currency for the purposes of such judgment
or order and (ii) the spot rate of exchange in the City of New York at
which any such person on the date of payment of such judgment or order
is able to purchase Euros with the amount of the Judgment Currency
actually received by such person. The foregoing indemnity shall
continue in full force and effect notwithstanding any such judgment or
order as aforesaid. The term "spot rate of exchange" shall include any
premiums or costs of exchange payable in connection with the purchase
of, or conversion into, Euros.
XX. COUNTERPARTS. This Agreement may be executed in one or more
counterparts (which may include counterparts delivered by telecopier)
and, if executed in more than one counterpart, the executed agreement,
counterparts shall each be deemed to be an original, but all such
counterparts shall together constitute one and the same instrument.
XXI. AMENDMENTS. No amendment or waiver of any provision of this Agreement,
nor any consent or approval to any departure therefrom, shall in any
event be effective unless the same shall be in writing and signed by
the parties hereto.
XXII. HEADINGS. The headings herein are inserted for convenience of reference
only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
[THE REMAINDER OF THIS PAGE HAS BEEN LEFT BLANK INTENTIONALLY]
<Page>
32
If the foregoing is in accordance with your understanding of
our agreement, kindly sign and return to us a counterpart hereof, whereupon this
instrument will become a binding agreement between the Company and the Initial
Purchasers in accordance with its terms.
Very truly yours,
PREEM HOLDINGS AB (PUBL) PREEM HOLDINGS AB (PUBL)
By /s/ Richard Ohman By /s/ John P. Oswald
-------------------------------- -------------------------------
Name: Name:
Title: Title:
Accepted:
DEUTSCHE BANK AG LONDON
By /s/ Gareth Noonan
---------------------------------
Authorized Signatory
By /s/ Brian Bassett
---------------------------------
Authorized Signatory
Address for notices pursuant to Section IX(3):
Deutsche Bank AG London
Winchester House
1 Great Winchester Street
London EC2N 2DB
Attention: Legal Department
Telecopier No.: +44-20-7547-2704
UBS AG, acting through its business group
UBS WARBURG
By /s/ Marcus Stub
-----------------------------------------
Authorized Signatory
By /s/ Jeffrey Lubin
-----------------------------------------
Authorized Signatory
Address for notices pursuant to Section IX(3):
UBS AG, acting through its business group
UBS Warburg
1 Finsbury Avenue,
London EC2M 2PP
Attention: Legal Department
Telecopier No.: +44-20-7568-4537
<Page>
SCHEDULE 1
<Table>
<Caption>
Principal
Initial Purchaser Amount
- ----------------- of Securities
-------------
Deutsche Bank AG London EURO
UBS AG, acting through its business EURO
group UBS Warburg
Total EURO
</Table>
<Page>
ANNEX A
- --------------------------------------------------------------------------
EURO ___ [ ]% Senior Secured Notes due 2011
REGISTRATION RIGHTS AGREEMENT
Dated as of April o, 2001
Among
Preem Holdings AB (publ),
Deutsche Bank AG London,
and
UBS Warburg Ltd.
- --------------------------------------------------------------------------
<Page>
TABLE OF CONTENTS
<Table>
<Caption>
PAGE
1. Definitions..............................................................................................3
2. Exchange Offer...........................................................................................6
3. Shelf Registration Statement.............................................................................9
4. Liquidated Damages......................................................................................10
5. Registration Procedures.................................................................................12
6. Registration Expenses...................................................................................19
7. Indemnification and Contribution........................................................................20
8. Rule 144A...............................................................................................23
9. Underwritten Registrations..............................................................................23
10. Miscellaneous...........................................................................................24
(a) No Inconsistent Agreements.....................................................................24
(b) Adjustments Affecting Transfer Restricted Securities...........................................24
(c) Amendments and Waivers.........................................................................24
(d) Notices........................................................................................24
(e) Successors and Assigns.........................................................................26
(f) Counterparts...................................................................................26
(g) Headings.......................................................................................26
(h) Governing Law..................................................................................26
(i) Remedies.......................................................................................26
(j) Submission to Jurisdiction; Appointment of Agent for Service; Waiver...........................26
(k) Currency Indemnity.............................................................................27
(l) Severability...................................................................................28
(m) Securities Held by the Company or Its Affiliates...............................................28
i
<Page>
(n) Third Party Beneficiaries......................................................................28
(o) Entire Agreement...............................................................................28
</Table>
ii
<Page>
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (the "AGREEMENT") is dated
as of April ?, 2001, among Preem Holdings AB (publ), a company organized under
the laws of the Kingdom of Sweden (the "COMPANY") and Deutsche Bank AG London
and UBS Warburg Ltd. (together, the "INITIAL PURCHASERS").
This Agreement is entered into in connection with the Purchase
Agreement, dated as of March ?, 2001, among the Company and the Initial
Purchasers (the "PURCHASE AGREEMENT"), which provides for the sale by the
Company to the Initial Purchasers of its EURO225,000,000% [ ] Senior Secured
Notes due 2011 (the "Securities"). The Securities are to be issued under an
indenture dated as of April ?, 2001 (the "INDENTURE"), between the Company and
Bankers Trust Company, as Trustee. In order to induce the Initial Purchasers to
enter into the Purchase Agreement, the Company has agreed to provide the
registration rights set forth in this Agreement for the benefit of the Initial
Purchasers and their direct and indirect transferees and assigns.
The parties hereby agree as follows:
1. DEFINITIONS
Unless otherwise defined herein, terms defined in the
Indenture shall be used herein as defined therein. As used in this Agreement,
the following terms shall have the following meanings:
"ADVICE": As defined in Section 5 hereof.
"AGREEMENT": As defined in the first introductory paragraph
hereof.
"APPLICABLE PERIOD": As defined in Section 2(b) hereof.
"BUSINESS DAY": A day other than a Saturday, Sunday, or other
day in which commercial banking institutions are authorized or required
by law to close in New York City, Stockholm, Sweden, London or
Luxembourg.
"CLEARSTREAM": Clearstream Banking, SOCIETE ANONYME.
"COMMON DEPOSITARY": As defined in Section 5(i) hereof.
"COMPANY": As defined in the first introductory paragraph
hereto.
"EFFECTIVENESS PERIOD": As defined in Section 3(a) hereof.
"EFFECTIVENESS TARGET DATE": The 180th day after the Issue
Date.
"EUROCLEAR": Morgan Guaranty Trust Company of New York,
Brussels office, as operator of the Euroclear System.
"EVENT DATE": As defined in Section 4(b) hereof.
MANNHEIMER SWARTLING ADVOKATBYRA
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"EXCHANGE ACT": The Securities Exchange Act of 1934, as
amended, and the rules and regulations of the SEC promulgated
thereunder.
"EXCHANGE OFFER": As defined in Section 2(a) hereof.
"EXCHANGE OFFER REGISTRATION STATEMENT": As defined in
Section 2(a) hereof.
"EXCHANGE SECURITIES": As defined in Section 2(a) hereof.
"FILING DATE": The 75th day after the Issue Date.
"HOLDER": Any holder of Transfer Restricted Securities.
"INDENTURE": As defined in the second introductory paragraph
hereto.
"INITIAL PURCHASERS": As defined in the first introductory
paragraph hereto.
"INSPECTORS": As defined in Section 5(o) hereof.
"ISSUE DATE": The date of the issuance of the Securities
under the Indenture.
"LIQUIDATED DAMAGES": As defined in Section 4(a) hereof.
"NASD": As defined in Section 5(s) hereof.
"PARTICIPANT": As defined in Section 7(a) hereof.
"PARTICIPATING BROKER-DEALER": As defined in Section 2(b)
hereof.
"PERSON": An individual, trustee, corporation, partnership,
limited liability company, joint stock company, trust, unincorporated
association, union, business association, firm or other legal entity.
"PRIVATE EXCHANGE": As defined in Section 2(b) hereof.
"PRIVATE EXCHANGE SECURITIES": As defined in Section 2(b)
hereof.
"PROSPECTUS": The prospectus included in any Registration
Statement (including, without limitation, any prospectus subject to
completion and a prospectus that includes any information previously
omitted from a prospectus filed as part of an effective registration
statement in reliance upon Rule 430A promulgated under the Securities
Act), as amended or supplemented by any prospectus supplement, and all
other amendments and supplements to the Prospectus, including
post-effective amendments, and all material incorporated by reference
or deemed to be incorporated by reference in such Prospectus.
"PURCHASE AGREEMENT": As defined in the second introductory
paragraph hereto.
"RECORDS": As defined in Section 5(o) hereof.
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"REGISTRATION STATEMENT": Any registration statement of the
Company, including, but not limited to, the Exchange Offer Registration
Statement or the Shelf Registration Statement, filed with the SEC
pursuant to the provisions of this Agreement, including the Prospectus,
amendments and supplements to such registration statement, including
post-effective amendments, all exhibits, and all material incorporated
by reference or deemed to be incorporated by reference in such
registration statement.
"RULE 144": Rule 144 promulgated under the Securities Act, as
such Rule may be amended from time to time, or any similar rule (other
than Rule 144A) or regulation hereafter adopted by the SEC providing
for offers and sales of securities made in compliance therewith
resulting in offers and sales by subsequent holders that are not
affiliates of an issuer of such securities being free of the
registration and prospectus delivery requirements of the Securities
Act.
"RULE 144A": Rule 144A promulgated under the Securities Act,
as such Rule may be amended from time to time, or any similar rule
(other than Rule 144) or regulation hereafter adopted by the SEC.
"RULE 415": Rule 415 promulgated under the Securities Act, as
such Rule may be amended from time to time, or any similar rule or
regulation hereafter adopted by the SEC.
"SEC": The U.S. Securities and Exchange Commission.
"SECURITIES": As defined in the second introductory paragraph
hereto.
"SECURITIES ACT": The United States Securities Act of 1933,
as amended, and the rules and regulations of the SEC promulgated
thereunder.
"SHELF NOTICE": As defined in Section 2(c) hereof.
"SHELF REGISTRATION STATEMENT": As defined in Section 3(a)
hereof.
"TRANSFER RESTRICTED SECURITIES": Each Security until the
earliest to occur of (i) the date on which such Security has been
exchanged by a Person (other than a Participating Broker-Dealer) for
Exchange Securities in the Exchange Offer, (ii) following the exchange
by a Participating Broker-Dealer in the Exchange Offer of such Security
for one or more Exchange Securities, the date on which such Exchange
Securities are sold to a purchaser who receives from such Participating
Broker-Dealer on or prior to the date of such sale a copy of the
Prospectus, (iii) the date on which such Security has been effectively
registered under the Securities Act and disposed of in accordance with
the Shelf Registration Statement or (iv) the date on which such
Security is eligible for distribution to the public pursuant to Rule
144 under the Securities Act.
"TRUST INDENTURE ACT": The Trust Indenture Act of 1939, as
amended.
"TRUSTEE": The trustee, in its capacity as such, under the
Indenture and, if existent, the trustees under any indenture governing
the Exchange Securities and Private Exchange
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Securities (if any); the trustee under the Indenture for the Securities
shall initially be Bankers Trust Company.
"UNDERWRITTEN REGISTRATION OR UNDERWRITTEN OFFERING": A
registration in which securities of the Company are sold to an
underwriter for reoffering to the public.
2. EXCHANGE OFFER
(a) The Company agrees to file at its sole cost and expense
with the SEC no later than the Filing Date, unless prohibited by applicable law
or SEC policy, an offer to exchange (the "EXCHANGE OFFER") any and all of the
Transfer Restricted Securities (other than Private Exchange Securities, if any)
for a like aggregate principal amount of Securities of the Company, which are
substantially identical in all material respects to the Securities (the
"EXCHANGE SECURITIES") and which are entitled to the benefits of the Indenture
or a trust indenture which is substantially identical in all material respects
to the Indenture (other than such changes to such Indenture or any such
identical trust indenture as are necessary to comply with any requirements of
the SEC to effect or maintain the qualification thereof under the Trust
Indenture Act) and which, in either case, has been qualified under the Trust
Indenture Act, except that the Exchange Securities (other than Private Exchange
Securities, if any) shall have been registered pursuant to an effective
Registration Statement under the Securities Act and shall contain no restrictive
legend thereon. The Exchange Offer shall be registered under the Securities Act
on the appropriate form (the "EXCHANGE OFFER REGISTRATION STATEMENT") and shall
comply with all applicable tender offer rules and regulations under the Exchange
Act. The Company agrees to (i) file (or submit on a confidential basis) the
Exchange Offer Registration Statement with the SEC on or prior to 75 days after
the Issue Date; (ii) use its reasonable best efforts to cause the Exchange Offer
Registration Statement to be declared effective under the Securities Act on or
before the Effectiveness Target Date; (iii) (A) file all pre-effective
amendments to such Registration Statement as may be necessary in order to cause
such Registration Statement to become effective, (B) file, if applicable, a
post-effective amendment to such Registration Statement pursuant to Rule 430A
under the Securities Act and (C) cause all necessary filings in connection with
the registration and qualifications of the Exchange Securities to be made under
the blue sky laws of such jurisdictions as are necessary to permit consummation
of the Exchange Offer; and (iv) use its reasonable best efforts to consummate
the Exchange Offer on or prior to 30 days after the date on which the Exchange
Offer Registration Statement is declared effective by the SEC. Upon the Exchange
Offer Registration Statement being declared effective, the Company will offer
the Exchange Securities in exchange for surrender of the Securities. If after
such Exchange Offer Registration Statement is declared effective by the SEC, the
Exchange Offer or the issuance of the Exchange Securities thereunder is
interfered with by any stop order, injunction or other order or requirement of
the SEC or any other governmental agency or court, such Exchange Offer
Registration Statement shall be deemed not to have become effective for purposes
of this Agreement. Each Holder who participates in the Exchange Offer will be
required to represent that (i) any Exchange Securities received by it will be
acquired in the ordinary course of its business, (ii) it has no arrangement or
understanding with any Person to participate in the distribution (within the
meaning of the Securities Act) of the Exchange Securities, (iii) it is not an
"affiliate" (as defined in Rule 405 under the Securities Act) of the Company or,
if it is such an affiliate, it will comply with the registration and prospectus
delivery requirements of the Securities Act to the extent applicable and (iv) it
is not acting on behalf of any Person who could not truthfully
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make the foregoing representations. If such Holder is not a broker-dealer,
such Holder will be required to represent that it is not engaged in, and does
not intend to engage in, the distribution of the Exchange Securities. If such
Holder is a broker-dealer that will receive Exchange Securities for its own
account in exchange for Securities that were acquired as a result of
market-making activities or other trading activities, it will be required to
acknowledge that it will deliver a prospectus in connection with any resale
of such Exchange Securities. Upon consummation of the Exchange Offer in
accordance with this Section 2, the Company shall have no further obligation
to register Transfer Restricted Securities (other than Private Exchange
Securities and other than in respect of any Exchange Securities as to which
clause 2(c)(iv) hereof applies) pursuant to Section 3 hereof. No securities
other than the Exchange Securities shall be included in the Exchange Offer
Registration Statement.
(b) The Company shall include within the Prospectus contained
in the Exchange Offer Registration Statement a section entitled "Plan of
Distribution," reasonably acceptable to the Initial Purchasers, which shall
contain a summary statement of the positions taken or policies made by the Staff
of the SEC with respect to the potential "underwriter" status of any
broker-dealer that is the beneficial owner (as defined in Rule 13d-3 under the
Exchange Act) of Exchange Securities received by such broker-dealer in the
Exchange Offer (a "PARTICIPATING BROKER-DEALER"), whether such positions or
policies have been publicly disseminated by the Staff of the SEC or such
positions or policies, in the judgment of the Initial Purchasers, represent the
prevailing views of the Staff of the SEC. Such "Plan of Distribution" section
shall also expressly permit the use of the Prospectus by all Persons subject to
the prospectus delivery requirements of the Securities Act, including all
Participating Broker-Dealers (unless such Participating Broker-Dealer will be
reselling an unsold allotment from the original sale of the Securities), and
include a statement describing the means by which Participating Broker-Dealers
may resell the Exchange Securities.
After the consummation of the Exchange Offer, the Company
shall use its best efforts to keep the Exchange Offer Registration Statement
effective and to amend and supplement the Prospectus contained therein, in order
to permit such Prospectus to be lawfully delivered by any Participating
Broker-Dealer subject to the prospectus delivery requirements of the Securities
Act and other Persons, if any, with similar prospectus delivery requirements for
such period of time as is necessary to comply with applicable law in connection
with any resale of the Exchange Securities; PROVIDED, HOWEVER, that such period
shall not exceed 180 days after the consummation of the Exchange Offer (or such
longer period if extended pursuant to the last paragraph of Section 5 hereof)
(the "APPLICABLE PERIOD").
If, prior to consummation of the Exchange Offer, the Initial
Purchasers hold any Securities acquired by them and having, or which are
reasonably likely to be determined to have, the status of an unsold allotment in
the initial distribution, the Company, upon the written request of the Initial
Purchasers simultaneously with the delivery of the Exchange Securities in the
Exchange Offer, shall issue and deliver to the Initial Purchasers in exchange
(the "PRIVATE EXCHANGE") for such Securities held by the Initial Purchasers a
like principal amount of Securities of the Company, that are substantially
identical in all material respects to the Exchange Securities (the "PRIVATE
EXCHANGE SECURITIES") (and which are issued pursuant to the same indenture as
the Exchange Securities) except for the placement of a restrictive legend on
such Private Exchange Securities. The Private Exchange Securities shall bear the
same CUSIP number, if any, ISIN number and Common Code as
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the Exchange Securities to the extent permitted by the CUSIP Service Bureau
of Standard & Poor's and other applicable organizations.
Interest on the Exchange Securities and the Private Exchange
Securities will accrue from the last interest payment date on which interest was
paid on the Securities surrendered in exchange therefor or if no interest has
been paid on the Securities from the Issue Date.
In connection with the Exchange Offer, the Company shall:
(1) mail to each Holder a copy of the Prospectus forming part
of the Exchange Offer Registration Statement, together with an appropriate
letter of transmittal and related documents;
(2) utilize the services of a depositary for the Exchange
Offer with an address in London, England, which may be either the Trustee or an
affiliate of the Trustee;
(3) permit Holders to withdraw tendered Securities at any
time prior to the close of business, London time, on the last business day on
which the Exchange Offer shall remain open; and
(4) otherwise comply in all material respects with all
applicable laws, rules and regulations.
As soon as practicable after the close of the Exchange Offer
or the Private Exchange, as the case may be, the Company shall:
(1) accept for exchange all Securities tendered and not
validly withdrawn pursuant to the Exchange Offer or the Private Exchange;
(2) deliver to the Trustees or Authenticating Agent for
cancellation of all Securities so accepted for exchange; and
(3) cause each Trustee promptly to authenticate and deliver to
each Holder of the Securities, Exchange Securities or Private Exchange
Securities, as the case may be, in global form in aggregate principal amount
equal to the respective Securities so accepted for exchange, as further set
forth in the Indenture.
The Exchange Securities and the Private Exchange Securities
may be issued under (i) the Indenture or (ii) indenture substantially identical
in all material respects to the Indenture which in either event shall provide
that (1) the Exchange Securities shall not be subject to the transfer
restrictions set forth in the Indenture and (2) the Private Exchange Securities
shall be subject to the transfer restrictions set forth in the Indenture. The
Indenture or such indenture substantially identical in all material respects to
the Indenture shall provide that the Exchange Securities, Private Exchange
Securities and Securities shall vote and consent together on all matters as one
class and that none of the Exchange Securities, Private Exchange Securities or
Securities will have the right to vote or consent as a separate class on any
matter.
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(c) If (i) the Company is not permitted to file the Exchange
Offer Registration Statement or to consummate the Exchange Offer because the
Exchange Offer is not permitted by applicable law or SEC policy, (ii) any Holder
of Transfer Restricted Securities that is a "qualified institutional buyer" (as
defined in Rule 144A under the Securities Act) notifies the Company at least 20
Business Days prior to the consummation of the Exchange Offer that (a)
applicable law or SEC policy prohibits such Holder from participating in the
Exchange Offer, (b) such Holder may not resell the Exchange Securities acquired
by it in the Exchange Offer to the public without delivering a prospectus and
the prospectus contained in the Exchange Offer Registration Statement is not
appropriate or available for such resales by such Holder or (c) such Holder is a
broker-dealer and holds Securities acquired directly from the Company or an
affiliate of the Company, (iii) the Exchange Offer is not for any other reason
consummated within 210 days after the Issue Date, or (iv) the Exchange Offer has
been completed and in the opinion of counsel for the Initial Purchasers a
Registration Statement must be filed and a prospectus must be delivered by the
Initial Purchasers in connection with any offering or sale of Transfer
Restricted Securities, then the Company shall promptly deliver written notice
thereof (the "SHELF NOTICE") to the Trustees and in the case of clauses (i) and
(iii), all Holders and, in the case of clauses (ii) and (v) the affected
Holders, and shall at its own cost file a Shelf Registration Statement pursuant
to Section 3 hereof.
3. SHELF REGISTRATION STATEMENT
If a Shelf Notice is delivered as contemplated by Section 2(c)
hereof, then:
(a) The Company will use its reasonable best efforts to: (A)
file with the SEC a Registration Statement for an offering to be made on a
continuous basis pursuant to Rule 415 covering all of the Transfer Restricted
Securities (the "SHELF REGISTRATION STATEMENT"), within 90 days of the earliest
to occur of clauses (i) through (iv) in Section 2(c) above and (B) cause the
Shelf Registration Statement to be declared effective by the SEC on or prior to
the 150th day after such obligation arises; PROVIDED, HOWEVER, that if the
Company files a Shelf Registration Statement pursuant to this Section 3(a), it
need not abandon the attempt to cause the SEC to declare the Exchange Offer
Registration Statement effective, and it may satisfy its obligations to register
the Securities pursuant to this Agreement either by complying with Section 2
and/or Section 3. If the Company shall not have yet filed an Exchange Offer
Registration Statement, the Company shall use its best efforts to file with the
SEC the Shelf Registration Statement on or prior to the Filing Date. The Shelf
Registration Statement shall be on Form F-1 or another appropriate form
permitting registration of such Transfer Restricted Securities for resale by
Holders in the manner or manners designated by them (including, without
limitation, one or more underwritten offerings), or may be an amendment to the
Exchange Offer Registration Statement. The Company shall not permit any
securities other than the Transfer Restricted Securities to be included in the
Shelf Registration Statement.
The Company shall use its reasonable best efforts to keep the
Shelf Registration Statement continuously effective, supplemented and amended to
ensure that it is available for resales of Securities by the holders of Transfer
Restricted Securities entitled to this benefit and to ensure that such Shelf
Registration Statement conforms and continues to conform with the requirements
of this Agreement, the Securities Act and the policies, rules and regulations of
the SEC, as announced from time to time, until the second anniversary of the
Issue Date, subject to extension pursuant to the last paragraph of Section 5
hereof (the "EFFECTIVENESS PERIOD"), or such
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shorter period ending when all Transfer Restricted Securities covered by the
Shelf Registration Statement have been sold in the manner set forth and as
contemplated in the Shelf Registration Statement or when the Transfer
Restricted Securities become eligible for resale pursuant to Rule 144 under
the Securities Act without volume restrictions, if any.
(b) If the Shelf Registration Statement ceases to be effective
for any reason at any time during the Effectiveness Period (other than because
of the sale of all of the securities registered thereunder), the Company shall
use its best efforts to obtain the prompt withdrawal of any order suspending the
effectiveness thereof.
(c) The Company shall promptly supplement and amend the Shelf
Registration Statement if required by the rules, regulations or instructions
applicable to the registration form used for such Shelf Registration Statement,
if required by the Securities Act, or if reasonably requested by the Holders of
a majority in aggregate principal amount of the Transfer Restricted Securities
covered by such Registration Statement or by any underwriter of such Transfer
Restricted Securities based on a reasonable belief that such supplement or
amendment is required by law.
4. LIQUIDATED DAMAGES
(a) The Company and the Initial
Purchasers agree that the Holders of Securities will suffer damages if
the Company fails to fulfill its obligations under Section 2 or Section
3 hereof and that it would not be feasible to ascertain the extent of
such damages with precision. Accordingly, the Company agrees to pay, as
liquidated damages, additional interest on the Securities ("LIQUIDATED
DAMAGES") under the circumstances and to the extent set forth below
(each of which shall be given independent effect and shall not be
duplicative):
(i) if neither the Exchange Offer Registration
Statement nor the Shelf Registration Statement has been filed on or
prior to the Filing Date, then, commencing on the 76th day after the
Issue Date, Liquidated Damages shall accrue on the Securities over and
above the stated interest at a rate of 0.50% per annum for the first 90
days immediately following the Filing Date, such Liquidated Damages
rate increasing by an additional 0.50% per annum at the beginning of
each subsequent 90-day period, or part thereof;
(ii) if neither the Exchange Offer Registration
Statement nor the Shelf Registration Statement is declared effective by
the SEC on or prior to the Effectiveness Target Date, then, commencing
on the 181st day after the Issue Date, Liquidated Damages shall accrue
on the Securities included or which should have been included in such
Registration Statement over and above the stated interest at a rate of
0.50% per annum for the first 90 days immediately following the
Effectiveness Target Date, such Liquidated Damages rate increasing by
an additional 0.50% per annum at the beginning of each subsequent
90-day period, or part thereof; or
(iii) if the Exchange Offer has not been consummated
within 30 days after the Effectiveness Target Date with respect to the
Exchange Offer Registration Statement,
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Liquidated Damages shall accrue on the Securities over and above the
stated interest at a rate of 0.50% per annum for the first 90 days
commencing on the 31st day after the Effectiveness Target Date, such
Liquidated Damages rate increasing by an additional 0.50% per annum
at the beginning of each subsequent 90-day period, or part thereof;
or
(iv) (A) the Exchange Offer Registration Statement is
filed and declared effective but thereafter ceases to be effective or
fails to be usable for its intended purpose at any time prior to the
time that the Exchange Offer is consummated and is not succeeded within
5 Business Days by an additional Registration Statement filed and
declared effective or (B) the Shelf Registration Statement is filed and
declared effective but thereafter ceases to be effective or fails to be
usable for its intended purpose at any time during the Effectiveness
Period and is not succeeded within 5 Business Days by an additional
Registration Statement filed and declared effective, Liquidated Damages
shall accrue on the Securities over and above the stated interest rate
at a rate of 0.50% per annum for the first 90 days commencing on the
day the applicable Registration Statement ceases to be effective or
usable for its intended purpose without being declared effective again
within 5 Business Days, such Liquidated Damages rate increasing by an
additional 0.50% per annum at the beginning of each such subsequent
90-day period, or part thereof (it being understood and agreed that,
notwithstanding any provision to the contrary, so long as any Note that
is the subject of a Shelf Notice is then covered by an effective Shelf
Registration Statement, no Liquidated Damages shall accrue on such
Note); PROVIDED, HOWEVER, that Liquidated Damages may accrue at a
maximum rate of 2% per annum of the principal amount of Securities; and
PROVIDED, FURTHER, that (1) upon the filing of the Exchange Offer
Registration Statement or a Shelf Registration Statement as required
hereunder (in the case of clause (i) of this Section 4(a)), (2) upon
the effectiveness of the Exchange Offer Registration Statement or the
Shelf Registration Statement as required hereunder (in the case of
clause (ii) of this Section 4(a)), (3) upon the consummation of the
Exchange Offer (in the case of clause (iii) of this Section 4(a)), and
(4) upon the effectiveness or usability of the Exchange Offer
Registration Statement which had ceased to remain effective or be
usable (in the case of clause (iv)(A) of this Section 4(a)), or upon
the effectiveness or usability of the Shelf Registration Statement
which had ceased to remain effective or be usable (in the case of
clause (iv)(B) of this Section 4(a)), Liquidated Damages on the
affected Securities as a result of such clause (or the relevant
subclause thereof), as the case may be, shall cease to accrue.
(b) The Company shall notify the Trustee and
each Paying Agent within 5 Business Days after each and every date on which an
event occurs in respect of which Liquidated Damages is required to be paid (an
"EVENT DATE"). Any amounts of Liquidated Damages due pursuant to (a)(i),
(a)(ii), (a)(iii) or (a)(iv) of this Section 4 will be payable as set forth in
the Indenture and the Notes semi-annually on each April 15 and October 15 (to
the holders of record on the April 1 and October 1 immediately preceding such
dates), commencing with the first such date occurring after any such Liquidated
Damages commences to accrue. The amount of Liquidated Damages will be determined
by multiplying the applicable Liquidated Damages rate by the principal amount of
the affected Securities of such Holders, multiplied by a fraction, the numerator
of which is the number of days such Liquidated Damages rate was applicable
during such period (determined on the basis of a 360-day year comprised of
twelve 30-day months and, in the case of a partial month, the actual number of
days elapsed), and the denominator of which is 360. The
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Company shall notify the Trustee within 5 Business Days of the cessation of
any requirement to pay Liquidated Damages hereunder.
(c) Upon both commencement and completion of the
Exchange Offer, the Company will provide notice thereof (if and so long as the
Securities are listed on the Luxembourg Stock Exchange and the rules of such
stock exchange shall so require) by publication in a newspaper having a general
circulation in Luxembourg (which is expected to be the LUXEMBURGER WORT).
5. REGISTRATION PROCEDURES
In connection with the filing of any Registration Statement
pursuant to Sections 2 or 3 hereof, the Company shall effect such
registration(s) to permit the sale of the securities covered thereby in
accordance with the intended method or methods of disposition thereof, and
pursuant thereto and in connection with any Registration Statement filed by the
Company hereunder the Company shall:
(a) Prepare and file with the SEC prior to the Filing
Date, a Registration Statement or Registration Statements as prescribed by
Sections 2 or 3 hereof, and use its best efforts to cause each such Registration
Statement to become effective and remain effective as provided herein; PROVIDED,
HOWEVER, that, if (1) such filing is pursuant to Section 3 hereof, or (2) a
Prospectus contained in an Exchange Offer Registration Statement filed pursuant
to Section 2 hereof is required to be delivered under the Securities Act by any
Participating Broker-Dealer who seeks to sell Exchange Securities during the
Applicable Period, before filing any Registration Statement or Prospectus or any
amendments or supplements thereto, the Company shall furnish to and afford the
Holders of the Transfer Restricted Securities covered by such Registration
Statement or each such Participating Broker-Dealer, as the case may be, their
counsel and the managing underwriters, if any, a reasonable opportunity to
review copies of all such documents (including copies of any documents to be
incorporated by reference therein and all exhibits thereto) proposed to be filed
(in each case at least 5 Business Days prior to such filing).
(b) Prepare and file with the SEC such amendments and
post-effective amendments to each Shelf Registration Statement or Exchange Offer
Registration Statement, as the case may be, as may be necessary to keep such
Registration Statement continuously effective for the Effectiveness Period or
the Applicable Period or until consummation of the Exchange Offer, as the case
may be; cause the related Prospectus to be supplemented by any Prospectus
supplement required by applicable law, and as so supplemented to be filed
pursuant to Rule 424 (or any similar provisions then in force) promulgated under
the Securities Act; and comply with the provisions of the Securities Act and the
Exchange Act applicable to it with respect to the disposition of all securities
covered by such Registration Statement as so amended or in such Prospectus as so
supplemented and with respect to the subsequent resale of any securities being
sold by a Participating Broker-Dealer covered by any such Prospectus.
Notwithstanding the foregoing, if the Board of Directors of the Company
determines in good faith that it is in the best interests of the Company not to
disclose the existence of or facts surrounding any proposed or pending material
event or transaction involving the Company or its subsidiaries, the Company may
(i) in the event a Shelf Registration Statement has been filed, allow the Shelf
Registration Statement to fail to be effective or usable as a result of such
nondisclosure for up to 60 days during the Effectiveness
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Period, but in no event for any period in excess of 30 consecutive days, and
(ii) in the event the Exchange Offer is consummated, allow the Exchange Offer
Registration Statement to fail to be effective or usable as a result of such
non-disclosure for up to 15 days during the Applicable Period. The Company
shall be deemed not to have used its best efforts to keep a Registration
Statement effective during the Applicable Period if it voluntarily takes any
action that would result in selling Holders of the Transfer Restricted
Securities covered thereby or Participating Broker-Dealers seeking to sell
Exchange Securities not being able to sell such Transfer Restricted
Securities or such Exchange Securities during that period unless such action
is required by applicable law or unless the Company complies with this
Agreement, including without limitation, the provisions of paragraph 5(k)
hereof and the last paragraph of this Section 5.
(c) If (1) a Shelf Registration Statement is filed pursuant to
Section 3 hereof, or (2) a Prospectus contained in an Exchange Offer
Registration Statement filed pursuant to Section 2 hereof is required to be
delivered under the Securities Act by any Participating Broker-Dealer who seeks
to sell Exchange Securities during the Applicable Period, notify the Holders of
Transfer Restricted Securities, or each such Participating Broker-Dealer, as the
case may be, their counsel and the managing underwriters, if any, promptly (but
in any event within 5 Business Days), and, if requested by such Persons, confirm
such notice in writing, (i) when a Prospectus or any Prospectus supplement or
post-effective amendment has been filed, and, with respect to a Registration
Statement or any post-effective amendment, when the same has become effective
under the Securities Act (including in such notice a written statement that any
Holder may, upon request, obtain, at the sole expense of the Company, one
conformed copy of such Registration Statement or post-effective amendment
including financial statements and schedules, documents incorporated or deemed
to be incorporated by reference and exhibits), (ii) of the issuance by the SEC
of any stop order suspending the effectiveness of a Registration Statement or of
any order preventing or suspending the use of any preliminary prospectus or the
initiation of any proceedings for that purpose, (iii) if at any time when a
prospectus is required by the Securities Act to be delivered in connection with
sales of the Transfer Restricted Securities or resales of Exchange Securities by
Participating Broker-Dealers, the representations and warranties of the Company
contained in any agreement (including any underwriting agreement), contemplated
by Section 5(n) hereof cease to be true and correct, (iv) of the receipt by the
Company of any notification with respect to the suspension of the qualification
or exemption from qualification of a Registration Statement or any of the
Transfer Restricted Securities or the Exchange Securities to be sold by any
Participating Broker-Dealer for offer or sale in any jurisdiction, or the
initiation or threatening of any proceeding for such purpose, (v) of the
happening of any event, the existence of any condition or any information
becoming known that makes any statement made in such Registration Statement or
related Prospectus or any document incorporated or deemed to be incorporated
therein by reference untrue in any material respect or that requires the making
of any changes in or amendments or supplements to such Registration Statement,
Prospectus or documents so that, in the case of the Registration Statement, it
will not contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements
therein not misleading, and that in the case of the Prospectus, it will not
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading, and
(vi) of the determination by the Company that a post-effective amendment to a
Registration Statement would be appropriate.
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(d) Use its best efforts to prevent the issuance of any order
suspending the effectiveness of a Registration Statement or of any order
preventing or suspending the use of a Prospectus or suspending the qualification
(or exemption from qualification) of any of the Transfer Restricted Securities
or the Exchange Securities for sale in any jurisdiction, and, if any such order
is issued, to use its best efforts to obtain the withdrawal of any such order at
the earliest possible moment.
(e) If a Shelf Registration Statement is filed pursuant to
Section 3 and if requested by the managing underwriter or underwriters (if any),
or the Holders of a majority in aggregate principal amount of the Transfer
Restricted Securities being sold in connection with an underwritten offering or
any Participating Broker-Dealer, (i) promptly incorporate in a prospectus
supplement or post-effective amendment such information as the managing
underwriter or underwriters (if any), such Holders, any Participating
Broker-Dealer or counsel for any of them determines is necessary to be included
therein, (ii) make all required filings of such prospectus supplement or such
post-effective amendment as soon as practicable after the Company has received
notification of the matters to be incorporated in such prospectus supplement or
post-effective amendment and (iii) supplement or make amendments to such
Registration Statement.
(f) If (l) a Shelf Registration Statement is filed pursuant to
Section 3 hereof, or (2) a Prospectus contained in an Exchange Offer
Registration Statement filed pursuant to Section 2 hereof is required to be
delivered under the Securities Act by any Participating Broker-Dealer who seeks
to sell Exchange Securities during the Applicable Period, furnish to each
selling Holder of Transfer Restricted Securities and to each such Participating
Broker-Dealer who so requests and to counsel and each managing underwriter, if
any, at the sole expense of the Company, one conformed copy of the Registration
Statement or Registration Statements and each post-effective amendment thereto,
including financial statements and schedules, and, if requested, all documents
incorporated or deemed to be incorporated therein by reference and all exhibits.
(g) If (l) a Shelf Registration Statement is filed pursuant to
Section 3 hereof, or (2) a Prospectus contained in an Exchange Offer
Registration Statement filed pursuant to Section 2 hereof is required to be
delivered under the Securities Act by any Participating Broker-Dealer who seeks
to sell Exchange Securities during the Applicable Period, deliver to each Holder
of Transfer Restricted Securities, or each such Participating Broker-Dealer, as
the case may be, their respective counsel, and the underwriters, if any, at the
sole expense of the Company, as many copies of the Prospectus or Prospectuses
(including each form of preliminary prospectus) and each amendment or supplement
thereto and any documents incorporated by reference therein as such Persons may
reasonably request; and, subject to the last paragraph of this Section 5, the
Company hereby consents to the use of such Prospectus and each amendment or
supplement thereto by each of the Holders of Transfer Restricted Securities or
each such Participating Broker-Dealer, as the case may be, and the underwriters
or agents, if any, and dealers (if any), in connection with the offering and
sale of the Transfer Restricted Securities covered by, or the sale by
Participating Broker-Dealers of the Exchange Securities pursuant to, such
Prospectus and any amendment or supplement thereto.
(h) Prior to any public offering of Transfer Restricted
Securities or Exchange Securities or any delivery of a Prospectus contained in
the Exchange Offer Registration Statement by any Participating Broker-Dealer who
seeks to sell Exchange Securities during the Applicable Period, use its
reasonable best efforts to register or qualify (and to cooperate with selling
Holders of
<Page>
Transfer Restricted Securities or each such Participating Broker-Dealer, as
the case may be, the managing underwriter or underwriters, if any, and their
respective counsel in connection with the registration or qualification (or
exemption from such registration or qualification) of such Transfer
Restricted Securities) for offer and sale under the securities or Blue Sky
laws of such jurisdictions within the United States as any selling Holder,
Participating Broker-Dealer, or the managing underwriter or underwriters
reasonably request; PROVIDED, HOWEVER, that where Exchange Securities held by
Participating Broker-Dealers or Transfer Restricted Securities are offered
other than through an underwritten offering, the Company agrees to cause its
counsel to perform Blue Sky investigations and file registrations and
qualifications required to be filed pursuant to this Section 5(h); keep each
such registration or qualification (or exemption therefrom) effective during
the period such Registration Statement is required to be kept effective and
do any and all other acts or things reasonably necessary or advisable to
enable the disposition in such jurisdictions of the Exchange Securities held
by Participating Broker-Dealers or the Transfer Restricted Securities covered
by the applicable Registration Statement; PROVIDED, HOWEVER, that the Company
shall not be required to (A) qualify generally to do business in any
jurisdiction where it is not then so qualified, (B) take any action that
would subject it to general service of process in any such jurisdiction where
it is not then so subject or (C) subject itself to taxation in any such
jurisdiction where it is not then so subject.
(i) If a Shelf Registration Statement is filed pursuant to
Section 3 hereof, cooperate with the selling Holders of Transfer Restricted
Securities and the managing underwriter or underwriters, if any, to facilitate
the timely preparation and delivery of certificates representing Transfer
Restricted Securities to be sold, which certificates shall not bear any
restrictive legends and shall be in a form eligible for deposit with the Common
Depositary; and enable such Transfer Restricted Securities to be in such
denominations and registered in such names as the managing underwriter or
underwriters, if any, or Holders may request.
(j) Use its reasonable best efforts to cause the Transfer
Restricted Securities covered by the Registration Statement and the Exchange
Securities to be registered with or approved by such other governmental agencies
or authorities as may be necessary to enable the selling Holders thereof or the
underwriter or underwriters, if any, to dispose of such Transfer Restricted
Securities or Exchange Securities, except as may be required solely as a
consequence of the nature of a selling Holder's business, in which case the
Company will cooperate in all reasonable respects with the filing of such
Registration Statement and the granting of such approvals.
(k) If (l) a Shelf Registration Statement is filed pursuant to
Section 3 hereof, or (2) a Prospectus contained in an Exchange Offer
Registration Statement filed pursuant to Section 2 hereof is required to be
delivered under the Securities Act by any Participating Broker-Dealer who seeks
to sell Exchange Securities during the Applicable Period, upon the occurrence of
any event contemplated by paragraph 5(c)(v) or 5(c)(vi) hereof, as promptly as
practicable prepare and (subject to Section 5(b) hereof) file with the SEC, at
the sole expense of the Company, a supplement or post-effective amendment to the
Registration Statement or a supplement to the related Prospectus or any document
incorporated or deemed to be incorporated therein by reference, or file any
other required document so that, as thereafter delivered to the purchasers of
the Transfer Restricted Securities being sold thereunder or to the purchasers of
the Exchange Securities to whom such Prospectus will be delivered by a
Participating Broker-Dealer, any such Prospectus will not contain an untrue
statement of a material fact or omit to state a material fact required to be
stated
<Page>
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
(l) Unless the rating in effect for the Securities is equally
applicable and in effect for the Exchange Securities and the Transfer Restricted
Securities, use its best efforts to cause the Transfer Restricted Securities
covered by a Registration Statement or the Exchange Securities, as the case may
be, to be rated with the appropriate rating agencies.
(m) Prior to the effective date of the first Registration
Statement relating to the Transfer Restricted Securities, provide a CUSIP
number, ISIN Code and Common Code for the Transfer Restricted Securities or
Exchange Securities, as the case may be.
(n) In connection with any underwritten offering of Transfer
Restricted Securities pursuant to a Shelf Registration Statement, enter into an
underwriting agreement as is customary in underwritten offerings of debt
securities similar to the Securities and take all such other actions as are
reasonably requested by the managing underwriter or underwriters in order to
facilitate the registration or the disposition of such Transfer Restricted
Securities and, in such connection, (i) make such representations and warranties
to, and covenants with, the underwriters with respect to the business of the
Company and its subsidiaries (including any acquired business, properties or
entity, if applicable) and the Registration Statement, Prospectus and documents,
if any, incorporated or deemed to be incorporated by reference therein, in each
case, as are customarily made by issuers to underwriters in underwritten
offerings of debt securities similar to the Securities, and confirm the same in
writing if and when requested; (ii) obtain the written opinion of counsel to the
Company and written updates thereof in form, scope and substance reasonably
satisfactory to the managing underwriter or underwriters, addressed to the
underwriters covering the matters customarily covered in opinions requested in
underwritten offerings of debt similar to the Securities and such other matters
as may be reasonably requested by the managing underwriter or underwriters;
(iii) obtain "comfort" letters and updates thereof in form, scope and substance
reasonably satisfactory to the managing underwriter or underwriters from the
independent certified public accountants of the Company (and, if necessary, any
other independent certified public accountants of any subsidiary of the Company
or of any business acquired by the Company for which financial statements and
financial data are, or are required to be, included or incorporated by reference
in the Registration Statement), addressed to each of the underwriters, such
letters to be in customary form and covering matters of the type customarily
covered in "comfort" letters in connection with underwritten offerings of debt
similar to the Securities and such other matters as reasonably requested by the
managing underwriter or underwriters; and (iv) if an underwriting agreement is
entered into, the same shall contain indemnification provisions and procedures
no less favorable than those set forth in Section 7 hereof (or such other
provisions and procedures acceptable to Holders of a majority in aggregate
principal amount of Transfer Restricted Securities covered by such Registration
Statement and the managing underwriter or underwriters or agents) with respect
to all parties to be indemnified pursuant to said Section, including, without
limitation, the Holders of Transfer Restricted Securities and the underwriters.
The above shall be done at each closing under such underwriting agreement, or as
and to the extent required thereunder.
(o) If (1) a Shelf Registration Statement is filed pursuant to
Section 3 hereof, or (2) a Prospectus contained in an Exchange Offer
Registration Statement filed pursuant to Section 2 hereof is required to be
delivered under the Securities Act by any Participating Broker-Dealer who
<Page>
seeks to sell Exchange Securities during the Applicable Period, make
available for inspection by any selling Holder of such Transfer Restricted
Securities being sold, or each such Participating Broker-Dealer, as the case
may be, any underwriter participating in any such disposition of Transfer
Restricted Securities, if any, and any attorney, accountant or other agent
retained by any such selling Holder or each such Participating Broker-Dealer,
as the case may be, or underwriter (collectively, the "INSPECTORS"), at the
offices where normally kept, during reasonable business hours, all financial
and other records, pertinent corporate documents and instruments of the
Company and its subsidiaries (collectively, the "RECORDS") as shall be
reasonably necessary to enable them to exercise any applicable due diligence
responsibilities, and cause the officers, directors and employees of the
Company and its subsidiaries to supply all information reasonably requested
by any such Inspector in connection with such Registration Statement. Records
that the Company determines, in good faith, to be confidential and any
Records that it notifies the Inspectors are confidential shall not be
disclosed by the Inspectors unless (i) the disclosure of such Records is
necessary to avoid or correct a misstatement or omission in such Registration
Statement, (ii) the release of such Records is ordered pursuant to a subpoena
or other order from a court of competent jurisdiction, (iii) disclosure of
such information is, in the opinion of counsel for any Inspector, necessary
or advisable in connection with any action, claim, suit or proceeding,
directly or indirectly, involving or potentially involving such Inspector and
arising out of, based upon, relating to, or involving this Agreement, or any
transactions contemplated hereby or arising hereunder or (iv) the information
in such Records has been made generally available to the public. Each selling
Holder of such Transfer Restricted Securities and each such Participating
Broker-Dealer will be required to agree that information obtained by it as a
result of such inspections shall be deemed confidential and shall not be used
by it as the basis for any market transactions in the securities of the
Company unless and until such information is generally available to the
public. Each selling Holder of such Transfer Restricted Securities and each
such Participating Broker-Dealer or underwriter, as the case may be, will be
required further to agree that it will, upon learning that disclosure of such
Records is sought in a court of competent jurisdiction, give notice to the
Company and allow the Company at its sole expense to undertake appropriate
action to prevent disclosure of the Records deemed confidential.
(p) Provide an indenture trustee for the Transfer Restricted
Securities or the Exchange Securities, as the case may be, and cause the
applicable Indenture or the trust indenture provided for in Section 2(a) hereof,
as the case may be, to be qualified under the Trust Indenture Act not later than
the effective date of the first Registration Statement relating to the Transfer
Restricted Securities; and in connection therewith, cooperate with the trustee
under any such indenture and the Holders of the Transfer Restricted Securities,
to effect such changes to such indenture as may be required for such indenture
to be so qualified in accordance with the terms of the Trust Indenture Act;
furnish the trustee with an officer's certificate certifying that such indenture
has been so qualified under the Trust Indenture Act and that the Transfer
Restricted Securities are the subject of a Registration Statement; and execute,
and use its reasonable best efforts to cause such trustee to execute, all
documents as may be required to effect such changes, and all other forms and
documents required to be filed with the SEC to enable such indenture to be so
qualified in a timely manner.
(q) Comply with all applicable rules and regulations of the
SEC and make generally available to its securityholders earnings statements
satisfying the provisions of Section 11(a) of the
<Page>
Securities Act and Rule 158 thereunder (or any similar rule promulgated under
the Securities Act) no later than 45 days after the end of any 12-month
period (or 90 days after the end of any 12-month period if such period is a
fiscal year) (i) commencing at the end of any fiscal quarter in which
Transfer Restricted Securities are sold to underwriters in a firm commitment
or best efforts underwritten offering and (ii) if not sold to underwriters in
such an offering, commencing on the first day of the first fiscal quarter of
the Company after the effective date of a Registration Statement, which
statements shall cover said 12-month periods.
(r) If an Exchange Offer or a Private Exchange is to be
consummated, upon delivery of the Transfer Restricted Securities by Holders to
the Company (or to such other Person as directed by the Company) in exchange for
the Exchange Securities or the Private Exchange Securities, as the case may be,
the Company shall mark, or cause to be marked, on such Transfer Restricted
Securities that such Transfer Restricted Securities are being cancelled in
exchange for the Exchange Securities or the Private Exchange Securities, as the
case may be; in no event shall such Transfer Restricted Securities be marked as
paid or otherwise satisfied.
(s) Cooperate with each seller of Transfer Restricted
Securities covered by any Registration Statement and each underwriter, if any,
participating in the disposition of such Transfer Restricted Securities and
their respective counsel in connection with any filings required to be made with
the National Association of Securities Dealers, Inc. (the "NASD").
(t) Use its best efforts to take all other steps necessary or
advisable to effect the registration of the Exchange Securities and/or Transfer
Restricted Securities covered by a Registration Statement contemplated hereby.
(u) Make an application to list the Exchange Securities on the
Luxembourg Stock Exchange and to use its best efforts to have the Exchange
Securities admitted to trading on the Luxembourg Stock Exchange as promptly as
practicable and thereafter maintained such listing.
The Company may require each seller of Transfer Restricted
Securities as to which any Shelf Registration Statement is being effected to (i)
furnish to the Company such information regarding such seller and the
distribution of such Transfer Restricted Securities and (ii) make such
representations, in each case as the Company may, from time to time, reasonably
request. The Company may exclude from such registration the Transfer Restricted
Securities of any seller who unreasonably fails to furnish such information or
make such representations within a reasonable time after receiving such request.
Each seller as to which any Shelf Registration Statement is being effected
agrees to furnish promptly to the Company all information required to be
disclosed in order to make the information previously furnished to the Company
by such seller not materially misleading.
Each Holder of Transfer Restricted Securities and each
Participating Broker-Dealer agrees by acquisition of such Transfer Restricted
Securities or Exchange Securities to be sold by such Participating
Broker-Dealer, as the case may be, that, upon actual receipt of any notice from
the Company of the happening of any event of the kind described in Section
5(c)(ii), 5(c)(iv), 5(c)(v) or 5(c)(vi) hereof, such Holder will forthwith
discontinue disposition of such Transfer Restricted Securities covered by such
Registration Statement or Prospectus or Exchange Securities to be sold by such
Holder or Participating Broker-Dealer, as the case may be, until such Holder's
or
<Page>
Participating Broker-Dealer's receipt of the copies of the supplemented or
amended Prospectus contemplated by Section 5(k) hereof, or until it is
advised in writing (the "ADVICE") by the Company that the use of the
applicable Prospectus may be resumed, and has received copies of any
amendments or supplements thereto. In the event the Company shall give any
such notice, each of the Effectiveness Period and the Applicable Period shall
be extended by the number of days during such periods from and including the
date of the giving of such notice to and including the date when each seller
of Transfer Restricted Securities covered by such Registration Statement or
Exchange Securities to be sold by such Participating Broker-Dealer, as the
case may be, shall have received (x) the copies of the supplemented or
amended Prospectus contemplated by Section 5(k) hereof or (y) the Advice.
6. REGISTRATION EXPENSES
(a) All fees and expenses incident to the performance
of or compliance with this Agreement by the Company shall be borne by the
Company whether or not the Exchange Offer Registration Statement or a Shelf
Registration Statement is filed or becomes effective, including, without
limitation, (i) all registration and filing fees (including, without limitation,
(A) fees with respect to filings required to be made with the NASD in connection
with an underwritten offering, (B) fees and expenses of compliance with state
securities or Blue Sky laws (including, without limitation, reasonable fees and
disbursements of counsel in connection with Blue Sky qualifications of the
Transfer Restricted Securities or Exchange Securities and determination of the
eligibility of the Transfer Restricted Securities or Exchange Securities for
investment under the laws of such jurisdictions (x) where the holders of
Transfer Restricted Securities are located, in the case of the Exchange
Securities, or (y) as provided in Section 5(h) hereof, in the case of Transfer
Restricted Securities or Exchange Securities to be sold by a Participating
Broker-Dealer during the Applicable Period)), and (C) all expenses and fees in
connection with the obtaining of any approval from any relevant authority in
Sweden; (ii) printing expenses, including, without limitation, the printing of
prospectuses if the printing of prospectuses is requested by the managing
underwriter or underwriters, if any, by the Holders of a majority in aggregate
principal amount of the Transfer Restricted Securities included in any
Registration Statement or by any Participating Broker-Dealer, as the case may
be, (iii) fees and disbursements of counsel for the Company and fees and
disbursements of special counsel for the sellers of Transfer Restricted
Securities (subject to the provisions of Section 6(b) hereof), (iv) fees and
disbursements of all independent certified public accountants referred to in
Section 5(n)(iii) hereof (including, without limitation, the expenses of any
special audit and "cold comfort" letters required by or incident to such
performance), (v) rating agency fees, if any, and any fees associated with
making the Exchange Securities eligible for trading through Euroclear and
Clearstream Banking, (vi) Securities Act liability insurance, if the Company
desires such insurance, (vii) reasonable fees and expenses of all other Persons
retained by the Company, (viii) internal expenses of the Company (including,
without limitation, all salaries and expenses of officers and employees of the
Company performing legal or accounting duties), (ix) the expense of any annual
audit, (x) the fees and expenses incurred in connection with the listing of the
securities to be registered on any securities exchange, including, without
limitation, the Luxembourg Stock Exchange, and (xi) the expenses relating to
printing, word processing and distributing all Registration Statements,
underwriting agreements, securities sales agreements, indentures and any other
documents necessary in order to comply with this Agreement.
<Page>
(b) The Company shall reimburse the Holders of the Transfer
Restricted Securities being registered in a Shelf Registration Statement for the
fees and disbursements of not more than one counsel (in addition to appropriate
local counsel) chosen by the Holders of a majority in aggregate principal amount
of the Transfer Restricted Securities to be included in such Registration
Statement (which counsel shall be Simpson Thacher & Bartlett unless otherwise
affirmatively stated by the Holders) and other out-of-pocket expenses of such
Holders of Transfer Restricted Securities incurred in connection with the
registration and sale of the Transfer Restricted Securities pursuant to a Shelf
Registration Statement or the exchange of Transfer Restricted Securities
pursuant to the Exchange Offer.
7. INDEMNIFICATION AND CONTRIBUTION
(a) The Company shall indemnify and hold harmless each
Holder of Transfer Restricted Securities offered pursuant to a Shelf
Registration Statement, each Participating Broker-Dealer selling Exchange
Securities during the Applicable Period and the Initial Purchasers, and their
respective affiliates, their respective officers, directors, employees,
representatives and agents, and each Person, if any, who controls any such
Person within the meaning of the Securities Act or the Exchange Act (each a
"PARTICIPANT"), from and against any loss, claim, damage or liability, joint or
several, or any action in respect thereof (including, without limitation, any
loss, claim, damage, liability or action relating to purchases and sales of
Transfer Restricted Securities and Exchange Securities as the case may be) to
which any such Holder, Broker-Dealer or Initial Purchaser may become subject,
whether commenced or threatened under the Securities Act, the Exchange Act, any
other supra-national, federal, regional, local and foreign statutory law or
regulation at common law or otherwise, insofar a such loss, claim, damage,
liability or action arises out of, or is based upon (i) any untrue statement or
alleged untrue statement of a material fact contained in any Registration
Statement or Prospectus, or any amendment or supplement thereto, or any related
preliminary prospectus, or in any blue sky application or other document
prepared or executed by the Company (or based upon any written information
furnished by the Company) specifically for the purpose of qualifying any or all
of the Transfer Restricted Securities under the securities laws of any state or
other jurisdiction (such application, document or information being hereinafter
called a "BLUE SKY APPLICATION"), or (ii) the omission or alleged omission to
state therein a material fact required to be stated therein or necessary in
order to make the statements therein not misleading, and shall reimburse each
Participant promptly upon demand for any legal or other costs, charges and
expenses reasonably incurred by that Participant in connection with
investigating or defending or preparing to defend against or appearing as a
third party witness in connection with any such loss, claim, damage, liability
or action as such expenses are incurred; PROVIDED, HOWEVER, that the Company
shall not be liable in any such case to the extent that any such loss, claim,
damage, liability or action arises out of, or is based upon, an untrue statement
or alleged untrue statement in or omission or alleged omission from the
Registration Statement or Prospectus, or in any such amendment or supplement, or
in any Blue Sky Application in reliance upon and in conformity with the written
information furnished to the Company by or on behalf of any Participant
specifically for inclusion therein; and PROVIDED, FURTHER, that with respect to
any such untrue statement in or omission from any preliminary prospectus the
indemnity agreement contained in this Section 7(a) shall not inure to the
benefit of any such Participant to the extent that the sale to the Person
asserting any such loss, claim, damage, liability or action was an initial
resale by such Participant and any such loss, claim, damage, liability or action
of or with respect to such
<Page>
Participant results from the fact that both (A) to the extent required by
applicable law, a copy of the Prospectus was not sent or given to such Person
at or prior to the written confirmation of the sale of such securities to
such Person and (B) the untrue statement in or omission from such preliminary
prospectus was corrected in the Prospectus unless, in either case, such
failure to deliver the Prospectus was a result of non-compliance by the
Company with Section 5(g) of this Agreement.
(b) Each Holder of Transfer Restricted Securities offered
pursuant to a Shelf-Registration Statement, each Participating Broker-Dealer
selling Exchange Securities during the Applicable Period and the Initial
Purchasers (each a "PARTICIPANT INDEMNIFYING PARTY") severally and not jointly,
shall indemnify and hold harmless the Company, its affiliates, their respective
officers, directors, employees, representatives and agents, and each Person, if
any, who controls the Company within the meaning of the Securities Act or the
Exchange Act (collectively referred to for purposes of this Section 7(b) and
Section 7(d) as the Company), from and against any loss, claim, damage or
liability, joint or several, or any action in respect thereof, to which the
Company or any such director, officer or controlling Person may become subject,
whether commenced or threatened under the Securities Act, the Exchange Act, any
other federal or state statutory law or regulation, at common law or otherwise,
insofar as such loss, claim, damage, liability or action arises out of, or is
based upon, (i) any untrue statement or alleged untrue statement of a material
fact contained (A) in any preliminary prospectus or the Registration Statement
or Prospectus, or in any amendment or supplement thereto, or (B) in any Blue Sky
Application or (ii) the omission or alleged omission to state therein, a
material fact required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, but in each case only to the extent that the untrue
statement or alleged untrue statement or omission or alleged omission was made
in reliance upon and in conformity with the written information furnished to the
Company by that Participant Indemnifying Party specifically for inclusion
therein, and shall reimburse the Company for any legal or other costs, charges
and expenses reasonably incurred by the Company in connection with investigating
or defending or preparing to defend against or appearing as a third party
witness in connection with any such loss, claim, damage, liability or action as
such expenses are incurred.
(c) Promptly after the receipt by an indemnified party under
this Section 7 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party pursuant to Section 7, notify the indemnifying party in
writing of the claim or the commencement of that action; PROVIDED, HOWEVER, that
the failure to notify the indemnifying party shall not relieve it from any
liability which it may have under this Section 7 except to the extent that it
has been materially prejudiced (through the forfeiture of substantive rights or
defenses) by such failure; and, PROVIDED, FURTHER, that the failure to notify
the indemnifying party shall not relieve it from any liability which it may have
to an indemnified party otherwise than under this Section 7. If any such claim
or action shall be brought against an indemnified party, and it shall notify the
indemnifying party thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it wishes, jointly with any other
similarly notified indemnifying party, to assume the defense thereof with
counsel reasonably satisfactory to the indemnified party. After notice from the
indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to
the indemnified party under this Section 7 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs
<Page>
of investigation; PROVIDED, HOWEVER, that an indemnified party shall have the
right to employ its own counsel in any such action, but the fees, expenses
and other charges of such counsel for the indemnified party will be at the
expense of such indemnified party unless (1) the employment of counsel by the
indemnified party has been authorized in writing by the indemnifying party,
(2) the indemnified party has reasonably concluded (based upon advice of
counsel to the indemnified party) that there may be legal defenses available
to it or other indemnified parties that are different from or in addition to
those available to the indemnifying party, (3) a conflict or potential
conflict exists (based upon advice of counsel to the indemnified party)
between the indemnified party and the indemnifying party (in which case the
indemnifying party will not have the right to direct the defense of such
action on behalf of the indemnified party) or (4) the indemnifying party has
not in fact employed counsel reasonably satisfactory to the indemnified party
to assume the defense of such action within a reasonable time after receiving
notice of the commencement of the action, in each of which cases the
reasonable fees, disbursements and other charges of counsel will be at the
expense of the indemnifying party or parties. It is understood that the
indemnifying party or parties shall not, in connection with any proceeding or
related proceedings in the same jurisdiction, be liable for the reasonable
fees, disbursements and other charges of more than one separate firm of
attorneys (in addition to any local counsel) at any one time for all such
indemnified party or parties. Each indemnified party, as a condition of the
indemnity agreements contained in sections 7(a) and 7(b) shall use all
reasonable efforts to cooperate with the indemnifying party in the defense of
any such action or claim. No indemnifying party shall be liable for any
settlement of any such action effected without its written consent (which
consent shall not be unreasonably withheld), but if settled with its written
consent or if there be a final judgment for the plaintiff in any such action,
the indemnifying party agrees to indemnify and hold harmless any indemnified
party from and against any loss or liability by reason of such settlement or
judgment. No indemnifying party shall, without the prior written consent of
the indemnified party (which consent shall not be unreasonably withheld),
effect any settlement of any pending or threatened proceeding in respect of
which any indemnified party is or could have been a party and indemnity could
have been sought hereunder by such indemnified party unless such settlement
includes an unconditional release of such indemnified party from all
liability on claims that are the subject matter of such proceedings.
(d) If the indemnification provided for in this Section 7
shall for any reason be unavailable to or insufficient to hold harmless an
indemnified party under Section 7(a) or 7(b), then each indemnifying party
shall, in lieu of indemnifying such indemnified party, contribute to the amount
paid or payable by such indemnified party as a result of such loss, claim,
damage or liability, or action in respect thereof, (i) in such proportion as
shall be appropriate to reflect the relative benefits received by the Company on
the one hand and the Participants on the other from the offering of the
Securities or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the relative
fault of the Company on the one hand and the Participants on the other with
respect to the statements or omissions which resulted in such loss, claim,
damage or liability, or action in respect thereof, as well as any other relevant
equitable considerations. The relative benefits received by the Company on the
one hand and the Participants on the other shall be deemed to be in the same
proportion as the total net proceeds from the offering of the Securities (before
deducting expenses) received by or on behalf of the Company bear on the one
hand, and the total underwriting discounts and commissions received by the
Initial Purchasers with respect to the Securities purchased under the Purchase
Agreement, on the other hand, bear to the total gross
<Page>
proceeds from the offering of the Securities under the Purchase Agreement.
The relative fault shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to the Company
or information supplied by the Company on the one hand or the Participants on
the other, the intent of the parties and their relative knowledge, access to
information and opportunity to correct or prevent such untrue statement or
omission. The Company and the Participants agree that it would not be just
and equitable if contributions pursuant to this Section 7(d) were to be
determined by PRO RATA allocation (even if the Participants were treated as
one entity for such purpose) or by any other method of allocation that does
not take into account the equitable considerations referred to herein. The
amount paid or payable by an indemnified party as a result of the loss,
claim, damage or liability, or action in respect thereof, referred to above
in this Section 7(d) shall be deemed to include, for purposes of this Section
7(d), any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending or preparing to defend
any such action or claim. Notwithstanding the provisions of this Section
7(d), no Participant shall be required to contribute any amount in excess of
the amount by which the total price at which the Securities purchased by it
were resold exceeds the amount of any damages which such Purchaser has
otherwise paid or become liable to pay by reason of any untrue or alleged
untrue statement or omission or alleged omission. No Person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any Person who was not
guilty of such fraudulent misrepresentation. The Participant's obligations to
contribute as provided in this Section 7(d) are several in proportion to
their respective purchase obligations and not joint.
The obligations of the Company and any Participant
Indemnifying Party in this Section 7 are in addition to any other liability that
the Company or any Participant Indemnifying Party, as the case may be, may
otherwise have, including in respect of any breaches of representations,
warranties and agreements made herein by any such party.
8. RULE 144A
The Company covenants to furnish to the holders of the
Securities and to prospective investors, upon the request of such holder, any
information required to be delivered pursuant to Rule 144A(d)(4) under the
Securities Act so long as the Securities are not freely transferable under the
Securities Act.
9. UNDERWRITTEN REGISTRATIONS
If any of the Transfer Restricted Securities covered by any
Shelf Registration Statement are to be sold in an underwritten offering, the
investment banker or investment bankers and manager or managers that will manage
the offering will be selected by the Holders of a majority in aggregate
principal amount of such Transfer Restricted Securities included in such
offering and shall be reasonably acceptable to the Company.
No Holder of Transfer Restricted Securities may participate in
any underwritten registration hereunder unless such Holder (a) agrees to sell
such Holder's Transfer Restricted Securities on the basis provided in any
underwriting arrangements approved by the Persons entitled hereunder to approve
such arrangements and (b) completes and executes all questionnaires, powers
<Page>
of attorney, indemnities, underwriting agreements and other documents
required under the terms of such underwriting arrangements.
10. MISCELLANEOUS
(a) NO INCONSISTENT AGREEMENTS. The Company
represents, warrants and agrees that it has not, as of the date hereof, nor will
it, after the date of this Agreement, enter into any agreement with respect to
any of its securities that is inconsistent with the rights granted to the
Holders of Transfer Restricted Securities in this Agreement or otherwise
conflicts with the provisions hereof. The Company will not enter into any
agreement with respect to any of its securities which will grant to any Person
piggy-back registration rights with respect to the Exchange Offer Registration
Statement or the Shelf Registration Statement.
(b) ADJUSTMENTS AFFECTING TRANSFER RESTRICTED
SECURITIES. The Company shall not, directly or indirectly,
take any action with respect to the Transfer Restricted
Securities as a class that would adversely affect the ability
of the Holders of Transfer Restricted Securities to include
such Transfer Restricted Securities in a registration
undertaken pursuant to this Agreement.
(c) AMENDMENTS AND WAIVERS. The provisions of this
Agreement may not be amended, modified or supplemented, and waivers or
consents to departures from the provisions hereof may not be given,
otherwise than with the prior written consent of (A) the Holders of not
less than a majority in aggregate principal amount of the then
outstanding Transfer Restricted Securities with respect to the Transfer
Restricted Securities and (B) in circumstances that would adversely
affect the Participating Broker-Dealers, the Participating
Broker-Dealers holding not less than a majority in aggregate principal
amount of the Exchange Securities held by all Participating
Broker-Dealers with respect to Exchange Securities; PROVIDED, HOWEVER,
that Section 7 and this Section 10(c) may not be amended, modified or
supplemented without the prior written consent of each Holder and each
Participating Broker-Dealer (including any Person who was a Holder or
Participating Broker-Dealer of Transfer Restricted Securities or
Exchange Securities, as the case may be, disposed of pursuant to any
Registration Statement). Notwithstanding the foregoing, a waiver or
consent to depart from the provisions hereof with respect to a matter
that relates exclusively to the rights of Holders of the Transfer
Restricted Securities whose securities are being sold pursuant to a
Registration Statement and that does not directly or indirectly affect,
impair, limit or compromise the rights of other Holders of Transfer
Restricted Securities may be given by Holders of at least a majority in
aggregate principal amount of the Transfer Restricted Securities being
sold by such Holders pursuant to such Registration Statement; PROVIDED,
HOWEVER, that the provisions of this sentence may not be amended,
modified or supplemented except in accordance with the provisions of
the immediately preceding sentence.
(d) NOTICES. All notices and other communications
(including, without limitation, any notices or other communications to
either Trustee) provided for or permitted hereunder shall be made in
writing by hand-delivery, registered first-class mail, next-day air
courier or facsimile:
<Page>
(1) if to a Holder of the Transfer Restricted Securities or
any Participating Broker-Dealer, at the most current address of such
Holder or Participating Broker-Dealer, as the case may be, set forth on
the records of the registrar under the applicable Indenture, with a
copy in like manner to the Initial Purchasers as follows:
Deutsche Bank AG London
Winchester House
1 Great Winchester Street
London, England EC2N 2DB
United Kingdom
Facsimile No: [ ]
Attention: [ ]
UBS Warburg Ltd.
1 Finsbury Avenue
London
EC2M 2PP
Facsimile No: [ ]
Attention: [ ]
with a copy to:
Simpson Thacher & Bartlett
One Ropemaker Street
21st Floor
London EC2Y 9HU
Facsimile No: 44-207-275-6502
Attention: Gregory W. Conway, Esq.
(2) if to the Initial Purchasers, at the addresses specified in
Section 10(d)(1);
(3) if to the Company, as follows:
Preem Holdings AB (publ)
Sandhamnsgatan 51
S-11560 Stockholm
Sweden
Facsimile No: [ ]
Attention: [ ]
with a copy to:
<Page>
Akin, Gump, Strauss, Hauer & Feld
One Angel Court
London EC2R 7HJ
Facsimile No.: 44 020 7726 9610
Attention: Stephen Hatfield, Esq.
Any such statements, requests, notices or agreements shall
take effect at the time of receipt thereof. The Company shall be entitled to act
and rely upon any request, consent, notice or agreement given or made on behalf
of the Initial Purchasers.
Copies of all such notices, demands or other communications
shall be concurrently delivered by the Person giving the same to each Trustee at
the address and in the manner specified in each Indenture.
(e) SUCCESSORS AND ASSIGNS. This Agreement shall inure to the benefit
of and be binding upon the successors and assigns of each of the
parties hereto and the Holders; PROVIDED, HOWEVER, that this Agreement
shall not inure to the benefit of or be binding upon a successor or
assign of a Holder unless and to the extent such successor or assign
holds Transfer Restricted Securities.
(f) COUNTERPARTS. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each
of which when so executed shall be deemed to be an original and all of
which taken together shall constitute one and the same agreement.
(g) HEADINGS. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning
hereof.
(h) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
(i) REMEDIES. In the event of a breach by the Company or by any Holder
of any of their obligations under this Agreement, each Holder or the
Company, as the case may be, in addition to being entitled to exercise
all rights granted by law, including recovery of damages (other than
the recovery of damages for a breach by the Company of its obligations
under Sections 2 or 3 hereof for which liquidated damages have been
paid pursuant to Section 4 hereof), will be entitled to specific
performance of its rights under this Agreement. The Company and each
Holder agree that monetary damages would not be adequate compensation
for any loss incurred by reason of a breach by it of any of the
provisions of this Agreement and hereby further agree that, in the
event of any action for specific performance in respect of such breach,
it shall waive the defense that a remedy at law would be adequate.
(j) SUBMISSION TO JURISDICTION; APPOINTMENT OF AGENT FOR SERVICE;
WAIVER. To the fullest extent permitted by applicable law, the Company
irrevocably submits to the non-exclusive jurisdiction of any federal or
state court in the Borough of Manhattan in the City
<Page>
of New York, County and State of New York, United States of America,
in any suit or proceeding based on or arising under this Agreement,
and irrevocably agrees that all claims in respect of such suit or
proceeding may be determined in any such court. The Company, to the
fullest extent permitted by applicable law, irrevocably and fully
waives the defense of an inconvenient forum to the maintenance of
such suit or proceeding and hereby irrevocably designates and
appoints CT Corporation (the "Authorized Agent"), for the later of a
period of ten years or until such time as no Notes are outstanding
as its authorized agent upon whom process may be served in any such
suit or proceeding. The Company represents that it has notified the
Authorized Agent of such designation and appointment and that the
Authorized Agent has accepted the same in writing. The Company
hereby irrevocably authorizes and directs its Authorized Agent to
accept such service. The Company further agrees that service of
process upon its Authorized Agent and written notice of said service
to the Company mailed by first class mail or delivered to its
Authorized Agent shall be deemed in every respect effective service
of process upon the Company in any such suit or proceeding. Nothing
herein shall affect the right of any person to serve process in any
other manner permitted by law. The Company agrees that a final
action in any such suit or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any
other lawful manner. Notwithstanding the foregoing, any action
against the Company arising out of or based on this Agreement or the
transactions contemplated hereby may also be instituted by any of
the Initial Purchasers, their respective officers and employees or
any person who controls any of the Initial Purchasers within the
meaning of the Securities Act in any competent court in the Kingdom
of Sweden, and the Company expressly accepts the jurisdiction of any
such court in any such action.
The Company hereby irrevocably waives, to the extent permitted
by law, any immunity to jurisdiction to which it may otherwise be entitled
(including, without limitation, immunity to pre-judgment attachment,
post-judgment attachment and execution) in any legal suit, action or proceeding
against it arising out of or based on this Agreement or the transactions
contemplated hereby.
The provisions of this Section 10(i) are intended to be
effective upon the execution of this Agreement without any further action by the
Company or the Initial Purchasers and the introduction of a true copy of this
Agreement into evidence shall be conclusive and final evidence as to such
matters.
(k) CURRENCY INDEMNITY. The Company shall indemnify each Participant
against any loss incurred by it as a result of any judgment or order
being given or made and expressed and paid in a currency (the "Judgment
Currency") other than Euros and as a result of any variation as between
(i) the rate of exchange at which the Euro amount is converted into the
Judgment Currency for the purpose of such judgment or order and (ii)
the spot rate of exchange in New York, New York at which such
Participant on the date of payment of such judgment or order is able to
purchase Euros with the amount of the Judgment Currency actually
received by such Participant. If the Euros so purchased are greater
than the amount originally due to such Participant hereunder, such
Participant agrees to pay to the Company an amount equal to the excess
of the Euros so purchased over the amount originally due to such
Participant hereunder. The foregoing shall constitute a separate and
independent
<Page>
obligation of the Company and the Participant, as the case may be,
and shall continue in full force and effect notwithstanding any such
judgment or order as aforesaid. The term "spot rate of exchange"
shall include any premiums and costs of exchange payable in
connection with the purchase of, or conversion into, Euros.
(l) SEVERABILITY. The remedies provided herein are cumulative and not
exclusive of any remedies provided by law. If any term, provision,
covenant or restriction of this Agreement is held by a court of
competent jurisdiction to be invalid, illegal, void or unenforceable,
the remainder of the terms, provisions, covenants and restrictions set
forth herein shall remain in full force and effect and shall in no way
be affected, impaired or invalidated, and the parties hereto shall use
their best efforts to find and employ an alternative means to achieve
the same or substantially the same result as that contemplated by such
term, provision, covenant or restriction. It is hereby stipulated and
declared to be the intention of the parties that they would have
executed the remaining terms, provisions, covenants and restrictions
without including any of such that may be hereafter declared invalid,
illegal, void or unenforceable.
(m) SECURITIES HELD BY THE COMPANY OR ITS AFFILIATES. Whenever the
consent or approval of Holders of a specified percentage of Transfer
Restricted Securities is required hereunder, Transfer Restricted
Securities held by the Company or its "affiliates" (as such term is
defined in Rule 405 under the Securities Act) shall not be counted in
determining whether such consent or approval was given by the Holders
of such required percentage.
(n) THIRD PARTY BENEFICIARIES. Holders of Transfer Restricted
Securities and Participating Broker-Dealers are intended third party
beneficiaries of this Agreement, and this Agreement may be enforced by
such Persons.
(o) ENTIRE AGREEMENT. This Agreement, together with the Purchase
Agreement and each Indenture, is intended by the parties as a final and
exclusive statement of the agreement and understanding of the parties
hereto in respect of the subject matter contained herein and therein
and any and all prior oral or written agreements, representations, or
warranties, contracts, understandings, correspondence, conversations
and memoranda between the Initial Purchasers on the one hand and the
Company on the other, or between or among any agents, representatives,
parents, subsidiaries, affiliates, predecessors in interest or
successors in interest with respect to the subject matter hereof and
thereof are merged herein and replaced hereby.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
PREEM HOLDINGS AB (PUBL)
By:
-----------------------------------------
Name:
Title:
By:
-----------------------------------------
Name:
Title:
<Page>
DEUTSCHE BANK AG LONDON
By:
--------------------------------
AUTHORIZED REPRESENTATIVE
UBS WARBURG LTD.
By:
--------------------------------
AUTHORIZED REPRESENTATIVE
<Page>
ANNEX B
DEBT RESTRUCTURING AGREEMENT
10 APRIL 2001
AMONG
CORRAL PETROLEUM HOLDINGS AB (PUBL)
AND
PREEM HOLDINGS AB (PUBL)
AND
PREEM PETROLEUM AB
<Page>
This DEBT RESTRUCTURING AGREEMENT is dated as of 10 April 2001 among:
CORRAL PETROLEUM HOLDINGS AB (PUBL), reg. no. 556477-1284, ("CORRAL");
PREEM HOLDINGS AB (PUBL), reg. no. 556206-9673, ("HOLDINGS"); and
PREEM PETROLEUM AB, reg. no. 556072-6977, ("PREEM PETROLEUM").
XXIII. Definitions and interpretation
1. DEFINITIONS
"AGREEMENT" means this Debt Restructuring
Agreement.
"ASSIGNED SHAREHOLDER LOAN AMOUNT" means the
outstanding amount under the Existing Shareholder Loan less the
Repaid Shareholder Loan Amount.
"BUSINESS DAY" means a day (other than a
Saturday or Sunday) which is not a public holiday and on which
banks are open for general business in Stockholm.
"EFFECTIVE DATE" means the day on which the
Gross Note Proceeds, after deduction of fees payable and expenses
reimbursable pursuant to the terms of the Purchase Agreement, are
payable to Holdings pursuant to the terms of the Purchase
Agreement.
"EURO" or "EUR" means the single currency of the
member states of the European Union that adopt the euro as its
currency in accordance with legislation of the European Union
relating to European Economic and Monetary Union.
"EXISTING SHAREHOLDER LOAN" means the
shareholder loan from Corral to Preem Petroleum in the total
principal amount of SEK 2,259 million, as evidenced by a loan
agreement dated 31 December 2000.
"GROSS NOTE PROCEEDS" means the total gross
amount payable to the Initial Purchasers (as defined in the
Purchase Agreement) upon the issuance of the Notes.
"NET NOTE PROCEEDS" means the Gross Note
Proceeds after deduction of (i) all fees, discounts, costs and
expenses incurred in connection
<Page>
with the issuance of the Notes, and (ii) an amount equal to
one interest payment on the Notes.
"NEW SHAREHOLDER LOAN NO. 1A" means the loan
under the Shareholder Loan Agreement No. 1A entered into on or
about the date hereof between Holdings as lender and Preem
Petroleum as borrower.
"NEW SHAREHOLDER LOAN NO. 1B" means any present
and future loan under the Shareholder Loan Agreement No. 1B
entered into on or about the date hereof between Holdings as
lender and Preem Petroleum as borrower.
"NEW SHAREHOLDER LOAN NO. 2" means the loan
under the Shareholder Loan Agreement No. 2 entered into on or
about the date hereof between Corral as lender and Holdings as
borrower.
"NOTES" means the notes issued under the
Indenture dated on or about the date hereof between Holdings and
the Trustee.
"PAYMENT AMOUNT" means SEK 2,259 million less
the SEK Equivalent of the difference between the Gross Note
Proceeds and the Net Note Proceeds.
"PURCHASE AGREEMENT" means the purchase
agreement dated 10 April 2001 among Holdings, Deutsche Bank AG,
London and UBS AG, acting through its business group UBS Warburg.
"REPAID SHAREHOLDER LOAN AMOUNT" means so much
of the outstanding amount under the Existing Shareholder Loan as
is equal to the Payment Amount.
"SEK EQUIVALENT" means an amount in euro
converted into Swedish Kronor at the spot rate of exchange for
purchasing Swedish Kronor with payment in euro and with delivery
on the Effective Date.
"SWEDISH KRONOR" or "SEK" means the lawful
currency of Sweden.
"TRUSTEE" means Bankers Trust Company.
2. INTERPRETATION
A. A reference in this Agreement or in any other
document referred to herein or delivered in
connection herewith to a statute or any provision
thereof shall refer also to that statute or provision
as amended or re-enacted.
<Page>
B. A reference in this Agreement or in any other
document referred to herein or delivered in
connection herewith to an agreement or document shall
refer also to such agreement or document as amended,
varied or supplemented and shall include all
appendices and other attachments.
XXIV. Disbursements
1. Holdings shall use the SEK Equivalent of the Net Note Proceeds
as a disbursement to Preem Petroleum for a part of the amount
of the New Shareholder Loan No. 1A.
2. Preem Petroleum shall use an amount disbursed by Holdings
pursuant to Clause 2.1 equal to the Payment Amount to repay
the Repaid Shareholder Loan Amount to Corral.
3. All rights to the Assigned Shareholder Loan Amount shall be
assigned by Corral to Holdings on the Effective Date, so that
the Assigned Shareholder Loan Amount is owed by Preem
Petroleum to Holdings.
4. The amount disbursed by Holdings to Preem Petroleum pursuant
to Clause 2.1 together with a part of the Assigned Shareholder
Loan Amount equal to the SEK Equivalent of the difference
between the Gross Note Proceeds and the Net Note Proceeds
shall constitute the New Shareholder Loan No. 1A.
5. Any remaining amount of the Assigned Shareholder Loan Amount
(after deduction of the amount referred to in Clause 2.4)
shall constitute the New Shareholder Loan No. 1B.
6. In consideration of the assignment of the Assigned Shareholder
Loan Amount pursuant to Clause 2.3, Holdings shall agree to
repay to Corral an amount equal to the Assigned Shareholder
Loan Amount. Such debt shall constitute the New Shareholder
Loan No. 2.
7. Following the transactions described in Clauses 2.1 to 2.6,
the following loans shall be in place:
(a) The New Shareholder Loan No. 1A owed by Preem Petroleum to
Holdings.
(b) The New Shareholder Loan No. 1B owed by Preem Petroleum to
Holdings.
(c) The New Shareholder Loan No. 2 owed by Holdings to Corral.
<Page>
8. Upon completion of the transactions described in Clauses 2.1
to 2.6, there shall be no debt owed directly by Preem
Petroleum to Corral in respect of the Existing Shareholder
Loan.
XXV. Payment instructions and calculations
1. On the Effective Date the SEK Equivalent of the Net Note
Proceeds shall be paid to Preem Petroleum for value on such
date (at such time as is customary for the settlement of
transactions in Swedish Kronor) and in immediately available
funds to the account at such bank as Preem Petroleum has
designated.
2. Upon receipt of the SEK Equivalent of the Net Note Proceeds,
Preem Petroleum shall pay an amount equal to the Payment
Amount to Corral for value on the same date (at such time as
is customary for the settlement of transactions in Swedish
Kronor) and in immediately available funds to the account at
such bank as Corral has designated.
3. Any designation by Preem Petroleum or Corral of a bank account
shall be notified to the other parties before the Effective
Date.
4. On the Effective Date all parties shall sign a confirmation in
the form of SCHEDULE 1 setting out the exact amounts for the
transactions described in Clause 2 (Disbursements). Existing
loan notes evidencing the Existing Shareholder Loan shall be
cancelled on the Effective Date.
XXVI. Miscellaneous
1. No party may assign, transfer, novate or dispose of any of, or
any interest in, its rights and/or obligations under this
Agreement.
2. No amendment to this Agreement shall be effective against any
party unless made in writing and signed by such party.
3. No delay or omission in exercising any powers or privileges
hereunder shall be construed as a waiver thereof or an
acquiescence therewith. Any exercise of any part of the rights
shall not preclude subsequent enforcement of any such rights
which have not, or have not fully, been exercised.
XXVII. Notices
1. All notices or other communications under or in connection
with this Agreement shall be in the English language and be
given by letter or by telefax (and, in the case of telefax,
confirmed by letter). Any such notice will be deemed to be
given as follows:
<Page>
(a) if by letter, when delivered to the address notified in
accordance with Clause 5.3; and
(b) if by telefax, when received.
2. Any notice received on a non-working day or after business
hours in the place of receipt will only be deemed to be given
on the next working day in that place.
3. The address and telefax number of each party for all notices
under or in connection with this Agreement are:
Corral: Corral Petroleum Holdings AB (publ)
Attention: Managing Director
Biblioteksgatan 29
P.O. Box 5785
SE-114 87 Stockholm
Sweden
Telephone: +46 8 614 13 00
Telefax: +46 8 614 13 14
Holdings: Preem Holdings AB (publ)
Attention: Richard Ohman
Biblioteksgatan 29
P.O. Box 5785
SE-114 87 Stockholm
Sweden
Telephone: +46 8 614 13 00
Telefax: +46 8 614 13 14
Preem Petroleum: Preem Petroleum AB
Attention: Chief Financial Officer
Sandhamnsgatan 51
P.O. Box 27800
SE-115 90 Stockholm
Sweden
Telephone: +46 8 450 10 00
Telefax: +46 8 450 10 55
or any other address notified by one party to the other parties by
not less than five (5) Business Days' notice.
XXVIII. Governing law and jurisdiction
1. This Agreement shall be governed by and construed in
accordance with Swedish law.
<Page>
2. The courts of Sweden shall have non-exclusive jurisdiction
over matters arising out of or in connection with this
Agreement. The City Court of Stockholm shall be court of first
instance.
-----------------
<Page>
IN WITNESS WHEREOF, this Agreement has been signed in thee (3)
originals, of which the parties have received one each.
CORRAL PETROLEUM HOLDINGS AB (publ)
-------------------------
Name: Richard Ohman
PREEM HOLDINGS AB (publ)
----------------------- -------------------------
Name: Karim Karaman Name: Lars Nelson
PREEM PETROLEUM AB
----------------------- -------------------------
Name: Richard Ohman Name: Lars Nelson
<Page>
SCHEDULE 1
FORM OF CONFIRMATION
This CONFIRMATION is entered into in connection with the Debt
Restructuring Agreement entered into among Corral Petroleum Holdings AB (publ),
Preem Holdings AB (publ) and Preem Petroleum AB on 10 April 2001 (the
"AGREEMENT"). Terms defined in the Agreement shall have the same meanings when
used herein.
(a) The Effective Date is: [DATE]
(b) The Gross Note Proceeds amount to: EUR [AMOUNT]
(c) The Net Note Proceeds amount to: EUR [AMOUNT]
(d) The spot rate of exchange for EUR/SEK is: [FIGURE]
(e) The Repaid Shareholder Loan Amount is: SEK [PAYMENT AMOUNT]
(f) The Assigned Shareholder Loan Amount is: SEK [EXISTING SHAREHOLDER LOAN
LESS REPAID SHAREHOLDER LOAN]
(g) The New Shareholder Loan No. 1A amounts to: SEK [SEK EQUIVALENT OF
GROSS NOTE PROCEEDS]
(h) The New Shareholder Loan No. 1B amounts to: SEK [ZERO]
(i) The New Shareholder Loan No. 2 amounts to: SEK [ASSIGNED SHAREHOLDER
LOAN]
MANNHEIMER SWARTLING ADVOKATBYRA
STOCKHOLM, SWEDEN
<Page>
PREEM HOLDINGS AB (publ) CORRAL PETROLEUM HOLDINGS AB (publ)
--------------------------- ---------------------------
Name: Name:
--------------------------
Name:
PREEM PETROLEUM AB
---------------------------
Name:
---------------------------
Name
<Page>
SHAREHOLDER LOAN AGREEMENT NO. 1A
10 APRIL 2001
BETWEEN
PREEM HOLDINGS AB (PUBL)
AS LENDER
AND
PREEM PETROLEUM AB
AS BORROWER
<Page>
This SHAREHOLDER LOAN AGREEMENT is dated as of 10 April 2001 between:
PREEM HOLDINGS AB (PUBL), reg. no. 556206-9673, (the "LENDER"); and
PREEM PETROLEUM AB, reg. no. 556072-6977, (the "BORROWER").
XXIX. Definitions and interpretation
1. DEFINITIONS
"AGREEMENT" means this Shareholder Loan
Agreement, including the Loan Note issued hereunder.
"AUTHORISED SIGNATORIES" means representatives
of the Borrower authorised and registered as signatories of the
Borrower with the Swedish Patent and Registration Office (Sw:
PATENT- OCH REGISTRERINGSVERKET).
"BUSINESS DAY" means a day (other than a
Saturday or Sunday) which is not a public holiday and on which
banks are open for general business in Stockholm.
"CONFIRMATION OF SUBORDINATION" means an
agreement in the form of SCHEDULE 2 entered into by the Borrower,
the Lender and one or several Confirmed Creditors.
"CONFIRMED CREDITORS" means the banks, financial
institutions and other lenders from time to time providing
financing to the Borrower and the Subsidiaries, and which are
parties to Confirmations of Subordination, and "CONFIRMED
CREDITOR" means any of them.
"DEBT RESTRUCTURING AGREEMENT" means the Debt
Restructuring Agreement entered into on or about the date hereof
among the Borrower, the Lender and the Parent for the purpose of
restructuring and assigning existing shareholder debt owed by the
Borrower.
"EFFECTIVE DATE" means the date defined as such
in the Debt Restructuring Agreement.
"EVENT OF DEFAULT" means any of the events
specified in Clauses 4.2 to 4.9.
<Page>
"FINANCIAL INDEBTEDNESS" means any indebtedness in respect of:
(a) moneys borrowed and debit balances at banks and other
financial institutions;
(b) any debenture, bond, note or other debt instrument;
(c) the acquisition cost of any asset to the extent payable
before or after the time of acquisition or possession by the
party liable where the advance or deferred payment is
arranged primarily as a method of raising finance or
financing the acquisition of that asset;
(d) leases entered into primarily as a method of raising
finance or financing the leased asset;
(e) any acceptance or documentary credit;
(f) receivables sold or discounted (otherwise than on a
non-recourse basis);
(g) any swaps, foreign exchange transactions, cap, floor,
collar or option transactions or any other interest or
currency derivatives transactions entered into in connection
with the management of risks related to financial
indebtedness (the value of any such transactions shall be
calculated by reference only to a mark-to-market valuation);
(h) any amount raised under any other transaction having the
commercial effect of a borrowing or raising of money; or
(i) any guarantee, indemnity or similar assurance against
financial loss of any person.
"LOAN" means the total principal amount advanced
by the Lender under Clause 2 (Shareholder Loan), or the total
principal amount outstanding hereunder at any time. The Loan shall
be denominated in Swedish Kronor.
"LOAN NOTE" means the loan note evidencing the
Loan, issued pursuant to Clause 2.2 in the form of SCHEDULE 1 and
signed by Authorised Signatories.
"NOTEHOLDERS" means the holders from time to
time of the Notes.
"NOTES" means the 10 5/8 % senior secured notes
due 2011 and any additional notes issued under the indenture
governing the Notes, dated as
<Page>
of 10 April 2001, by and between the Pledgor, Deutsche Bank AG
London, as principal paying agent, and the Trustee.
"PARENT" means Corral Petroleum Holdings AB
(publ), reg. no. 556477-1284.
"SECURITY ASSIGNMENT" means the agreement
entered into on or about the date hereof under which security is
provided by the Lender to the Trustee on behalf of the Noteholders
over the Lender's rights under this Agreement.
"SECURITY INTEREST" means any mortgage, pledge,
lien, charge, assignment by way of security, hypothecation,
security interest, title retention (other than in respect of goods
purchased in the ordinary course of trading), sale and repurchase
or sale and lease-back arrangement or any other agreement or
arrangement in each case having the effect of conferring security.
"SENIOR CREDITORS" means the Confirmed Creditors
and all other creditors (including trade creditors) of the
Borrower and the Subsidiaries (other than the Lender), and their
assignees from time to time, and "SENIOR CREDITOR" means any of
them.
"SENIOR DEBT" means all present and future
liabilities of the Borrower and the Subsidiaries to the Senior
Creditors, absolute or contingent, whether or not matured,
including, without limitation, principal, interest, damages and
costs.
"SHAREHOLDER LOAN NO. 1B" means the Shareholder
Loan Agreement No. 1B entered into on or about the date hereof
between the Lender as lender and the Borrower as borrower.
"SHAREHOLDER LOAN NO. 2" means the Shareholder
Loan Agreement No. 2 entered into on or about the date hereof
between the Lender as borrower and the Parent as lender.
"STIBOR" means the Stockholm Interbank Offered
Rate as quoted on the Reuters screen SIOR (or such other screen as
may replace that screen) at or about 11.00 a.m. (Stockholm time)
on the relevant date or, if the relevant rate does not appear, the
average (rounded upwards to four decimal places) of the rates
which prime banks were offering to other prime banks in the
Stockholm interbank market for deposits in Swedish Kronor as of
11.00 a.m. (Stockholm time) on the relevant date, in each case for
a period of thirty (30) days.
"SUBORDINATED DEBT" means (i) the indebtedness
of the Borrower to the Lender hereunder, and (ii) any other
Financial Indebtedness of the Borrower to the Lender which is duly
and effectively subordinated on
<Page>
substantially the same terms, including, without limitation, in
respect of maturity, right to interest payments and the
provisions of Clauses 4.11, 10 and 11. For the avoidance of
doubt, Shareholder Loan No. 1B is Subordinated Debt for the
purposes of this Agreement.
"SUBORDINATION PERIOD" means the period from the
Effective Date until the earlier of (i) the date falling 179 days
after the date on which the Loan shall be repaid pursuant to
Clause 3.1 (Repayment), (ii) the date on which all Senior Debt has
been fully and finally satisfied, and (iii) the date falling 179
days after the date on which the Lender has given a notice in
accordance with Clause 4.10 to each of the Confirmed Creditors.
"SUBSIDIARY" means any Swedish or foreign legal
entity (whether incorporated or not), which is a subsidiary (Sw:
DOTTERBOLAG) of the Borrower, directly or indirectly, in
accordance with the Swedish Companies Act (Sw: AKTIEBOLAGSLAGEN).
"SWEDISH KRONOR" or "SEK" means the lawful
currency of Sweden.
"TAXES" means all types (whether now existing or
introduced in the future) of income and other taxes, levies,
imposts, deductions, charges and withholdings whatsoever together
with interest thereon and penalties and surcharges with respect
thereto, if any, and any payments made on or in respect thereof,
and "TAX" and "TAXATION" shall be construed accordingly.
"TRUSTEE" means Bankers Trust Company, as
Trustee under the indenture governing the Notes, dated as of 10
April 2001, by and between the Pledgor, Deutsche Bank AG London,
as principal paying agent, and the Trustee.
2. INTERPRETATION
A. A reference in this Agreement or in any other
document referred to herein or delivered in
connection herewith to a statute or any provision
thereof shall refer also to that statute or provision
as amended or re-enacted.
B. A reference in this Agreement or in any other
document referred to herein or delivered in
connection herewith to an agreement or document shall
refer also to such agreement or document as amended,
varied or supplemented and shall include all
appendices and other attachments.
XXX. Shareholder loan
<Page>
1. On the Effective Date the Lender shall provide the Borrower
with a loan subject to the terms of this Agreement. The amount
of such loan shall be determined in accordance with the Debt
Restructuring Agreement. Such loan amount shall be disbursed
subject to and in accordance with the terms of the Debt
Restructuring Agreement and shall constitute Subordinated
Debt.
2. The Loan shall be evidenced by one Loan Note signed by
Authorised Signatories. The Loan Note shall be executed on the
Effective Date and delivered to the Trustee. For as long as
the Security Assignment is effective and not enforced, the
Loan Note shall be held by the Trustee, who shall be entitled
to receive payment when due under the Loan Note. Upon an
enforcement of the Security Assignment, the Trustee may sell
the Loan Note or any part of the Loan publicly or privately,
provided the purchaser agrees to be bound by the terms of this
Agreement as lender.
3. Nothing in this Agreement shall prevent the Borrower from
incurring other debt owed to the Lender which is not
Subordinated Debt (to the extent this is not prohibited under
other agreements binding on the Borrower and the Lender), from
repaying such other debt or from paying interest on such other
debt.
XXXI. Repayment
1. The Borrower shall repay the Loan in full on 31 March 2011.
The Borrower shall not prepay the Loan before such date,
except as otherwise expressly provided in Clause 4 (Events of
Default), or with the prior written consent of the Confirmed
Creditors.
2. The Loan shall only be repaid upon presentation of the Loan
Note. If the Loan is partially repaid, a new Loan Note for the
remaining amount shall be executed.
XXXII. Events of default
1. Subject to any express exceptions, each of the events set out
in Clauses 4.2 to 4.9 below is an Event of Default (whether or
not caused by any reason whatsoever outside the control of the
Borrower or any other person).
<Page>
2. NON-PAYMENT: The Borrower does not pay on the due date, any
amount due and payable by it hereunder in the currency and in
the manner specified, provided that it shall not constitute an
Event of Default if such failure is due solely to technical
errors , as determined in good faith by the Lender, and the
Borrower remedies the same within three (3) Business Days of
the due date for payment.
3. CROSS-DEFAULT:
(a) Any Financial Indebtedness of the Borrower or any
Subsidiary is not paid when due or within the
applicable grace period (if any).
(b) Any Financial Indebtedness of the Borrower or any
Subsidiary is declared prematurely due and payable or
is placed on demand, in either case as a result of an
event of default (howsoever described) under the
document relating to that Financial Indebtedness.
(c) Any commitment for, or underwriting of, any Financial
Indebtedness of the Borrower or any Subsidiary is
cancelled or suspended as a result of an event of
default (howsoever described) under the document
relating to that Financial Indebtedness.
(d) The circumstances in this Clause 4.3 will only
constitute an Event of Default if the amount of
Financial Indebtedness referred to exceeds SEK
150,000,000 in aggregate.
4. INSOLVENCY:
(a) The Borrower is, or is deemed for the purposes of any
law to be, insolvent or admits in writing its
inability to pay its debts as they fall due.
(b) The Borrower suspends making payments on all or any
class of its debts or announces an intention to do so,
or a moratorium is declared in respect of any of its
indebtedness.
(c) The Borrower commences negotiations with any one or
more of its creditors with a view to the general
readjustment or rescheduling of its indebtedness, or
makes a composition or an arrangement with its
creditors or any similar proceeding, arrangement or
assignment.
<Page>
5. INSOLVENCY PROCEEDINGS:
(a) The Borrower takes any corporate action or any order is
made or resolution passed for the suspension of
payments, business reorganisation (Sw:
FORETAGSREKONSTRUKTION), liquidation or bankruptcy of
the Borrower (except in the context of a solvent
reconstruction with the Borrower as surviving entity).
(b) A liquidator, receiver, insolvency manager,
reconstruction manager (Sw: FORETAGSREKONSTRUKTOR) or
similar officer is appointed in respect of the Borrower
or in respect of all or substantially all of its
assets.
6. CREDITORS' PROCESS: Any distress or execution is levied against, or
an encumbrancer takes possession of, an asset or certain of the
assets of the Borrower the value of which asset or assets exceeds
SEK 50,000,000, unless such distress, execution or taking possession
is stayed, discharged, struck out or given up within thirty (30)
days of being levied or taking place or is thereafter being
contested in good faith and by appropriate means.
7. CESSATION OF BUSINESS: The Borrower ceases or threatens to cease to
carry on all or a substantial part of its business.
8. REPUDIATION: The Borrower repudiates this Agreement.
9. UNLAWFULNESS: At any time it is or becomes unlawful for the Borrower to
perform or comply with any material or all of its obligations under
this Agreement or any of the obligations of the Borrower under this
Agreement are not or cease to be legal, valid and binding, in either
case in any material respect.
10. In case of an Event of Default, provided such Event of Default has not
been cured or waived, the Lender shall provide all Confirmed Creditors
with a written notice specifying the Event of Default. Following such
notice the Lender shall consult with the Confirmed Creditors with a
view to curing such Event of Default.
11. On and at any time after the occurrence of an Event of Default,
provided such Event of Default has not been cured or waived, the Lender
may, by notice to the Borrower declare the Loan due and payable,
whereupon it shall become due and payable on the date specified by the
Lender, provided, however, that the date so specified shall not fall
before the expiry of the Subordination Period.
XXXIII. Interest
<Page>
8(8)
1. Neither the Loan nor any other amount which may be payable
hereunder shall carry interest before the date on which such
amount is due and payable.
2. If the Borrower fails to pay an amount payable by it under
this Agreement on the due date, it shall forthwith on demand
by the Lender pay interest on the overdue amount from the due
date up to the date of actual payment at a rate determined by
adding a margin of two (2) percentage units to STIBOR on the
due date. Interest shall be compounded at the end of each
thirty (30) day period during which the overdue amount remains
outstanding.
XXXIV. Payments
1. All payments by the Borrower under this Agreement shall be
made for value on the due date (at such time as is customary
for the settlement of transactions in the relevant currency)
and in immediately available funds to the account at such
office or bank as the Lender may designate from time to time.
Any such designation shall be notified to the Borrower not
later than five (5) Business Days before the payment is due.
2. All payments made by the Borrower under this Agreement shall
be made without set-off or counterclaim.
3. If a payment is due on a day which is not a Business Day, the
due date for that payment shall instead be the following
Business Day.
4. A repayment or prepayment of the Loan is payable in Swedish
Kronor. Amounts payable in respect of costs, expenses and
Taxes and the like are payable in the currency in which they
are incurred.
5. If Swedish Kronor is replaced as legal tender in Sweden by the
euro, all references to Swedish Kronor in this Agreement shall
be deemed to be references to the euro, provided that the
Lender, acting reasonably and in good faith and after having
consulted with the Borrower, shall determine at what time such
replacement shall be made for the purpose of this Agreement in
the event that such replacement includes a transition period.
In case of any such change of currency, this Agreement shall
be amended to the extent the Lender specifies to be necessary
to reflect the change in currency and to put the Lender and
the Borrowers in the same position, so far as possible, that
they would have been in if no change of currency had occurred.
<Page>
9(9)
XXXV. Withholdings
1. All payments to be made by the Borrower hereunder shall be
made free and clear of any deduction or withholding.
2. If the Borrower is required by law to make any deduction or
withholding on account of Tax or otherwise from any payment to
the Lender hereunder, the sum due from it in respect of such
payment shall be increased to the extent necessary to ensure
that, after making of such deduction or withholding, the
Lender receives a net sum equal to the sum which it would have
received had no deduction or withholding been made.
3. This Clause 7 (Withholdings) shall not apply in the case of
deductions or withholdings to be made with reference to income
tax on its overall income ultimately due by the Lender by
operation of applicable laws.
XXXVI. Indemnities
1. If the Lender receives an amount in respect of the Borrower's
liability under this Agreement or if that liability is
converted into a claim, proof, judgement or order in a
currency other than the currency in which such obligation is
due (the "CONTRACTUAL CURRENCY"):
(a) the Borrower shall on demand indemnify the Lender
as an independent obligation against any loss or
liability arising out of or as a result of the
conversion;
(b) if the amount received by the Lender, when
converted into the Contractual Currency at a market
rate in the usual course of its business, is less than
the amount owed in the Contractual Currency, the
Borrower shall on demand pay to the Lender an amount
in the Contractual Currency equal to the deficit; and
(c) the Borrower shall on demand pay to the Lender
any exchange costs and Taxes payable in connection
with any such conversion.
2. The Borrower shall on demand indemnify the Lender against any
cost, expense, loss or liability, as determined by the Lender,
which it incurs as a consequence of the occurrence of any
Event of Default (taking into account, where appropriate, any
amounts received by the Lender under Clause 5.2).
<Page>
10(10)
XXXVII. Representations and warranties
The Borrower represents and warrants that:
(a) it is a limited liability company, duly
incorporated and validly existing under the laws of
Sweden, with full power and authority to carry on its
business as it is being conducted and to execute and
perform all of its obligations under this Agreement
and all action required to authorise such execution
and performance has been duly taken;
(b) the execution and performance of this Agreement
will not violate any applicable law or regulation or
contravene any provision of its Articles of
Association; and
(c) subject to the qualifications in the legal
opinions as to matters of law in force on the date of
this Agreement and not fact, this Agreement constitutes
its legal, valid and binding obligations enforceable in
accordance with its terms.
XXXVIII. Restrictions in relation to the Loan
1. The Borrower undertakes that, during the Subordination Period,
except as expressly permitted by this Agreement or with the
prior written consent of the Confirmed Creditors, it will not,
and will procure that no Subsidiary will:
(a) pay, prepay or repay, discharge by way of
set-off, or acquire, any Subordinated Debt;
(b) pay interest on any Subordinated Debt;
(c) create or permit to subsist, any Security
Interest or other encumbrance over any of its assets,
or give any financial support, for any Subordinated
Debt; or
(d) take or omit to take any action whereby the
ranking and/or subordination of the Subordinated Debt
contemplated by this Agreement may be impaired.
2. The Lender undertakes that, during the Subordination Period,
except as expressly permitted by this Agreement or with the
prior written consent of the Confirmed Creditors, it will not:
<Page>
11(11)
(a) demand or receive payment, prepayment or
repayment, or accept discharge by way of set-off, of
any Subordinated Debt;
(b) demand or receive any payment of interest on any
Subordinated Debt;
(c) receive or permit to subsist, any Security
Interest or other encumbrance, or give any financial
support, for any Subordinated Debt (for the avoidance
of doubt, any Security Interest created by the Lender
over any Subordinated Debt owed hereunder, in order to
secure the Notes shall not constitute a breach
hereunder);
(d) assign, transfer or otherwise dispose of any
Subordinated Debt to a third party, provided, however,
that (i) the Lender may assign Subordinated Debt to
the Parent or a wholly-owned subsidiary of the Parent
in accordance with Clause 14.2 (provided this is
permissible under other agreements binding on the
Lender), and (ii) the Lender may assign its rights
hereunder by way of security to Trustee on behalf of
the Noteholders under the Security Assignment; or
(e) commence any proceedings against the Borrower or
any Subsidiary in respect of any Subordinated Debt
(including, without limitation, applying for
enforcement of any amount outstanding or for the
liquidation, bankruptcy or re-organisation of the
Borrower or any Subsidiary).
XXXIX. Subordination in case of insolvency
1. In an insolvency or bankruptcy of the Borrower or any
Subsidiary initiated during the Subordination Period, the
Lender shall endeavour to procure that any distributions with
respect to the Subordinated Debt by the bankruptcy
administrator or liquidator, or any other person making the
distribution, are made to the Senior Creditors to the extent
necessary to repay all the Senior Debt in full.
2. Any release, discharge or settlement between Lender and the
Senior Creditors (or any of them) shall be conditional upon no
security, disposition or payment to any Senior Creditor being
void, set aside or ordered to be refunded pursuant to any law
relating to bankruptcy, liquidation or insolvency, or for any
other reason whatsoever, and if such condition shall not be
fulfilled the Senior Creditors shall be entitled to enforce
this Agreement subsequently as if such release, discharge or
settlement had not occurred and any such payment had not been
made.
<Page>
12(12)
XL. Redistribution of payments
1. In the event that any payment in respect of Subordinated Debt
is received by the Lender, in cash or in kind, by way of
set-off or otherwise, in violation of this Agreement, the
Lender shall hold such payment, up to the amount of the Senior
Debt, separated and for the account of the Senior Creditors,
and promptly pay and distribute it to the Senior Creditors for
application towards the Senior Debt.
2. If the Senior Debt is partially paid out of any proceeds
received in respect of or on account of any Subordinated Debt,
the Lender will not be entitled to exercise any subrogation
right to the Senior Debt until the Senior Debt has been
irrevocably paid and discharged in full.
XLI. Further assurances of subordination
1. The Borrower and the Lender shall enter into Confirmations of
Subordination with the other lenders to the Borrower from time
to time to confirm that such lenders have the benefit of the
subordination provisions in this Agreement and qualify as
"Confirmed Creditors" hereunder.
2. Each of the Lender and the Borrower undertakes, at its own
expense, from time to time, upon reasonable request, to do all
such acts and execute all such documents as may be necessary
for giving full effect to the subordination of the
Subordinated Debt to the Senior Debt as envisaged by this
Agreement and securing to the Senior Creditors the full
benefit of the rights, powers and remedies conferred upon them
in this Agreement.
XLII. Assignment
1. The Borrower may not assign, transfer, novate or dispose of
any of, or any interest in, its rights and/or obligations
under this Agreement.
2. The Lender may at any time assign all or any part of its
rights and obligations under this Agreement to the Trustee
pursuant to the Security Assignment or to the Parent or a
wholly-owned subsidiary of the Parent which adheres to this
Agreement (if such subsidiary ceases to be so owned, the
rights and obligations shall be reassigned to the Lender),
provided this is permissible under other agreements binding on
the Lender.
<Page>
13(13)
XLIII. Miscellaneous
1. No amendment to this Agreement shall be effective against any
party unless made in writing and signed by such party.
2. No delay or omission in exercising any powers or privileges
hereunder shall be construed as a waiver thereof or an
acquiescence therewith. Any exercise of any part of the rights
shall not preclude subsequent enforcement of any such rights
which have not, or have not fully, been exercised.
XLIV. Notices
1. All notices or other communications under or in connection
with this Agreement shall be in the English language and be
given by letter or by telefax (and, in the case of telefax,
confirmed by letter) with a copy to the Trustee. Any such
notice will be deemed to be given as follows:
(a) if by letter, when delivered to the address
notified in accordance with Clause 16.3; and
(b) if by telefax, when received.
2. Any notice received on a non-working day or after business
hours in the place of receipt will only be deemed to be given
on the next working day in that place.
3. The address and telefax number of each party for all notices
under or in connection with this Agreement are:
The Lender: Preem Holdings AB (publ)
Attention: Richard Ohman
Biblioteksgatan 29
P.O. Box 5785
SE-114 87 Stockholm, Sweden
Telephone: +46 8 614 13 00
Telefax: +46 8 614 13 14
<Page>
14(14)
The Borrower: Preem Petroleum AB
Attention: Chief Financial Officer
Sandhamnsgatan 51
P.O. Box 27800
SE-115 90 Stockholm, Sweden
Telephone: +46 8 450 10 00
Telefax: +46 8 450 10 55
The Trustee: Bankers Trust Company
Four Albany Street
Corporate Trust and Agency Services
New York, NY 10006, USA
Attention: Carol Ng
Telephone: +1 212 250 61 47
Telefax: +1 212 250 09 33
or any other address notified by one party to the other parties by
not less than five (5) Business Days' notice.
XLV. Governing law and jurisdiction
1. This Agreement shall be governed by and construed in
accordance with Swedish law.
2. The courts of Sweden shall have non-exclusive jurisdiction
over matters arising out of or in connection with this
Agreement. The City Court of Stockholm shall be court of first
instance.
-----------------
<Page>
15(15)
IN WITNESS WHEREOF, this Agreement has been signed in two (2)
originals, of which the parties have received one each.
PREEM HOLDINGS AB (publ)
as Lender
------------------------- ------------------------
Name: Karim Karaman Name: Lars Nelson
PREEM PETROLEUM AB
as Borrower
------------------------- -------------------------
Name: Richard Ohman Name: Lars Nelson
<Page>
1(1)
SCHEDULE 1
FORM OF LOAN NOTE
PRINCIPAL AMOUNT: SEK [AMOUNT]
The principal amount set out above (the "LOAN") is on the date
hereof owed by us to Preem Holdings AB (publ) (the "LENDER") or order. The terms
and conditions for the Loan are set out in Shareholder Loan Agreement No. 1A
entered into between ourselves and the Lender on 10 April 2001 (the
"AGREEMENT").
The Loan is subordinated to all other indebtedness owed by us
from time to time, except for Subordinated Debt, as defined in the Agreement,
and does not carry any interest before the due date. The Loan is repayable on
[DATE] and may only be accelerated in special circumstances and subject to a
waiting period of one hundred and seventy nine (179) days, all as more fully set
out in the Agreement.
We confirm that we have no right of set-off or counterclaim
which may reduce the amount payable by us in respect of the Loan.
The Loan shall be evidenced by this loan note, which is
subject to all terms and conditions of the Agreement.
By executing this loan note we confirm that we have been notified that the Loan
has been assigned by way of security, by the Lender to Bankers Trust Company
(the "TRUSTEE") acting on behalf of the Noteholders (as defined in the
Agreement) from time to time pursuant to a Security Assignment Agreement dated
10 April 2001. For as long as the Security Assignment (as defined in the
Agreement) is effective and not enforced, (i) all amounts payable by us in
respect of the Loan may only be paid to the Trustee or order, unless and until
we are otherwise notified by the Trustee, and (ii) the terms of the Loan may
only be amended or varied with the consent of the Trustee.
This loan note and the Agreement are governed by Swedish law.
<Page>
Date: [DATE]
PREEM PETROLEUM AB
--------------------------- ------------------------
Name: Name:
<Page>
MANNHEIMER SWARTLING ADVOKATBYRA
STOCKHOLM, SWEDEN
<Page>
SCHEDULE 2
FORM OF CONFIRMATION OF SUBORDINATION
This CONFIRMATION OF SUBORDINATION is entered into in
connection with the Shareholder Loan Agreement No.1A entered into between Preem
Holdings AB (publ) (the "JUNIOR LENDER") and Preem Petroleum AB (the "BORROWER")
on 10 April 2001 (the "AGREEMENT"). Terms defined in the Agreement shall have
the same meanings when used herein.
The Agreement contains provisions to the effect that the Loan
shall during the Subordination Period be subordinated to the Borrower's other
indebtedness, except other Subordinated Indebtedness. The Agreement also
provides the Senior Creditors to the Borrower with certain rights as Confirmed
Creditors, provided they have entered into Confirmations of Subordination.
[NAME] (the "SENIOR LENDER") is a lender to the Borrower and has requested to
have the benefit of the rights conferred upon the Confirmed Creditors in the
Agreement.
The parties hereby agree that the Senior Lender shall have the
benefit of all rights conferred upon the Confirmed Creditors as Senior Creditors
in the Agreement. All indebtedness owed by the Borrower to the Senior Lender
shall constitute Senior Debt under the Agreement. The parties further agree that
any amendment of, variation or modification to, or termination of, the Agreement
(including the waiver of any right under the Agreement) shall require the prior
written consent of the Senior Lender, and prior written notice to the Trustee.
The address and telefax number of the Senior Lender for all
notices under or in connection with this Confirmation of Subordination are:
[ADDRESS]
Attention: [TITLE]
Telephone: [NUMBER]
Telefax: [NUMBER]
or any other address notified by the Senior Lender to the other parties by not
less than five (5) Business Days' notice. The addresses and telefax numbers of
the Junior Lender and the Borrower are set out in the Agreement.
All notices or other communications under or in connection
with this Confirmation of Subordination shall be in the English language and be
given by letter or by telefax (and, in the case of telefax, confirmed by
letter). Any such notice will be deemed to be given, if by letter, when
MANNHEIMER SWARTLING ADVOKATBYRA
STOCKHOLM, SWEDEN
<Page>
delivered to the address notified in accordance with the above, and, if by
telefax, when received. Any notice received on a non-working day or after
business hours in the place of receipt will only be deemed to be given on the
next working day in that place.
This Confirmation of Subordination shall be governed by and
construed in accordance with Swedish law. The courts of Sweden shall have
non-exclusive jurisdiction over matters arising out of or in connection with
this Confirmation of Subordination. The City Court of Stockholm shall be court
of first instance.
Date: [DATE]
PREEM PETROLEUM AB PREEM HOLDINGS AB (publ)
as Borrower as Junior Lender
--------------------------- ---------------------------
Name: Name:
--------------------------- ---------------------------
Name: Name:
[NAME]
as Senior Lender
---------------------------
Name:
---------------------------
Name:
<Page>
SHAREHOLDER LOAN AGREEMENT NO. 1B
10 APRIL 2001
BETWEEN
PREEM HOLDINGS AB (PUBL)
AS LENDER
AND
PREEM PETROLEUM AB
AS BORROWER
<Page>
This SHAREHOLDER LOAN AGREEMENT is dated as of 10 April 2001
between:
PREEM HOLDINGS AB (PUBL), reg. no. 556206-9673, (the
"LENDER"); and
PREEM PETROLEUM AB, reg. no. 556072-6977, (the "BORROWER").
XLVI. Definitions and interpretation
1. DEFINITIONS
"AGREEMENT" means this Shareholder Loan
Agreement including the Loan Notes issued hereunder.
"AUTHORISED SIGNATORIES" means representatives
of the Borrower authorised and registered as signatories of the
Borrower with the Swedish Patent and Registration Office (Sw:
PATENT- OCH REGISTRERINGSVERKET).
"BUSINESS DAY" means a day (other than a
Saturday or Sunday) which is not a public holiday and on which
banks are open for general business in Stockholm.
"CONFIRMATION OF SUBORDINATION" means an
agreement in the form of SCHEDULE 2 entered into by the Borrower,
the Lender and one or several Confirmed Creditors.
"CONFIRMED CREDITORS" means the banks, financial
institutions and other lenders from time to time providing
financing to the Borrower and the Subsidiaries, and which are
parties to Confirmations of Subordination, and "CONFIRMED
CREDITOR" means any of them.
"DEBT RESTRUCTURING AGREEMENT" means the Debt
Restructuring Agreement entered into on or about the date hereof
among the Borrower, the Lender and the Parent for the purpose of
restructuring and assigning existing shareholder debt owed by the
Borrower.
"EFFECTIVE DATE" means the date defined as such
in the Debt Restructuring Agreement.
"EVENT OF DEFAULT" means any of the events
specified in Clauses 4.2 to 4.9.
<Page>
2(2)
"FINANCIAL INDEBTEDNESS" means any indebtedness in respect of:
(j) moneys borrowed and debit balances at banks and other financial
institutions;
(k) any debenture, bond, note or other debt instrument;
(l) the acquisition cost of any asset to the extent payable before or after
the time of acquisition or possession by the party liable where the
advance or deferred payment is arranged primarily as a method of
raising finance or financing the acquisition of that asset;
(m) leases entered into primarily as a method of raising finance or
financing the leased asset;
(n) any acceptance or documentary credit;
(o) receivables sold or discounted (otherwise than on a non-recourse
basis);
(p) any swaps, foreign exchange transactions, cap, floor, collar or option
transactions or any other interest or currency derivatives transactions
entered into in connection with the management of risks related to
financial indebtedness (the value of any such transactions shall be
calculated by reference only to a mark-to-market valuation);
(q) any amount raised under any other transaction having the commercial
effect of a borrowing or raising of money; or
(r) any guarantee, indemnity or similar assurance against financial loss of
any person.
"LOAN" means the total principal amount assigned
to or to be advanced by the Lender under Clause 2 (Shareholder
Loans) in one or several disbursements, or the total principal
amount outstanding hereunder at any time. The Loan shall be
denominated in Swedish Kronor.
"LOAN NOTE" means a loan note evidencing the
Loan or a part thereof, issued pursuant to Clause 2.5 in the form
of SCHEDULE 1 and signed by Authorised Signatories.
"NOTEHOLDERS" means the holders from time to
time of the Notes.
"NOTES" means the 10 5/8 % senior secured notes
due 2011 and any additional notes issued under the indenture
governing the Notes, dated as
<Page>
3(3)
of 10 April 2001, by and between the Lender, Deutsche Bank AG
London, as principal paying agent, and the Trustee.
"PARENT" means Corral Petroleum Holdings AB
(publ), reg. no. 556477-1284.
"SECURITY INTEREST" means any mortgage, pledge,
lien, charge, assignment by way of security, hypothecation,
security interest, title retention (other than in respect of goods
purchased in the ordinary course of trading), sale and repurchase
or sale and lease-back arrangement or any other agreement or
arrangement in each case having the effect of conferring security.
"SENIOR CREDITORS" means the Confirmed Creditors and all other
creditors (including trade creditors) of the Borrower and the
Subsidiaries (other than the Lender), and their assignees from
time to time, and "SENIOR CREDITOR" means any of them.
"SENIOR DEBT" means all present and future liabilities of the
Borrower and the Subsidiaries to the Senior Creditors, absolute or
contingent, whether or not matured, including, without limitation,
principal, interest, damages and costs.
"SHAREHOLDER LOAN NO. 1A" means the Shareholder
Loan Agreement No. 1A entered into on or about the date hereof
between the Lender as lender and the Borrower as borrower.
"STIBOR" means the Stockholm Interbank Offered
Rate as quoted on the Reuters screen SIOR (or such other screen as
may replace that screen) at or about 11.00 a.m. (Stockholm time)
on the relevant date or, if the relevant rate does not appear, the
average (rounded upwards to four decimal places) of the rates
which prime banks were offering to other prime banks in the
Stockholm interbank market for deposits in Swedish Kronor as of
11.00 a.m. (Stockholm time) on the relevant date, in each case for
a period of thirty (30) days.
"SUBORDINATED DEBT" means (i) the indebtedness
of the Borrower to the Lender hereunder, and (ii) any other
Financial Indebtedness of the Borrower to the Lender which is duly
and effectively subordinated on substantially the same terms,
including, without limitation, in respect of maturity, right to
interest payments and the provisions of Clauses 4.11, 10 and 11.
For the avoidance of doubt, Shareholder Loan No. 1A is not, for
the purposes of this Agreement, Subordinated Debt.
"SUBORDINATION PERIOD" means the period from the Effective Date
until the earlier of (i) the date on which all Senior Debt has
been fully and finally satisfied, and (ii) the date falling 179
days after the date on which the Lender
<Page>
4(4)
has given a notice in accordance with Clause 4.10 to each of
the Confirmed Creditors.
"SUBSIDIARY" means any Swedish or foreign legal entity (whether
incorporated or not), which is a subsidiary (Sw: DOTTERBOLAG) of
the Borrower, directly or indirectly, in accordance with the
Swedish Companies Act (Sw: AKTIEBOLAGSLAGEN).
"SWEDISH KRONOR" or "SEK" means the lawful
currency of Sweden.
"TAXES" means all types (whether now existing or
introduced in the future) of income and other taxes, levies,
imposts, deductions, charges and withholdings whatsoever together
with interest thereon and penalties and surcharges with respect
thereto, if any, and any payments made on or in respect thereof,
and "TAX" and "TAXATION" shall be construed accordingly.
"TRUSTEE" means Bankers Trust Company, as
Trustee under the indenture governing the Notes, dated as of 10
April 2001, by and between the Lender, Deutsche Bank AG London, as
principal paying agent, and the Trustee.
2. INTERPRETATION
A. A reference in this Agreement or in any other
document referred to herein or delivered in
connection herewith to a statute or any provision
thereof shall refer also to that statute or provision
as amended or re-enacted.
B. A reference in this Agreement or in any other
document referred to herein or delivered in
connection herewith to an agreement or document shall
refer also to such agreement or document as amended,
varied or supplemented and shall include all
appendices and other attachments.
XLVII. Shareholder loans
1. On the Effective Date the Lender may provide the Borrower with
a loan subject to the terms of this Agreement. The amount of
such loan, if any, shall be determined in accordance with the
Debt Restructuring Agreement. Such loan amount shall
constitute Subordinated Debt.
<Page>
5(5)
2. The Lender and the Borrower may agree that the Lender shall
provide the Borrower with additional financing in the form of
Subordinated Debt. Such additional financing shall be
disbursed as agreed between the parties.
3. Any distributions from the Borrower to the Lender by way of
group contributions (Sw: KONCERNBIDRAG), made in order to
obtain the most favourable tax position within the group
(including the Parent) in Sweden, shall be distributed in the
form of loans hereunder from the Lender to the Borrower, so
that the amount of such loan shall constitute Subordinated
Debt, unless the parties agree otherwise (provided this is
permissible under other agreements binding on the Borrower and
the Lender).
4. Nothing in Clause 2.3 shall restrict the Borrower from paying
dividends in cash to the Lender, provided such dividends are
permissible under other agreements binding on the Borrower and
the Lender.
5. The Loan shall be evidenced by one or several Loan Notes
signed by Authorised Signatories. A Loan Note shall be
executed promptly after a disbursement is made in accordance
with this Clause 2.
6. Nothing in this Agreement shall prevent the Borrower from
incurring other debt owed to the Lender which is not
Subordinated Debt (to the extent this is not prohibited under
other agreements binding on the Borrower and the Lender), from
repaying such other debt or from paying interest on such other
debt.
XLVIII. Repayment and conversion
1. The Borrower shall not repay the Loan, except as expressly
provided in Clause 4 (Events of Default), or with the prior
written consent of the Confirmed Creditors.
2. To the extent that may be required to avoid the Borrower being
obligated to enter into liquidation (Sw: LIKVIDATION), the
board of the Borrower may decide that the Loan (or part
thereof, as the case may be) shall be utilised in meeting
losses of the Borrower by writing down the principal amount of
the Loan by the amount required to avoid liquidation and
converting such amount into a conditional capital contribution
(Sw: VILLKORAT AKTIEAGARTILLSKOTT). The rights of the Lender
in respect of the converted amount will thereupon be converted
into rights of a provider of capital contributions. Upon
utilisation of any part of the Loan pursuant to this Clause
3.2, the Borrower shall give notice to the Lender.
<Page>
6(6)
3. The Loan shall be repaid only upon presentation of the
relevant Loan Note(s). If the Loan is partially repaid, a new
Loan Note for the remaining amount shall be executed.
XLIX. Events of default
1. Subject to any express exceptions, each of the events set out
in Clauses 4.2 to 4.9 below is an Event of Default (whether or
not caused by any reason whatsoever outside the control of the
Borrower or any other person).
2. NON-PAYMENT: The Borrower does not pay on the due date, any
amount due and payable by it hereunder in the currency and in
the manner specified, provided that it shall not constitute an
Event of Default if such failure is due solely to technical
errors and the Borrower remedies the same within three (3)
Business Days of the due date for payment.
3. CROSS-DEFAULT:
(e) Any Financial Indebtedness of the Borrower or any
Subsidiary is not paid when due or within the
applicable grace period (if any).
(f) Any Financial Indebtedness of the Borrower or any
Subsidiary is declared prematurely due and payable or
is placed on demand, in either case as a result of an
event of default (howsoever described) under the
document relating to that Financial Indebtedness.
(g) Any commitment for, or underwriting of, any
Financial Indebtedness of the Borrower or any
Subsidiary is cancelled or suspended as a result of an
event of default (howsoever described) under the
document relating to that Financial Indebtedness.
(h) The circumstances in this Clause 4.3 will only
constitute an Event of Default if the amount of
Financial Indebtedness referred to exceeds SEK
150,000,000 in aggregate.
4. INSOLVENCY:
(d) The Borrower is, or is deemed for the purposes
of any law to be, insolvent or admits in writing its
inability to pay its debts as they fall due.
<Page>
7(7)
(e) The Borrower suspends making payments on all or
any class of its debts or announces an intention to
do so, or a moratorium is declared in respect of any
of its indebtedness.
(f) The Borrower commences negotiations with any
one or more of its creditors with a view to the
general readjustment or rescheduling of its
indebtedness, or makes a composition or an
arrangement with its creditors or any similar
proceeding, arrangement or assignment.
5. INSOLVENCY PROCEEDINGS:
(c) The Borrower takes any corporate action or any
order is made or resolution passed for the
suspension of payments, business reorganisation (Sw:
FORETAGSREKONSTRUKTION), liquidation or bankruptcy
of the Borrower (except in the context of a solvent
reconstruction with the Borrower as surviving
entity).
(d) A liquidator, receiver, insolvency manager,
reconstruction manager (Sw: FORETAGSREKONSTRUKTOR) or
similar officer is appointed in respect of the Borrower
or in respect of all or substantially all of its
assets.
6. CREDITORS' PROCESS: Any distress or execution is levied
against, or an encumbrancer takes possession of, an asset or
certain of the assets of the Borrower the value of which asset
or assets exceeds SEK 50,000,000, unless such distress,
execution or taking possession is stayed, discharged, struck
out or given up within thirty (30) days of being levied or
taking place or is thereafter being contested in good faith
and by appropriate means.
7. CESSATION OF BUSINESS: The Borrower ceases or threatens to
cease to carry on all or a substantial part of its business.
8. REPUDIATION: The Borrower repudiates this Agreement.
9. UNLAWFULNESS: At any time it is or becomes unlawful for the
Borrower to perform or comply with any material or all of its
obligations under this Agreement or any of the obligations of
the Borrower under this Agreement are not or cease to be
legal, valid and binding, in either case in any material
respect.
10. In case of an Event of Default, provided such Event of Default
has not been cured or waived, the Lender shall provide all
Confirmed Creditors with a written notice specifying the Event
of Default. Following such notice the Lender shall consult
with the Confirmed Creditors with a view to curing such Event
of Default.
<Page>
8(8)
11. On and at any time after the occurrence of an Event of
Default, provided such Event of Default has not been cured or
waived, the Lender may, by notice to the Borrower declare the
Loan due and payable, whereupon it shall become due and
payable on the date specified by the Lender, provided,
however, that the date so specified shall not fall before the
expiry of the Subordination Period.
L. Interest
1. Neither the Loan nor any other amount which may be payable
hereunder shall carry interest before the date on which such
amount is due and payable.
2. If the Borrower fails to pay an amount payable by it under
this Agreement on the due date, it shall forthwith on demand
by the Lender pay interest on the overdue amount from the due
date up to the date of actual payment at a rate determined by
adding a margin of two (2) percentage units to STIBOR on the
due date. Interest shall be compounded at the end of each
thirty (30) day period during which the overdue amount remains
outstanding.
LI. Payments
1. All payments by the Borrower under this Agreement shall be
made for value on the due date (at such time as is customary
for the settlement of transactions in the relevant currency)
and in immediately available funds to the account at such
office or bank as the Lender may designate from time to time.
Any such designation shall be notified to the Borrower not
later than five (5) Business Days before the payment is due.
2. All payments made by the Borrower under this Agreement shall
be made without set-off or counterclaim.
3. If a payment is due on a day which is not a Business Day, the
due date for that payment shall instead be the following
Business Day.
4. A repayment or prepayment of the Loan is payable in Swedish
Kronor. Amounts payable in respect of costs, expenses and
Taxes and the like are payable in the currency in which they
are incurred.
5. If Swedish Kronor is replaced as legal tender in Sweden by the
euro, all references to Swedish Kronor in this Agreement shall
be deemed to be
<Page>
9(9)
references to the euro, provided that the Lender, acting
reasonably and in good faith and after having consulted with
the Borrower, shall determine at what time such replacement
shall be made for the purpose of this Agreement in the event
that such replacement includes a transition period. In case
of any such change of currency, this Agreement shall be
amended to the extent the Lender specifies to be necessary
to reflect the change in currency and to put the Lender and
the Borrowers in the same position, so far as possible, that
they would have been in if no change of currency had occurred.
LII. Withholdings
1. All payments to be made by the Borrower hereunder shall be
made free and clear of any deduction or withholding.
2. If the Borrower is required by law to make any deduction or
withholding on account of Tax or otherwise from any payment to
the Lender hereunder, the sum due from it in respect of such
payment shall be increased to the extent necessary to ensure
that, after making of such deduction or withholding, the
Lender receives a net sum equal to the sum which it would have
received had no deduction or withholding been made.
3. This Clause 7 (Withholdings) shall not apply in the case of
deductions or withholdings to be made with reference to income
tax on its overall income ultimately due by the Lender by
operation of applicable laws.
LIII. Indemnities
1. If the Lender receives an amount in respect of the Borrower's
liability under this Agreement or if that liability is
converted into a claim, proof, judgement or order in a
currency other than the currency in which such obligation is
due (the "CONTRACTUAL CURRENCY"):
(d) the Borrower shall on demand indemnify the Lender
as an independent obligation against any loss or
liability arising out of or as a result of the
conversion;
(e) if the amount received by the Lender, when
converted into the Contractual Currency at a market
rate in the usual course of its business, is less than
the amount owed in the Contractual Currency, the
Borrower shall on demand pay to the Lender an amount
in the Contractual Currency equal to the deficit; and
<Page>
10(10)
(f) the Borrower shall on demand pay to the Lender any
exchange costs and Taxes payable in connection with
any such conversion.
2. The Borrower shall on demand indemnify the Lender against any
cost, expense, loss or liability, as determined by the Lender,
which it incurs as a consequence of the occurrence of any
Event of Default (taking into account, where appropriate, any
amounts received by the Lender under Clause 5.2).
LIV. Representations and warranties
The Borrower represents and warrants that:
(d) it is a limited liability company, duly incorporated
and validly existing under the laws of Sweden, with
full power and authority to carry on its business as it
is being conducted and to execute and perform all of
its obligations under this Agreement and all action
required to authorise such execution and performance
has been duly taken;
(e) the execution and performance of this Agreement
will not violate any applicable law or regulation or
contravene any provision of its Articles of
Association; and
(f) subject to the qualifications in the legal opinions
as to matters of law in force on the date of this
Agreement and not fact, this Agreement constitutes its
legal, valid and binding obligations enforceable in
accordance with its terms.
LV. Restrictions in relation to the Loan
1. The Borrower undertakes that, during the Subordination Period,
except as expressly permitted by this Agreement or with the
prior written consent of the Confirmed Creditors, it will not,
and will procure that no Subsidiary will:
(e) pay, prepay or repay, discharge by way of set-off,
or acquire, any Subordinated Debt;
(f) pay interest on any Subordinated Debt;
<Page>
11(11)
(g) create or permit to subsist, any Security Interest
or other encumbrance over any of its assets, or give
any financial support, for any Subordinated Debt; or
(h) take or omit to take any action whereby the ranking
and/or subordination of the Subordinated Debt
contemplated by this Agreement may be impaired.
2. The Lender undertakes that, during the Subordination Period,
except as expressly permitted by this Agreement or with the
prior written consent of the Confirmed Creditors, it will not:
(f) demand or receive payment, prepayment or repayment,
or accept discharge by way of set-off, of any
Subordinated Debt;
(g) demand or receive any payment of interest on any
Subordinated Debt;
(h) receive or permit to subsist, any Security Interest
or other encumbrance, or give any financial support,
for any Subordinated Debt (for the avoidance of doubt,
any Security Interest created by the Lender over its
rights under the Shareholder Loan No. 1A, in order to
secure the Notes shall not constitute a breach
hereunder);
(i) assign, transfer or otherwise dispose of any
Subordinated Debt to a third party, provided, however,
that (i) the Lender may assign Subordinated Debt to the
Parent or a wholly-owned subsidiary of the Parent in
accordance with Clause 14.2 (provided this is
permissible under other agreements binding on the
Lender), and (ii) the Lender may assign its rights
under the Shareholder Loan No. 1A by way of security to
Trustee on behalf of the Noteholders; or
(j) commence any proceedings against the Borrower or
any Subsidiary in respect of any Subordinated Debt
(including, without limitation, applying for
enforcement of any amount outstanding or for the
liquidation, bankruptcy or re-organisation of the
Borrower or any Subsidiary).
LVI. Subordination in case of insolvency
<Page>
12(12)
1. In an insolvency or bankruptcy of the Borrower or any
Subsidiary initiated during the Subordination Period, the
Lender shall endeavour to procure that any distributions with
respect to the Subordinated Debt by the bankruptcy
administrator or liquidator, or any other person making the
distribution, are made to the Senior Creditors to the extent
necessary to repay all the Senior Debt in full.
2. Any release, discharge or settlement between Lender and the
Senior Creditors (or any of them) shall be conditional upon no
security, disposition or payment to any Senior Creditor being
void, set aside or ordered to be refunded pursuant to any law
relating to bankruptcy, liquidation or insolvency, or for any
other reason whatsoever, and if such condition shall not be
fulfilled the Senior Creditors shall be entitled to enforce
this Agreement subsequently as if such release, discharge or
settlement had not occurred and any such payment had not been
made.
LVII. Redistribution of payments
1. In the event that any payment in respect of Subordinated Debt
is received by the Lender, in cash or in kind, by way of
set-off or otherwise, in violation of this Agreement, the
Lender shall hold such payment, up to the amount of the Senior
Debt, separated and for the account of the Senior Creditors,
and promptly pay and distribute it to the Senior Creditors for
application towards the Senior Debt.
2. If the Senior Debt is partially paid out of any proceeds
received in respect of or on account of any Subordinated Debt,
the Lender will not be entitled to exercise any subrogation
right to the Senior Debt until the Senior Debt has been
irrevocably paid and discharged in full.
LVIII. Further assurances of subordination
1. The Borrower and the Lender shall enter into Confirmations of
Subordination with the other lenders to the Borrower from time
to time to confirm that such lenders have the benefit of the
subordination provisions in this Agreement and qualify as
"Confirmed Creditors" hereunder.
2. Each of the Lender and the Borrower undertakes, at its own
expense, from time to time, upon reasonable request, to do all
such acts and execute all such documents as may be necessary
for giving full effect to the
<Page>
13(13)
subordination of the Subordinated Debt to the Senior Debt
as envisaged by this Agreement and securing to the Senior
Creditors the full benefit of the rights, powers and remedies
conferred upon them in this Agreement.
LIX. Assignment
1. The Borrower may not assign, transfer, novate or dispose of
any of, or any interest in, its rights and/or obligations
under this Agreement.
2. The Lender may at any time assign all or any part of its
rights and obligations under this Agreement to the Parent or a
wholly-owned subsidiary of the Parent which adheres to this
Agreement (if such subsidiary ceases to be so owned, the
rights and obligations shall be reassigned to the Lender),
provided this is permissible under other agreements binding on
the Lender.
LX. Miscellaneous
1. No amendment to this Agreement shall be effective against any
party unless made in writing and signed by such party.
2. No delay or omission in exercising any powers or privileges
hereunder shall be construed as a waiver thereof or an
acquiescence therewith. Any exercise of any part of the rights
shall not preclude subsequent enforcement of any such rights
which have not, or have not fully, been exercised.
LXI. Notices
1. All notices or other communications under or in connection
with this Agreement shall be in the English language and be
given by letter or by telefax (and, in the case of telefax,
confirmed by letter). Any such notice will be deemed to be
given as follows:
(c) if by letter, when delivered to the address notified
in accordance with Clause 16.3; and
(d) if by telefax, when received.
<Page>
14(14)
2. Any notice received on a non-working day or after business
hours in the place of receipt will only be deemed to be given
on the next working day in that place.
3. The address and telefax number of each party for all notices
under or in connection with this Agreement are:
The Lender: Preem Holdings AB (publ)
Attention: Richard Ohman
Biblioteksgatan 29
P.O. Box 5785
SE-114 87 Stockholm
Sweden
Telephone: +46 8 614 13 00
Telefax: +46 8 614 13 14
The Borrower: Preem Petroleum AB
Attention: Chief Financial Officer
Sandhamnsgatan 51
P.O. Box 27800
SE-115 90 Stockholm
Sweden
Telephone: +46 8 450 10 00
Telefax: +46 8 450 10 55
or any other address notified by one party to the other parties by
not less than five (5) Business Days' notice.
LXII. Governing law and jurisdiction
1. This Agreement shall be governed by and construed in
accordance with Swedish law.
2. The courts of Sweden shall have non-exclusive jurisdiction
over matters arising out of or in connection with this
Agreement. The City Court of Stockholm shall be court of first
instance.
-----------------
<Page>
15(15)
IN WITNESS WHEREOF, this Agreement has been signed in two (2)
originals, of which the parties have received one each.
PREEM HOLDINGS AB (publ)
as Lender
------------------------- ------------------------
Name: Karim Karaman Name: Lars Nelson
PREEM PETROLEUM AB
as Borrower
------------------------- -------------------------
Name: Richard Ohman Name: Lars Nelson
<Page>
SCHEDULE 2
FORM OF CONFIRMATION OF SUBORDINATION
This CONFIRMATION OF SUBORDINATION is entered into in
connection with the Shareholder Loan Agreement No. 1B entered into between Preem
Holdings AB (publ) (the "JUNIOR LENDER") and Preem Petroleum AB (the "BORROWER")
on 10 April 2001 (the "AGREEMENT"). Terms defined in the Agreement shall have
the same meanings when used herein.
The Agreement contains provisions to the effect that the Loan
shall during the Subordination Period be subordinated to the Borrower's other
indebtedness, except other Subordinated Debt and Shareholder Loan No. 1A. The
Agreement also provides the Senior Creditors to the Borrower with certain rights
as Confirmed Creditors, provided they have entered into Confirmations of
Subordination. [NAME] (the "SENIOR LENDER") is a lender to the Borrower and has
requested to have the benefit of the rights conferred upon the Confirmed
Creditors in the Agreement.
The parties hereby agree that the Senior Lender shall have the
benefit of all rights conferred upon the Confirmed Creditors as Senior Creditors
in the Agreement. All indebtedness owed by the Borrower to the Senior Lender
shall constitute Senior Debt under the Agreement. The parties further agree that
any amendment of, variation or modification to, or termination of, the Agreement
(including the waiver of any right under the Agreement) shall require the prior
written consent of the Senior Lender.
The address and telefax number of the Senior Lender for all
notices under or in connection with this Confirmation of Subordination are:
[ADDRESS]
Attention: [TITLE]
Telephone: [NUMBER]
Telefax: [NUMBER]
or any other address notified by the Senior Lender to the other parties by not
less than five (5) Business Days' notice. The addresses and telefax numbers of
the Junior Lender and the Borrower are set out in the Agreement.
All notices or other communications under or in connection
with this Confirmation of Subordination shall be in the English language and be
given by letter or by telefax (and, in the case of telefax, confirmed by
letter). Any such notice will be deemed to be given, if by letter, when
delivered to the address notified in accordance with the above, and, if by
telefax, when received. Any notice received on a non-working day or after
business hours in the place of receipt will only be deemed to be given on the
next working day in that place.
<Page>
This Confirmation of Subordination shall be governed by and
construed in accordance with Swedish law. The courts of Sweden shall have
non-exclusive jurisdiction over matters arising out of or in connection with
this Confirmation of Subordination. The City Court of Stockholm shall be court
of first instance.
Date: [DATE]
PREEM PETROLEUM AB PREEM HOLDINGS AB (publ)
as Borrower as Junior Lender
--------------------------- ---------------------------
Name: Name:
-------------------------- ----------------------------
Name: Name:
[NAME]
as Senior Lender
---------------------------
Name:
---------------------------
Name:
<Page>
SHAREHOLDER LOAN AGREEMENT NO. 2
10 APRIL 2001
BETWEEN
CORRAL PETROLEUM HOLDINGS AB (PUBL)
AS LENDER
AND
PREEM HOLDINGS AB (PUBL)
AS BORROWER
<Page>
This SHAREHOLDER LOAN AGREEMENT is dated as of 10 April 2001
between:
CORRAL PETROLEUM HOLDINGS AB (PUBL), reg. no. 556477-1284,
(the "LENDER"); and
PREEM HOLDINGS AB (PUBL), reg. no. 556206-9673, (the
"BORROWER").
LXIII. Definitions and interpretation
1. DEFINITIONS
"AGREEMENT" means this Shareholder Loan
Agreement.
"BUSINESS DAY" means a day (other than a
Saturday or Sunday) which is not a public holiday and on which
banks are open for general business in Stockholm.
"CONFIRMATION OF SUBORDINATION" means an
agreement in the form of SCHEDULE 1 entered into by the Borrower,
the Lender and the Trustee.
"DEBT RESTRUCTURING AGREEMENT" means the Debt
Restructuring Agreement entered into on or about the date hereof
among the Borrower, the Lender and Preem Petroleum for the purpose
of restructuring and assigning existing shareholder debt owed by
Preem Petroleum.
"EFFECTIVE DATE" means the date defined as such
in the Debt Restructuring Agreement.
"INDENTURE" means the indenture between the
Borrower and the Trustee governing the Notes, dated on or about
the date hereof.
"LOAN" means the total principal amount advanced
or to be advanced by the Lender under Clause 2 (Shareholder Loans)
in one or several disbursements, or the total principal amount
outstanding hereunder at any time. The Loan shall be denominated
in Swedish Kronor.
"NOTEHOLDERS" means the holders from time to
time of the Notes.
"NOTES" means the 10 5/8 % senior secured notes
due 2011 and any additional notes issued under the indenture
governing the Notes, dated as
<Page>
2(2)
of 10 April 2001, by and between the Lender, Deutsche Bank AG
London, as principal paying agent, and the Trustee.
"PREEM PETROLEUM" means Preem Petroleum AB, reg.
no. 556072-6977.
"SECURITY INTEREST" means any mortgage, pledge,
lien, charge, assignment by way of security, hypothecation,
security interest, title retention (other than in respect of goods
purchased in the ordinary course of trading), sale and repurchase
or sale and lease-back arrangement or any other agreement or
arrangement in each case having the effect of conferring security.
"SENIOR DEBT" means all present and future liabilities of the
Borrower to the Noteholders under the Notes and the Indenture,
absolute or contingent, whether or not matured, including, without
limitation, principal, interest, damages and costs.
"SHAREHOLDER LOAN NO. 1B" means the Shareholder
Loan Agreement No. 1B entered into on or about the date hereof
between the Borrower as lender and Preem Petroleum as borrower.
"STIBOR" means the Stockholm Interbank Offered
Rate as quoted on the Reuters screen SIOR (or such other screen as
may replace that screen) at or about 11.00 a.m. (Stockholm time)
on the relevant date or, if the relevant rate does not appear, the
average (rounded upwards to four decimal places) of the rates
which prime banks were offering to other prime banks in the
Stockholm interbank market for deposits in Swedish Kronor as of
11.00 a.m. (Stockholm time) on the relevant date, in each case for
a period of thirty (30) days.
"SUBORDINATED DEBT" means (i) the indebtedness
of the Borrower to the Lender hereunder, and (ii) any other
indebtedness of the Borrower to the Lender, absolute or
contingent, whether or not matured, including, without limitation,
principal, interest, damages and costs.
"SUBORDINATION PERIOD" means the period from the Effective Date
until the date on which all Senior Debt has been fully and finally
satisfied.
"SUBSIDIARY" means any Swedish or foreign legal entity (whether
incorporated or not), which is a subsidiary (Sw: DOTTERBOLAG) of
the Borrower, directly or indirectly, in accordance with the
Swedish Companies Act (Sw: AKTIEBOLAGSLAGEN).
"SWEDISH KRONOR" or "SEK" means the lawful
currency of Sweden.
<Page>
3(3)
"TAXES" means all types (whether now existing or
introduced in the future) of income and other taxes, levies,
imposts, deductions, charges and withholdings whatsoever together
with interest thereon and penalties and surcharges with respect
thereto, if any, and any payments made on or in respect thereof,
and "TAX" and "TAXATION" shall be construed accordingly.
"TRUSTEE" means Bankers Trust Company, as
Trustee under the indenture governing the Notes, dated as of 10
April 2001, by and between the Lender, Deutsche Bank AG London, as
principal paying agent, and the Trustee.
2. INTERPRETATION
A. A reference in this Agreement or in any other
document referred to herein or delivered in
connection herewith to a statute or any provision
thereof shall refer also to that statute or provision
as amended or re-enacted.
B. A reference in this Agreement or in any other
document referred to herein or delivered in
connection herewith to an agreement or document shall
refer also to such agreement or document as amended,
varied or supplemented and shall include all
appendices and other attachments.
LXIV. Shareholder loans
1. On the Effective Date the Lender shall provide the Borrower
with a loan, subject to the terms of this Agreement. The
amount of such loan shall be determined in accordance with the
Debt Restructuring Agreement. Such loan amount shall
constitute Subordinated Debt.
2. Any further indebtedness owed by the Borrower to the Lender
shall also constitute Subordinated Debt, unless the parties
agree otherwise (provided this is permissible pursuant to the
terms of the Notes and the Indenture). Such further
indebtedness shall be incurred as agreed between the parties.
3. Any distributions from Preem Petroleum to the Borrower by way
of group contributions (Sw: KONCERNBIDRAG) which are made in
the form of subordinated loans from the Borrower to Preem
Petroleum under Clause 2.3 of the Shareholder Loan Agreement
No. 1B, shall be further distributed from the Borrower to the
Lender as group contributions in the form of loans hereunder
from the Lender to the Borrower, so that the amount of such
loans shall constitute Subordinated Debt.
<Page>
4(4)
4. Nothing in this Agreement shall prevent the Borrower from
incurring other debt owed to the Lender which is not
Subordinated Debt (to the extent this is not prohibited under
the terms of the Notes or the Indenture), from repaying such
other debt or from paying interest on such other debt.
LXV. Repayment
The Borrower shall not repay the Loan during the
Subordination Period, except with the prior written consent of the
Trustee.
LXVI. Interest
1. Neither the Loan nor any other amount which may be payable
hereunder shall carry interest before the date on which such
amount is due and payable.
2. If the Borrower fails to pay an amount payable by it under
this Agreement on the due date, it shall forthwith on demand
by the Lender pay interest on the overdue amount from the due
date up to the date of actual payment at a rate determined by
adding a margin of two (2) percentage units to STIBOR on the
due date. Interest shall be compounded at end of each thirty
(30) day period during which the overdue amount remains
outstanding.
LXVII. Payments
1. All payments by the Borrower under this Agreement shall be
made for value on the due date (at such time as is customary
for the settlement of transactions in the relevant currency)
and in immediately available funds to the account at such
office or bank as the Lender may designate from time to time.
Any such designation shall be notified to the Borrower not
later than five (5) Business Days before the payment is due.
2. All payments made by the Borrower under this Agreement shall
be made without set-off or counterclaim.
3. If a payment is due on a day which is not a Business Day, the
due date for that payment shall instead be the following
Business Day.
<Page>
5(5)
4. A repayment or prepayment of the Loan is payable in Swedish
Kronor. Amounts payable in respect of costs, expenses and
Taxes and the like are payable in the currency in which they
are incurred.
5. If Swedish Kronor is replaced as legal tender in Sweden by the
euro, all references to Swedish Kronor in this Agreement shall
be deemed to be references to the euro, provided that the
Lender, acting reasonably and in good faith and after having
consulted with the Borrower, shall determine at what time such
replacement shall be made for the purpose of this Agreement in
the event that such replacement includes a transition period.
In case of any such change of currency, this Agreement shall
be amended to the extent the Lender specifies to be necessary
to reflect the change in currency and to put the Lender and
the Borrowers in the same position, so far as possible, that
they would have been in if no change of currency had occurred.
LXVIII. Withholdings
1. All payments to be made by the Borrower hereunder shall be
made free and clear of any deduction or withholding.
2. If the Borrower is required by law to make any deduction or
withholding on account of Tax or otherwise from any payment to
the Lender hereunder, the sum due from it in respect of such
payment shall be increased to the extent necessary to ensure
that, after making of such deduction or withholding, the
Lender receives a net sum equal to the sum which it would have
received had no deduction or withholding been made.
3. This Clause 6 (Withholdings) shall not apply in the case of
deductions or withholdings to be made with reference to income
tax on its overall income ultimately due by the Lender by
operation of applicable laws.
LXIX. Indemnities
If the Lender receives an amount in respect of the Borrower's liability
under this Agreement or if that liability is converted into a claim, proof,
judgement or order in a currency other than the currency in which such
obligation is due (the "CONTRACTUAL CURRENCY"):
(a) the Borrower shall on demand indemnify the Lender
as an independent obligation against any loss or
liability arising out of or as a result of the
conversion;
<Page>
6(6)
(b) if the amount received by the Lender, when converted
into the Contractual Currency at a market rate in the
usual course of its business, is less than the amount
owed in the Contractual Currency, the Borrower shall on
demand pay to the Lender an amount in the Contractual
Currency equal to the deficit; and
(c) the Borrower shall on demand pay to the Lender any
exchange costs and Taxes payable in connection with
any such conversion.
LXX. Representations and warranties
The Borrower represents and warrants that:
(a) it is a limited liability company, duly incorporated
and validly existing under the laws of Sweden, with
full power and authority to carry on its business as it
is being conducted and to execute and perform all of
its obligations under this Agreement and all action
required to authorise such execution and performance
has been duly taken;
(b) the execution and performance of this Agreement will
not violate any applicable law or regulation or
contravene any provision of its Articles of
Association; and
(c) subject to the qualifications in the legal opinions
as to matters of law in force on the date of this
Agreement and not fact, this Agreement constitutes its
legal, valid and binding obligations enforceable in
accordance with its terms.
LXXI. Restrictions in relation to the Loan
1. The Borrower undertakes that, during the Subordination Period,
except as expressly permitted by this Agreement or with the
prior written consent of the Trustee, it will not, and will
procure that no Subsidiary will:
(a) pay, prepay or repay, discharge by way of set-off,
or acquire, any Subordinated Debt;
(b) pay interest on any Subordinated Debt;
(c) create or permit to subsist, any Security Interest
or other encumbrance over any of its assets, or give
any financial support, for any Subordinated Debt; or
<Page>
7(7)
(d) take or omit to take any action whereby the ranking
and/or subordination of the Subordinated Debt
contemplated by this Agreement may be impaired.
2. The Lender undertakes that, during the Subordination Period,
except as expressly permitted by this Agreement or with the
prior written consent of the Trustee, it will not:
(a) demand or receive payment, prepayment or repayment,
or accept discharge by way of set-off, of any
Subordinated Debt;
(b) demand or receive any payment of interest on any
Subordinated Debt;
(c) receive or permit to subsist, any Security Interest
or other encumbrance, or give any financial support,
for any Subordinated Debt;
(d) assign, transfer or otherwise dispose of any
Subordinated Debt to a third party; or
(e) commence any proceedings against the Borrower or any
Subsidiary in respect of any Subordinated Debt
(including, without limitation, applying for
enforcement of any amount outstanding or for the
liquidation, bankruptcy or re-organisation of the
Borrower or any Subsidiary).
LXXII. Subordination in case of insolvency
1. In the insolvency or bankruptcy of the Borrower or any
Subsidiary initiated during the Subordination Period, the
Lender shall endeavour to procure that any distributions with
respect to the Subordinated Debt by the bankruptcy
administrator or liquidator, or any other person making the
distribution, are made to the Trustee on behalf of the
Noteholders to the extent necessary to repay all the Senior
Debt in full.
2. Any release, discharge or settlement between Lender and the
Trustee on behalf of the Noteholders (or any of them) shall be
conditional upon no security, disposition or payment to any
Noteholder being void, set aside or ordered to be refunded
pursuant to any law relating to bankruptcy, liquidation or
insolvency, or for any other reason whatsoever, and if such
condition shall not be fulfilled the Trustee on behalf of the
Noteholders shall be entitled to enforce this Agreement
subsequently as if such release,
<Page>
8(8)
discharge or settlement had not occurred and any such payment
had not been made.
LXXIII. Redistribution of payments
1. In the event that any payment in respect of Subordinated Debt
is received by the Lender, in cash or in kind, by way of
set-off or otherwise, in violation of this Agreement, the
Lender shall hold such payment, up to the amount of the Senior
Debt, separated and for the account of the Noteholders, and
promptly pay it to the Trustee for distribution to the
Noteholders for application towards the Senior Debt.
2. If the Senior Debt is partially paid out of any proceeds
received in respect of or on account of any Subordinated Debt,
the Lender will not be entitled to exercise any subrogation
right to the Senior Debt until the Senior Debt has been
irrevocably paid and discharged in full.
LXXIV. Further assurances of subordination
1. The Borrower, the Lender and the Trustee shall enter into a
Confirmation of Subordination to confirm that Trustee on
behalf of the Noteholders has the benefit of the subordination
provisions in this Agreement.
2. Each of the Lender and the Borrower undertakes, at its own
expense, from time to time, upon reasonable request, to do all
such acts and execute all such documents as may be necessary
for giving full effect to the subordination of the
Subordinated Debt to the Senior Debt as envisaged by this
Agreement and securing to the Trustee on behalf of the
Noteholders the full benefit of the rights, powers and
remedies conferred upon them in this Agreement.
LXXV. Assignment
1. The Borrower may not assign, transfer, novate or dispose of
any of, or any interest in, its rights and/or obligations
under this Agreement.
2. The Lender may not assign, transfer, novate or dispose of any
of, or any interest in, its rights and/or obligations under
this Agreement.
LXXVI. Miscellaneous
<Page>
9(9)
1. No amendment to this Agreement shall be effective against any
party unless made in writing and signed by such party.
2. No delay or omission in exercising any powers or privileges
hereunder shall be construed as a waiver thereof or an
acquiescence therewith. Any exercise of any part of the rights
shall not preclude subsequent enforcement of any such rights
which have not, or have not fully, been exercised.
LXXVII. Notices
1. All notices or other communications under or in connection
with this Agreement shall be in the English language and be
given by letter or by telefax (and, in the case of telefax,
confirmed by letter). Any such notice will be deemed to be
given as follows:
(a) if by letter, when delivered to the address
notified in accordance with Clause 15.3; and
(b) if by telefax, when received.
2. Any notice received on a non-working day or after business
hours in the place of receipt will only be deemed to be given
on the next working day in that place.
3. The address and telefax number of each party for all notices
under or in connection with this Agreement are:
The Lender: Corral Petroleum Holdings AB (publ)
Attention: Managing Director
Biblioteksgatan 29
P.O. Box 5785
SE-114 87 Stockholm
Sweden
Telephone: +46 8 614 13 00
Telefax: +46 8 614 13 14
The Borrower: Preem Holdings AB (publ)
Attention: Richard Ohman
Biblioteksgatan 29
P.O. Box 5785
SE-114 87 Stockholm
Sweden
<Page>
10(10)
Telephone: +46 8 614 13 00
Telefax: +46 8 614 13 14
or any other address notified by one party to the other parties by
not less than five (5) Business Days' notice.
LXXVIII. Governing law and jurisdiction
1. This Agreement shall be governed by and construed in
accordance with Swedish law.
2. The courts of Sweden shall have non-exclusive jurisdiction
over matters arising out of or in connection with this
Agreement. The City Court of Stockholm shall be court of first
instance.
-----------------
IN WITNESS WHEREOF, this Agreement has been signed in two (2)
originals, of which the parties have received one each.
CORRAL PETROLEUM HOLDINGS AB (publ)
as Lender
--------------------------
Name: Richard Ohman
PREEM HOLDINGS AB (publ)
as Borrower
-------------------------- -------------------------
Name: Karim Karaman Name: Lars Nelson
<Page>
1(1)
SCHEDULE 1
FORM OF CONFIRMATION OF SUBORDINATION
This CONFIRMATION OF SUBORDINATION is entered into in
connection with the Shareholder Loan Agreement No. 2 entered into between Corral
Petroleum Holdings AB (publ) (the "JUNIOR LENDER") and Preem Holdings AB (publ)
(the "BORROWER") on 10 April 2001 (the "AGREEMENT"). Terms defined in the
Agreement shall have the same meanings when used herein.
The Agreement contains provisions to the effect that the Loan
shall be subordinated to the Borrower's indebtedness to the Noteholders during
the Subordination Period. The Agreement also provides Bankers Trust Company (the
"TRUSTEE") acting on behalf of the Noteholders with certain rights.
The parties hereby agree that the Trustee, acting on behalf of
the Noteholders, shall have the benefit of all rights conferred upon it in the
Agreement. All indebtedness owed by the Borrower to the Noteholders shall
constitute Senior Debt under the Agreement. The parties further agree that any
amendment of, variation or modification to, or termination of, the Agreement
(including the waiver of any right under the Agreement) shall require the prior
written consent of the Trustee.
The address and telefax number of the Trustee for all notices
under or in connection with this Confirmation of Subordination are:
[ADDRESS]
Attention: [TITLE]
Telephone: [NUMBER]
Telefax: [NUMBER]
or any other address notified by the Trustee to the other parties by not less
than five (5) Business Days' notice. The addresses and telefax numbers of the
Junior Lender and the Borrower are set out in the Agreement.
All notices or other communications under or in connection
with this Confirmation of Subordination shall be in the English language and be
given by letter or by telefax (and, in the case of telefax, confirmed by
letter). Any such notice will be deemed to be given, if by letter, when
delivered to the address notified in accordance with the above, and, if by
telefax, when received. Any notice received on a non-working day or after
business hours in the place of receipt will only be deemed to be given on the
next working day in that place.
<Page>
2(2)
This Confirmation of Subordination shall be governed by and
construed in accordance with Swedish law. The courts of Sweden shall have
non-exclusive jurisdiction over matters arising out of or in connection with
this Confirmation of Subordination. The City Court of Stockholm shall be court
of first instance.
Date: [DATE]
PREEM HOLDINGS AB (publ) CORRAL PETROLEUM HOLDINGS AB (publ)
as Borrower as Junior Lender
--------------------------- ---------------------------
Name: Name:
---------------------------
Name:
BANKERS TRUST COMPANY
as Trustee
---------------------------
Name:
---------------------------
Name:
<Page>
3(3)
ANNEX C
[Form of Opinion of U.S. Counsel for the Company]
Akin, Gump, Strauss, Hauer & Feld shall have furnished to the
Initial Purchasers their written opinion, as United States counsel to the
Company, addressed to the Initial Purchasers and dated the Closing Date, in form
and substance reasonably satisfactory to the Initial Purchasers, substantially
to the effect set forth below:
A. assuming due authorization, execution and delivery by the Company under
the laws of the Kingdom of Sweden, this Agreement has been duly
executed and delivered by the Company;
B. assuming due authorization, execution and delivery by the Company under
the laws of the Kingdom of Sweden, the Indenture has been duly executed
and delivered by the Company and assuming due authorization, execution
and delivery by the Trustee of the Indenture, the Indenture is a valid
and binding agreement, enforceable against the Company in accordance
with its terms, except to the extent that such enforceability may be
limited by applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws affecting creditors'
rights generally and by general equitable principles (whether
considered in a proceeding in equity or at law);
C. assuming due authorization, execution and delivery by the Company under
the laws of the Kingdom of Sweden and due authentication in accordance
with the terms of the Indenture, when delivered to and paid for by the
Initial Purchasers in accordance with the terms of this Agreement, the
Securities will have been duly executed and issued by the Company and
will be valid and binding obligations of the Company, enforceable
against the Company in accordance with their terms and entitled to the
benefits of the Indenture, except to the extent that such
enforceability may be limited by applicable bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar
laws affecting creditors' rights generally and by general equitable
principles (whether considered in a proceeding in equity or at law);
<Page>
D. assuming due authorization, execution and delivery by the Company under
the laws of the Kingdom of Sweden, each of the other Transaction
Documents has been duly executed and delivered by the Company and
assuming due authorization, execution and delivery by the other parties
thereto, each such Transaction Document is a valid and binding
agreement, enforceable against the Company in accordance with its
terms, except to the extent that such enforceability may be limited by
applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws affecting creditors'
rights generally and by general equitable principles (whether
considered in a proceeding in equity or at law);
E. the issuance and sale by the Company at the Closing Date of the
Securities, the compliance by the Company with the terms thereof and of
the Transaction Documents and the consummation of the transactions
contemplated by the Transaction Documents do not and will not conflict
with or result in a violation of (a) any existing applicable statutory
law, rule or regulation of any court or governmental agency or body of
the United States or the State of New York (other than state securities
or "Blue Sky" laws as to which we have not been requested to express
any opinion) or (b) any order, known to us, of any government,
government instrumentality or court of the United States or the State
of New York having jurisdiction over the Company or any of its
subsidiaries or any of their properties or assets;
F. assuming due authorization, execution and delivery by the Company under
the laws of the Kingdom of Sweden, the Security Agreements create in
favor of the Trustee for the benefit of the holders of the Securities
an enforceable security interest under the Uniform Commercial Code as
in effect in the State of New York in the Collateral;(1)
G. no consent, approval, authorization, order, decree, registration or
qualification of or filing of or with any United States Federal or New
York governmental agency or body is required for the execution,
delivery and performance by the Company of each of the Transaction
Documents, the issuance, authentication, sale and delivery of the
Securities and compliance by the Company with the terms thereof and the
consummation of the transactions contemplated by the Transaction
Documents, except such as may be required by state securities or Blue
Sky laws; no opinion need be expressed, however, as to (a) the laws of
any jurisdiction outside the United States and (b) laws other than
those that, in the experience of such counsel, are normally applicable
to transactions of the type provided for by this Agreement;
H. each Transaction Document conforms in all material respects to the
description thereof contained in the Offering Memorandum;
- --------
(1) Note that if the Collateral is held in New York, the Initial Purchasers
will require an opinion relating to perfection as well.
<Page>
I. the statements made in the Prospectus under the headings "Description
of the Notes" and "Certain Swedish and United States Federal Income Tax
Consequence--United States," insofar as they purport to summarize
matters of U.S. federal law, constitute accurate summaries of such law
in all material respects;
J. neither the Company nor any of its subsidiaries is (a) an "investment
company" or a company "controlled by" an investment company within the
meaning of the Investment Company Act and the rules and regulations of
the Commission thereunder or (b) a "holding company" or a "subsidiary
company" of a holding company or an "affiliate" thereof within the
meaning of the Public Utility Holding Company Act of 1935, as amended;
K. neither the consummation of the transactions contemplated by this
Agreement nor the sale, issuance, execution or delivery of the
Securities will violate Regulation G, T, U or X of the Federal Reserve
Board;
L. no registration of the Securities under the Securities Act or
qualification of the Indenture under the Trust Indenture Act is
required for the offer and sale of the Securities by the Company to the
Initial Purchasers or the reoffer, resale and delivery of the
Securities by the Initial Purchasers to the initial purchasers
therefrom in the manner contemplated by this Agreement, the Indenture
and the Offering Memorandum;
M. the Indenture conforms in all material respects with the requirements
of the Trust Indenture Act and the rules and regulations of the
Commission applicable to an indenture which is qualified thereunder;
N. there are no stamp or other issuance or transfer taxes or duties,
value-added taxes, documentary taxes, capital gains, income,
withholding or other taxes payable in New York State or New York City
by or on behalf of the Initial Purchasers in connection with (a) the
issuance of Securities, (b) the sale, transfer and delivery of the
Securities to the Initial Purchasers pursuant to this Agreement or for
the resale of the Securities placed by or at the direction of the
Initial Purchasers or (c) the execution and delivery of this Agreement
or any of the other Transaction Documents or the consummation of any of
the transactions contemplated hereby or thereby; and
O. assuming the validity of such actions under the laws of the Kingdom of
Sweden, under the laws of the State of New York relating to submission
to personal jurisdiction, the Company has, pursuant to Section XVIII of
this Agreement, legally, validly and irrevocably submitted to the
personal jurisdiction of any state or federal court located in the
Borough of Manhattan, The City of New York, New York in any action
based on or arising under this Agreement or the transactions
contemplated thereby, and has legally, validly and effectively
appointed the Authorized Agent as
<Page>
its authorized agent for the purposes described in Section XVIII of
this Agreement, and the Company has validly and irrevocably waived
(a) the defense of an inconvenient forum to the maintenance of any
such suit or proceeding and (b) any immunity to jurisdiction to which
it may otherwise be entitled in any such suit or proceeding.
Such counsel shall also state that they have participated in
conferences with representatives of the Company, representatives of its
independent accountants and counsel and representatives of the Initial
Purchasers and their counsel at which conferences the contents of the
Preliminary Offering Memorandum and the Offering Memorandum and any amendment
and supplement thereto and related matters were discussed and, although such
counsel assumes no responsibility for the accuracy, completeness or fairness of
the Offering Memorandum or any amendment or supplement thereto (except as
expressly provided above), nothing has come to the attention of such counsel to
cause such counsel to believe that the Offering Memorandum or any amendment or
supplement thereto (other than the financial statements and other financial
information contained therein, as to which such counsel need express no belief),
as of the date thereof and as of the Closing Date, contained or contains any
untrue statement of a material fact or omitted or omits to state a material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading.
In such opinion, such counsel may rely (a) as to matters
involving the applicable laws of the Kingdom of Sweden, upon the opinion of
Mannheimer & Swartling, Swedish counsel to the Company and (b) as to factual
matters, upon certificates obtained from officers of the Company and from public
officials.
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ANNEX D
[Form of Opinion of Special Swedish Counsel for the Company]
Mannheimer & Swartling shall have furnished to the Initial Purchasers
their written opinion, as special Swedish counsel to the Company, addressed to
the Initial Purchasers and dated the Closing Date, in form and substance
reasonably satisfactory to the Initial Purchasers, substantially to the effect
set forth below:
i. the Company and each of its Swedish subsidiaries has been duly
organized and is validly existing as a corporation in good standing
under the laws of the Kingdom of Sweden, is duly qualified to do
business and is in good standing as a foreign corporation in each
jurisdiction in which its ownership or lease of property or the conduct
of its businesses requires such qualification, and has all power and
authority necessary to own or hold its properties and to conduct the
businesses in which it is engaged, except where the failure to so
qualify or have such power or authority would not, singularly or in the
aggregate, have a Material Adverse Effect;
ii. the Company has full corporate power and authority to execute and
deliver each of the Transaction Documents and to perform its
obligations thereunder, and all corporate action required to be taken
for the due and proper authorization, execution and delivery of each of
the Transaction Documents and the consummation of the transactions
contemplated thereby has been duly and validly taken;
iii. assuming the due authorization, execution and delivery of this
Agreement by the parties hereto other than the Company and assuming the
validity of this Agreement and the enforceability accorded its terms
under the laws of the State of New York, this Agreement is a valid and
legally binding agreement, enforceable against the Company in
accordance with its terms, except to the extent that such
enforceability may be limited by applicable bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar
laws affecting creditors' rights generally and by general equitable
principles (whether considered in a proceeding in equity or at law);
iv. the Indenture has been duly authorized, executed and delivered by the
Company and, assuming the due authorization, execution and delivery of
the Indenture by the Trustee and assuming the validity of the Indenture
and the enforceability accorded its terms under the laws of the State
of New York, then the Indenture is a valid and legally binding
agreement, enforceable against the Company in accordance with its
terms, except to the extent that such enforceability may be limited by
applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws affecting creditors'
rights generally and by general equitable principles (whether
considered in a proceeding in equity or at law);
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v. assuming the validity of the Securities and the enforceability accorded
their terms under the laws of the State of New York and due
authentication in accordance with the terms of the Indenture, when
delivered to and paid for by the Initial Purchasers in accordance with
the terms of this Agreement, the Securities will have been duly
authorized, executed and issued by the Company and will be valid and
binding obligations of the Company, enforceable against the Company in
accordance with their terms and entitled to the benefits of the
Indenture, except to the extent that such enforceability may be limited
by applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws affecting creditors'
rights generally and by general equitable principles (whether
considered in a proceeding in equity or at law);
vi. each of the other Transaction Documents has been duly authorized,
executed and delivered by the Company and, assuming the due
authorization, execution and delivery of each such respective
Transaction Documents by the parties thereto other than the Company,
and assuming the validity of each such Transaction Document and the
enforceability accorded its respective terms under the laws of the
State of New York, then each such Transaction Document is a valid and
legally binding agreement, enforceable against the Company in
accordance with its terms, except to the extent that such
enforceability may be limited by applicable bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar
laws affecting creditors' rights generally and by general equitable
principles (whether considered in a proceeding in equity or at law);
vii. no consent, approval, authorization, order, decree, registration or
qualification of or filing of or with any court or arbitrator or
governmental agency or body having jurisdiction over the Company or any
of its Swedish subsidiaries or any of their respective properties or
assets under any statute, judgment, order, decree, rule or regulation
is required for the execution, delivery and performance by the Company
of each of the Transaction Documents, the issuance, authentication,
sale and delivery of the Securities and compliance by the Company with
the terms thereof and the consummation of the transactions contemplated
by the Transaction Documents, except for such consents, approvals,
authorizations, orders, decrees, registrations, qualifications or
filings as have been obtained or made prior to the Closing Date;
viii. the execution and delivery by the Company of each of the Transaction
Documents, the issuance, authentication, sale and delivery of the
Securities and compliance by the Company with the terms thereof and the
performance by the Company of its obligations under, and the
consummation of the transactions contemplated by, the Transaction
Documents will not conflict with or result in a material breach or
violation of any of the terms or provisions of, or constitute a default
under, or result
<Page>
in the creation or imposition of any lien, charge or encumbrance
upon any property or assets of the Company or any of its Swedish
subsidiaries pursuant to, any material indenture, mortgage, deed of
trust, loan agreement or other material agreement or instrument to
which the Company or any of its Swedish subsidiaries is a party or
by which the Company or any of its Swedish subsidiaries is bound or
to which any of the property or assets of the Company or any of its
Swedish subsidiaries is subject, nor will such actions conflict with
or result in any violation of the provisions of the memorandum of
association (if applicable) or articles of association (or other
similar organizational document) of the Company or any of its
Swedish subsidiaries or any statute or any judgment, order, decree,
rule or regulation of any court or arbitrator or governmental agency
or body having jurisdiction over the Company or any of its Swedish
subsidiaries or any of their properties or assets;
ix. the Company has an authorized capitalization as set forth in the
Offering Memorandum, and all of the outstanding shares of capital stock
of the Company and each of its Swedish subsidiaries have been duly and
validly authorized and issued and are fully paid and non-assessable;
and the capital stock of the Company conforms in all material respects
to the description thereof contained in the Offering Memorandum;
x. all of the issued shares of capital stock of each Swedish subsidiary of
the Company are (except as set forth in the Offering Memorandum or as
would be permitted by the terms of the Indenture) owned directly or
indirectly by the Company, free and clear of all liens, encumbrances,
equities or claims of record;
xi. the descriptions in the Offering Memorandum of Swedish statutes, legal
and governmental proceedings and contracts and other documents governed
by Swedish law are accurate in all material respects; the statements
set forth in the Offering Memorandum under the captions "Note on
Certain Regulatory Issues related to Sweden," "Risk Factors--We are
subject to governmental and environmental regulations...," "Risk
Factors - We may be liable for environmental damages...," "Risk factors
- Legal action by the Swedish Competition Authority and the European
Union Competition Authority...," ["Risk Factors - Certain of our
subsidiaries are subject to restrictions on distributions...,"] "Risk
Factors - We were a dormant subsidiary of Preem Petroleum AB...," "Risk
Factors - If Preem Holdings AB or Preem Petroleum AB incurs substantial
operating losses or a reduction in the value of its assets...," "Risk
Factors--Swedish insolvency laws differ from U.S. insolvency laws...,"
"Business -- Enforcement of Civil Liabilities," "Description of Certain
Indebtedness," ["Description of the Notes--Payment of Additional
Amounts,"] and "Certain Swedish and United States Federal Income Tax
Consequences--Sweden," to the extent they represent statements or
summaries of Swedish legal matters, constitute accurate summaries of
such legal matters in all material respects;]
<Page>
xii. the Initial Purchasers would be permitted to commence proceedings
against the Company in Swedish courts of competent jurisdiction based
upon this Agreement and the holders of Securities (or the Trustee
acting on their behalf) would be permitted to commence proceedings
against the Company in Swedish courts of competent jurisdiction based
upon the Transaction Documents and such Swedish courts would recognize
the laws of the State of New York as the governing law of all such
documents;
xiii. the Company has the power, and has taken all necessary corporate
action, to submit to the non-exclusive jurisdiction of the Federal and
New York State courts sitting in New York City and the waiver by the
Company of any objection to the venue of the proceedings in any of such
court is valid under Swedish law and Swedish courts would give effect
to such a submission and waiver;
xiv. assuming that the method of service of process set forth in this
Agreement constitutes a valid and legally binding obligation of the
Company under the laws of the State of New York, and provided the
relevant agent has accepted its appointment, then Swedish courts will
give effect to such method of service of process;
xv. a final and conclusive judgment (with no further right of appeal) of a
court of competent jurisdiction sitting in New York City arising out of
or in relation to the obligations of the Company under any of the
Transaction Documents would be enforceable by fresh proceedings brought
in the courts of the Kingdom of Sweden against the Company, subject to
the discussion of enforceability of judgments set forth in the Offering
Memorandum under the caption, "Service of Process and Enforcement of
Civil Liabilities";
xvi. under Swedish law, no holder of any Securities will be, purely on
account of such holding, subject to any liability in respect of any
liability of the Company, and there are no restrictions under Swedish
law on sale or transfer of the Securities;
xvii. the Company can sue and be sued in its own name; the Company is not
entitled to any immunity as a defense to any suit or action brought or
maintained in respect of its obligations under any of the Transaction
Documents;
xviii. to ensure the legality, validity, enforceability or admissibility into
evidence of any of the Transaction Documents, it is not necessary that,
prior to seeking enforcement thereof, any such document be filed or
recorded with any court or other authority in the Kingdom of Sweden or
that any Swedish stamp or other issuance or transfer taxes or duties,
value-added taxes, documentary taxes, registration taxes, capital
gains, income, withholding or other taxes imposed by any governmental
department or other taxing authority of or in the Kingdom of Sweden be
paid;
<Page>
xix. the certificates used to evidence the Securities are in due and proper
form and comply with all applicable requirements of law in the Kingdom
of Sweden; and
xx. no provision of this Agreement, the Indenture, Securities or any other
Transaction Document will contradict any provision of the laws, or any
public policy, of the Kingdom of Sweden.
Such counsel shall also state that each of Akin, Gump,
Strauss, Hauer & Feld and Simpson Thacher & Bartlett may rely thereon in giving
the opinions discussed in this agreement.
<Page>
ANNEX E
[Form of Opinion of In-house Counsel for the Company]
Per Behm shall have furnished to the Initial Purchasers his
written opinion, as in-house counsel to the Company, addressed to the Initial
Purchasers and dated the Closing Date, in form and substance reasonably
satisfactory to the Initial Purchasers, substantially to the effect set forth
below:
i. neither the Company nor any of its subsidiaries is
(a) in violation of its memorandum of association
(if applicable) or articles of association (or
other similar organizational document), (b) in
default in any material respect, and no event has
occurred which, with notice or lapse of time or
both, would constitute such a default, in the due
performance or observance of any term, covenant or
condition contained in any material indenture,
mortgage, deed of trust, loan agreement or other
material agreement or instrument to which it is a
party or by which it is bound or to which any of
its property or assets is subject or (c) in
violation in any material respect of any law,
ordinance, governmental rule, regulation or court
decree to which it or its property or assets may
be subject;
ii. there are no judicial, legal, arbitral,
rule-making, administrative or governmental
proceedings pending or, to the best of such
counsel's knowledge, threatened in the Kingdom of
Sweden to which the Company or any of its
subsidiaries is a party or of which any property
or assets of the Company or any of its
subsidiaries is the subject which (a) singularly
or in the aggregate, if determined adversely to
the Company or any of its subsidiaries, would have
a Material Adverse Effect or (b) questions the
validity or enforceability of any of the
Transaction Documents or any action taken or to be
taken pursuant thereto; and
iii. the Company and each of its subsidiaries possess all
material licenses, certificates, authorizations
and permits issued by, and have made all
declarations and filings with, the appropriate
supranational, federal, [provincial] or foreign
regulatory agencies or bodies which are necessary
or desirable for the ownership of their respective
properties or the conduct of their respective
businesses as described in the Offering
Memorandum, except where the failure to possess or
make the same would not, singularly or in the
aggregate, have a Material Adverse Effect, and
neither the Company nor any of its subsidiaries
has received notification of any revocation or
modification of any such license, certificate,
authorization or permit or has any reason to
believe that any such license, certificate,
authorization or permit will not be renewed in the
ordinary course.
<Page>
ANNEX F
April 3, 2001
The Board of Directors of
Preem Holdings AB
Sandharnnsgatan 51
SE-115 90 Stockholm
Sweden
Deutsche Bank AG London
UBS Warburg Limited
c/o Deutsche Bank AG London
Winchester House
1 Great Winchester Street
London EC2N 2DB
United Kingdom
We have audited the consolidated balance sheet of Preem Petroleum AB and
subsidiaries (the "Company") as of December 31, 1999 and 2000, and the related
consolidated statements of operations and cash flows for each of the years in
the three-year period ended December 31, 2000 included in the Offering
Memorandum of the Company, dated April 3, 2001, relating to EURO 250,000,000
10 5/8% Senior Secured Notes Due 2011, (the "Notes"); our report with respect
thereto is also included in that Offering Memorandum. The Offering Memorandum,
dated April 3, 2001, is herein referred to as the Offering Memorandum. We have
also audited the balance sheet of Preem Holdings AB as of December 31, 1999 and
2000 and the related statements of operations and cash flow for each of the
years in the three-year period ended December 31, 2000.
This letter is being furnished in reliance upon your representation to us that:
a. You are knowledgeable with respect to the due diligence review process
that would be performed if this placement of securities were being
registered pursuant to the Securities Act of 1933 (the "Act").
b. In connection with the offering of the Notes, the review process that
you have performed is substantially consistent with the due diligence
review process that you would have performed if this placement of
securities were being registered pursuant to the Act.
In connection with the Offering Memorandum:
1. We are independent certified public accountants with respect to the
Company under the Rule 101 of the AICPA's Code of Professional Conduct
and its interpretations and rulings as well as under the applicable
published rules and regulations in Sweden.
2. We have not audited any consolidated financial statements of the
Company as of any date or for any period subsequent to December 31,
2000; although we have conducted an audit for the year ended December
31, 2000. The purpose (and therefore the scope) of the
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audit was to enable us to express our opinion on the consolidated
financial statements for any interim period within that year.
Therefore, we are unable to and do not express any opinion on the
financial position, results of operations, or cash flows as of any
date or for any period subsequent to December 31, 2000.
3. For purposes of this letter, we have read the 2001 minutes of meetings
of the Board of Directors of the Company as set forth in the minute
books at April 3, 2001, officials of the Company having advised us that
the minutes of all such meetings through that date were set forth
therein.
4. Company officials have advised us that no consolidated financial
statements as of any date or for any period subsequent to December 31,
2000, are available. We have inquired of certain officials of the
Company who have responsibility for financial and accounting matters
whether (a) at April 3, 2001, there was any change in the capital
stock, increase in consolidated long-term debt, or decrease in
consolidated net current assets or shareholders' equity of the
consolidated companies as compared with amounts shown on the December
31, 2000, consolidated balance sheet included in the Offering
Memorandum or (b) for the period from January 1, 2001, to April 3,
2001, there were any decreases, as compared with the corresponding
period in the preceding year, in consolidated net sales and operating
revenues, in operating income or in the total amounts of consolidated
net earnings. On the basis of these inquiries and our reading of the
minutes as described in 3, nothing came to our attention that cause us
to believe that there was any such change, increase, or decrease,
except in all instances for changes, increases, or decreases that the
Offering Memorandum discloses have occurred or may occur.
5. For purposes of this letter, we have also read the items identified by
you on the attached copy of selected pages from the Offering Memorandum
and have performed the following procedures, which were applied as
indicated with respect to the symbols explained below. With respect to
these items, we make no comments as to the Company's determination as
to what constitutes the appropriate presentations, disclosures,
explanations or causal relationships for such items.
a. Compared the amount or percentage to or recalculated the
amount or percentage from the corresponding amount or
percentage appearing in the Company's audited consolidated
financial statements and notes thereto, included in the
Offering Memorandum, and found them to be in agreement.
b. Recalculated the percentage or amount from and/or compared the
amount to a corresponding amount appearing on a schedule or
report prepared by the Company and found them to be in
agreement. Management of the Company have represented to as
that the schedules were derived from the regularly maintained
accounting record of the Company.
c. Recalculated the Euro amount based on the corresponding
Swedish Kronor and Euro, as applicable, amount appearing in or
derived from the audited consolidated financial statements
included in the Offering Circular, a schedule prepared by the
Company, using the December 31, 2001 exchange rates as
specified in the "Exchange Rate Information" section page (iv)
of the Offering Memorandum. This conversion does not
necessarily result in the same Euro amount as would
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have arisen if the conversion had been performed in
accordance with US GAAP. We make no representations as to the
appropriateness of the exchange rates used.
d. Recalculated the amount from corresponding amounts appearing
in the audited consolidated financial statements included in
the Offering Circular, or a schedule prepared by the Company
based upon the definition of "EBITDA" as described in note 5
on page 10 of the Offering Memorandum. We make no
representations as to the appropriateness of such definition
or whether it reflects an appropriate measure of the debt
service ability of the Company.
e. Recalculated the amounts under "As Adjusted" in section of the
Offering Memorandum entitled "Capitalization" based on
applicable assumptions specified in the Offering Memorandum
and found them to be in agreement. However, we make no comment
as to the reasonableness of those assumptions nor as to the
successful completion of the offering, the amount or
application of proceeds to be received therefrom, or whether
such use will actually take place.
f. Recalculated the amount under the heading "Pro forma 2000" in
the section of the Offering Memorandum entitled "Summary
Historical and Pro Forma Consolidated Financial Information of
the Company" based on the applicable assumptions specified in
the Offering Memorandum and found them to be in agreement.
However, we make no comment as the reasonableness of those
assumptions nor as to the successful completion of the
offering, the interest rate of the bonds to be issued, the
amount or the application of proceeds to be received, or
whether such use will actually take place.
For the purposes of reporting our findings, in those instances in which one or
more of the compared amounts or percentages stated were rounded to some degree
and the amounts or percentages were in agreement, except that they were not
rounded to the same degree, we have nevertheless stated that we found the
compared amounts and percentages to be in agreement.
6. Our audit of the consolidated financial statements for the periods
referred to in the introductory paragraph of this letter comprised
audit tests and procedures deemed necessary for the purpose of
expressing an opinion on such financial statements taken as a whole.
For none of the periods referred to therein, or any other period, did
we perform audit tests for the purpose of expressing an opinion on
individual balances of amounts or summaries of selected transactions
such as those enumerated above and, accordingly, we express no opinion
thereon.
7. It should be understood that we make no representations regarding
questions of legal interprotation or regarding the sufficiency for your
purposes of the procedures enumerated in paragraph 5; also, such
procedures would not necessarily reveal any material misstatement of
the amounts or percentages listed above. Further, we have addressed
ourselves solely to the foregoing data as set forth in the Offering
Memorandum and make no representations regarding the adequacy of
disclosure or regarding whether any material facts have been omitted.
8. This letter is solely for the information of the addresses and to
assist the initial Purchasers (as defined in the Offering Memorandum)
in conducting and documenting their
<Page>
investigation of the affairs of the Company in connection with the
offering of the securities covered by the Offering Memorandum, and
is not to be used, circulated, quoted, or otherwise referred to
within or without the underwriting group for any purpose, including
but not limited to the registration, purchase, or sale of
securities, nor is it to be filed with or referred to in whole or in
part in the Offering Memorandum or any other document, except that
reference may be made to it in any list of closing documents
pertaining to the offering of the securities covered by the Offering
Memorandum.
Yours truly,
KPMG
/s/ Cronie Wallquist
Cronie Wallquist
Partner