x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
¨ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
DELAWARE DELAWARE DELAWARE | 45-3763855 27-2198168 45-2685067 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |
One Sylvan Way, Second Floor Parsippany, New Jersey | 07054 | |
(Address of principal executive offices) | (Zip Code) |
PBF Energy Inc. | x Yes ¨ No |
PBF Holding Company LLC | x Yes ¨ No |
PBF Finance Corporation | x Yes o No |
PBF Energy Inc. | x Yes o No |
PBF Holding Company LLC | x Yes o No |
PBF Finance Corporation | x Yes o No |
Large accelerated filer | Accelerated filer | Non-accelerated filer (Do not check if a smaller reporting company) | Smaller reporting company | ||||
PBF Energy Inc. | ¨ | ¨ | x | ¨ | |||
PBF Holding Company LLC | ¨ | ¨ | x | ¨ | |||
PBF Finance Corporation | o | o | x | o |
PBF Energy Inc. | ¨ Yes x No |
PBF Holding Company LLC | ¨ Yes x No |
PBF Finance Corporation | o Yes x No |
CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS | ||||
ITEM 1. | Financial Statements (Unaudited) | |||
ITEM 2. | ||||
ITEM 3. | ||||
ITEM 4. | ||||
ITEM 1. | ||||
ITEM 6. | ||||
• | supply, demand, prices and other market conditions for our products; |
• | the effects of competition in our markets; |
• | changes in currency exchange rates, interest rates and capital costs; |
• | adverse developments in our relationship with both our key employees and unionized employees; |
• | our ability to operate our businesses efficiently, manage capital expenditures and costs (including general and administrative expenses) tightly and generate earnings and cash flow; |
• | our substantial indebtedness described in our 2012 Annual Reports on Form 10-K and this Quarterly Report on Form 10-Q; |
• | restrictive covenants in our indebtedness that may adversely affect our operational flexibility; |
• | payments to the holders of PBF LLC Series A Units and PBF LLC Series B Units under our tax receivable agreement for certain tax benefits we may claim, and our assumptions regarding payments arising under the tax receivable agreement and other arrangements relating to our organizational structure; |
• | our expectations with respect to our acquisition activity; |
• | our expectations with respect to our capital improvement projects including the development and expansion of our Delaware City crude unloading facilities and status of an air permit to transfer crude to Paulsboro; |
• | the possibility that we might reduce or not make further dividend payments; |
• | adverse impacts from changes in our regulatory environment or actions taken by environmental interest groups; |
• | the costs of being a public company, including Sarbanes-Oxley Act compliance; |
• | any decisions we make with respect to our energy-related logistical assets that could qualify for an MLP structure, including future opportunities that we may determine present greater potential value to stockholders than the planned MLP initial public offering, as described elsewhere in this Quarterly Report on Form 10-Q under "Recent Developments"; |
• | the timing and structure of the planned MLP may change; |
• | unanticipated developments may delay or negatively impact the planned MLP; |
• | receipt of regulatory approvals and compliance with contractual obligations required in connection with the planned MLP; |
• | the impact of the planned MLP on our relationships with our employees, customers and vendors and our credit rating and cost of funds; and |
• | the possibility that the interests of our financial sponsors (funds affiliated with The Blackstone Group L.P. and First Reserve Management, L.P.) will conflict with ours. |
June 30, 2013 | December 31, 2012 | ||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 69,230 | $ | 285,884 | |||
Accounts receivable | 591,352 | 503,796 | |||||
Inventories | 1,537,573 | 1,497,119 | |||||
Deferred tax asset | 4,682 | 7,717 | |||||
Prepaid expense and other current assets | 46,136 | 13,388 | |||||
Total current assets | 2,248,973 | 2,307,904 | |||||
Property, plant, and equipment, net | 1,685,104 | 1,635,587 | |||||
Deferred tax assets | 204,589 | 112,862 | |||||
Deferred charges and other assets, net | 187,237 | 197,349 | |||||
Total assets | $ | 4,325,903 | $ | 4,253,702 | |||
LIABILITIES AND EQUITY | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 227,567 | $ | 360,057 | |||
Accrued expenses | 1,029,364 | 1,031,467 | |||||
Payable to related parties pursuant to tax receivable agreement | 1,007 | 1,007 | |||||
Deferred revenue | 183,949 | 210,543 | |||||
Total current liabilities | 1,441,887 | 1,603,074 | |||||
Delaware Economic Development Authority loan | 16,000 | 20,000 | |||||
Long-term debt | 799,963 | 709,980 | |||||
Payable to related parties pursuant to tax receivable agreement | 290,017 | 159,004 | |||||
Other long-term liabilities | 36,127 | 38,099 | |||||
Total liabilities | 2,583,994 | 2,530,157 | |||||
Commitments and contingencies (Note 10) | |||||||
Equity: | |||||||
Class A common stock, $0.001 par value, 1,000,000,000 shares authorized, 39,563,835 shares outstanding at June 30, 2013, 23,571,221 shares outstanding, at December 31, 2012 | 40 | 24 | |||||
Class B common stock, $0.001 par value, 1,000,000 shares authorized, 41 shares outstanding, at June 30, 2013 and December 31, 2012 | — | — | |||||
Preferred stock, $0.001 par value, 100,000,000 shares authorized, no shares outstanding, at June 30, 2013 and December 31, 2012 | — | — | |||||
Additional paid in capital | 658,355 | 417,835 | |||||
Retained earnings | 16,021 | 1,956 | |||||
Accumulated other comprehensive loss | (3,576 | ) | (61 | ) | |||
Total PBF Energy Inc. equity | 670,840 | 419,754 | |||||
Noncontrolling interest | 1,071,069 | 1,303,791 | |||||
Total equity | 1,741,909 | 1,723,545 | |||||
Total liabilities and equity | $ | 4,325,903 | $ | 4,253,702 | |||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Revenues | $ | 4,678,293 | $ | 5,077,015 | $ | 9,476,141 | $ | 9,793,121 | |||||||
Cost and expenses: | |||||||||||||||
Cost of sales, excluding depreciation | 4,295,979 | 4,279,046 | 8,731,081 | 8,939,239 | |||||||||||
Operating expenses, excluding depreciation | 202,583 | 170,702 | 408,599 | 358,845 | |||||||||||
General and administrative expenses | 19,141 | 25,286 | 49,235 | 39,100 | |||||||||||
Loss (gain) on sale of assets | — | 53 | — | (2,450 | ) | ||||||||||
Depreciation and amortization expense | 27,563 | 22,422 | 54,093 | 42,963 | |||||||||||
4,545,266 | 4,497,509 | 9,243,008 | 9,377,697 | ||||||||||||
Income from operations | 133,027 | 579,506 | 233,133 | 415,424 | |||||||||||
Other income (expense) | |||||||||||||||
Change in fair value of contingent consideration | — | (692 | ) | — | (1,384 | ) | |||||||||
Change in fair value of catalyst lease | 6,820 | 5,371 | 5,481 | (978 | ) | ||||||||||
Interest expense, net | (21,708 | ) | (28,443 | ) | (43,319 | ) | (59,851 | ) | |||||||
Income before income taxes | 118,139 | 555,742 | 195,295 | 353,211 | |||||||||||
Income tax expense | (10,969 | ) | — | (18,413 | ) | — | |||||||||
Net income | 107,170 | $ | 555,742 | 176,882 | $ | 353,211 | |||||||||
Less: net income attributable to noncontrolling interest | 90,344 | 148,649 | |||||||||||||
Net income attributable to PBF Energy Inc. | $ | 16,826 | $ | 28,233 | |||||||||||
Weighted-average shares of Class A common stock outstanding | |||||||||||||||
Basic | 26,944,055 | 25,276,137 | |||||||||||||
Diluted | 27,706,696 | 26,110,976 | |||||||||||||
Net income available to Class A common stock per share: | |||||||||||||||
Basic | $ | 0.62 | $ | 1.12 | |||||||||||
Diluted | $ | 0.61 | $ | 1.08 | |||||||||||
Dividend per common share | $ | 0.30 | $ | 0.60 | |||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Net income | $ | 107,170 | $ | 555,742 | $ | 176,882 | $ | 353,211 | |||||||
Other comprehensive income: | |||||||||||||||
Unrealized (loss) gain on available for sale securities | (6 | ) | 3 | (6 | ) | — | |||||||||
Amortization of defined benefit plans unrecognized net loss | 324 | — | 216 | 17 | |||||||||||
Total other comprehensive income | 318 | 3 | 210 | 17 | |||||||||||
Comprehensive income | 107,488 | $ | 555,745 | 177,092 | $ | 353,228 | |||||||||
Less: Comprehensive income attributable to noncontrolling interest | 90,581 | 148,804 | |||||||||||||
Comprehensive income attributable to PBF Energy Inc. | $ | 16,907 | $ | 28,288 |
Six months ended June 30, | |||||||
2013 | 2012 | ||||||
Cash flows from operating activities: | |||||||
Net income | $ | 176,882 | $ | 353,211 | |||
Adjustments to reconcile net income to net cash provided by operations: | |||||||
Depreciation and amortization | 57,353 | 45,480 | |||||
Stock-based compensation | 1,977 | 1,047 | |||||
Change in fair value of catalyst lease obligation | (5,481 | ) | 978 | ||||
Change in fair value of contingent consideration | — | 1,384 | |||||
Deferred income taxes | 16,669 | — | |||||
Non-cash change inventory repurchase obligations | (17,377 | ) | (12,611 | ) | |||
Write-off of unamortized deferred financing fees | — | 4,391 | |||||
Pension and other post retirement benefits costs | 8,472 | 6,335 | |||||
Gain on disposition of property, plant and equipment | — | (2,450 | ) | ||||
Changes in current assets and current liabilities: | |||||||
Accounts receivable | (87,556 | ) | (131,996 | ) | |||
Inventories | (183,038 | ) | (65,754 | ) | |||
Other current assets | (32,748 | ) | 41,198 | ||||
Accounts payable | (132,490 | ) | 5,882 | ||||
Accrued expenses | 193,267 | (79,321 | ) | ||||
Deferred revenue | (26,594 | ) | (22,311 | ) | |||
Other assets and liabilities | (9,537 | ) | (28,089 | ) | |||
Net cash (used in) provided by operations | (40,201 | ) | 117,374 | ||||
Cash flow from investing activities: | |||||||
Expenditures for property, plant and equipment | (105,084 | ) | (64,123 | ) | |||
Expenditures for deferred turnarounds cost | (4,551 | ) | (22,609 | ) | |||
Expenditures for other assets | (3,089 | ) | (6,503 | ) | |||
Proceeds from sale of assets | — | 3,381 | |||||
Net cash used in investing activities | (112,724 | ) | (89,854 | ) | |||
Cash flows from financing activities: | |||||||
Proceeds from members' capital contributions to PBF Energy Company LLC (former controlling interest) | — | 250 | |||||
Distribution to PBF Energy Company LLC members | (121,945 | ) | (12,860 | ) | |||
Dividend payments | (14,168 | ) | — | ||||
Proceeds from 8.25% senior secured notes | — | 665,806 | |||||
Proceeds from long-term debt | — | 430,000 | |||||
Proceeds from catalyst lease | — | 9,452 | |||||
Proceeds from revolver borrowings | 160,000 | — | |||||
Repayments of revolver borrowings | (65,000 | ) | — | ||||
Repayments of long-term debt | — | (1,041,718 | ) | ||||
Payment of contingent consideration related to acquisition of Toledo refinery | (21,357 | ) | (103,642 | ) | |||
Deferred financing costs and other | (1,259 | ) | (16,246 | ) | |||
Net cash used in financing activities | (63,729 | ) | (68,958 | ) | |||
Net decrease in cash and cash equivalents | (216,654 | ) | (41,438 | ) | |||
Cash and equivalents, beginning of period | 285,884 | 50,166 | |||||
Cash and equivalents, end of period | $ | 69,230 | $ | 8,728 | |||
Supplemental cash flow disclosures | |||||||
Non-cash activities: | |||||||
Conversion of Delaware Economic Development Authority loan to grant | $ | 4,000 | $ | — | |||
Accrued construction in progress | 3,300 | 1,939 | |||||
Non-cash impact of inventory supply and offtake agreements on inventory and accrued expenses | 142,584 | 61,449 |
June 30, 2013 | December 31, 2012 | ||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 69,230 | $ | 254,291 | |||
Accounts receivable | 591,352 | 503,796 | |||||
Due from related party | — | 14,721 | |||||
Inventories | 1,537,573 | 1,497,119 | |||||
Prepaid expense and other current assets | 46,136 | 13,388 | |||||
Total current assets | 2,244,291 | 2,283,315 | |||||
Property, plant and equipment, net | 1,685,104 | 1,635,587 | |||||
Deferred charges and other assets, net | 187,237 | 197,349 | |||||
Total assets | $ | 4,116,632 | $ | 4,116,251 | |||
LIABILITIES AND EQUITY | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 227,567 | $ | 360,057 | |||
Accrued expenses | 1,028,187 | 1,025,918 | |||||
Deferred revenue | 183,949 | 210,543 | |||||
Total current liabilities | 1,439,703 | 1,596,518 | |||||
Delaware Economic Development Authority loan | 16,000 | 20,000 | |||||
Long-term debt | 799,963 | 709,980 | |||||
Intercompany notes payable | 31,632 | — | |||||
Other long-term liabilities | 37,297 | 38,099 | |||||
Total liabilities | 2,324,595 | 2,364,597 | |||||
Commitments and contingencies (Note 10) | |||||||
Equity: | |||||||
Member's equity | 930,808 | 930,098 | |||||
Retained earnings | 869,960 | 830,497 | |||||
Accumulated other comprehensive loss | (8,731 | ) | (8,941 | ) | |||
Total equity | 1,792,037 | 1,751,654 | |||||
Total liabilities and equity | $ | 4,116,632 | $ | 4,116,251 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Revenues | $ | 4,678,293 | $ | 5,077,015 | $ | 9,476,141 | $ | 9,793,121 | |||||||
Costs and expenses: | |||||||||||||||
Cost of sales, excluding depreciation | 4,295,979 | 4,279,046 | 8,731,081 | 8,939,239 | |||||||||||
Operating expenses, excluding depreciation | 202,583 | 170,702 | 408,599 | 358,845 | |||||||||||
General and administrative expenses | 19,141 | 25,286 | 49,235 | 39,100 | |||||||||||
Loss (gain) on sale of assets | — | 53 | — | (2,450 | ) | ||||||||||
Depreciation and amortization expense | 27,563 | 22,422 | 54,093 | 42,963 | |||||||||||
4,545,266 | 4,497,509 | 9,243,008 | 9,377,697 | ||||||||||||
Income from operations | 133,027 | 579,506 | 233,133 | 415,424 | |||||||||||
Other income (expense) | |||||||||||||||
Change in fair value of contingent consideration | — | (692 | ) | — | (1,384 | ) | |||||||||
Change in fair value of catalyst lease | 6,820 | 5,371 | 5,481 | (978 | ) | ||||||||||
Interest expense, net | (21,738 | ) | (28,443 | ) | (43,349 | ) | (59,851 | ) | |||||||
Net income | $ | 118,109 | $ | 555,742 | $ | 195,265 | $ | 353,211 | |||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Net income | $ | 118,109 | $ | 555,742 | $ | 195,265 | $ | 353,211 | |||||||
Other comprehensive income: | |||||||||||||||
Unrealized gain (loss) on available for | |||||||||||||||
sale securities | (6 | ) | 3 | (6 | ) | — | |||||||||
Amortization of defined benefit plans unrecognized net loss | 324 | — | 216 | 17 | |||||||||||
Total other comprehensive income | 318 | 3 | 210 | 17 | |||||||||||
Comprehensive income | $ | 118,427 | $ | 555,745 | $ | 195,475 | $ | 353,228 | |||||||
Six months ended June 30, | |||||||
2013 | 2012 | ||||||
Cash flows from operating activities: | |||||||
Net income | $ | 195,265 | $ | 353,211 | |||
Adjustments to reconcile net income to net cash provided by operations: | |||||||
Depreciation and amortization | 57,353 | 45,480 | |||||
Stock-based compensation | 1,977 | 1,047 | |||||
Change in fair value of catalyst lease obligation | (5,481 | ) | 978 | ||||
Change in fair value of contingent consideration | — | 1,384 | |||||
Non-cash change in inventory repurchase obligations | (17,377 | ) | (12,611 | ) | |||
Write-off of unamortized deferred financing fees | — | 4,391 | |||||
Pension and other post retirement benefit costs | 8,472 | 6,335 | |||||
Gain on disposition of property, plant and equipment | — | (2,450 | ) | ||||
Changes in current assets and current liabilities: | |||||||
Accounts receivable | (87,556 | ) | (131,996 | ) | |||
Due to/from related party | 14,721 | — | |||||
Inventories | (183,038 | ) | (65,754 | ) | |||
Other current assets | (32,748 | ) | 41,198 | ||||
Accounts payable | (132,490 | ) | 5,882 | ||||
Accrued expenses | 195,311 | (79,321 | ) | ||||
Deferred revenue | (26,594 | ) | (22,311 | ) | |||
Other assets and liabilities | (8,366 | ) | (28,089 | ) | |||
Net cash (used in) provided by operations | (20,551 | ) | 117,374 | ||||
Cash flows from investing activities: | |||||||
Expenditures for property, plant and equipment | (105,084 | ) | (64,123 | ) | |||
Expenditures for deferred turnarounds costs | (4,551 | ) | (22,609 | ) | |||
Expenditures for other assets | (3,089 | ) | (6,503 | ) | |||
Proceeds from sale of assets | — | 3,381 | |||||
Net cash used in investing activities | (112,724 | ) | (89,854 | ) | |||
Cash flows from financing activities: | |||||||
Proceeds from revolver borrowings | 160,000 | — | |||||
Proceeds from intercompany notes payable | 31,632 | — | |||||
Proceeds from member's capital contributions | — | 250 | |||||
Proceeds from 8.25% senior secured notes | — | 665,806 | |||||
Proceeds from long-term debt | — | 430,000 | |||||
Proceeds from catalyst lease | — | 9,452 | |||||
Distributions to members | (155,802 | ) | (12,860 | ) | |||
Repayments of revolver borrowings | (65,000 | ) | — | ||||
Repayments of long-term debt | — | (1,041,718 | ) | ||||
Payment of contingent consideration related to acquisition of Toledo refinery | (21,357 | ) | (103,642 | ) | |||
Deferred financing costs and other | (1,259 | ) | (16,246 | ) | |||
Net cash used in financing activities | (51,786 | ) | (68,958 | ) | |||
Net decrease in cash and cash equivalents | (185,061 | ) | (41,438 | ) | |||
Cash and equivalents, beginning of period | 254,291 | 50,166 | |||||
Cash and equivalents, end of period | $ | 69,230 | $ | 8,728 | |||
Supplemental cash flow disclosures | |||||||
Non-cash activities: | |||||||
Conversion of Delaware Economic Development Authority loan to grant | $ | 4,000 | $ | — | |||
Accrued construction in progress | 3,300 | 1,939 | |||||
Non-cash impact of inventory supply and offtake agreements on inventory and accrued expenses | 142,584 | 61,449 |
Holders of PBF LLC Series A Units | Outstanding Shares of PBF Energy Class A Common Stock | Total * | ||||||
December 31, 2012 | 72,972,131 | 23,571,221 | 96,543,352 | |||||
75.6 | % | 24.4 | % | 100 | % | |||
June 12, 2013 | 57,027,225 | 39,563,835 | 96,591,060 | |||||
59.0 | % | 41.0 | % | 100 | % | |||
June 30, 2013 | 57,027,225 | 39,563,835 | 96,591,060 | |||||
59.0 | % | 41.0 | % | 100 | % |
* | Assumes all of the holders of PBF LLC Series A Units exchange their PBF LLC Series A Units for shares of PBF Energy’s Class A common stock on a one-for-one basis. |
PBF Energy Inc. Equity | Noncontrolling Interest | Total Equity | |||||||||
Balance at January 1, 2013 | $ | 419,754 | $ | 1,303,791 | $ | 1,723,545 | |||||
Net income | 28,233 | 148,649 | 176,882 | ||||||||
Dividend and distributions | (14,168 | ) | (121,945 | ) | (136,113 | ) | |||||
Record deferred tax asset and liabilities and tax receivable agreement associated with Secondary Offering | (24,377 | ) | — | (24,377 | ) | ||||||
Record allocation of non controlling interest upon completion of Secondary Offering | 260,243 | (260,243 | ) | — | |||||||
Stock-based compensation | 1,053 | 924 | 1,977 | ||||||||
Exercise of PBF LLC options, net | — | (215 | ) | (215 | ) | ||||||
Other comprehensive income | 86 | 124 | 210 | ||||||||
Exchange of PBF LLC Series A Units for Class A common stock | 16 | (16 | ) | — | |||||||
Balance at June 30, 2013 | $ | 670,840 | $ | 1,071,069 | $ | 1,741,909 |
June 30, 2013 | |||||||||||
Titled Inventory | Inventory Supply and Offtake Arrangements | Total | |||||||||
Crude oil and feedstocks | $ | 579,102 | $ | 113,785 | $ | 692,887 | |||||
Refined products and blendstocks | 386,316 | 424,331 | 810,647 | ||||||||
Warehouse stock and other | 34,039 | — | 34,039 | ||||||||
$ | 999,457 | $ | 538,116 | $ | 1,537,573 |
December 31, 2012 | |||||||||||
Titled Inventory | Inventory Supply and Offtake Arrangements | Total | |||||||||
Crude oil and feedstocks | $ | 384,441 | $ | 257,947 | $ | 642,388 | |||||
Refined products and blendstocks | 405,545 | 417,865 | 823,410 | ||||||||
Warehouse stock and other | 31,321 | — | 31,321 | ||||||||
$ | 821,307 | $ | 675,812 | $ | 1,497,119 |
June 30, 2013 | December 31, 2012 | ||||||
Deferred turnaround costs, net | $ | 71,785 | $ | 78,128 | |||
Catalyst | 63,957 | 66,377 | |||||
Deferred financing costs, net | 29,318 | 30,987 | |||||
Restricted cash | 12,116 | 12,114 | |||||
Linefill | 8,735 | 8,042 | |||||
Intangible assets, net | 869 | 1,085 | |||||
Other | 457 | 616 | |||||
$ | 187,237 | $ | 197,349 |
June 30, 2013 | December 31, 2012 | ||||||
Inventory-related accruals | $ | 521,507 | $ | 287,929 | |||
Inventory supply and offtake arrangements | 376,633 | 536,594 | |||||
Excise and sales tax payable | 26,896 | 40,776 | |||||
Accrued transportation costs | 25,830 | 20,338 | |||||
Accrued interest | 22,930 | 22,764 | |||||
Accrued utilities | 17,803 | 19,060 | |||||
Customer deposits | 10,078 | 26,541 | |||||
Accrued salaries and benefits | 5,996 | 15,212 | |||||
Accrued construction in progress | 3,300 | 16,481 | |||||
Income taxes payable | 1,177 | 1,275 | |||||
Fair value of contingent consideration for refinery acquisition | — | 21,358 | |||||
Other | 17,214 | 23,139 | |||||
$ | 1,029,364 | $ | 1,031,467 |
June 30, 2013 | December 31, 2012 | ||||||
Inventory-related accruals | $ | 521,507 | $ | 287,929 | |||
Inventory supply and offtake arrangements | 376,633 | 536,594 | |||||
Excise and sales tax payable | 26,896 | 36,414 | |||||
Accrued transportation costs | 25,830 | 20,338 | |||||
Accrued interest | 22,930 | 22,764 | |||||
Accrued utilities | 17,803 | 19,060 | |||||
Customer deposits | 10,078 | 26,541 | |||||
Accrued salaries and benefits | 5,996 | 15,212 | |||||
Accrued construction in progress | 3,300 | 16,481 | |||||
Fair value of contingent consideration for refinery acquisition | — | 21,358 | |||||
Other | 17,214 | 23,227 | |||||
$ | 1,028,187 | $ | 1,025,918 |
Three Months Ended June 30, 2013 | Six Months Ended June 30, 2013 | |||||||
Current tax expense | $ | 1,744 | $ | 1,744 | ||||
Deferred tax expense | 9,225 | 16,669 | ||||||
Total tax expense | $ | 10,969 | $ | 18,413 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
Pension Benefits | 2013 | 2012 | 2013 | 2012 | |||||||||||
Components of net period benefit cost: | |||||||||||||||
Service cost | $ | 3,699 | $ | 3,548 | $ | 7,397 | $ | 5,718 | |||||||
Interest cost | 248 | 215 | 496 | 251 | |||||||||||
Expected return on plan assets | (138 | ) | (152 | ) | (276 | ) | (162 | ) | |||||||
Amortization of prior service costs | 3 | 2 | 5 | 5 | |||||||||||
Amortization of loss | 105 | 1 | 210 | 15 | |||||||||||
Net periodic benefit cost | $ | 3,917 | $ | 3,614 | $ | 7,832 | $ | 5,827 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
Post Retirement Medical Plan | 2013 | 2012 | 2013 | 2012 | |||||||||||
Components of net period benefit cost: | |||||||||||||||
Service cost | $ | 181 | $ | 135 | $ | 363 | $ | 270 | |||||||
Interest cost | 84 | 95 | 167 | 190 | |||||||||||
Net periodic benefit cost | $ | 265 | $ | 230 | $ | 530 | $ | 460 |
As of June 30, 2013 | |||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Assets: | |||||||||||||||
Money market funds | $ | 5,855 | $ | — | $ | — | $ | 5,855 | |||||||
Derivatives included with inventory supply arrangement obligations | — | 2,724 | — | 2,724 | |||||||||||
Liabilities: | |||||||||||||||
Commodity contracts | 6,191 | 125 | — | 6,316 | |||||||||||
Catalyst lease obligations | — | 37,961 | — | 37,961 |
As of December 31, 2012 | |||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Assets: | |||||||||||||||
Money market funds | $ | 175,786 | $ | — | $ | — | $ | 175,786 | |||||||
Commodity contracts | 3,303 | — | — | 3,303 | |||||||||||
Derivatives included with inventory supply arrangement obligations | — | 5,595 | — | 5,595 | |||||||||||
Liabilities: | |||||||||||||||
Catalyst lease obligations | — | 43,442 | — | 43,442 | |||||||||||
Commodity contracts | — | 1,872 | — | 1,872 | |||||||||||
Contingent consideration for refinery acquisition | — | — | 21,358 | 21,358 |
• | Money market funds categorized in Level 1 of the fair value hierarchy are measured at fair value based on quoted market prices and included within cash and cash equivalents. |
• | The commodity contracts categorized in Level 1 of the fair value hierarchy are measured at fair value based on quoted prices in an active market. The commodity contracts categorized in Level 2 of the fair value hierarchy are measured at fair value using a market approach based upon future commodity prices for similar instruments quoted in active markets. |
• | The derivatives included with inventory supply arrangement obligations and the catalyst lease obligations are categorized in Level 2 of the fair value hierarchy and are measured at fair value using a market approach based upon commodity prices for similar instruments quoted in active markets. |
• | The contingent consideration for refinery acquisition obligation at December 31, 2012 is categorized in Level 3 of the fair value hierarchy and is estimated using a discounted cash flow model based on management's estimate of the future cash flows of the Toledo refinery; a risk free rate of return of 0.16%; credit rate spread of 4.38%; and a discount rate of 4.54%. During the three and six months ended June 30, 2013, there was no change in fair value, as the obligation was known and was paid in full on April 30, 2013. |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Balance at beginning of period | $ | 21,358 | $ | 122,924 | $ | 21,358 | $ | 122,232 | |||||||
Purchases | — | — | — | — | |||||||||||
Settlements | (21,358 | ) | (103,643 | ) | (21,358 | ) | (103,643 | ) | |||||||
Unrealized loss included in earnings | — | 692 | — | 1,384 | |||||||||||
Transfers into Level 3 | — | — | — | — | |||||||||||
Transfers out of Level 3 | — | — | — | — | |||||||||||
Balance at end of period | $ | — | $ | 19,973 | $ | — | $ | 19,973 |
June 30, 2013 | December 31, 2012 | ||||||||||||||
Carrying value | Fair value | Carrying value | Fair value | ||||||||||||
Senior secured notes (a) | $ | 667,002 | $ | 688,219 | $ | 666,538 | $ | 700,963 | |||||||
Revolver (b) | 95,000 | 95,000 | — | — | |||||||||||
Catalyst leases (c) | 37,961 | 37,961 | 43,442 | 43,442 | |||||||||||
Long-term debt | $ | 799,963 | $ | 821,180 | $ | 709,980 | $ | 744,405 |
Description | Balance Sheet Location | Fair Value Asset/(Liability) | ||
Derivatives designated as hedging instruments: | ||||
June 30, 2013: | ||||
Derivatives included with inventory supply arrangement obligations | Accrued expenses | $ | 2,724 | |
December 31, 2012: | ||||
Derivatives included with inventory supply arrangement obligations | Accrued expenses | $ | 5,595 | |
Derivatives not designated as hedging instruments: | ||||
June 30, 2013: | ||||
Commodity contracts | Accrued expenses | $ | (6,316 | ) |
December 31, 2012: | ||||
Commodity contracts | Accounts receivable | $ | 1,431 |
Description | Location of Gain or (Loss) Recognized in Income on Derivatives | Gain or (Loss) Recognized in Income on Derivatives | ||
Derivatives designated as hedging instruments: | ||||
For the three months ended June 30, 2013: | ||||
Derivatives included with inventory supply arrangement obligations | Cost of sales | $ | 4,880 | |
For the three months ended June 30, 2012: | ||||
Derivatives included with inventory supply arrangement obligations | Cost of sales | $ | (16,336 | ) |
For the six months ended June 30, 2013: | ||||
Derivatives included with inventory supply arrangement obligations | Cost of sales | $ | (2,871 | ) |
For the six months ended June 30, 2012: | ||||
Derivatives included with inventory supply arrangement obligations | Cost of sales | $ | (327 | ) |
Derivatives not designated as hedging instruments: | ||||
For the three months ended June 30, 2013: | ||||
Derivatives included with inventory supply arrangement obligations | Cost of sales | $ | — | |
Commodity contracts | Cost of sales | $ | (4,728 | ) |
For the three months ended June 30, 2012: | ||||
Derivatives included with inventory supply arrangement obligations | Cost of sales | $ | — | |
Commodity contracts | Cost of sales | $ | 689 | |
For the six months ended June 30, 2013: | ||||
Derivatives included with inventory supply arrangement obligations | Cost of sales | $ | — | |
Commodity contracts | Cost of sales | $ | 13,949 | |
For the six months ended June 30, 2012: | ||||
Derivatives included with inventory supply arrangement obligations | Cost of sales | $ | (8 | ) |
Commodity contracts | Cost of sales | $ | 27,607 | |
Hedged items designated in fair value hedges: | ||||
For the three months ended June 30, 2013: | ||||
Crude oil and feedstock inventory | Cost of sales | $ | 6,393 | |
For the three months ended June 30, 2012: | ||||
Crude oil and feedstock inventory | Cost of sales | $ | 12,412 | |
For the six months ended June 30, 2013: | ||||
Crude oil and feedstock inventory | Cost of sales | $ | 3,505 | |
For the six months ended June 30, 2012: | ||||
Crude oil and feedstock inventory | Cost of sales | $ | (394 | ) |
Basic Earnings Per Share: | Three Months Ended June 30, 2013 | Six Months Ended June 30, 2013 | |||||
Numerator for basic net income per Class A common share-net income attributable to PBF Energy | $ | 16,826 | $ | 28,233 | |||
Denominator for basic net income per Class A common share-weighted average shares | 26,944,055 | 25,276,137 | |||||
Basic net income attributable to PBF Energy per Class A common share | $ | 0.62 | $ | 1.12 | |||
Diluted Earnings Per Share: | |||||||
Numerator for diluted net income per Class A common share-net income attributable to PBF Energy (1) | $ | 16,826 | $ | 28,233 | |||
Denominator (1): | |||||||
Denominator for basic net income per Class A common share-weighted average shares | 26,944,055 | 25,276,137 | |||||
Effect of dilutive securities: | |||||||
Common stock equivalents (2) | 762,641 | 834,839 | |||||
Denominator for diluted net income per common share-adjusted weighted average shares | 27,706,696 | 26,110,976 | |||||
Diluted net income attributable to PBF Energy per Class A common share | $ | 0.61 | $ | 1.08 |
(1) | During the three and six months ended June 30, 2013, the potential conversion of 69,647,005 and 71,314,923 of PBF LLC Series A Units, respectively, were excluded from the denominator in computing diluted net income per share because including them would have had an antidilutive effect. As the PBF LLC Series A Units were not included, the numerator used in the calculation of diluted net income per share was equal to the numerator used in the calculation of basic net income per share and does not include the net income and income tax attributable to the net income associated with the potential conversion of the PBF LLC Series A Units. |
(2) | Represents an adjustment to weighted-average diluted shares outstanding to assume the full exchange of common stock equivalents, including options and warrants for PBF LLC Series A Units and options for shares of PBF Energy Class A common stock. Common stock equivalents excludes the effects of options to purchase 731,250 shares of PBF Energy Class A common stock because they are anti-dilutive. |
June 30, 2013 | |||||||||||||||||||
Issuer | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Combining and Consolidated Adjustments | Total | |||||||||||||||
ASSETS | |||||||||||||||||||
Current assets: | |||||||||||||||||||
Cash and cash equivalents | $ | 47,183 | $ | 22,047 | $ | — | $ | — | $ | 69,230 | |||||||||
Accounts receivable | 316,504 | 274,848 | — | — | 591,352 | ||||||||||||||
Inventories | 867,850 | 669,723 | — | — | 1,537,573 | ||||||||||||||
Prepaid expense and other current assets | 31,026 | 15,110 | — | — | 46,136 | ||||||||||||||
Due from related parties | 9,901,707 | 12,753,447 | — | (22,655,154 | ) | — | |||||||||||||
Total current assets | 11,164,270 | 13,735,175 | — | (22,655,154 | ) | 2,244,291 | |||||||||||||
Property, plant and equipment, net | 39,757 | 1,645,347 | — | — | 1,685,104 | ||||||||||||||
Investment in subsidiaries | 2,122,924 | — | — | (2,122,924 | ) | — | |||||||||||||
Deferred charges and other assets, net | 29,680 | 157,557 | — | — | 187,237 | ||||||||||||||
Total assets | $ | 13,356,631 | $ | 15,538,079 | $ | — | $ | (24,778,078 | ) | $ | 4,116,632 | ||||||||
LIABILITIES AND EQUITY | |||||||||||||||||||
Current liabilities: | |||||||||||||||||||
Accounts payable | $ | 184,639 | $ | 42,928 | $ | — | $ | — | $ | 227,567 | |||||||||
Accrued expenses | 601,323 | 426,864 | — | — | 1,028,187 | ||||||||||||||
Deferred revenue | — | 183,949 | — | — | 183,949 | ||||||||||||||
Due to related parties | 9,979,868 | 12,675,286 | — | (22,655,154 | ) | — | |||||||||||||
Total current liabilities | 10,765,830 | 13,329,027 | — | (22,655,154 | ) | 1,439,703 | |||||||||||||
Delaware Economic Development Authority loan | — | 16,000 | — | — | 16,000 | ||||||||||||||
Long-term debt | 762,002 | 37,961 | — | — | 799,963 | ||||||||||||||
Intercompany notes payable | 31,632 | — | — | — | 31,632 | ||||||||||||||
Other long-term liabilities | 5,130 | 32,167 | — | — | 37,297 | ||||||||||||||
Total liabilities | 11,564,594 | 13,415,155 | — | (22,655,154 | ) | 2,324,595 | |||||||||||||
Commitments and contingencies | |||||||||||||||||||
Equity: | |||||||||||||||||||
Member's equity | 930,808 | 664,789 | — | (664,789 | ) | 930,808 | |||||||||||||
Retained earnings (accumulated deficit) | 869,960 | 1,459,703 | — | (1,459,703 | ) | 869,960 | |||||||||||||
Accumulated other comprehensive loss | (8,731 | ) | (1,568 | ) | — | 1,568 | (8,731 | ) | |||||||||||
Total equity | 1,792,037 | 2,122,924 | — | (2,122,924 | ) | 1,792,037 | |||||||||||||
Total liabilities and equity | $ | 13,356,631 | $ | 15,538,079 | $ | — | $ | (24,778,078 | ) | $ | 4,116,632 |
December 31, 2012 | |||||||||||||||||||
Issuer | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Combining and Consolidated Adjustments | Total | |||||||||||||||
ASSETS | |||||||||||||||||||
Current assets: | |||||||||||||||||||
Cash and cash equivalents | $ | 241,926 | $ | 12,365 | $ | — | $ | — | $ | 254,291 | |||||||||
Accounts receivable | 306,999 | 196,797 | — | — | 503,796 | ||||||||||||||
Inventories | 664,225 | 832,894 | — | — | 1,497,119 | ||||||||||||||
Prepaid expense and other current assets | 8,835 | 4,553 | — | — | 13,388 | ||||||||||||||
Due from related parties | 6,770,893 | 8,105,364 | — | (14,861,536 | ) | 14,721 | |||||||||||||
Total current assets | 7,992,878 | 9,151,973 | — | (14,861,536 | ) | 2,283,315 | |||||||||||||
Property, plant and equipment, net | 28,200 | 1,607,387 | — | — | 1,635,587 | ||||||||||||||
Investment in subsidiaries | 945,622 | — | — | (945,622 | ) | — | |||||||||||||
Deferred charges and other assets, net | 31,081 | 166,268 | — | — | 197,349 | ||||||||||||||
Total assets | $ | 8,997,781 | $ | 10,925,628 | $ | — | $ | (15,807,158 | ) | $ | 4,116,251 | ||||||||
LIABILITIES AND EQUITY | |||||||||||||||||||
Current liabilities: | |||||||||||||||||||
Accounts payable | $ | 197,624 | $ | 162,433 | $ | — | $ | — | $ | 360,057 | |||||||||
Accrued expenses | 363,536 | 662,382 | — | — | 1,025,918 | ||||||||||||||
Deferred revenue | — | 210,543 | — | — | 210,543 | ||||||||||||||
Due to related parties | 6,016,505 | 8,845,031 | — | (14,861,536 | ) | — | |||||||||||||
Total current liabilities | 6,577,665 | 9,880,389 | — | (14,861,536 | ) | 1,596,518 | |||||||||||||
Delaware Economic Development Authority loan | — | 20,000 | — | — | 20,000 | ||||||||||||||
Long-term debt | 666,538 | 43,442 | — | — | 709,980 | ||||||||||||||
Other long-term liabilities | 1,924 | 36,175 | — | — | 38,099 | ||||||||||||||
Total liabilities | 7,246,127 | 9,980,006 | — | (14,861,536 | ) | 2,364,597 | |||||||||||||
Commitments and contingencies | |||||||||||||||||||
Equity: | |||||||||||||||||||
Member's equity | 930,098 | 664,108 | — | (664,108 | ) | 930,098 | |||||||||||||
Retained earnings | 830,497 | 283,076 | — | (283,076 | ) | 830,497 | |||||||||||||
Accumulated other comprehensive loss | (8,941 | ) | (1,562 | ) | — | 1,562 | (8,941 | ) | |||||||||||
Total equity | 1,751,654 | 945,622 | — | (945,622 | ) | 1,751,654 | |||||||||||||
Total liabilities and equity | $ | 8,997,781 | $ | 10,925,628 | $ | — | $ | (15,807,158 | ) | $ | 4,116,251 |
Three Months Ended June 30, 2013 | |||||||||||||||||||
Issuer | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Combining and Consolidated Adjustments | Total | |||||||||||||||
Revenues | $ | 3,507,984 | $ | 2,802,291 | $ | — | $ | (1,631,982 | ) | $ | 4,678,293 | ||||||||
Costs and expenses: | |||||||||||||||||||
Cost of sales, excluding depreciation | 4,046,249 | 1,881,712 | — | (1,631,982 | ) | 4,295,979 | |||||||||||||
Operating expenses, excluding depreciation | (142 | ) | 202,725 | — | — | 202,583 | |||||||||||||
General and administrative expenses | 15,595 | 3,546 | — | — | 19,141 | ||||||||||||||
Depreciation and amortization expense | 3,317 | 24,246 | — | — | 27,563 | ||||||||||||||
4,065,019 | 2,112,229 | — | (1,631,982 | ) | 4,545,266 | ||||||||||||||
Income (loss) from operations | (557,035 | ) | 690,062 | — | — | 133,027 | |||||||||||||
Other income (expense): | |||||||||||||||||||
Equity in earnings of subsidiaries | 695,768 | — | — | (695,768 | ) | — | |||||||||||||
Change in fair value of catalyst lease | — | 6,820 | — | — | 6,820 | ||||||||||||||
Interest expense, net | (20,624 | ) | (1,114 | ) | — | — | (21,738 | ) | |||||||||||
Net income | $ | 118,109 | $ | 695,768 | $ | — | $ | (695,768 | ) | $ | 118,109 | ||||||||
Comprehensive Income | $ | 118,427 | $ | 695,768 | $ | — | $ | (695,768 | ) | $ | 118,427 |
Three Months Ended June 30, 2012 | |||||||||||||||||||
Issuer | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Combining and Consolidated Adjustments | Total | |||||||||||||||
Revenues | $ | 2,124,901 | $ | 3,112,506 | $ | — | $ | (160,392 | ) | $ | 5,077,015 | ||||||||
Costs and expenses: | |||||||||||||||||||
Cost of sales, excluding depreciation | 2,774,980 | 1,664,458 | — | (160,392 | ) | 4,279,046 | |||||||||||||
Operating expenses, excluding depreciation | — | 170,702 | — | — | 170,702 | ||||||||||||||
General and administrative expenses | 22,600 | 2,686 | — | — | 25,286 | ||||||||||||||
Loss on sale of asset | — | 53 | — | — | 53 | ||||||||||||||
Depreciation and amortization expense | 1,389 | 21,033 | — | — | 22,422 | ||||||||||||||
2,798,969 | 1,858,932 | — | (160,392 | ) | 4,497,509 | ||||||||||||||
Income (loss) from operations | (674,068 | ) | 1,253,574 | — | — | 579,506 | |||||||||||||
Other income (expense): | |||||||||||||||||||
Equity in earnings (loss) of subsidiaries | 1,252,145 | — | — | (1,252,145 | ) | — | |||||||||||||
Change in fair value of catalyst lease | — | 5,371 | — | — | 5,371 | ||||||||||||||
Change in fair value of contingent consideration | — | (692 | ) | — | — | (692 | ) | ||||||||||||
Interest expense, net | (22,335 | ) | (6,108 | ) | — | — | (28,443 | ) | |||||||||||
Net income | $ | 555,742 | $ | 1,252,145 | $ | — | $ | (1,252,145 | ) | $ | 555,742 | ||||||||
Comprehensive Income | $ | 555,745 | $ | 1,252,148 | $ | — | $ | (1,252,148 | ) | $ | 555,745 |
Six Months Ended June 30, 2013 | |||||||||||||||||||
Issuer | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Combining and Consolidated Adjustments | Total | |||||||||||||||
Revenues | $ | 6,561,777 | $ | 6,315,781 | $ | — | $ | (3,401,417 | ) | $ | 9,476,141 | ||||||||
Costs and expenses: | |||||||||||||||||||
Cost of sales, excluding depreciation | 7,453,784 | 4,678,714 | — | (3,401,417 | ) | 8,731,081 | |||||||||||||
Operating expenses, excluding depreciation | (141 | ) | 408,740 | — | — | 408,599 | |||||||||||||
General and administrative expenses | 42,040 | 7,195 | — | — | 49,235 | ||||||||||||||
Depreciation and amortization expense | 6,138 | 47,955 | — | — | 54,093 | ||||||||||||||
7,501,821 | 5,142,604 | — | (3,401,417 | ) | 9,243,008 | ||||||||||||||
Income (loss) from operations | (940,044 | ) | 1,173,177 | — | — | 233,133 | |||||||||||||
Other income (expense): | |||||||||||||||||||
Equity in earnings (loss) of subsidiaries | 1,176,634 | — | — | (1,176,634 | ) | — | |||||||||||||
Change in fair value of catalyst lease | — | 5,481 | — | — | 5,481 | ||||||||||||||
Interest expense, net | (41,325 | ) | (2,024 | ) | — | — | (43,349 | ) | |||||||||||
Net income | $ | 195,265 | $ | 1,176,634 | $ | — | $ | (1,176,634 | ) | $ | 195,265 | ||||||||
Comprehensive Income | $ | 195,475 | $ | 1,176,634 | $ | — | $ | (1,176,634 | ) | $ | 195,475 |
Six Months Ended June 30, 2012 | |||||||||||||||||||
Issuer | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Combining and Consolidated Adjustments | Total | |||||||||||||||
Revenues | $ | 2,845,520 | $ | 7,455,629 | $ | — | $ | (508,028 | ) | $ | 9,793,121 | ||||||||
Costs and expenses: | |||||||||||||||||||
Cost of sales, excluding depreciation | 3,581,841 | 5,865,426 | — | (508,028 | ) | 8,939,239 | |||||||||||||
Operating expenses, excluding depreciation | — | 358,845 | — | — | 358,845 | ||||||||||||||
General and administrative expenses | 34,556 | 4,544 | — | — | 39,100 | ||||||||||||||
Gain on sale of asset | — | (2,450 | ) | — | — | (2,450 | ) | ||||||||||||
Depreciation and amortization expense | 2,939 | 40,024 | — | — | 42,963 | ||||||||||||||
3,619,336 | 6,266,389 | — | (508,028 | ) | 9,377,697 | ||||||||||||||
Income (loss) from operations | (773,816 | ) | 1,189,240 | — | — | 415,424 | |||||||||||||
Other income (expense): | |||||||||||||||||||
Equity in earnings (loss) of subsidiaries | 1,170,639 | — | — | (1,170,639 | ) | — | |||||||||||||
Change in fair value of catalyst lease | — | (978 | ) | — | — | (978 | ) | ||||||||||||
Change in fair value of contingent consideration | — | (1,384 | ) | — | — | (1,384 | ) | ||||||||||||
Interest expense, net | (43,612 | ) | (16,239 | ) | — | — | (59,851 | ) | |||||||||||
Net income | $ | 353,211 | $ | 1,170,639 | $ | — | $ | (1,170,639 | ) | $ | 353,211 | ||||||||
Comprehensive Income | $ | 353,228 | $ | 1,170,639 | $ | — | $ | (1,170,639 | ) | $ | 353,228 |
Six Months Ended June 30, 2013 | |||||||||||||||||||
Issuer | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Combining and Consolidated Adjustments | Total | |||||||||||||||
Cash flows from operating activities: | |||||||||||||||||||
Net income | $ | 195,265 | $ | 1,176,634 | $ | — | $ | (1,176,634 | ) | $ | 195,265 | ||||||||
Adjustments to reconcile net income to net | |||||||||||||||||||
cash from operating activities: | |||||||||||||||||||
Depreciation and amortization | 9,339 | 48,014 | — | — | 57,353 | ||||||||||||||
Stock based compensation | — | 1,977 | — | — | 1,977 | ||||||||||||||
Change in fair value of catalyst lease obligation | — | (5,481 | ) | — | — | (5,481 | ) | ||||||||||||
Non-cash change in inventory repurchase obligations | — | (17,377 | ) | — | — | (17,377 | ) | ||||||||||||
Pension and other post retirement benefit costs | — | 8,472 | — | — | 8,472 | ||||||||||||||
Equity in earnings of subsidiaries | (1,176,634 | ) | — | — | 1,176,634 | — | |||||||||||||
Changes in operating assets and liabilities: | |||||||||||||||||||
Accounts receivable | (9,505 | ) | (78,051 | ) | — | — | (87,556 | ) | |||||||||||
Inventories | (203,625 | ) | 20,587 | — | — | (183,038 | ) | ||||||||||||
Other current assets | (22,191 | ) | (10,557 | ) | — | — | (32,748 | ) | |||||||||||
Accounts payable | (12,985 | ) | (119,505 | ) | — | — | (132,490 | ) | |||||||||||
Accrued expenses | 237,384 | (42,073 | ) | — | — | 195,311 | |||||||||||||
Deferred revenue | — | (26,594 | ) | — | — | (26,594 | ) | ||||||||||||
Amounts due to/from related parties | 832,549 | (817,828 | ) | — | — | 14,721 | |||||||||||||
Other assets and liabilities | 4,114 | (12,480 | ) | — | — | (8,366 | ) | ||||||||||||
Net cash (used in) provided by operating activities | (146,289 | ) | 125,738 | — | — | (20,551 | ) | ||||||||||||
Cash flows from investing activities: | |||||||||||||||||||
Expenditures for property, plant and equipment | (18,240 | ) | (86,844 | ) | — | — | (105,084 | ) | |||||||||||
Expenditures for refinery turnarounds costs | — | (4,551 | ) | — | — | (4,551 | ) | ||||||||||||
Expenditures for other assets | — | (3,089 | ) | — | — | (3,089 | ) | ||||||||||||
Net cash provided by (used in) investing activities | (18,240 | ) | (94,484 | ) | — | — | (112,724 | ) | |||||||||||
Cash flows from financing activities: | |||||||||||||||||||
Proceeds from revolver borrowings | 160,000 | — | — | — | 160,000 | ||||||||||||||
Proceeds from intercompany notes payable | 31,632 | — | — | — | 31,632 | ||||||||||||||
Distribution to members | (155,802 | ) | — | — | — | (155,802 | ) | ||||||||||||
Repayments of revolver borrowings | (65,000 | ) | — | — | — | (65,000 | ) | ||||||||||||
Payment of contingent consideration related to acquisition of Toledo refinery | — | (21,357 | ) | — | — | (21,357 | ) | ||||||||||||
Deferred financing costs and other | (1,044 | ) | (215 | ) | — | — | (1,259 | ) | |||||||||||
Net cash used in financing activities | (30,214 | ) | (21,572 | ) | — | — | (51,786 | ) | |||||||||||
Net (decrease) increase in cash and cash equivalents | (194,743 | ) | 9,682 | — | — | (185,061 | ) | ||||||||||||
Cash and equivalents, beginning of period | 241,926 | 12,365 | — | — | 254,291 | ||||||||||||||
Cash and equivalents, end of period | $ | 47,183 | $ | 22,047 | $ | — | $ | — | $ | 69,230 |
Six Months Ended June 30, 2012 | |||||||||||||||||||
Issuer | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Combining and Consolidated Adjustments | Total | |||||||||||||||
Cash flows from operating activities: | |||||||||||||||||||
Net income | $ | 353,211 | $ | 1,170,639 | $ | — | $ | (1,170,639 | ) | $ | 353,211 | ||||||||
Adjustments to reconcile net income to net | |||||||||||||||||||
cash from operating activities: | |||||||||||||||||||
Depreciation and amortization | 5,456 | 40,024 | — | — | 45,480 | ||||||||||||||
Stock based compensation | — | 1,047 | — | — | 1,047 | ||||||||||||||
Change in fair value of catalyst lease obligation | — | 978 | — | — | 978 | ||||||||||||||
Change in fair value of contingent consideration | — | 1,384 | — | — | 1,384 | ||||||||||||||
Non-cash change in inventory repurchase obligations | — | (12,611 | ) | — | — | (12,611 | ) | ||||||||||||
Write off of unamortized deferred financing fees | 4,391 | — | — | — | 4,391 | ||||||||||||||
Gain on sale of assets | — | (2,450 | ) | — | — | (2,450 | ) | ||||||||||||
Pension and other post retirement benefit costs | 17 | 6,318 | — | — | 6,335 | ||||||||||||||
Equity in earnings of subsidiaries | (1,170,639 | ) | — | — | 1,170,639 | — | |||||||||||||
Changes in operating assets and liabilities: | |||||||||||||||||||
Accounts receivable | (392,653 | ) | 260,657 | — | — | (131,996 | ) | ||||||||||||
Inventories | (533,530 | ) | 467,776 | — | — | (65,754 | ) | ||||||||||||
Other current assets | (5,778 | ) | 46,976 | — | — | 41,198 | |||||||||||||
Accounts payable | 21,201 | (5,570 | ) | — | (9,749 | ) | 5,882 | ||||||||||||
Accrued expenses | 57,022 | (136,343 | ) | — | — | (79,321 | ) | ||||||||||||
Deferred revenue | — | (22,311 | ) | — | — | (22,311 | ) | ||||||||||||
Amounts due to/from related parties | 1,317,885 | (1,317,885 | ) | — | — | — | |||||||||||||
Other assets and liabilities | (651 | ) | (27,438 | ) | — | — | (28,089 | ) | |||||||||||
Net cash (used in) provided by operating activities | (344,068 | ) | 471,191 | — | (9,749 | ) | 117,374 | ||||||||||||
Cash flows from investing activities: | |||||||||||||||||||
Expenditures for property, plant and equipment | (9,904 | ) | (54,219 | ) | — | — | (64,123 | ) | |||||||||||
Expenditures for refinery turnarounds costs | — | (22,609 | ) | — | — | (22,609 | ) | ||||||||||||
Expenditures for other assets | — | (6,503 | ) | — | — | (6,503 | ) | ||||||||||||
Proceeds from sale of assets | — | 3,381 | — | — | 3,381 | ||||||||||||||
Net cash used in investing activities | (9,904 | ) | (79,950 | ) | — | — | (89,854 | ) | |||||||||||
Cash flows from financing activities: | |||||||||||||||||||
Proceeds from member contributions | 250 | — | — | — | 250 | ||||||||||||||
Proceeds from senior secured notes | 665,806 | — | — | — | 665,806 | ||||||||||||||
Proceeds from long-term debt | 430,000 | — | — | — | 430,000 | ||||||||||||||
Proceeds from catalyst lease | — | 9,452 | — | — | 9,452 | ||||||||||||||
Distributions to members | (12,860 | ) | — | — | — | (12,860 | ) | ||||||||||||
Repayments of long-term debt | (698,750 | ) | (342,968 | ) | — | — | (1,041,718 | ) | |||||||||||
Payment of contingent consideration related to acquisition of Toledo refinery | — | (103,642 | ) | — | — | (103,642 | ) | ||||||||||||
Deferred financing costs and other | (16,246 | ) | — | — | — | (16,246 | ) | ||||||||||||
Net cash provided by (used in) financing activities | 368,200 | (437,158 | ) | — | — | (68,958 | ) | ||||||||||||
Net increase (decrease) in cash and cash equivalents | 14,228 | (45,917 | ) | — | (9,749 | ) | (41,438 | ) | |||||||||||
Cash and equivalents, beginning of period | 3,124 | 47,042 | — | — | 50,166 | ||||||||||||||
Cash and equivalents, end of period | $ | 17,352 | $ | 1,125 | $ | — | $ | (9,749 | ) | $ | 8,728 |
Three months ended June 30, | Six months ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Revenue | $ | 4,678,293 | $ | 5,077,015 | $ | 9,476,141 | $ | 9,793,121 | |||||||
Cost of sales, excluding depreciation | 4,295,979 | 4,279,046 | 8,731,081 | 8,939,239 | |||||||||||
Gross refining margin (1) | 382,314 | 797,969 | 745,060 | 853,882 | |||||||||||
Operating expenses, excluding depreciation | 202,583 | 170,702 | 408,599 | 358,845 | |||||||||||
General and administrative expenses | 19,141 | 25,286 | 49,235 | 39,100 | |||||||||||
Loss (gain) on sale of assets | — | 53 | — | (2,450 | ) | ||||||||||
Depreciation and amortization expense | 27,563 | 22,422 | 54,093 | 42,963 | |||||||||||
249,287 | 218,463 | 511,927 | 438,458 | ||||||||||||
Income from operations | 133,027 | 579,506 | 233,133 | 415,424 | |||||||||||
Change in fair value of catalyst leases | 6,820 | 5,371 | 5,481 | (978 | ) | ||||||||||
Change in fair value of contingent consideration | — | (692 | ) | — | (1,384 | ) | |||||||||
Interest expense, net | (21,708 | ) | (28,443 | ) | (43,319 | ) | (59,851 | ) | |||||||
Income before income taxes | 118,139 | 555,742 | 195,295 | 353,211 | |||||||||||
Income tax expense | (10,969 | ) | — | (18,413 | ) | — | |||||||||
Net income | 107,170 | $ | 555,742 | 176,882 | $ | 353,211 | |||||||||
Less: net income attributable to noncontrolling interest | 90,344 | 148,649 | |||||||||||||
Net income attributable to PBF Energy Inc. | $ | 16,826 | $ | 28,233 | |||||||||||
Gross margin | $ | 155,484 | $ | 606,234 | $ | 288,506 | $ | 455,013 | |||||||
Net income available to Class A common stock per share: | |||||||||||||||
Basic | $ | 0.62 | $ | 1.12 | |||||||||||
Diluted | $ | 0.61 | $ | 1.08 |
(1) | See Non-GAAP Financial Measures below. |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Key Operating Information | |||||||||||||||
Production (barrels per day ("bpd") in thousands) | 464.0 | 475.2 | 450.9 | 451.4 | |||||||||||
Crude oil and feedstocks throughput (bpd in thousands) | 464.6 | 479.1 | 453.1 | 451.3 | |||||||||||
Total crude oil and feedstocks throughput (millions of barrels) | 42.3 | 43.6 | 82.0 | 82.1 | |||||||||||
Gross refining margin per barrel of throughput (1) | $ | 9.04 | $ | 18.30 | $ | 9.08 | $ | 10.40 | |||||||
Operating expense, excluding depreciation, per barrel of throughput | $ | 4.79 | $ | 3.92 | $ | 4.98 | $ | 4.37 | |||||||
Crude and feedstocks (% of total throughput) (2): | |||||||||||||||
Heavy crude | 16 | % | 17 | % | 15 | % | 18 | % | |||||||
Medium crude | 39 | % | 42 | % | 44 | % | 46 | % | |||||||
Light crude | 38 | % | 32 | % | 33 | % | 28 | % | |||||||
Other feedstocks and blends | 7 | % | 9 | % | 8 | % | 8 | % | |||||||
Yield (% of total throughput): | |||||||||||||||
Gasoline and gasoline blendstocks | 45 | % | 48 | % | 46 | % | 47 | % | |||||||
Distillates and distillate blendstocks | 37 | % | 34 | % | 37 | % | 35 | % | |||||||
Lubes | 2 | % | 2 | % | 2 | % | 2 | % | |||||||
Chemicals | 3 | % | 3 | % | 3 | % | 3 | % | |||||||
Other | 13 | % | 13 | % | 12 | % | 13 | % | |||||||
(1) | See Non-GAAP Financial Measures below. |
(2) | We define heavy crude oil as crude oil with an American Petroleum Institute (API) gravity less than 24 degrees. We define medium crude oil as crude oil with an API gravity between 24 and 35 degrees. We define light crude oil as crude oil with an API gravity higher than 35 degrees. |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
(dollars per barrel, except as noted) | |||||||||||||||
Dated Brent Crude | $ | 102.43 | $ | 108.29 | $ | 107.50 | $ | 113.61 | |||||||
West Texas Intermediate (WTI) crude oil | $ | 94.07 | $ | 93.30 | $ | 94.17 | $ | 98.16 | |||||||
Crack Spreads | |||||||||||||||
Dated Brent (NYH) 2-1-1 | $ | 14.67 | $ | 15.32 | $ | 13.60 | $ | 12.78 | |||||||
WTI (Chicago) 4-3-1 | $ | 29.26 | $ | 28.17 | $ | 27.72 | $ | 23.89 | |||||||
Crude Oil Differentials | |||||||||||||||
Dated Brent (foreign) less WTI | $ | 8.36 | $ | 14.99 | $ | 13.33 | $ | 15.45 | |||||||
Dated Brent less Maya (heavy, sour) | $ | 4.59 | $ | 9.16 | $ | 7.30 | $ | 9.55 | |||||||
Dated Brent less WTS (sour) | $ | 8.42 | $ | 20.28 | $ | 16.42 | $ | 19.93 | |||||||
Dated Brent less ASCI (sour) | $ | 3.14 | $ | 4.41 | $ | 3.55 | $ | 4.07 | |||||||
WTI less WCS (heavy, sour) | $ | 16.63 | $ | 19.87 | $ | 21.54 | $ | 23.16 | |||||||
WTI less Bakken (light, sweet) | $ | 2.06 | $ | 6.54 | $ | 1.98 | $ | 9.49 | |||||||
WTI less Syncrude (light, sweet) | $ | (4.33 | ) | $ | 1.68 | $ | (3.84 | ) | $ | 4.49 | |||||
Natural gas (dollars per MMBTU) | $ | 4.02 | $ | 2.35 | $ | 3.76 | $ | 2.43 |
1. | Assumed Exchange of all PBF LLC Series A Units for shares of PBF Energy Class A common stock. As a result of the assumed exchange of all PBF LLC Series A Units, the noncontrolling interest related to these units is converted to controlling interest. Management believes that it is useful to provide the per-share effect associated with the assumed exchange of all PBF LLC Series A Units. |
2. | Income Taxes. Prior to the IPO we were organized as a limited liability company treated as a “flow-through” entity for income tax purposes, and even after our IPO, not all of our earnings are subject to corporate-level income taxes. Adjustments have been made to the Adjusted Pro Forma tax provisions and earnings to assume that we had adopted our post-IPO corporate tax structure for all periods presented and are taxed as a C corporation in the U.S. at the prevailing corporate rates. These assumptions are consistent with the assumption in clause 1 above that all PBF LLC Series A Units are exchanged for shares of PBF Energy Class A common stock, as the assumed exchange would change the amount of our earnings that is subject to corporate income tax. |
Three months ended June 30, | Six months ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Net income attributable to PBF Energy Inc. | $ | 16,826 | $ | — | $ | 28,233 | $ | — | |||||||
Add: Net income attributable to the noncontrolling interest(1) | 90,344 | 555,742 | 148,649 | 353,211 | |||||||||||
Less: Income tax expense(2) | (35,686 | ) | (219,518 | ) | (58,716 | ) | (139,518 | ) | |||||||
Adjusted pro forma net income | $ | 71,484 | $ | 336,224 | $ | 118,166 | $ | 213,693 | |||||||
Diluted weighted-average shares outstanding of PBF Energy Inc. (3) | 27,706,696 | — | 26,110,976 | — | |||||||||||
Conversion of PBF LLC Series A Units (4) | 69,647,005 | 97,353,701 | 71,314,923 | 97,425,899 | |||||||||||
Pro forma shares outstanding—diluted (5) | 97,353,701 | 97,353,701 | 97,425,899 | 97,425,899 | |||||||||||
Adjusted pro forma net income per fully exchanged, fully diluted shares outstanding | $ | 0.73 | $ | 3.45 | $ | 1.21 | $ | 2.19 |
(1) | Represents the elimination of the noncontrolling interest associated with the ownership by the members of PBF LLC other than PBF Energy as if such members had fully exchanged their PBF LLC Series A Units for shares of PBF Energy's Class A common stock. | |
(2) | Represents an adjustment to reflect PBF Energy's current effective corporate tax rate of approximately 39.5% applied to all periods presented. The adjustment assumes the full exchange of existing PBF LLC Series A Units as described in (1) above. | |
(3) | Represents weighted-average diluted shares outstanding assuming the conversion of all common stock equivalents, including options and warrants for units of PBF LLC Series A Units and options for shares of PBF Energy Class A common stock as calculated under the treasury stock method for the three and six month period ended June 30, 2013. Common stock equivalents exclude the effects of options to purchase 731,250 shares of PBF Energy's Class A common stock because they are anti-dilutive. | |
(4) | Represents an adjustment to weighted-average diluted shares to assume the full exchange of existing PBF LLC Series A Units as described in (1) above. | |
(5) | Diluted pro forma shares outstanding for historical periods prior to our IPO reflect the same number of diluted shares outstanding as the applicable current periods in order to present such pre-IPO periods on a comparable basis. |
Three Months Ended June 30, | |||||||||||
2013 | 2012 | ||||||||||
$ | per barrel of throughput | $ | per barrel of throughput | ||||||||
Reconciliation of gross margin to gross refining margin: | |||||||||||
Gross margin | $ | 155,484 | $3.68 | $ | 606,234 | $13.90 | |||||
Add: | |||||||||||
Refinery operating expense | 202,583 | $4.79 | 170,702 | $3.92 | |||||||
Refinery depreciation expense | 24,247 | $0.57 | 21,033 | $0.48 | |||||||
Gross refining margin | $ | 382,314 | $9.04 | $ | 797,969 | $18.30 | |||||
Six Months Ended June 30, | |||||||||||
2013 | 2012 | ||||||||||
$ | per barrel of throughput | $ | per barrel of throughput | ||||||||
Reconciliation of gross margin to gross refining margin: | |||||||||||
Gross margin | $ | 288,506 | $3.52 | $ | 455,013 | $5.54 | |||||
Add: | |||||||||||
Refinery operating expense | 408,599 | $4.98 | 358,845 | $4.37 | |||||||
Refinery depreciation expense | 47,955 | $0.58 | 40,024 | $0.49 | |||||||
Gross refining margin | $ | 745,060 | $9.08 | $ | 853,882 | $10.40 | |||||
• | does not reflect depreciation expense or our cash expenditures, or future requirements, for capital expenditures or contractual commitments; |
• | does not reflect changes in, or cash requirements for, our working capital needs; |
• | does not reflect our interest expense, or the cash requirements necessary to service interest or principal payments, on our debt; |
• | does not reflect realized and unrealized gains and losses from hedging activities, which may have a substantial impact on our cash flow; |
• | does not reflect certain other non-cash income and expenses; and |
• | excludes income taxes that may represent a reduction in available cash. |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
Reconciliation of net income to EBITDA: | |||||||||||||||||
Net income (1) | 107,170 | 555,742 | 176,882 | 353,211 | |||||||||||||
Add:Depreciation and amortization expense | 27,563 | 22,422 | 54,093 | 42,963 | |||||||||||||
Add: Interest expense, net | 21,708 | 28,443 | 43,319 | 59,851 | |||||||||||||
Add: Income tax expense (1) | 10,969 | — | 18,413 | — | |||||||||||||
EBITDA | $ | 167,410 | $ | 606,607 | $ | 292,707 | $ | 456,025 | |||||||||
Reconciliation of EBITDA to Adjusted EBITDA: | |||||||||||||||||
EBITDA | $ | 167,410 | $ | 606,607 | $ | 292,707 | $ | 456,025 | |||||||||
Stock based compensation | 957 | 540 | 1,977 | 1,047 | |||||||||||||
Non-cash change in fair value of catalyst lease obligations | (6,820 | ) | (5,371 | ) | (5,481 | ) | 978 | ||||||||||
Non-cash change in fair value of contingent consideration | — | 692 | — | 1,384 | |||||||||||||
Non-cash change in fair value of inventory repurchase obligations | (2,831 | ) | (5,289 | ) | (13,873 | ) | (12,209 | ) | |||||||||
Non-cash deferral of gross profit on finished product sales | (20,496 | ) | 2,330 | (28,030 | ) | (3,441 | ) | ||||||||||
Adjusted EBITDA | $ | 138,220 | $ | 599,509 | $ | 247,300 | $ | 443,784 |
Exhibit Number | Description | |
10.1† | Inventory Intermediation Agreement dated as of June 26, 2013 (as amended) between J. Aron & Company and PBF Holding Company LLC and Paulsboro Refining Company LLC. | |
10.2† | Inventory Intermediation Agreement dated as of June 26, 2013 (as amended) between J. Aron & Company and PBF Holding Company LLC and Delaware City Refining Company LLC. | |
31.1 | Certification of Thomas J. Nimbley, Chief Executive Officer of PBF Energy Inc. pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
31.2 | Certification of Matthew C. Lucey, Chief Financial Officer of PBF Energy Inc. pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
31.3 | Certification of Thomas J. Nimbley, Chief Executive Officer of PBF Holding Company LLC pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
31.4 | Certification of Matthew C. Lucey, Chief Financial Officer of PBF Holding Company LLC pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
32.1* | Certification of Thomas J. Nimbley, Chief Executive Officer of PBF Energy Inc. pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
32.2* | Certification of Matthew C. Lucey, Chief Financial Officer of PBF Energy Inc. pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
32.3* | Certification of Thomas J. Nimbley, Chief Executive Officer of PBF Holding Company LLC pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
32.4* | Certification of Matthew C. Lucey, Chief Financial Officer of PBF Holding Company LLC pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
101.INS | XBRL Instance Document. | |
101.SCH | XBRL Taxonomy Extension Schema Document. | |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document. | |
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document. | |
101.LAB | XBRL Taxonomy Extension Label Linkbase Document. | |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document. |
* | Furnished, not filed. |
† | Confidential treatment requested as to certain portions, which portions are omitted and filed separately with the Securities and Exchange Commission. |
PBF Energy Inc. | ||||
Date | August 8, 2013 | By: | /s/ Matthew C. Lucey | |
Matthew C. Lucey Senior Vice President, Chief Financial Officer (Duly Authorized Officer and Principal Financial Officer) | ||||
PBF Holding Company LLC | ||||
Date | August 8, 2013 | By: | /s/ Matthew C. Lucey | |
Matthew C. Lucey Senior Vice President, Chief Financial Officer (Duly Authorized Officer and Principal Financial Officer) | ||||
PBF Finance Corporation | ||||
Date | August 8, 2013 | By: | /s/ Matthew C. Lucey | |
Matthew C. Lucey Senior Vice President, Chief Financial Officer (Duly Authorized Officer and Principal Financial Officer) |
Exhibit Number | Description | |
10.1† | Inventory Intermediation Agreement dated as of June 26, 2013 (as amended) between J. Aron & Company and PBF Holding Company LLC and Paulsboro Refining Company LLC. | |
10.2† | Inventory Intermediation Agreement dated as of June 26, 2013 (as amended) between J. Aron & Company and PBF Holding Company LLC and Delaware City Refining Company LLC. | |
31.1 | Certification of Thomas J. Nimbley, Chief Executive Officer of PBF Energy Inc. pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
31.2 | Certification of Matthew C. Lucey, Chief Financial Officer of PBF Energy Inc. pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
31.3 | Certification of Thomas J. Nimbley, Chief Executive Officer of PBF Holding Company LLC pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
31.4 | Certification of Matthew C. Lucey, Chief Financial Officer of PBF Holding Company LLC pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
32.1* | Certification of Thomas J. Nimbley, Chief Executive Officer of PBF Energy Inc. pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
32.2* | Certification of Matthew C. Lucey, Chief Financial Officer of PBF Energy Inc. pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
32.3* | Certification of Thomas J. Nimbley, Chief Executive Officer of PBF Holding Company LLC pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
32.4* | Certification of Matthew C. Lucey, Chief Financial Officer of PBF Holding Company LLC pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
101.INS | XBRL Instance Document. | |
101.SCH | XBRL Taxonomy Extension Schema Document. | |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document. | |
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document. | |
101.LAB | XBRL Taxonomy Extension Label Linkbase Document. | |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document. |
* | Furnished, not filed. |
† | Confidential treatment requested as to certain portions, which portions are omitted and filed separately with the Securities and Exchange Commission. |
Page | ||||
DEFINITIONS & CONSTRUCTION | ||||
TERM & EARLY TERMINATION | ||||
SALE OF INITIAL INVENTORY AND REPURCHASE OF ENDING INVENTORY | ||||
TARGET PRODUCT INVENTORY LEVELS; APPLICABLE SPREADS | ||||
ADDITIONAL INCLUDED LOCATIONS | ||||
PRODUCT SALES & REPORTING | ||||
PRODUCT SPECIFICATIONS, QUALITY & BLENDING | ||||
TITLE, RISK OF LOSS & CUSTODY | ||||
STORAGE | ||||
10. | CERTAIN REPRESENTATIONS | |||
WARRANTIES | ||||
PRICING & PAYMENT | ||||
FINANCIAL INFORMATION; NOTIFICATIONS; CREDIT SUPPORT | ||||
TAXES | ||||
INSURANCE | ||||
FORCE MAJEURE | ||||
REPRESENTATIONS, WARRANTIES & COVENANTS | ||||
TERMINATION EVENTS, DEFAULT & EARLY TERMINATION | ||||
INDEMNIFICATION & CLAIMS | ||||
LIMITATION ON DAMAGES | ||||
INFORMATION & INSPECTION RIGHTS | ||||
GOVERNING LAW & DISPUTES | ||||
ASSIGNMENT | ||||
NOTICES | ||||
NATURE OF THE TRANSACTION & RELATIONSHIP OF THE PARTIES | ||||
CONFIDENTIALITY | ||||
CHANGE IN LAW | ||||
MISCELLANEOUS | ||||
1. | DEFINITIONS & CONSTRUCTION |
1.1 | Definitions. For purposes of this Agreement, including the foregoing recitals, the following terms shall have the meanings indicated below. |
1.2 | Interpretation. Unless the context otherwise requires or except where specifically stated otherwise, in this Agreement: |
1.2.1 | words using the singular or plural number also include the plural or singular number, respectively; |
1.2.2 | references to any Party shall be construed as a reference to such Party’s successors in interest and permitted assigns; |
1.2.3 | references to a provision of Applicable Law or Applicable Laws are references to that provision or Applicable Laws generally, as may be amended, extended or re-enacted from time to time; |
1.2.4 | references to “days,” “months” and “years” mean calendar days, months and years, respectively, and a “day” consists of the 24-hour period commencing at 12:00:00 a.m. EPT and ending on 11:59:59 EPT on that day; |
1.2.5 | references to “dollars” or “$” mean U.S. dollars; |
1.2.6 | the (i) volumes of record for purposes of this Agreement shall be in barrels (i.e., 42 net U.S. gallons, measured at 60° F) and (ii) prices of record for purposes of this Agreement shall be in dollars per barrel or dollars per gallon, as applicable. |
1.2.7 | references to “Exhibits,” “Sections” and “Schedules” in this Agreement, or to a provision contained therein, shall be construed as references to the Exhibits, Sections and Schedules of this Agreement, as may be |
1.2.8 | References to any agreement or other document or to a provision contained in any of those shall be construed, at the particular time, as a reference to it as it may then have been amended, supplemented, modified, superseded, replaced, refinanced, assigned, novated and/or waived by the counterparties thereto in accordance with its terms from time to time; |
1.2.9 | references to “assets” include present and future properties, revenues and rights of every description; |
1.2.10 | references herein to “consent” mean, unless otherwise specified, the prior written consent of the Party at issue, which shall not be unreasonably withheld, delayed or conditioned; |
1.2.11 | the terms “hereof,” “herein,” “hereby,” “hereto” and similar words refer to this entire Agreement and not any particular Exhibit, Section, subsection, Schedule or subdivision of this Agreement; |
1.2.12 | the words “include” or “including” shall be deemed to be followed by “without limitation” or “but not limited to” whether or not they are followed by such phrases or words of like import; |
1.2.13 | references to a “judgment” include any order, injunction, determination, award or other judicial or arbitral measure in any jurisdiction; |
1.2.14 | the example calculations set forth in the Schedules hereto shall not be construed as creating any duty or obligation of the Parties; such examples are for illustrative purposes only and do not take precedence over any terms or conditions set forth in the remainder of this Agreement; |
1.2.15 | references to “obligations” shall be construed to mean a Party’s prompt and complete performance of its covenants and obligations required pursuant to this Agreement; and |
1.2.16 | references to any “person” include any natural person, corporation, partnership, limited liability company, joint venture, trust or unincorporated organization, estate, association, partnership, statutory body, joint stock company or any other private entity or organization, Governmental Authority, court or any other legal entity, whether acting in an individual, fiduciary or other capacity. |
1.3 | If there is any ambiguity, inconsistency, discrepancy or conflict between this Agreement and any other Transaction Document, this Agreement shall govern and |
1.4 | Unless otherwise specified, in computing any period of time under this Agreement the day of the act, event or default from which such period begins to run shall be day “zero” and not included. If the last day of the period so computed is not a Business Day then, unless this Agreement provides otherwise, the period shall run until the end of the next Business Day. |
1.5 | The provisions of this Agreement shall be construed in accordance with the natural meanings of their terms. The Parties agree that each has had the opportunity to review the terms and provisions of this Agreement with counsel of its choosing and to negotiate any desired changes or clarifications and that the terms of this Agreement will not be interpreted against one Party or the other on the ground that such Party drafted or revised a particular provision. Instead, in the event of any ambiguity, this Agreement will be interpreted in accordance with the intent of the Parties as evidenced by the Agreement, taken as a whole. |
2. | TERM & EARLY TERMINATION |
2.1 | Initial Term. This Agreement shall be effective as of the Effective Date solely with respect to PRC’s determination of the Estimated Initial Inventory under Section 3.1. Subject to satisfaction of the conditions in Section 2.6, the initial term of this Agreement with respect to all other rights and obligations hereunder shall then commence as of the Commencement Date and continue in full force and effect until July 1, 2015 at 11:59:59 p.m. EPT (the “Initial Term”); provided, however, that this Agreement is subject to earlier termination as provided in Sections 2.3, 2.4 and 2.5. |
2.2 | Renewal Term. As of the expiration of the Initial Term, PRC and Aron may, by mutual agreement and no less than 180 days prior to the expiration of the Initial Term, renew this Agreement for one additional one-year term until July 1, 2016 at 11:59:59 p.m. EPT (or such longer term as may be agreed to by PRC and Aron) (the “Renewal Term”). |
2.3 | Specified Early Termination Rights. In addition to the termination rights in Section 2.4 and 2.5, PRC may, at its option and in its sole discretion, by providing no less than 60 days’ prior written notice to Aron, to be effective at 11:59:59 p.m. EPT on January 1, 2014 or, if later, at 11:59:59 p.m. EPT on the first day of the month immediately following the month during which such 60-day notice period expires (unless such 60-day notice period expires on the first day of a month, in which event such termination will be effective on such day) (but no later than July 1, 2014), terminate this Agreement, in which case this Agreement shall terminate in its entirety and the Specified Early Termination Fee will be due and payable by PRC to the extent applicable as set forth in Section 3.8.7 as part of the Step-out Payment Amount; provided that such termination notice shall not be effective unless (i) DCRC (with |
2.4 | General Early Termination Right. In addition to the termination rights in Section 2.3 and 2.5, PRC may, at its option and in its sole discretion, by providing no less than 60 days’ prior written notice to Aron, to be effective at 11:59:59 p.m. EPT on July 1, 2014 or, if later, at 11:59:59 p.m. EPT on the first day of the month immediately following the month during which such 60-day notice period expires (unless such 60-day notice period expires on the first day of a month, in which event such termination will be effective on such day), terminate this Agreement, in which case this Agreement shall terminate in its entirety and the Early Termination Fee will be due and payable by PRC to the extent applicable as set forth in Section 3.8.8 as part of the Step-out Payment Amount; provided that such termination notice shall not be effective unless (i) DCRC (with PBFH) has concurrently elected to exercise its right to terminate the Related Agreement pursuant to Section 2.4 thereof (in which case, the Early Termination Fee as provided for thereunder would become due to the extent applicable) or (ii) Aron has agreed to the continuation of the Related Agreement following such early termination of this Agreement (in which case, no “Early Termination Fee” will be due under this Agreement or pursuant to Section 2.4 of the Related Agreement at such time). |
2.5 | Termination Right Upon Aron Transaction. *****. |
2.6 | Conditions to Commencement. |
2.6.1 | Conditions to Obligations of Aron. The obligations of Aron contemplated by this Agreement shall be subject to satisfaction by PRC of the following conditions precedent on and as of the Commencement Date: |
2.6.2 | Conditions to Obligations of PRC. The obligations of PRC contemplated by this Agreement shall be subject to satisfaction by Aron of the following conditions precedent on and as of the Commencement Date: |
3. | SALE OF INITIAL INVENTORY AND REPURCHASE OF ENDING INVENTORY |
3.1 | Estimated Initial Inventory (Estimated Step-in Inventory). On Thursday, June 27, 2013, PRC shall prepare its good faith estimate of the Initial Inventory to be sold by PRC to Aron hereunder as of the Commencement Date (the “Estimated Initial Inventory”) based on the volumes held in the Included Locations as of 11:59:59 p.m. EPT on Wednesday, June 26, 2013, and shall deliver a written statement thereof to Aron by 5:00:00 p.m. EPT on Thursday, June 27, 2013. |
3.2 | Initial Purchase (Initial Step-in Purchase). On the Commencement Date, and subject to satisfaction of the conditions set forth in Section 2.6.1, Aron agrees to purchase the Initial Inventory from PRC, subject to Section 3.5, based on the sum of, for each Product Group, the product of (a) the Estimated Step-in Product Benchmark applicable to each Product Group and (b) the Estimated Initial Inventory (based on |
3.3 | Payment for Estimated Initial Inventory (Initial Step-in Payment). Promptly after the opening of financial markets in New York, New York on the Commencement Date, and subject to satisfaction of the conditions set forth in Section 2.6.1, Aron shall pay *****% of the Estimated Initial Inventory Purchase Price to PRC by wire transfer of immediately available funds; provided, however, that PRC may, at its election, direct that all or a portion of the Estimated Initial Inventory Purchase Price be paid to MSCG on PRC’s behalf in accordance with the Payment Direction Letter, and the Parties agree to use commercially reasonable efforts to coordinate the respective timing of payments made pursuant to the Payment Direction Letter; provided, further, for the avoidance of doubt, title to the Initial Inventory shall pass from PRC to Aron, consistent with PRC’s warranty of title set forth in Section 11.1.1 and at and as of the time specified in the definition of the Commencement Date, subject to PRC’s confirmation of receipt of funds in an amount equal to such Estimated Initial Inventory Purchase Price. |
3.4 | Determination of Actual Initial Inventory (Actual Step-in Inventory). The Parties shall determine the actual volumes of the Initial Inventory sold by PRC to Aron hereunder as of the Commencement Date (the “Actual Initial Inventory”) in accordance with the procedures set forth in Schedule D. The Final Inventory Quantity Report shall thereafter be delivered to the Parties pursuant to the procedures set forth in Schedule D. |
3.5 | Initial Purchase True-Up (Step-in True-Up). No later than 5:00 p.m. EPT on the fifth Business Day after the delivery of the Final Inventory Quantity Report pursuant to the procedures set forth in Exhibit D, Aron shall deliver a written statement to PRC showing a calculation of the sum of, for each Product Group, the product of (i) the Actual Initial Inventory (based on the Final Inventory Quantity Report) and (ii) the Actual Step-in Product Benchmark applicable to each such Product Group (the “Actual Initial Inventory Purchase Price”). If (a) the amount of the Actual Initial Inventory Purchase Price exceeds the amount of the Estimated Initial Inventory Purchase Price, then Aron shall pay to PRC the amount of the resulting excess and (b) the amount of the Actual Initial Inventory Purchase Price is less than the amount of the Estimated Initial Inventory Purchase Price, then PRC shall pay to Aron the absolute value of the resulting difference, in each case pursuant to Section 3.6. |
3.6 | Payment of Initial Purchase True-Up (Payment of Step-in True-Up). No later than 5:00:00 p.m. EPT on the Initial Purchase True-Up Date, Aron or PRC, as applicable, shall pay the amount calculated as due and payable thereunder to the other Party by wire transfer of immediately available funds. If such amount is owed to PRC then PRC may, at its election, direct that all or a portion of such amount be paid by Aron to MSCG on PRC’s behalf in accordance with the Payment Direction Letter. If such |
3.7 | Arrangement Fee. |
3.7.1 | Concurrently with the calculation of Actual Initial Inventory Purchase Price under Section 3.5, Aron shall calculate the actual setup fee due in connection herewith (the “Actual Setup Fee”), which shall be equal to the product of the Setup Fee Rate and the Actual Maximum Step-in Value. |
3.7.2 | No later than 12:00:00 p.m. EPT on the third Business Day following the delivery of Aron’s written statement to PRC under Section 3.5, subject to the consummation of the transactions set forth in Section 3.3 and concurrently with the payment (if any) required to be made pursuant to Section 3.6, PRC shall pay the Actual Setup Fee to Aron by wire transfer of immediately available funds. |
3.8 | Purchase Upon Termination or Expiration (Step-out). |
3.8.1 | Upon the termination or expiration of this Agreement for any reason other than as a result of a Termination Event (the effective date of such termination or expiration being the “Step-out Date”), the Parties covenant and agree to proceed as provided in this Section 3.8; provided that (x) the terms of this Agreement applicable to any continuing obligations shall continue in effect following the Step-out Date until all obligations are finally settled as contemplated by this Section 3.8 and (y) the provisions of this Section 3.8 shall in no way limit the rights and remedies which the Performing Party may have as a result of a Termination Event, whether pursuant to Section 18 or otherwise. |
3.8.2 | PRC agrees to purchase from Aron all Aron Inventory located in situ in the Included Locations and owned by Aron on the Step-out Date (the “Step-out Inventory”), as follows: |
3.8.3 | The “Actual Step-out Inventory” of each Product Group shall be determined as of 11:59:59 p.m. EPT on the Step-out Date in accordance with Schedule D (with the necessary changes having been made therein to reflect a determination of such volumes using the procedures therein as of the Step-out Date, instead of as the Commencement Date). The Final Inventory Quantity Report shall be delivered to the Parties pursuant to the procedures set forth in Schedule D (as so modified). |
3.8.4 | The “Step-out Payment Amount” shall equal the sum of the following items (without duplication), as determined by Aron in a commercially reasonable manner: |
3.8.5 | The Parties acknowledge that Aron may not be able to definitively determine one or more of the components of the Step-out Payment Amount by the Step-out Date (provided, however, that Aron shall use its commercially reasonable efforts to determine all such components by the Step-out Date to the maximum extent practicable) and therefore agree in such event that Aron shall, in a commercially reasonable manner, estimate each of such components and use such estimated components to determine an estimate of the Step-out Payment Amount (the “Estimated Step-out Payment Amount”). Without limiting the generality of the foregoing, the Parties agree that the estimated amount with respect to clause (i) of Section 3.8.4 shall be the Estimated Step-out Inventory Purchase Price. Aron shall prepare, and provide PRC with, a statement of the Estimated Step-out Payment Amount, together with appropriate supporting documentation, at least two Business Days prior to the Step-out Date. Aron shall update its calculation of the Estimated Step-out Payment Amount by no later than 5:00 p.m. EPT on the Business Day immediately preceding the Step-out Date. If Aron is able to provide such updated amount by such time, that amount shall constitute the Estimated Step-out Payment Amount and shall be due and payable by no later than 5:00 p.m. EPT on the Step-out Date. Otherwise, the initial Estimated Step-out Payment Amount shall be the amount payable by such time on the Step-out Date. |
3.8.6 | No later than 30 days after the Step-out Date, Aron shall prepare, and provide PRC with, (i) a statement showing the calculation, as of the Step-out Date, of the Step-out Payment Amount and (ii) a statement (the “Step-out Reconciliation Statement”) reconciling the Step-out Payment Amount with the Estimated Step-out Payment Amount and indicating any amount remaining to be paid by one Party to the other as a result of such reconciliation. Within three Business Days after receiving the Step-out Reconciliation Statement and the related supporting documentation, the Parties will make any and all payments required pursuant thereto so that the Step-out Payment Amount shall have been paid in full by wire transfer of immediately available funds. |
3.8.7 | PRC agrees to pay Aron, only if this Agreement is terminated in its entirety pursuant to Section 2.3 on or prior to July 1, 2014 at 11:59:59 p.m. EPT (to the extent applicable under Section 2.3), an amount equal to the product of: (a) the amount calculated as the sum of, for each Product |
3.8.8 | PRC agrees to pay Aron, only if this Agreement is terminated in its entirety pursuant to Section 2.4 on or prior to July 1, 2015 at 11:59:59 p.m. EPT, but after July 1, 2014 at 11:59:59 p.m. EPT (to the extent applicable under Section 2.4), an amount equal to the product of: (a) the amount calculated as the sum of, for each Product Group, the product of (i) the Actual Step-out Inventory Product Benchmark and (ii) the Maximum Inventory, (b) the Early Termination Margin and (c) a fraction, the numerator of which is the number of days between the date of such early termination and July 1, 2015 and the denominator of which is 365 (the “Early Termination Fee”). |
3.8.9 | Notwithstanding anything herein to the contrary (including Section 1.2), it is agreed that the final month of the Term hereof (including if occurring upon an early termination of this Agreement pursuant to Section 2.3 or 2.4) shall be a “long” month consisting of a calendar month and the first day of the immediately following calendar month (and that if the operation of such provisions would result in a termination of this Agreement on a day that is not a Business Day then notwithstanding anything herein to the contrary, the effective date of any such termination shall occur on the next Business Day). |
3.9 | Disputes. If a Party in good faith disputes the accuracy of any amount calculated pursuant to this Section 3, the non-calculating Party shall provide written notice stating the reasons why the remaining disputed amount is incorrect, along with reasonable supporting documentation. In the event the Parties are unable to resolve such dispute, the matter shall be resolved in accordance with Section 22. |
4. | TARGET PRODUCT INVENTORY LEVELS; APPLICABLE SPREADS |
4.1 | Target Product Inventory. Subject to Section 4.2, in connection with establishing the Target Product Inventory for each Product Group, the Parties agree to follow the procedures set forth on Schedule F. |
4.2 | Initial Targets. No later than 5:00 p.m. EPT on Thursday, June 27, 2013, PRC shall deliver a written statement of the initial Target Product Inventory for each Product Group for the month of July 2013 (notwithstanding anything in Schedule F to the contrary). |
4.3 | Differentials. |
(a) | No later than 5:00 p.m. EPT on Friday, June 28, 2013, PRC shall deliver to Aron a statement listing the initial Differentials to be used hereunder as of |
(b) | Prior to the second to last Business Day of each month, PRC and Aron shall discuss whether to adjust any of the Differentials and, if either Party believes an adjustment is appropriate, the Parties shall negotiate in good faith and in a commercially reasonable manner to agree on such adjusted Differentials. If any such adjusted Differentials are agreed to by the second to last Business Day of such month, the Parties will promptly confirm such agreement in writing, and such adjusted Differential shall become applicable for purposes of determining the Product Benchmarks starting with the immediately following month. The Parties acknowledge that each such agreement to adjust the Differentials shall apply only prospectively starting in the following month and that successive adjustments may be made, in each case with the most recent adjustment superseding any prior adjustment on a going forward basis. |
(c) | Each time the Parties agree to adjusted Differentials, Aron shall determine the Differential Adjustment Amount as provided on Schedule G and such amount shall be included in the Aggregate Monthly Product True-Up Amount that is incorporated into the Monthly True-Up Payment in the immediately following month. |
4.4 | Hedging Activities. Any hedges, swaps, options, positions or any other instruments or strategies executed by either Party related in any way to the Products, shall be for the relevant Party’s own account (including with regard to the Aron Hedges, which shall be for Aron’s own account), and any Taxes and/or Liabilities incurred, directly or indirectly resulting from such activities, shall be borne exclusively by such relevant Party (provided that the foregoing shall not affect the treatment of Specified Unwind Costs pursuant to the express terms and conditions of Section 3.8 or 18). |
5. | ADDITIONAL INCLUDED LOCATIONS |
5.1 | From time to time after the Commencement Date, PRC may notify Aron that PRC wishes to add a third-party storage location as an Included Location for purposes of this Agreement. Following such notification, Aron shall promptly undertake a due diligence review of the proposed Included Location to reasonably determine whether Aron is prepared to hold Product inventory at such proposed Included Location. Aron shall be under no further obligation with respect to such proposed Included Location if Aron reasonably determines that, based on such due diligence review, it is not prepared to hold Product inventory at such proposed Included Location. Aron |
5.2 | If Aron advises PRC that Aron is prepared to hold Product inventory at such proposed Included Location, then PRC may endeavor to negotiate and implement Required Storage Arrangements pursuant to which PRC may transfer and assign to Aron PRC’s (and/or its Affiliates’) right to use the proposed Included Location; provided that (a) upon and concurrently with implementing any Required Storage Arrangement, the Parties shall execute such amendments to this Agreement and/or the Exhibits and/or Schedules hereto as are necessary or appropriate to add such proposed Included Location as an Included Location hereunder, (b) to the extent requested by Aron, the Parties shall amend any other applicable Transaction Document to include any inventory transferred to Aron as a result of such assignment, designation or arrangement and (c) no change shall occur in the Minimum Inventory or the Maximum Inventory in connection with the implementation of such Required Storage Arrangements unless agreed to by Aron. Notwithstanding anything to the contrary in this Section 5.2, PRC shall nevertheless be free in its sole discretion to enter into storage agreements with third parties, provided such storage agreements are not at a location that is an Included Location. |
5.3 | The Parties will cooperate in good faith with regard to the negotiation, preparation and execution of any Required Storage Arrangements upon commercially reasonable terms, in form and substance reasonably satisfactory to both Parties. |
5.4 | If any Required Storage Arrangements are entered into in connection with additional Included Locations and, thereafter, PRC shall materially fail to (i) perform its obligations under, (ii) comply with or (iii) maintain such Required Storage Arrangements in effect; provided, in each case that if PRC fails to cure any such failure within three Business Days after receiving written notice thereof from Aron, then Aron may, in its reasonable discretion, require that such location be removed from the Included Locations and that PRC at the time such location is removed purchase all Aron Inventory then located at such location on terms comparable to those that apply to a termination of this Agreement under Section 3.8. |
6. | PRODUCT SALES & REPORTING |
6.1 | Products Sales to Aron by PRC. Aron agrees to purchase from PRC, and PRC agrees to sell to Aron, the Products produced by the Refinery or delivered to the Refinery, and delivered by PRC into the Included Locations at the prices determined pursuant to this Agreement and otherwise in accordance with the terms and conditions of this Agreement (in each case, other than with regard to any Excess Quantities or Excluded Third-Party Inventory); provided that (i) Aron shall not be obligated at any time to purchase Products from PRC if such purchase would result in Aron owning Products in any Product Group in the Included Locations in excess of the Maximum Inventory for such Product Group specified on Schedule E (as such Maximum Inventory is |
6.2 | Products Sales to PRC by Aron. PRC agrees to purchase from Aron, and Aron agrees to sell to PRC, the Products delivered out of the Included Locations at the prices determined pursuant to this Agreement and otherwise in accordance with the terms and conditions of this Agreement; provided that PRC agrees that its purchases and receipt of Products from Aron shall be in sufficient quantities so that Aron shall, at all times during the Term, have available storage capacity in the Included Locations to take delivery of any Products to be sold by PRC to Aron pursuant to Section 6.1. |
6.3 | Daily Report of Inventory Volumes. On or prior to 5:00 p.m. EPT on each Business Day, PRC shall deliver to Aron a report, in the form provided on Exhibit 3, setting forth a good faith estimate of the volumes of each Product (the “Inventory Volumes”) held in the Included Locations as of 11:59:59 p.m. EPT on the immediately prior Business Day and any prior, non-reported days (including holidays and weekends), including the total Aron Inventory levels as to each grade of Product, in each case based on the best available information, by applying the Volume Determination Procedures, together with comparable information with respect to any then-existing Commingled Quantities and/or Excluded Third Party Inventories, any Tanks which pursuant to Section 6.4.5 are not then Included Locations and any Tanks which pursuant to Section 9 have been substituted for other Tanks (the “Daily Report of Inventory Volumes”). |
6.4 | Excess Inventory Levels. |
6.4.1 | If PRC intends to designate an Excess Inventory Level for any whole or partial month for any Product Group, then PRC shall use commercially reasonable efforts to notify Aron of PRC’s intention prior to the Target Cutoff Date for such whole or partial month. If PRC fails to provide such notice in a timely manner, it shall not be entitled for that whole or partial month to designate an Excess Inventory Level for the relevant Product Group and Sections 6.4.4 and 6.4.5 shall apply. |
6.4.2 | If, pursuant to Section 6.4.1, PRC provides timely notice of its intention to designate an Excess Inventory Level for a Product Group, then Aron shall promptly advise PRC whether Aron accepts such Excess Inventory Level (in which case Section 6.4.3 shall apply) or rejects such Excess Inventory Level (in which case Section 6.4.4 and 6.4.5 shall apply). |
6.4.3 | If Aron accepts an Excess Inventory Level for any whole or partial month, then, for all purposes of this Agreement, such Excess Inventory Level shall constitute the Maximum Inventory for the relevant Product Group for such whole or partial month; provided that such Excess Inventory Level shall not apply to any other whole or partial month unless expressly |
6.4.4 | If Aron rejects an Excess Inventory Level for any whole or partial month or PRC fails to provide notice to Aron of its intention to designate an Excess Inventory Level in a timely manner for any whole or partial month, then the following provisions shall apply: |
(a) | PRC shall identify to Aron which Tanks holding Aron Inventory will also hold Commingled Quantities; and |
(b) | PRC shall, to the extent practicable and commercially reasonable, endeavor to use smaller capacity Tanks before larger capacity Tanks to hold Commingled Quantities. |
6.4.5 | In the event that PRC determines, in its reasonable discretion, that it does not wish to designate an Excess Inventory Level for a particular Product Group (or the applicable time for such designation pursuant to Section 6.4.1 has passed) during a whole or partial month and that the Maximum Inventory for such whole or partial month would otherwise be exceeded, then the following provisions shall apply: |
6.5 | Purchase Price of Products. The purchase price payable by Aron for any Product sold to it under Section 6.1 and by PRC for any Product sold to it under Section 6.2 shall be such prices as are established pursuant to Section 12.1 and as further adjusted pursuant to Section 12.5. |
6.6 | Ancillary Costs. PRC agrees to reimburse Aron for all Ancillary Costs incurred by Aron, subject to the provisions of this Section 6.6. Aron may demand such reimbursement from time to time and payment will be due as set forth in Section 12.5.2 after delivery to PRC of the relevant Backup Certificate. All refunds or adjustments of any type received by Aron related to any Ancillary Costs shall be reflected in the Monthly True-Up Payment as provided in Section 12.5 below. Upon requesting reimbursement for Ancillary Costs, Aron will deliver to PRC an officer’s |
7. | PRODUCT SPECIFICATIONS, QUALITY & BLENDING |
7.1 | Specifications. The Products sold and delivered to Aron shall generally conform to the typical properties set forth for each grade of Product listed on Schedule A, as amended by the Parties by mutual written agreement from time to time. |
7.2 | Blending of Products at the Refinery. In its role as a “fuel manufacturer” and a “refiner” (as such terms are defined under 40 C.F.R. Part 79 and Part 80) PRC shall be responsible for: (i) registering the Products and the Refinery with the EPA, (ii) designating all of the volumes of Products that it may produce by refining and/or blending in accordance with EPA requirements, (iii) testing and certifying Product batches in accordance with EPA requirements, (iv) compliance with all applicable EPA recordkeeping and reporting requirements, (v) properly administering the product transfer document requirements of the EPA, (vi) meeting the renewable volume obligation compliance requirements as required under the RFS2 program and (vii) any and all other “fuel manufacturer” and “refiner” requirements set forth by the EPA under 40 C.F.R. Part 79 and Part 80. In all cases and for all Products, PRC shall be solely entitled to all “renewable identification numbers” or “RINs” applicable to or associated with all Products under this Agreement. |
8. | TITLE, RISK OF LOSS & CUSTODY |
8.1 | Transfer of Title. |
8.1.1 | Title to Products purchased by Aron pursuant to the terms of this Agreement shall pass from PRC to Aron as the Product passes the inlet flange of the Tank (including tanks at any other Included Locations added to the scope of this Agreement after the Commencement Date pursuant to Section 5) to which such Products are being delivered. All Products shall be delivered by PRC, at PRC’s cost, to Aron into the Tanks (including tanks at any other Included Locations added to the scope of this Agreement after the Commencement Date pursuant to Section 5). |
8.1.2 | Title to Products purchased by PRC pursuant to the terms of this Agreement shall pass from Aron to PRC as the Products pass the outlet flange of the Tank (including tanks at any other Included Locations added to the scope of this Agreement after the Commencement Date pursuant to Section 5) from which such Products are being delivered. Provided no Event of Default has occurred and is continuing with respect to PRC, PRC shall be permitted to withdraw from the Tanks (including tanks at any other Included Locations added to the scope of this Agreement after |
8.2 | Ownership. Aron shall own and have title to all of the Aron Inventory stored in the Included Locations (it being agreed and acknowledged that (i) Excess Quantities and Excluded Third-Party Inventory do not constitute Aron Inventory and (ii) upon PRC purchasing any Aron Inventory pursuant to Section 6.4.5, such quantities shall not constitute Aron Inventory unless and until the quantities in the affected Tanks are repurchased by Aron pursuant to Section 6.4.5). PRC, for itself and on behalf of its Affiliates, fully acknowledges Aron’s title to and interest in the Aron Inventory and further represents and warrants that neither it nor any of its Affiliates shall have any Lien on the Aron Inventory and waives any Lien held by it (if any) in the Aron Inventory. |
8.3 | Transfer of Custody. PRC shall maintain custody of all Products owned by Aron pursuant to the terms of this Agreement and shall be responsible for maintaining the insurance required of PRC pursuant to Section 15. PRC shall hold all Aron Inventory in the Included Locations solely as bailee. During the Term, neither PRC nor any of its Affiliates shall (and PRC shall not permit any of its Affiliates or any other person to) use any Aron Inventory for any purpose except as may be permitted by this Agreement. Solely in its capacity as bailee, PRC shall have custody of Aron Inventory from the time such Aron Inventory passes the inlet flange of the Tanks (including tanks at the Included Locations) until such time as such Aron Inventory passes the outlet flange of the Tanks (including tanks at the Included Locations). |
8.4 | Refinery Operations. At all times PRC shall have and retain complete control of the Refinery and its maintenance and operations, including utilization or maintenance of Tanks. |
9. | STORAGE |
9.1 | Services. PRC hereby undertakes the following obligations with respect to the Services to be provided by PRC under this Agreement, for and in consideration of the mutual covenants and undertakings set forth in this Agreement: |
9.1.1 | It agrees, in accordance with the terms and conditions of this Agreement, to provide to Aron the Services at the Refinery and the Tanks. |
9.1.2 | It shall comply with all Applicable Laws and any applicable safety guidelines, procedures or policies in connection with operations at the Refinery and the Tanks. |
9.1.3 | It shall maintain the Tanks in accordance with Accepted Industry Practice. |
9.2 | Tanks. PRC shall make available to Aron all of PRC’s and its Affiliates’ rights to use the Tanks for the Term of this Agreement to store the Aron Inventory sold by PRC to Aron pursuant to this Agreement. Aron may only store Aron Inventory in the Tanks that has been purchased from PRC pursuant to this Agreement. Notwithstanding anything in this Agreement to the contrary, PRC, as the owner and the operator of the Tanks and the Refinery, retains the right to manage the utilization of the Tanks (including by removing from service, changing the type of Product service of, or otherwise replacing or substituting with alternate tankage, any of the Tanks listed on Schedule B), in its sole discretion and in accordance with Accepted Industry Practice; provided that such utilization management activities by PRC do not prejudice Aron’s rights to the Aron Inventory hereunder and that the use of any alternate tankage shall be covered by all of the terms and conditions of this Agreement. |
9.3 | No Commingling. |
9.3.1 | Except (i) to the extent permitted in accordance with Section 6, (ii) in the event that a Change in Law occurs whereby any Governmental Authority has the right to purchase Products in the Tanks and/or to create or hold Liens in any such Products in the Tanks, or otherwise becomes entitled to exercise rights or powers substantially equivalent to the foregoing, or (iii) for Excluded Third-Party Inventory, PRC shall not store any Products owned by PRC or any of its Affiliates or a third party in any Tank without Aron’s prior written consent. Aron agrees that PRC may commingle Products only in the circumstances and subject to the terms and conditions described and referenced in this Section 9.3. Notwithstanding anything in this Agreement to the contrary, Aron acknowledges and agrees that PRC may store Excluded Third-Party Inventory in the Tanks. |
9.3.2 | PRC represents and warrants that, except for inchoate tax Liens and Liens permitted by the Intercreditor Agreement, there is only one third party (including such third party’s successors and assigns) that has a claim to any Excluded Third Party Inventory. |
9.4 | Receipts Into and Deliveries Out of the Included Locations. From and after the Commencement Date, (i) Aron shall accept and receive Products delivered by PRC to Aron into the Included Locations in connection with each sale by PRC to Aron pursuant to this Agreement and (ii) PRC shall withdraw Products from the Included Locations in connection with each sale by Aron to PRC pursuant to this Agreement. |
9.5 | Measurement. The quantity and quality of Products received into and delivered from the Included Locations, as well the quantity and quality of Aron Inventory in the Included Locations at any given time, shall be determined by applying the Volume Determination Procedures in accordance with the latest established API/ASTM |
9.6 | Aron Inventory. PRC shall be liable for contamination of the Aron Inventory, unless such contamination is due to Aron’s or its representative’s negligence or willful misconduct. As to contamination to the Aron Inventory for which PRC is liable pursuant to this Section 9.6, PRC shall promptly notify Aron of such contamination and the Parties shall account for any differences in the grade of the contaminated or downgraded Aron Inventory (including to the extent any such material no longer continues to meet the specifications for any Product for purposes hereof) pursuant to the volume determination, invoicing and payment procedures set forth in Sections 6.3, 12.1 and 12.5. |
9.7 | Condition and Maintenance of Tanks. |
9.7.1 | The execution of this Agreement by the Parties does not impose any obligation or responsibility on Aron in connection with: (i) any existing or future environmental condition at the Refinery, the Tanks and/or any related facilities (collectively, the “Facility”), including the presence of a regulated or hazardous substance on or in environment media at the Facility (including the presence in surface water, groundwater, soils or subsurface strata or air), including the subsequent migration of any such substance; (ii) any Environmental Law; (iii) the Required Permits; or (iv) any requirements arising under or relating to any Applicable Law pertaining or relating to the operation of the Facility, except to the extent of any Liabilities that are caused by the negligence or misconduct of Aron or its Representatives or are otherwise within the scope of Aron’s indemnification obligations under Sections 19.2 or 21.2, inclusive of when any Representatives of Aron are present at the Facility and cause a release or other event. |
9.7.2 | Products may require the application of heat or steam by PRC to maintain the same in a liquid free-flowing or pumpable state; PRC agrees to provide such required heat at PRC’s expense. Recalibration, or strapping, of the Tanks may be performed from time to time in accordance with the terms of this Agreement. In the event that recalibration of meters, gauges or other measurement equipment is reasonably requested by Aron consistent with Accepted Industry Practice such as “strapping,” the Parties shall select a mutually agreeable U.S. Customs & Border Protection bonded, |
9.7.3 | PRC may clean the Tanks during the Term of this Agreement for the following reasons: to perform maintenance, to perform inspections, in case of an emergency, to ensure product quality or as PRC otherwise deems appropriate in accordance with Accepted Industry Practice. In the event of Tank cleaning pursuant to this Section 9.7.3, PRC shall be responsible for the full cost of removing the Aron Inventory, cleaning the Tanks and disposing of any contaminants. PRC may identify substitute tank(s) for Aron during such time that a Tank is unavailable due to Tank cleaning pursuant to this Section 9.7 and the Parties shall cooperate with respect to the use of the same in a commercially reasonable manner. The transfer of the Aron Inventory from the unavailable Tank to the substitute tank, as well as any transfer from the substitute tank back to the original Tank or another tank, shall be at PRC’s sole expense. Any such substitute tank(s) will be covered by the terms and conditions of this Agreement. PRC shall, as provided in Section 6.3, notify Aron of all events and/or actions covered by or taken pursuant to this Section 9.7.3. |
9.8 | Certain Covenants Relating to Storage. |
9.8.1 | PRC agrees: |
9.8.2 | Each Party agrees that it shall, in the performance of its obligations under this Agreement, comply in all material respects with Applicable Law, including all Environmental Laws. Each Party shall maintain the records required to be maintained by Environmental Law and shall make such records available to the other Parties upon their reasonable request. Each Party also shall promptly notify the other Parties of any material violation or alleged material violation of any Environmental Law relating to any Products stored under this Agreement and, upon request, shall provide to the other Parties all evidence of environmental inspections or audits by any Governmental Authority with respect to such Products. |
10. | CERTAIN REPRESENTATIONS |
10.1 | The Parties intend that: |
10.1.1 | each purchase and sale of Product between them, whether or not further documented, shall constitute a “forward contract” under section 101(25) and a “commodity forward agreement” as such term is used in clause (A)(i)(VIII) of the definition of “swap agreement” under section 101(53B) of the Bankruptcy Code, protected by, inter alia, section 556 and section 560 of the Bankruptcy Code, and that it will be treated as such under and in all proceedings related to any bankruptcy, insolvency or similar law (regardless of the jurisdiction of application or competence of such law) or any regulation, ruling, order, directive or pronouncement made pursuant thereto; |
10.1.2 | as a result of the foregoing, (i) the Performing Party’s right to liquidate, collect, net and set off rights and obligations under this Agreement and liquidate and terminate this Agreement shall not be stayed, avoided or otherwise limited by the Bankruptcy Code, including sections 362(a), 547, 548 or 553 thereof; (ii) the Performing Party shall be entitled to the rights, remedies and protections afforded by and under, among other sections, sections 362(b)(6), 362(b)(17), 362(b)(27), 362(o), 546(e), 546(g), 546(j), 548(d), 553, 556, 560, 561 and 562 of the Bankruptcy Code; and (iii) any cash, securities or other property provided as performance assurance, credit support or collateral with respect to the transactions contemplated hereby shall constitute “margin payments” as defined in section 101(38) of the Bankruptcy Code and all payments for, under or in connection with the transactions contemplated hereby shall constitute “settlement payments” as defined in section 101(51A) of the Bankruptcy Code; and |
10.1.3 | this Agreement and each transaction between the Parties hereunder constitutes a “master netting agreement” under section 101(38A) of the Bankruptcy Code; and that the rights in Section 18 hereto include the rights referred to in section 561(a) of the Bankruptcy Code. |
10.2 | Single Agreement. This Agreement and all transactions hereunder form a single integrated agreement between the Parties. |
11. | WARRANTIES |
11.1 | Warranties of Title. |
11.1.1 | PRC warrants that on the Commencement Date it shall transfer, or cause to be transferred, to Aron good and marketable title to the Initial Inventory free and clear of any Liens (other than inchoate tax Liens and/or as |
11.1.2 | Each Party represents and warrants to the other Party that, as of each date of delivery of Products sold hereunder to the other Party, it has good and marketable title to the Products sold and delivered pursuant to this Agreement, free and clear of any Liens (other than inchoate tax Liens) or as contemplated in the Intercreditor Agreement, and that it has full right and authority to transfer such title and effect delivery of such Products. |
11.2 | Disclaimer of Warranties. EXCEPT FOR THE WARRANTY OF TITLE, THE PARTY SELLING PRODUCT HEREUNDER MAKES NO WARRANTY, CONDITION OR OTHER REPRESENTATION, WRITTEN OR ORAL, EXPRESS OR IMPLIED, OF MERCHANTABILITY, FITNESS OR SUITABILITY OF THE PRODUCT FOR ANY PARTICULAR PURPOSE OR OTHERWISE. |
12. | PRICING & PAYMENT |
12.1 | Interim Payment and Netting. |
12.1.1 | For each Production Week, Aron shall provide PRC with a net settlement statement setting forth: |
(1) | Using the Daily Report of Inventory Volumes provided by PRC, Aron will calculate the “Daily Net Volume” for all Aron Inventory at the Included Locations as follows: the Inventory Volumes for the prior reported day minus the Inventory Volumes for such day. The “Weekly Net Volume” shall be equal to the sum of the Daily Net Volumes by Product Group for each day in the Production Week. |
(2) | For each Product Group, the “Weekly Product Value” shall be an amount equal to (a) the Weekly Net Volume for such Product Group multiplied by (b) the applicable Weekly Product Benchmark for such Product Group. |
12.1.2 | On or before 2:00 p.m. EPT on each applicable “Invoice Date” set forth on Schedule I, Aron shall provide PRC with a statement setting forth: |
12.1.3 | The Party owing the Interim Net Payment Amount shall pay such amount to the other Party on or prior to the applicable “Payment Date” set forth on Schedule I, subject to Section 12.3; provided, however, that if such payment is due from PRC to Aron and Aron failed to deliver the statement required pursuant to Section 12.1.2 by 2:00 p.m. EPT on the applicable “Invoice Date” set forth on Schedule I, then such Interim Net Payment Amount shall not be due and payable until the next Business Day following the applicable “Payment Date” set forth on Schedule I. |
12.2 | Payments. Unless otherwise set forth herein, all payments to be made under this Agreement shall be made by wire transfer of same day funds in U.S. Dollars to such bank account at such bank as the payee shall designate in writing to the payor from time to time. All payments shall be deemed received on the Business Day on which same day funds therefor are received by the payee. Payments received after any applicable time set forth in this Agreement on any Business Day or on a day that is not a Business Day shall be deemed to have been received on the following Business Day. Except as otherwise expressly provided in this Agreement, all payments by PRC or Aron shall be made in full without discount, offset, withholding, counterclaim or deduction whatsoever for any claims which one Party may now have or hereafter acquire against the other Party, whether pursuant to the terms of this Agreement or otherwise, except as expressly provided herein. |
12.3 | Disputed Invoices. If an invoiced Party in good faith disputes the accuracy of the amount invoiced, the invoiced Party shall pay such amount as it in good faith believes to be correct and provide written notice stating the reasons why the remaining disputed amount is incorrect, along with supporting documentation. In the event the Parties are unable to resolve such dispute, the matter shall be resolved in accordance with Section 22. |
12.4 | Interest on Late Payments. Interest shall accrue on late payments under this Agreement at the lesser of (i) LIBOR plus the sum of 2.00% and the Applicable Margin and (ii) the maximum rate of interest per annum permitted by Applicable Law, from and including the date that payment is due until but excluding the date that payment is actually received by the Party to whom it is payable. |
12.5 | Monthly True-Up Payment. Aron shall use commercially reasonable efforts to provide to PRC, on the applicable “True Up Date” set forth on Schedule I, the Monthly True-Up Statement, showing the net true up amount due from one Party to the other Party (the “Monthly True-Up Payment”), and including the following amounts (without duplication): |
12.5.1 | the Aggregate Monthly Product True-Up Amount; plus |
12.5.2 | the Ancillary Costs for such month not otherwise paid or satisfied hereunder pursuant to Section 6.6, and as evidenced in the relevant Backup Certificate; and plus or minus, as applicable, |
12.5.3 | any other adjustments to amounts payable by one Party to the other Party pursuant to this Agreement. |
12.6 | Monthly True-Up Invoicing and Payment. If the amount of the Monthly True-Up Payment is a positive number, such amount shall be due from PRC to Aron, and if the amount of the Monthly True-Up Payment is a negative number, then the absolute value thereof shall be due from Aron to PRC. The Party owing the Monthly True-Up Payment shall pay such amount as shown on the Monthly True-Up Statement to the other Party on or prior to 5:00 p.m. EPT on the second Business Day following Aron’s delivery to PRC of the Monthly True-Up Statement and all related supporting documentation, subject to Section 12.3. |
13. | FINANCIAL INFORMATION; NOTIFICATIONS; CREDIT SUPPORT |
13.1 | Provision of Financial Information. PRC shall provide Aron, and Aron shall provide to PRC, (i) within 120 days following the end of each of its fiscal years, (a) a copy of the annual report, containing audited consolidated financial statements of PBFH or Aron, as applicable, and its consolidated subsidiaries for such fiscal year certified by independent certified public accountants and (b) the balance sheet, statement of income and statement of cash flow of PBFH or Aron, as applicable, for such fiscal year, as reviewed by PBFH’s or Aron’s, as applicable, independent certified public |
13.2 | Additional Information. Upon reasonable notice, PRC shall provide to Aron, and Aron shall provide to PRC, such additional information as Aron or PRC, as applicable, may reasonably request to enable it to ascertain the current financial condition of PRC or Aron, as applicable. |
13.3 | Notifications. Each Party shall notify the other Party in writing within two Business Days of learning of any of the following events: |
13.3.1 | any Event of Default or Additional Termination Event, specifying the nature and extent thereof and the corrective action (if any) taken or proposed to be taken with respect thereto; |
13.3.2 | any event that is reasonably expected to be a Material Adverse Change with respect to such party; |
13.3.3 | it or its Guarantor consolidates or amalgamates with, merges with or into, or transfers all or substantially all of its assets to another person; and |
13.3.4 | in the case of PRC, |
13.4 | Credit Support Guaranties. |
13.4.1 | As security for the prompt payment and performance in full when due of Aron’s obligations under this Agreement, Aron shall cause its Guarantor to (i) deliver to PRC prior to the Commencement Date its Guaranty in form and substance reasonably acceptable to PRC and (ii) maintain such Guaranty in effect for the Term hereof. |
13.4.2 | As security for the prompt payment and performance in full when due of PRC’s obligations under this Agreement, PRC shall cause its Guarantor to (i) deliver to Aron prior to the Commencement Date its Guaranty in form and substance reasonably acceptable to Aron and (ii) maintain such Guaranty in effect for the Term hereof. |
13.5 | Back-up Security Interest. The Parties intend that the transactions contemplated by this Agreement constitute purchase and sale transactions. If, notwithstanding the intent of the Parties, such transactions are deemed to constitute loans, then PRC shall be deemed to have pledged and granted to Aron, a first priority lien and security interest in all quantities of Product intended to constitute Aron Inventory hereunder and all proceeds thereof as security for the performance of all of PRC’s obligations and liabilities hereunder, and any UCC filings by Aron with respect to such quantities of Product shall serve to perfect such pledge and security interest. However, the filing of any UCC financing statements made pursuant to this Agreement shall in no way be construed as being contrary to the intent of the Parties that the transactions contemplated by this Agreement be treated as purchase and sale transactions. |
13.6 | Adequate Assurances. |
13.6.1 | Aron may, in its reasonable discretion and upon written notice to PRC, require that PBFH provide it with satisfactory security for or adequate assurance of its or its Guarantor’s performance within a specified time period as appropriate (but not less than two Business Days from delivery of such notice), when a Material Adverse Change has occurred as with respect to PRC or its Guarantor. |
13.6.2 | PRC may, in its reasonable discretion and upon notice to Aron, require that Aron provide it with satisfactory security for or adequate assurance of its or its Guarantor’s performance within a specified time period as appropriate (but not less than two Business Days from delivery of such notice), when a Material Adverse Change has occurred as with respect to Aron or its Guarantor. |
13.6.3 | PRC or Aron, as applicable, shall provide performance assurance to PRC or Aron, as applicable, on or prior to the second Business Day following written demand therefor in the form of Acceptable Credit Support. The performance assurance provided by PRC or Aron, as applicable, shall be for a reasonable duration and in an amount reasonably sufficient to cover a value up to PRC’s or Aron’s, as applicable, good faith estimated |
13.7 | Further Assurances. Each Party agrees, at any time and from time to time upon the request of the other Party, to execute, deliver and acknowledge, or cause to be executed, delivered and acknowledged, such further documents and instruments and to do such other acts and things as such Party may reasonably request in order to fully effect the purposes of this Agreement. Between the Effective Date and the Commencement Date, if the Parties determine in good faith that any Schedule hereto contains an error or requires further revision or clarification, the Parties shall cooperate in good faith to revise the content of such Schedule(s) to address such matter and, on the Commencement Date, will execute such amendment or other instrument as each Party deems reasonably necessary to cause each such revised Schedule to be incorporated as an attachment to this Agreement as contemplated by the terms hereof. |
14. | TAXES |
14.1 | Taxes. |
14.1.1 | Each Party represents that it is registered, and covenants that it will continue to be so registered, with the Internal Revenue Service and the New Jersey Division of Taxation to engage in tax-free transactions with respect to Products. Prior to the date of delivery of Products hereunder each Party shall provide to the other Party proper notification, exemption, motor fuel licenses or resale certificates or direct pay permits as may be required or permitted by Applicable Law. If a Party does not furnish such certificates and licenses to the other Party or if the transaction is subject to Tax under Applicable Law because no exemption exists, the applicable Party shall reimburse and indemnify the other Party for all Taxes that the other Party remits to a Governmental Authority or that are incurred by that Party, together with all penalties and interest thereon. PRC further agrees to provide Aron with a copy of its New Jersey Spill Compensation and Control Secondary Transfer Certificate upon Aron’s request. |
14.1.2 | In connection with the termination of this Agreement, Aron agrees that it will, in a timely manner, notify PRC as to whether or not PRC is to make a filing of New Jersey Form C 9600, Notification of Sale, Transfer, or Assignment in Bulk, or any other forms or notices related to bulk sales taxes in New Jersey pursuant to New Jersey Statutes Annotated Sections |
14.2 | Notwithstanding the foregoing, the Parties agree that PRC shall indemnify Aron for the amount of the New Jersey Spill Compensation and Control tax and all penalties or interest thereon paid, owing, asserted against or incurred by Aron directly or indirectly with respect to the Products purchased and sold hereunder (provided that the indemnity obligations in this Section 14.2 shall not apply to the extent Aron incurs any such tax, penalties or interest due to its failure to make any necessary filings with the appropriate authorities and/or maintain adequate documentation to establish Aron’s exemption from the same). |
14.3 | Each Party acknowledges and agrees that it will be solely responsible for any Excluded Taxes owed by it or any similar taxes such as gross earnings, gross receipts or similar taxes that are based upon gross receipts, gross earnings or gross revenues. Each Party hereby irrevocably waives and releases the other Party from, and agrees not to assert any reimbursement or other indemnification claims against the other party with respect to, any Liabilities (including pursuant to Section 19) with respect to the imposition or incurrence of any Excluded Taxes (including any such gross receipt taxes). |
14.4 | Any other provision of this Agreement to the contrary notwithstanding, this Section 14 shall survive until 90 days after the expiration of the statute of limitations for the assessment, collection and levy of any Tax. |
15. | INSURANCE |
15.1 | Insurance Required to be provided by PRC. PRC, directly or through an Affiliate, shall procure and maintain in full force and effect throughout the Term insurance coverage of the following types and amounts and with insurance companies rated not less than A- by A.M. Best, or otherwise reasonably acceptable to Aron, in respect of PRC’s receipt, handling and storage of Aron Inventory under this Agreement: |
15.1.1 | property damage coverage on an “all risk” basis in an amount sufficient to cover the market value or potential full replacement cost of all of the Aron Inventory. Such insurance shall be endorsed to include Aron as loss payee with respect to the Aron Inventory. Notwithstanding anything to the contrary herein, Aron may, at its option and expense, endeavor to procure and provide such property damage coverage for the Products; provided that to the extent any such insurance is duplicative with |
15.1.2 | Workers Compensation coverage in compliance with Applicable Laws; |
15.1.3 | automobile liability coverage in a minimum amount of $1,000,000; and |
15.1.4 | comprehensive or commercial general liability coverage and umbrella or excess liability coverage, which includes bodily injury, broad form property damage, contractual liability, products/completed operations liability, sudden and accidental pollution liability coverages, in a minimum amount of $300,000,000 per occurrence and in the aggregate. Such policies shall include Aron as an additional insured. |
15.2 | Additional Insurance Requirements. |
15.2.1 | PRC shall cause its insurance carriers to furnish insurance certificates to Aron, in a form reasonably satisfactory to Aron, evidencing the existence of the coverages required pursuant to Section 15.1. The certificate shall specify that the insurer will endeavor to mail 30 days’ written notice prior to cancelation of insurance becoming effective. Upon Aron’s request, PRC shall provide renewal certificates within 30 days of the expiration of the previous policy under which coverage is maintained. |
15.2.2 | The foregoing insurance in Section 15.1 shall include an endorsement indicating that the underwriters agree to waive all rights of subrogation against Aron. |
15.3 | Current Insurance. Schedule H sets forth PRC’s current applicable insurance coverages as of the Commencement Date. |
16. | FORCE MAJEURE |
16.1 | Neither Party shall be liable to the other Party if it is rendered unable by a Force Majeure Event to perform in whole or in part any obligation or condition of this Agreement for so long as the Force Majeure Event exists and to the extent that performance is hindered by the Force Majeure Event; provided, however, that the Party unable to perform shall use all commercially reasonable efforts to avoid or remove the Force Majeure Event. During the period that performance by the affected Party of a part or whole of its obligations has been suspended by reason of a Force Majeure Event, the other Party likewise may suspend the performance of all or a part of its obligations to the extent that such suspension is commercially reasonable, other than any payment or indemnification obligations that arose prior to the Force Majeure Event. |
16.2 | To the extent reasonably practicable, the affected Party rendered unable to perform shall give written notice to the other Party within 24 hours after receiving notice of |
17. | REPRESENTATIONS, WARRANTIES & COVENANTS |
17.1 | Mutual Representations and Warranties. Each Party represents and warrants to the other Party as of the Effective Date, and shall be deemed to represent and warrant as of the date of any purchase of Product hereunder, that: |
17.1.1 | it is (i) an “eligible contract participant” as defined in the U.S. Commodity Exchange Act, as amended, and (ii) a “forward contract merchant” under section 101(26) and a “master netting agreement participant” under section 101(38B), for purposes of the Bankruptcy Code; |
17.1.2 | it is duly organized and validly existing under the laws of the jurisdiction of its organization or incorporation and, if relevant under such laws, in good standing, has the power to execute and deliver this Agreement and any other related documentation that it is required by this Agreement to deliver and to perform its obligations under this Agreement, and has taken all necessary action to authorize such execution, delivery and performance; |
17.1.3 | such execution, delivery and performance do not violate or conflict with, in any material respect, any Applicable Law, any provision of its constitutional documents or any order or judgment of any court or Governmental Authority; |
17.1.4 | all governmental and other authorizations, approvals, consents, notices and filings that are required to have been obtained or submitted by it with respect to this Agreement have been obtained or submitted and are in full force and effect; |
17.1.5 | its obligations under this Agreement constitute its legal, valid and binding obligations, enforceable in accordance with their respective terms (subject to applicable bankruptcy, reorganization, insolvency, moratorium or similar laws affecting creditors’ rights generally and subject, as to enforceability, to equitable principles of general application regardless of whether enforcement is sought in a proceeding in equity or at law); |
17.1.6 | no Termination Event has occurred and is continuing, and no such event or circumstance would occur as a result of its entering into or performing its obligations under this Agreement; |
17.1.7 | there is not pending, nor to its knowledge threatened against it, any action, suit or proceeding at law or in equity or before any court, tribunal, Governmental Authority, official or arbitrator that is likely to affect the legality, validity or enforceability against it of this Agreement or its ability to perform its obligations under this Agreement; |
17.1.8 | it has entered into the Transaction Documents and will enter into any transaction thereunder as principal (and not as advisor, agent, broker or in any other capacity, fiduciary or otherwise) and with a full understanding of the material terms and risks of the same, and has made its own independent decision to enter into the Transaction Documents and any transaction and as to whether the Transaction Documents and any transaction are appropriate or suitable for it based upon its own judgment and upon advice from such advisers as it has deemed necessary and not in reliance upon any view expressed by any other Party; |
17.1.9 | it is capable of assessing the merits of and understanding (on its own behalf or through independent professional advice) the Transaction Documents and any transaction, understands and accepts the terms, conditions and risks of the Transaction Documents and any transaction and is capable of assuming and assumes the risks of the Transaction Documents and any transactions contemplated thereunder; |
17.1.10 | it is not bound by any agreement that would preclude or hinder its execution, delivery or performance of any of the Transaction Documents; |
17.1.11 | neither it nor any of its Affiliates has been contacted by or negotiated with any finder, broker or other intermediary in connection with the sale of Product hereunder who is entitled to any compensation with respect thereto; and |
17.1.12 | none of its directors, officers, employees or agents or those of its Affiliates has received or will receive any commission, fee, rebate, gift or entertainment of significant value in connection with any of the Transaction Documents. |
17.2 | Mutual Covenants. |
17.2.1 | Compliance with Applicable Laws. Each Party undertakes and covenants to the other Party that it shall comply in all material respects with all Applicable Laws, including all Environmental Laws, to which it may be subject in connection with the performance of any obligation or exercise of any rights under any of the Transaction Documents or in connection with any transaction contemplated by or undertaken pursuant to this Agreement. |
17.2.2 | Books and Records. All records or documents provided by any Party to the other Party shall, to the best knowledge of such Party, accurately and completely reflect the facts or estimates about the activities and transactions to which they relate. Each Party shall promptly notify the other Party if at any time such Party has reason to believe that any records or documents previously provided to the other Party no longer are materially accurate or complete. |
17.2.3 | Payments. All payments made under this Agreement shall be made in U.S. Dollars, the lawful currency of the United States. |
17.3 | PRC’s Representations and Covenants. |
17.3.1 | PRC represents and warrants that the Tanks have been maintained, repaired, inspected and serviced in accordance with Accepted Industry Practice and are generally in serviceable condition (normal wear and tear excepted) in all material respects. |
17.3.2 | PRC agrees that neither it nor any of its subsidiaries shall have any interest in or the right to dispose of, and shall not create or consent to the creation of any Liens with respect to, the Aron Inventory (it being acknowledged that (i) Excess Quantities and Excluded Third-Party Inventory do not constitute Aron Inventory and (ii) upon PRC purchasing any Aron Inventory pursuant to Section 6.4.5, such quantities shall not constitute Aron Inventory unless and until repurchased by Aron pursuant to Section 6.4.5). PRC authorizes Aron to file at any time and from time to time any UCC financing statements identifying the Aron Inventory subject to this Agreement and Aron’s ownership thereof and title thereto, and PRC shall execute and deliver to Aron, and PRC hereby authorizes Aron to file (with or without PRC’s signature), at any time and from time to time, all amendments to financing statements, assignments, continuation financing statements, termination statements and other documents and instruments, in form reasonably satisfactory to each of Aron and PRC, as Aron may reasonably request, to provide public notice of Aron’s ownership of and title to the quantities of the Aron Inventory subject to this Agreement and the Intercreditor Agreement. |
17.3.3 | PRC agrees that it will not incur, create, assume or guaranty any Specified Indebtedness if, in connection with such incurrence, creation, assumption or guaranty or proposed incurrence, creation, assumption or guaranty of Specified Indebtedness, the ratings assigned to the 8.25% notes due 2020 issued by PBFH and certain Affiliates thereof are (or would be) lower than B2 (or its then-current equivalent) by Moody’s Investors Service, Inc. (or any successor rating agency thereto) and B (or its then-current equivalent) by Standard & Poor’s Ratings Service (or any successor rating agency thereto), as rated by both such rating agencies. |
17.4 | Acknowledgement. PRC and Aron each acknowledge and agree that (1) each is a merchant of crude oil and petroleum products and may, from time to time, be dealing with prospective counterparties, or pursuing trading or hedging strategies, in connection with aspects of their respective business that are unrelated hereto and that such dealings and such trading or hedging strategies may be different from or opposite to those being pursued pursuant to or in connection with this Agreement, (2) neither PRC nor Aron has any fiduciary or trust obligations of any nature with respect to the other Party, or any of such Party’ Affiliates, (3) PRC and Aron may enter into transactions and purchase crude oil or petroleum products for their own account or the account of others at prices more favorable than those being paid by or to the other Party hereunder and (4) nothing herein shall be construed to prevent PRC or Aron, as applicable, or any of their partners, officers, employees or Affiliates, in any way, from purchasing, selling or otherwise trading in crude oil, petroleum products or any other commodity for their own account or for the account of others, whether prior to, simultaneously with or subsequent to any transactions under this Agreement (such matters and activities conducted or engaged in by each Party as described in the foregoing clauses (1), (3) and (4), and including in any event any hedging activities on any Products and other hydrocarbon assets unrelated to the transactions set forth in this Agreement or the other Transaction Documents, together |
17.5 | Outside Activities. Each of PRC and Aron acknowledge and agree that (a) all of its respective Outside Activities are conducted at its sole discretion and solely for its own account, (b) as a consequence, each shall solely be responsible to retain and pay, discharge and perform as and when due all Liabilities with respect to its own respective Outside Activities and (c) to the fullest extent permitted by Applicable Law, it shall defend, indemnify and hold harmless the other Party and its Affiliates from and against any Liabilities incurred by such other Party or its Affiliates as a result of or related to such first Party’s respective Outside Activities. |
18. | TERMINATION EVENTS, DEFAULT & EARLY TERMINATION |
18.1 | Events of Default. Notwithstanding any other provision of this Agreement, the occurrence and continuance of any of the following events or circumstances shall constitute an “Event of Default”: |
18.1.1 | A Party fails to make a payment when due and payable under this Agreement within two Business Days following receipt of a written demand for payment by the other Party. |
18.1.2 | A Party (or, if applicable, any Affiliate of such Party that is party to a Transaction Document) breaches any representation or warranty made or repeated, or deemed to have been made or repeated, by the Party in any material respect, or any representation or warranty proves to have been incorrect or misleading in any material respect when made or repeated or deemed to have been made or repeated under this Agreement or any Transaction Document; provided, however, that if such breach is curable, such breach is not cured to the reasonable satisfaction of the other Party within ten Business Days from the date that such Party receives written notice that corrective action is needed. |
18.1.3 | Other than a default more specifically described in this Section 18.1, a Party (or, if applicable, any Affiliate of such Party that is party to a Transaction Document) fails to perform any material obligation or breaches a material covenant required under this Agreement or any Transaction Document, which, if capable of cure, is not cured to the reasonable satisfaction of the other Party (acting in good faith and in a commercially reasonable manner) within ten Business Days from the date that such Party receives written notice that corrective action is needed. |
18.1.4 | A Party or such Party’s Guarantor (or, in the case of PRC, PBF) becomes or is Bankrupt; |
18.1.5 | A Party’s Guarantor (i) fails to satisfy, perform or comply with any material obligation in accordance with its Guaranty in favor of the other Party (the “Receiving Party”) if such failure continues after any applicable grace or notice period, (ii) breaches any covenant or any representation or warranty proves to have been incorrect or misleading in any material respect under its Guaranty, which is not cured within any applicable grace or notice period, or (iii) repudiates, disclaims, disaffirms or rejects (in each case, in writing), in whole or part, any obligation under its Guaranty, or challenges the validity of its Guaranty (in each case, in writing). |
18.1.6 | (i) Either Party or any of its Designated Affiliates (1) defaults under a Specified Transaction and, after giving effect to any applicable notice requirement or grace period, there occurs a liquidation of, an acceleration of obligations under or any early termination of, that Specified Transaction, or (2) disaffirms, disclaims, repudiates or rejects, in whole or in part, a Specified Transaction (or such action is taken by any person or entity appointed or empowered to operate it or act on its behalf), provided, that the other Party shall first give notice thereof to such first Party, and such default or other applicable event is not cured (if capable of being cured) to the reasonable satisfaction of the other Party within five Business Days from the date that such Party receives such notice (it being acknowledged and agreed that the foregoing shall not alter or extend the applicable notice or grace period, if any, applicable to such Specified Transaction and that the foregoing five Business Day period applies only to the right of a Party to declare an Event of Default under this Section 18.1.6); or (ii) either Party or any Affiliate of such Party that is a party to any credit support document provided pursuant to the terms and conditions of this Agreement disaffirms, disclaims, repudiates or rejects, in whole or in part, such credit support document or its material obligations thereunder other than pursuant to the applicable terms and conditions thereof. |
18.1.7 | Any Lien (other than a Lien granted by Aron and other than inchoate tax Liens) is placed on any material portion of the Aron Inventory due to an act or with the consent of PRC. Upon the occurrence of such event, PRC shall be deemed to be a Defaulting Party hereunder and Aron shall be deemed to be the Performing Party. |
18.1.8 | A Party fails to provide adequate assurances in accordance with, and within the time periods set forth in, Section 13.6. |
18.2 | Additional Termination Events. Notwithstanding any other provision of this Agreement, the occurrence of any of the events or circumstances specified in this Section 18.2 shall constitute an “Additional Termination Event” and, in each instance, PRC shall be deemed to be the “Affected Party” and Aron shall be deemed to be the Performing Party for purposes of determining the rights and remedies available to the Performing Party under Section 18.3. |
18.2.1 | Except in the case of any Refinery maintenance or turnaround, either (i) operations at the Refinery shall have ceased (other than as a result of a Force Majeure Event) for a period of at least 90 consecutive days or (ii) there occurs an inability to receive into, deliver Products out of or store Products (other than as a result of a Force Majeure Event) in the Tanks (taken as a whole) in any material respect for a period of at least 90 consecutive days. |
18.2.2 | A Force Majeure Event affecting the Refinery has occurred and is continuing for a period of at least 90 consecutive days. |
18.2.3 | The obligations under any Credit Agreement have become due and payable (i) at their scheduled maturity and have not been repaid in full on or prior to such date (after giving effect to any grace or cure periods) or (ii) prior to their scheduled maturity as a result of the occurrence and continuance of an event of default thereunder and the acceleration of the scheduled maturity of such obligations. |
18.2.4 | An “Event of Default” exists with respect to DCRC or PBFH under the Related Agreement. |
18.2.5 | PRC or any of its Affiliates sells, leases, subleases, transfers or otherwise disposes of, in one transaction or a series of related transactions, all or substantially all of the assets of the Refinery (provided that the foregoing event shall not constitute an Additional Termination Event if PRC has, in a timely manner, exercised its early termination right in connection with such event pursuant to Section 2.3 or 2.4 and complied with all applicable terms and conditions hereof in connection with exercising such right). |
18.2.6 | PBFH or PRCLLC (i) consolidates or amalgamates with, merges with or into, or transfers all or substantially all of its assets to, another person (including an Affiliate) or any such consolidation, amalgamation, merger or transfer is consummated, and (ii)(A) the successor resulting from any such consolidation, amalgamation or merger or the person that otherwise acquires all or substantially all of the assets of PBFH or PRCLLC does not assume, either by operation of law or without amendment or modification of the applicable Transaction Documents (other than any amendments or modifications that are ministerial in nature), all of PRC’s |
18.2.7 | A Change of Control with respect to PBF (provided that the foregoing event shall not constitute an Additional Termination Event if PRC has, in a timely manner, exercised its early termination right in connection with such event pursuant to Section 2.3 or 2.4 and complied with all applicable terms and conditions hereof in connection with exercising such right); provided that any Early Termination Date designated by Aron as a result of such occurrence shall occur no earlier than the effective date of such Change of Control event. |
18.2.8 | The Intercreditor Agreement ceases to be in full force and effect or the “Revolving Agent” (as defined therein) repudiates, disclaims, disaffirms or rejects (in each case, in writing), in whole or part, any of its material obligations thereunder or challenges the validity thereof (in each case, in writing). |
18.3 | Remedies Generally. Notwithstanding any other provision of this Agreement or any Specified Transaction, upon the occurrence and continuance of an Event of Default with respect to a Party (such Party referred to as the “Defaulting Party”), or upon the occurrence and continuance of an Additional Termination Event with respect to the Affected Party, the other Party in each case (the “Performing Party”) may, in its sole discretion, in addition to all other remedies available to it and without incurring any Liabilities, do any or all of the following: |
18.3.1 | suspend its performance under this Agreement, including any Product sale, purchase, receipt, delivery or payment obligations, upon written notice to the Defaulting Party or Affected Party; |
18.3.2 | declare all or any portion of the Defaulting Party’s or Affected Party’s, as applicable, obligations under this Agreement to be forthwith due and payable, all without presentment, demand, protest or further notice of any kind, all of which are expressly waived by the Defaulting Party or Affected Party, as applicable; |
18.3.3 | upon written notice to the Defaulting Party or the Affected Party, specify a date (the “Early Termination Date”) on which to terminate this Agreement; |
18.3.4 | terminate all other Transaction Documents and all other agreements that may then be outstanding between the Parties that relate specifically to this Agreement; |
18.3.5 | close out any Specified Transactions pursuant to Section 18.4; |
18.3.6 | determine the Settlement Amount pursuant to Section 18.5; |
18.3.7 | determine the Termination Amount as provided in Section 18.6; and |
18.3.8 | exercise any rights and remedies provided or available to the Performing Party under this Agreement or at law or equity, including such remedies as provided for under the UCC. |
18.4 | Export of Defaults to and Liquidation of Specified Transactions. If the Performing Party gives written notice to the Non-Performing Party pursuant to Section 18.3.3 declaring an Early Termination Date, the occurrence thereof shall constitute a material breach and an event of default, howsoever described, under all Specified Transactions by the Non-Performing Party, and the Performing Party may, by giving notice to the Non-Performing Party, designate an early termination date (which shall be no earlier than the Early Termination Date) for all Specified Transactions and, upon such designation, terminate, liquidate, accelerate and otherwise close out all Specified Transactions that lawfully may be closed out and terminated or, to the extent that in the reasonable opinion of the Performing Party certain of such Specified Transactions may not be liquidated and terminated under Applicable Law on such Early Termination Date, as soon thereafter as is reasonably practicable in which case the actual termination date for such Specified Transactions will be the Early Termination Date, subject to the final sentence of this Section 18.4. In such event, the Performing Party shall calculate the payments due upon early termination of such Specified Transactions in accordance with the terms set forth in such Specified Transactions and in a commercially reasonable manner and without duplication of any amounts payable pursuant to Section 18.5, which shall be aggregated or netted to a single liquidated amount (the “Specified Transaction Close-Out Amount”) and paid pursuant to the terms of such agreements, or, if no payment date is specified, on the payment date specified in Section 18.7. In determining the Specified Transaction Close-Out Amount the Performing Party may foreclose upon and apply any collateral provided by or on behalf of the Non-Performing Party under this Agreement or any Specified Transaction. Notwithstanding the foregoing, in lieu of closing out, liquidating and terminating such Specified Transactions, to the extent practicable and if mutually agreed to by the Parties, the Parties shall use commercially reasonable efforts to permit the Non-Performing Party to assume the Performing Party’s obligations under such Specified Transactions upon commercially reasonable terms. |
18.5 | Determination of Settlement Amount in the Event of Early Termination. |
18.5.1 | Notwithstanding any other provision of this Agreement, if the Performing Party terminates this Agreement pursuant to Section 18.3.3, the Performing Party shall have the right, immediately and for 60 days thereafter, to terminate any other contract or agreement that may then be outstanding among the Parties that relates specifically to this Agreement, including any Transaction Document and, subject to Section 18.5.2, to liquidate and terminate any or all rights and obligations under this Agreement; provided that, in the event Aron is the Performing Party, this Agreement shall not be deemed to have terminated in full until Aron shall have disposed of all of the Aron Inventory (but in any event within 60 days thereafter); and provided further that such 60 day period shall be extended to the extent that the Performing Party is subject to or required to comply with the order of any court of competent jurisdiction that limits its ability to exercise such rights or remedies or if the exercise of such rights or remedies is impracticable due to circumstances beyond the Performing Party’s reasonable control (which, with the exercise of due diligence, such Party cannot avoid or overcome). The “Settlement Amount” shall mean the amount, expressed in U.S. Dollars, of all actual, reasonable losses and costs that are incurred by the Performing Party (expressed as a positive number) or gains that are realized by the Performing Party (expressed as a negative number) as a result of the liquidation and termination of all rights and obligations under this Agreement, each determined in a commercially reasonable manner. The determination of the Settlement Amount shall include (without duplication): (w) for any Specified Period designated by PRC or otherwise established pursuant to the provisions of Schedule F prior to the Early Termination Date that ends after such Early Termination Date, the net present values as of the Early Termination Date of the Inventory Intermediation Roll Fees that would have become due as of the end of such Specified Period absent the early termination (where the discount rate to be used in the net present value calculation shall be equal to LIBOR plus the Applicable Margin), (x) all Specified Unwind Costs (as determined with respect to all Corresponding Futures and aggregated into a net amount), (y) the actual, reasonable losses and costs (or gains) incurred or realized by the Performing Party to the extent it elects to dispose of any Product inventories maintained for purposes of this Agreement and (z) if such termination occurs prior to July 1, 2015 and Aron is the Performing Party, the net present value of any Specified Early Termination Fee or Early Termination Fee that would have been payable to Aron pursuant to Section 3.8.7 or 3.8.8, respectively, as a result of an early termination under Section 2.3 or 2.4 of this Agreement (and the discount rate to be used in the net present value calculation shall be equal to LIBOR plus the Applicable Margin), except that if such termination |
18.5.2 | The Settlement Amount shall be determined by the Performing Party, acting in good faith, in a commercially reasonable manner, based on the applicable liquidated and terminated rights and obligations and shall be payable by one Party to the other. The Performing Party shall determine the Settlement Amount commencing as of the date on which such termination occurs by reference to such futures, forward, swap and options markets as it shall select in its commercially reasonable judgment; provided that the Performing Party is not required to effect such terminations and/or determine the Settlement Amount on a single day, but rather may effect such terminations and determine the Settlement Amount over a commercially reasonable period of time (but in any event within 60 days thereafter, subject to extension of such 60 day period on the same basis as the 60 day period referred to in Section 18.5.1 may be extended thereunder). In calculating the Settlement Amount, the Performing Party shall discount to present value (in a commercially reasonable manner based on LIBOR) any amount which would be due at a later date and shall add interest (at a rate determined in the same manner) to any amount due prior to the date of the calculation. |
18.6 | Determination of the Termination Amount in the Event of Early Termination. The amount payable in respect of early termination due to an Event of Default shall comprise (without duplication) all of the following amounts, which shall be aggregated or netted to a single liquidated amount (the “Termination Amount”) owing from one Party to the other Party: |
18.6.1 | the Settlement Amount; |
18.6.2 | the Specified Transaction Close-Out Amount as determined pursuant to Section 18.4; |
18.6.3 | the amount of any performance assurance, credit support or collateral provided by or on behalf of PRC under any Specified Transaction held by Aron at the Early Termination Date, which shall be applied as a credit to PRC; |
18.6.4 | without duplication, all actual out-of-pocket losses, damages and expenses reasonably and necessarily incurred by the Performing Party as a result of the termination and liquidation of this Agreement, in each case including reasonable (i) attorneys’ fees, (ii) court costs, (iii) |
18.6.5 | all Unpaid Amounts, including any purchase price for Product that has not yet been paid. |
18.7 | Payment of Termination Amount. The Performing Party shall notify the Non-Performing Party of the Termination Amount due from or due to such Party. If the Non-Performing Party owes the Termination Amount to the Performing Party, the Non-Performing Party shall pay the Termination Amount on the second Business Day after it receives the statement. If the Performing Party owes the Termination Amount to the Non-Performing Party, the Performing Party shall pay the Termination Amount once it has reasonably determined all amounts owed by the Non-Performing Party to it under all Specified Transactions and its rights of close-out and setoff under Section 18.9. |
18.8 | Certain Rights of Aron as Performing Party. Without limiting any other rights or remedies hereunder, if Aron is the Performing Party, Aron may, in its commercially reasonable discretion, (i) withdraw from storage any and all of the Products then in the Included Locations, (ii) otherwise arrange for the disposition of any Products then in the Included Locations and (iii) liquidate in a commercially reasonable manner any credit support, margin or collateral, to the extent not already in the form of cash (including applying any other margin or collateral) and apply and set off such credit support, margin or collateral or the proceeds thereof against any obligation owing by PRC to Aron. Aron shall be under no obligation to prioritize the order with respect to which it exercises any one or more rights and remedies available hereunder. PRC shall in all events remain liable to Aron for any amount payable by PRC in respect of any of its obligations remaining unpaid after any such liquidation, application and set off. |
18.9 | Setoff Rights of Performing Party. If the Performing Party elects to designate an Early Termination Date under Section 18.3.3, the Performing Party shall be entitled, at its option and in its discretion (and without prior notice to the Non-Performing Party), to setoff against the Termination Amount (whether such Termination Amount is payable to the Performing Party or to the Non-Performing Party) any other amounts payable under any agreements between the Non- Performing Party and the Performing Party (whether or not matured or contingent and irrespective of the currency, place of payment or place of booking of the obligation). To the extent that the Termination Amount is so set off, the Termination Amount and other amounts will be discharged promptly and in all respects. The Performing Party will give at least one Business Day’s prior written notice to the other Party of any set-off effected under this Section 18.9. |
18.10 | Non-Exclusive Remedies. The Performing Party’s rights under this Section 18 are in addition to, and not in limitation or exclusion of, any other rights of setoff, recoupment, combination of accounts, Lien or other right which it may have, whether |
18.11 | Indemnification. The Non-Performing Party shall reimburse the Performing Party for its reasonable costs and expenses, including reasonable attorneys’ fees, actually incurred in connection with the enforcement of, suing for or collecting any amounts payable by the Non-Performing Party. The Non-Performing Party shall indemnify and hold harmless the Performing Party for any reasonable damages, losses and expenses actually incurred by the Performing Party as a result of any Termination Event. |
19. | INDEMNIFICATION & CLAIMS |
19.1 | To the fullest extent permitted by Applicable Law and except as specified otherwise elsewhere in this Agreement (including the indemnification provisions in Section 21.2 and subject to Section 14), PRC shall defend, indemnify and hold harmless Aron, its Affiliates and their Representatives, agents and contractors from and against any Liabilities caused by PRC or its Representatives, agents or contractors in performing its obligations under this Agreement, except to the extent that such Liabilities were caused by the negligence or willful misconduct on the part of Aron or its Representatives, agents or contractors. |
19.2 | To the fullest extent permitted by Applicable Law and except as specified otherwise elsewhere in this Agreement (including the indemnification provisions in Section 21.2 and subject to Section 14), Aron shall defend, indemnify and hold harmless PRC, its Affiliates and their Representatives, agents and contractors from and against any Liabilities caused by Aron or its Representatives, agents or contractors in performing its obligations under this Agreement, except to the extent that such Liabilities were caused by the negligence or willful misconduct on the part of PRC or its Representatives, agents or contractors. |
19.3 | In addition to the indemnification obligations set forth in Sections 19.1 and 19.2 and elsewhere in this Agreement (except as set forth in the indemnification provisions in Section 21.2, and subject to Section 14), each Party (referred to as the “Indemnifying Party”) shall indemnify and hold the other Party (the “Indemnified Party”), its Affiliates and their Representatives, agents and contractors harmless from and against any and all Liabilities directly or indirectly arising from (i) the Indemnifying Party’s breach of any of its obligations under or covenants made in this Agreement; (ii) the Indemnifying Party’s negligence or willful misconduct; (iii) the Indemnifying Party’s failure to comply with Applicable Law with respect to the sale, transportation, storage, handling or disposal of Product or violation of any Environmental Law caused by the Indemnifying Party or its Representatives, agents or contractors, unless such violation liability results from the Indemnified Party’s negligence or willful misconduct; or (iv) the Indemnifying Party’s representations, |
19.4 | The Parties’ obligations to defend, indemnify and hold each other harmless under the terms of this Agreement shall not vest any rights in any third party, nor shall they be considered an admission of liability or responsibility for any purposes other than those enumerated in this Agreement. |
19.5 | Each Party agrees to notify the other Party as soon as practicable after receiving notice of any suit brought against it within the indemnities of this Agreement, shall furnish to the other the complete details within its knowledge and shall render all reasonable assistance requested by the other in the defense. Each Party shall have the right but not the duty to participate, at its own expense, with counsel of its own selection, in the defense and settlement thereof without relieving the other of any obligations hereunder. Notwithstanding the foregoing, the Indemnifying Party shall not be entitled to assume responsibility for and control of any judicial or administrative proceeding if such proceeding involves a Termination Event by the Indemnifying Party under this Agreement which shall have occurred and be continuing. Furthermore, the Indemnifying Party shall not, without the Indemnified Party’s prior written consent, settle or compromise any claim or consent to the entry of any judgment, which (i) does not include as a term thereof the giving by the claiming party or the plaintiff to the Indemnified Party of an unconditional release from all Liability in respect of such claim, (ii) grants non-monetary relief to the claiming party or the plaintiff or (iii) involves an admission of liability or guilt by the Indemnified Party. |
20. | LIMITATION ON DAMAGES |
20.1 | Unless otherwise expressly provided in this Agreement, the Parties’ Liability for damages is limited to direct, actual damages only and neither Party shall be liable for specific performance, lost profits or other business interruption damages, or special, consequential, incidental, punitive, exemplary or indirect damages, in tort, contract or otherwise, of any kind, arising out of or in any way connected with the performance, the suspension of performance, the failure to perform or the termination of this Agreement. Each Party acknowledges the duty to mitigate damages hereunder. |
21. | INFORMATION & INSPECTION RIGHTS |
21.1 | Audit Rights. Upon the reasonable request of either Party, the other Party shall provide the requesting Party with copies of all relevant documents and records in its possession that reasonably relate to the calculation of any formula, invoice, statement or the amount of any payment under this Agreement. The provisions of this Section 21 shall survive the termination of this Agreement for 18 months. |
21.2 | Right to Physical Inspection. From time to time during the Term, Aron shall have the right, at its own cost and expense, to have an Independent Inspector or its |
21.3 | Disputes Regarding Volume Determination Procedures. If a Party in good faith believes that the Volume Determination Procedures have not been applied correctly, including based on the report of any Independent Inspector, the disputing Party shall provide written notice stating the reasons why the Volume Determination Procedures were applied incorrectly, along with supporting documentation, and the Parties shall thereafter reasonably cooperate in order to resolve the dispute, including considering the report of any Independent Inspector, if applicable. In the event the Parties are unable to resolve such dispute, the matter shall be resolved in accordance with Section 22. |
22. | GOVERNING LAW & DISPUTES |
22.1 | Dispute Resolution. In the event the Parties are unable to resolve any claim, dispute or controversy regarding this Agreement or any matters arising in connection therewith, prior to initiating any arbitration or litigation as permitted herein, a Party shall refer the matter to a senior representative of such Party. Upon such referral, senior representatives of the Parties having authority to resolve the matter shall meet at a mutually acceptable time and place within ten days thereafter in order to exchange relevant information and to attempt to resolve the matter. If a senior representative intends to be accompanied to a meeting by an attorney, he or she shall give the other Party’s senior representative at least three Business Days’ prior notice of such intention so that he or she also can be accompanied by an attorney. If a Party’s senior representative does not meet with the other Party’s senior representative within such ten-day period or if the senior representatives are unable to resolve the dispute, then, following the expiration of such ten-day period, either Party may pursue any remedy available at law or in equity to enforce its rights hereunder available to it, subject in any event to the remainder of this Section 22. |
22.2 | Governing Law. |
22.2.1 | General Governing Law. Other than as set forth in Section 22.2.2, this Agreement and all matters arising in connection therewith, including validity and enforcement, contractual matters (except as otherwise set forth in Section 22.2.2) and any contractual payments owed hereunder, shall be governed by, interpreted and construed in accordance with the laws of the State of New York, without giving effect to its conflicts of laws principles that would result in the application of a different law. As to this Section 22.2.1: |
22.2.1.1 | Disputes involving amounts in controversy less than $1,000,000 shall be resolved by one arbitrator pursuant to Section 22.4. |
22.2.1.2 | Disputes involving amounts in controversy of $1,000,000 or more, but less than $2,500,000 shall be resolved by three arbitrators pursuant to Section 22.4. |
22.2.1.3 | As to matters involving amounts in controversy of $2,500,000 or more, each Party hereby submits itself to the exclusive jurisdiction of (i) any federal court of competent jurisdiction situated in the City of Wilmington, Delaware, and agrees not to contest the laying of venue in such forum, or (ii) if any such federal court declines to exercise or does not have jurisdiction, any Delaware state court in the City of Wilmington, Delaware, and agrees not to contest the laying of venue in such forum. |
22.2.2 | Governing Law Exceptions. As to claims for personal injury and any claims directly or indirectly based on torts, personal injury, environmental |
22.3 | EACH PARTY HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION TO THE JURISDICTION OF ANY COURT PURSUANT TO THIS SECTION 22 OR TO THE VENUE THEREIN OR ANY CLAIM OF INCONVENIENT FORUM OF SUCH COURT. EACH PARTY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY PROCEEDINGS RELATING TO THIS AGREEMENT. |
22.4 | Arbitration. Any dispute governed by Section 22.2.1.1 or 22.2.1.2 shall be resolved exclusively through final and binding arbitration using a single arbitrator, as to Section 22.2.1.1, or three arbitrators, as to Section 22.2.1.2, applying by reference the Commercial Arbitration Rules (the “AAA Rules”) of the American Arbitration Association (the “AAA”) as in effect on the date such dispute arises, as supplemented to the extent necessary to determine any procedural appeal questions by the Federal Arbitration Act (Title 9 of the United States Code). If there is any inconsistency between the provisions of this Agreement and the AAA Rules or the Federal Arbitration Act, the provisions of this Agreement shall control. |
22.4.1 | Arbitration must be initiated within the time period allowed by the applicable statute of limitations. |
22.4.2 | As to Section 22.2.1.1, if the Parties are unable to jointly select an arbitrator within 30 days following the initiation of the dispute, the AAA will name the arbitrator within 30 days after expiration of such period. The Parties each shall pay one-half of the compensation and expenses of the arbitrator(s). |
22.4.3 | As to Section 22.2.1.2, the initiating Party’s notice shall identify the arbitrator such Party is appointing. The responding Party shall respond within 30 days after receipt of such notice, identifying the arbitrator such |
22.4.4 | All arbitrators must (i) be neutral persons who have never been officers, directors, employees or consultants or had other business or personal relationships (except acting as arbitrator) with the Parties or any of their Affiliates, officers, directors or employees and (ii) have experience in or be knowledgeable about the matters in dispute. |
22.4.5 | The location of all arbitration proceedings shall be the City of Wilmington, Delaware. |
22.4.6 | The Parties and the arbitrators shall proceed diligently so that the award can be made as promptly as possible. If the amount in controversy is less than $1,000,000 the hearing shall commence as promptly as practicable after the selection of the arbitrator. If the amount in controversy is equal to or exceeds $1,000,000, the hearing shall commence at such time as agreed to by the Parties and the arbitrators but no later than three months after the selection of the third arbitrator. Expedited discovery will be permitted if and as agreed to by the Parties. If the Parties are unable to agree, the arbitrators shall resolve any discovery disputes consistent with the AAA Rules. Any matter involving an amount in controversy that is equal to or in excess of $1,000,000 shall be treated as a large, complex commercial case as per the AAA Rules. |
22.4.7 | Except as provided in the Federal Arbitration Act, the decision of the arbitrators shall be binding on and non-appealable by the Parties. In rendering any decision or award, the arbitrators must abide by all terms and conditions of this Agreement, including the exclusion of consequential, incidental, exemplary, special, indirect and punitive damages set forth in Section 20. |
22.4.8 | The Parties shall each bear their own costs and expenses (including attorneys’ fees) incurred in arbitrating any dispute pursuant to this Section 22.4. |
22.5 | Availability of Remedies. The Parties acknowledge and agree that damages may not be an adequate remedy for a breach of the provisions of this Agreement. For this reason, among others, the Parties could be irreparably harmed if this Agreement |
23. | ASSIGNMENT |
23.1 | This Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors and permitted assigns. |
23.2 | PRC shall not assign this Agreement or its rights or interests hereunder in whole or in part, or delegate its obligations hereunder in whole or in part, without the express written consent of Aron, except as set forth in Section 23.4 and 23.5. Aron shall not assign this Agreement or its rights or interests hereunder, directly or indirectly, through consolidation, amalgamation, merger or transfer, by operation of law or otherwise, in whole or in part, or delegate its obligations hereunder in whole or in part, without the express written consent of PRC, except that Aron may, without PRC’s express written consent, assign and delegate all of Aron’s rights and obligations hereunder to any Affiliate of Aron; provided that the obligations of such Affiliate hereunder are guaranteed by The Goldman Sachs Group, Inc. |
23.3 | If written consent is given for any assignment, the assignor shall remain jointly and severally liable with the assignee for the full performance of the assignor’s obligations under this Agreement unless the Parties otherwise agree in writing. |
23.4 | Either Party may create a security interest in (but may not otherwise assign any interest in) its receivables under this Agreement as to a third party without the consent of the other Party; provided that no such security interest shall impair or limit any rights or remedies of the other Party hereunder, including any rights of setoff, recoupment or counterclaim. |
23.5 | PRC may assign its rights and obligations under this Agreement to any and all lenders, security, note or bond holders, lien holders, investors, equity providers and other persons providing any interim or long term equity or debt financing, refinancing or recapitalization for the Refinery, their successors and assigns and any trustees or agents acting on their behalf. Additionally, if PRC wishes to assign (i) its rights and obligations under this Agreement, (ii) any Specified Transactions or (iii) any assets, including the Refinery and/or the Tanks, related to this Agreement to a master limited partnership that is an Affiliate of PRC, Aron agrees that it will cooperate with PRC in good faith and in a commercially reasonable manner to accommodate such assignment on terms that preserve for Aron, in all material respects, the economic and legal substance of the transactions contemplated by this Agreement and the Transaction Documents. |
23.6 | Any prohibited assignment in violation of this Section 23 shall be null and void ab initio and the non-assigning Party shall have the right, without prejudice to any other |
24. | NOTICES |
24.1 | Notices in Writing. Any notice, demand or document that a Party is required or may desire to give hereunder, except to the extent specifically provided otherwise herein, must be (i) in writing and (ii) given by personal delivery, overnight courier, facsimile or U.S. mail registered or certified mail, return receipt requested, with the postage prepaid and properly addressed or communicated to such Party at its address or facsimile number set forth on Schedule K, or at such other address as either Party may have furnished to the other by notice given in accordance with this Section 24.1. Other than notices relating to a Termination Event, termination of this Agreement, indemnification, assignment and disputes, notice may also be given by electronic mail at such e-mail address as is typically used for such type of matter in the conduct of the recipient’s business. Any notice delivered or made by personal delivery, overnight courier, facsimile or U.S. mail shall be deemed to be given on the date of actual delivery as shown by the receipt for personal delivery or overnight courier delivery, the addresser’s machine confirmation for facsimile deliver or the registry or certification receipt for registered or certified mail. |
25. | NATURE OF THE TRANSACTION & RELATIONSHIP OF THE PARTIES |
25.1 | Neither this Agreement nor any other Transaction Document or transaction under any of them, nor the performance by the Parties of their respective obligations under this Agreement, any other Transaction Document or any transaction shall constitute or create a joint venture, partnership or legal entity of any kind between the Parties. It is understood that each Party has complete charge of its employees and agents in the performance of its duties hereunder and nothing herein shall be construed to make a Party, or any employee or agent of such Party, an agent or employee of another Party. No Party shall have any authority (unless expressly conferred in writing under this Agreement or otherwise and not revoked) to bind another Party as its agent or otherwise. |
26. | CONFIDENTIALITY |
26.1 | This Agreement and all documents related to the foregoing and any information pertaining thereto made available by a Party or its Representatives to the other Party or its Representatives are confidential (collectively, “Confidential Information”), which obligation supersedes in all respects the Mutual Confidentiality Agreement dated as of April 18, 2013 by and between Aron and PBFH (the “Confidentiality Agreement”). Each Party shall at a minimum use the same efforts and standard of care with respect to Confidential Information provided by the other Party that it uses to preserve its own confidential information, and in no event less than commercially reasonable efforts. Confidential Information shall not be discussed with or disclosed to any third party by any Party except for such information (i) as may become |
26.2 | In the case of disclosure covered by clause (ii) of Section 26.1, the disclosing Party shall notify the other Party in writing of any proceeding of which it is aware which may result in disclosure (provided that the disclosing Party shall not be required to waive any attorney-client or work product privilege) and shall use reasonable efforts to prevent or limit such disclosure. The Parties may exercise all remedies available at law or in equity to enforce or seek relief in connection with the confidentiality obligations contained in this Agreement. |
27. | CHANGE IN LAW |
27.1 | Each Party shall make reasonable efforts to monitor any proposed Change in Law that may reasonably be expected to have an impact on Aron’s ability to perform any of its obligations under any of the Aron Hedges in a commercially reasonable manner and shall promptly notify the other Party upon becoming aware of any such proposed Change in Law. Such notice shall identify the proposed Change in Law and set out in reasonable detail the effects the notifying Party anticipates such Change in Law would have upon such performance of any such Aron Hedges if enacted. The Parties shall in good faith meet to discuss what, if any, measures can be taken by either Party (or both) to minimize and/or mitigate the effect of any such proposed Change in Law. If a Change in Law results or would result in a Party (the “Adversely Affected Party”): (a) violating any Applicable Law in connection with its performance of any of the Aron Hedges, (b) incurring Taxes, Liabilities or other sanctions of a monetary nature in excess of $1,000,000 per annum solely as a result of such Party’s performance of the Aron Hedges, in each case the Adversely Affected Party shall be entitled to request that the Parties meet for purposes of addressing such Change in Law by providing written notice (a “Change in Law Notice”) to the other Party (the “Non-Affected Party”). Within seven Business Days of receipt of a Change in Law Notice, the Parties shall meet in good faith with a view to identifying any steps (“Consequential Steps”) that would alleviate the effects of the relevant Change in Law on the Adversely Affected Party, which may include an agreement between the Parties to share the relevant incremental losses incurred by the Adversely Affected Party or the amendment of any Transaction Document. In identifying the Consequential Steps, the Parties shall, as far as is reasonably practicable, do so in a |
28. | MISCELLANEOUS |
28.1 | Survival. Termination or expiration of this Agreement shall not affect any rights or obligations that may have accrued prior to termination, including any in respect of antecedent breaches and, for the avoidance of doubt but subject to the terms of this Agreement, any rights or obligations under this Agreement or any of the other Transaction Documents in respect of transactions entered into up to and including the date of termination or expiration of this Agreement. The obligations of each Party that expressly survive termination, are required to take effect on or give effect to termination or the consequences of termination or which by their very nature must survive termination shall continue in full force and effect notwithstanding termination of this Agreement. |
28.2 | Entire Agreement; Amendments. This Agreement constitutes the entire agreement of the Parties regarding the matters contemplated herein or related thereto and no representations or warranties shall be implied or provisions added hereto in the absence of a written agreement to such effect between the Parties after the Effective Date; provided, however, that nothing in this Agreement shall limit, impair or contravene the Parties’ or their Affiliates’ rights as set forth in any Specified Transaction (whether entered into prior to, on or after the Effective Date) regarding the collection and determination of margin and collateral, the exporting or importing of events of default, termination events or the netting and setting off of amounts due. This Agreement may not be altered, amended, modified or otherwise changed in any respect except by a writing duly executed by an authorized representative of each Party and no representations or warranties shall be implied or terms added in the absence of a writing signed by both Parties. No promise, representation or inducement has been made by either Party that is not embodied in this Agreement, and neither Party shall be bound by or liable for any alleged representation, promise or inducement not so set forth. |
28.3 | Severability. If at any time any court of competent jurisdiction declares that any provision of this Agreement is or any provision of this Agreement becomes illegal, invalid or unenforceable in any respect under any Applicable Law of any jurisdiction, neither the legality, validity or enforceability of the remaining provisions nor the legality, validity or enforceability of such provision under the Applicable Law of any other jurisdiction will be affected or impaired in any way. The Parties will negotiate in good faith with a view to reform this Agreement in order to give effect to the original intention of the Parties and produce as nearly as is practicable in all |
28.4 | Waiver and Cumulative Remedies. No failure to exercise, nor any delay in exercising, any right, power or remedy under this Agreement or provided by Applicable Law shall operate as a waiver, nor shall any single or partial exercise of any right, power or remedy prevent any further or other exercise or the exercise of any other right, power or remedy. The rights, powers and remedies provided in this Agreement are cumulative and not exclusive of any rights, powers or remedies. Any waiver of any breach of this Agreement shall not be deemed to be a waiver of any subsequent breach. |
28.5 | Time Is of the Essence. Time shall be of the essence for this Agreement with respect to all aspects of each Party’s performance of its obligations under this Agreement. |
28.6 | No Third-Party Beneficiaries. There are no third party beneficiaries to this Agreement and the provisions of this Agreement shall not impart any legal or equitable right, remedy or claim enforceable by any person, firm or organization other than the Parties and their successors in interest and permitted assigns. |
28.7 | Announcements. At no time during the Term of this Agreement, and for a period of two years following its expiration or termination, shall any Party issue any press announcement or public statement regarding this Agreement without the prior written consent of the other Party, except as may be required by Applicable Law or applicable stock exchange rules or requirements or to the extent public disclosure is required under the circumstances described in any relevant confidentiality agreement entered into between the Parties. The issuing Party will: |
28.7.1 | use all reasonable efforts to notify the other Party of the content of such announcement at least three Business Days prior to such issue (unless otherwise required by Applicable Law or to the extent public disclosure is required under the circumstances described in any relevant confidentiality agreement entered into by the Parties); and |
28.7.2 | take the other Party’s comments on the proposed announcement into account as is reasonable under the circumstances, provided such comments are received within two Business Days of the notification. |
28.8 | Expenses. Each Party shall pay its own costs, fees and expenses, including attorneys’ fees, incurred by such Party in connection with the Transaction Documents and any costs, fees and expenses incident to the negotiation, execution and delivery of this Agreement and the consummation of the transactions contemplated thereunder. |
28.9 | Counterparts. This Agreement may be executed by the Parties in separate counterparts and all such counterparts shall together constitute one and the same |
PBF Corporate Standard | Product Group |
318 Furf Ext | Lube |
339 Furf Ext | Lube |
Alkylate | Gasoline |
CBOB Prm 12.9# | Gasoline |
CBOB Prm 14.5# | Gasoline |
CBOB Prm 7.8# | Gasoline |
CBOB Reg 12.9# | Gasoline |
CBOB Reg 13.5# | Gasoline |
CBOB Reg 14.5# | Gasoline |
CBOB Reg 7.8# | Gasoline |
Gasoline-Cat | Gasoline |
Gasoline-Lt Strtrun | Gasoline |
Jet A | Distillate |
Kerosene | Distillate |
LGO | Distillate |
Lube Distillate | Lube |
Lube Raffinate | Lube |
Lube Stocks | Lube |
Naphtha | Gasoline |
No 2 HO 2000 UD | Distillate |
No 2 LSD 500 | Distillate |
No 2 ULSD 15 | Distillate |
PBOB Prm 13.5# | Gasoline |
PBOB Prm 15.0# | Gasoline |
PBOB Prm V2 | Gasoline |
RBOB Reg 13.5# | Gasoline |
RBOB Reg 15.0# | Gasoline |
RBOB Reg V2 | Gasoline |
Reformate | Gasoline |
STK 318 | Lube |
STK 339 | Lube |
STK 345 | Lube |
STK 6154 | Lube |
STK 6336 | Lube |
ValAro 100 | Lube |
ValAro 130A | Lube |
ValAro 220 | Lube |
ValAro 45 | Lube |
ValAro 700NC | Lube |
VP 850M | Lube |
Tank List | Typical Contents | Tank List | Typical Contents |
T1021 | Lube Base Oil - STK 318 | T398 | Lube Raffinate |
T1022 | Lube Base Oil - STK 339 | T557 | Kerosene |
T1023 | Alkylate | T558 | Light Gas Oil |
T1024 | Lube Base Oil - STK 339 | T593 | Lube Base Oil - STK 6154 |
T1025 | Lube Base Oil - STK 339 | T595 | Lube Raffinate |
T1028 | Light Gas Oil | T634 | ValAro 100 |
T1063 | RBOB Unl Reg | T635 | ValAro 100 |
T1064 | CBOB Unl Reg | T636 | 318 Furfural Lube Extraction |
T1065 | RBOB Unl Reg | T670 | Lube Raffinate |
T1066 | RBOB Unl Reg | T724 | Alkylate |
T1115 | Cat Gasoline | T725 | Alkylate |
T1116 | Light Straight Run Gasoline | T756 | 318 Furfural Lube Extraction |
T1117 | Lube Base Oil - STK 339 | T767 | 339 Furfural Lube Extraction |
T1118 | Lube Base Oil - STK 339 | T8 | Lube Distillate |
T1131 | Lube Base Oil - STK 6336 | T802 | Light Straight Run Gasoline |
T1425 | Lube Base Oil - STK 6336 | T839 | Lube Base Oil - STK 345 |
T1427 | Lube Base Oil - STK 6336 | T840 | Lube Base Oil - STK 345 |
T1428 | Lube Base Oil - STK 6336 | T883 | Lube Base Oil - STK 6154 |
T1537 | Lube Base Oil - VP 850M | T93 | Lube Raffinate |
T1886 | Lube Distillate | T935 | Lube Raffinate |
T1887 | Lube Distillate | T936 | Lube Raffinate |
T1888 | Lube Distillate | T939 | Lube Base Oil - STK 318 |
T1891 | Lube Distillate | TS1 | 339 Furfural Lube Extraction |
T1892 | Lube Distillate | TS3 | Jet A |
T1898 | Lube Base Oil - STK 6336 | TS32 | Jet A |
T1899 | Lube Base Oil - STK 6336 | TS33 | Jet A |
T1911 | No 2 LS (500 ppm) Diesel | TS35 | Lube Base Oil - STK 6154 |
T1912 | Kerosene | TS36 | Jet A |
T1941 | Lube Distillate | TS37 | Light Gas Oil |
T1942 | Lube Distillate | TS46 | Light Gas Oil |
T1943 | Lube Distillate | TS49 | Lube Base Oil - STK 318 |
T1945 | Lube Distillate | TS50 | Lube Base Oil - STK 318 |
T1946 | Lube Distillate | TS52 | Lube Base Oil - STK 318 |
T1947 | Lube Distillate | TS54 | Light Gas Oil |
T1962 | Lube Raffinate | TS57 | Light Gas Oil |
T1963 | Lube Raffinate | TS58 | No 2 ULS (15 ppm) Diesel |
T1964 | Lube Raffinate | TS59 | No 2 ULS (15 ppm) Diesel |
T1965 | Lube Raffinate | TS60 | No 2 ULS (15 ppm) Diesel |
T2 | Lube Distillate | TS62 | No 2 ULS (15 ppm) Diesel |
T2173 | RBOB Unl Reg VOC2 | TS63 | No 2 HS (2000 ppm) Heating Oil-Undyed |
T219 | Lube Stocks | TS64 | No 2 ULS (15 ppm) Diesel |
T2807 | Jet A | TS80 | Naphtha |
T2808 | Jet A | TS81 | Naphtha |
T2869 | CBOB Unl Prem | TS82 | Naphtha |
T2940 | Cat Gasoline | Logical Tank 1 | #N/A |
T2941 | CBOB Unl Reg | Logical Tank 2 | #N/A |
T3 | Lube Distillate | ||
T3018 | Reformate | ||
T3174 | PBOB Unl Prem | ||
T368 | Lube Raffinate | ||
T391 | Lube Base Oil - STK 345 | ||
T397 | Lube Stocks |
(A.) | OVERVIEW: |
(B.) | HYDROCARBON INVENTORY INCLUSIONS AND EXCLUSIONS: |
• | Intra-Refinery linefill; |
• | BS&W in storage tanks; |
• | Unit fill at the Refinery. |
(C.) | INDEPENDENT INSPECTION: |
(D.) | ACCEPTANCE AND REVIEW - INVENTORY TEAM: |
(E.) | INVENTORY QUANTIFICATION PROCEDURES: |
• | Tank location, Tank number, type of roof and Tank type by site; |
• | Status at Commencement Date (active, inactive or out of service); |
• | Tank contents (product/grade); |
• | Tank equipment (i.e., mixers, heating coils or tubes); |
• | Tank reference gauge height; |
• | Tank calibration (ullage or innage), last Tank calibration date and Tank “critical zone”; |
• | Total Tank volume and heel volume; |
• | Design of Tank gauging tube (slotted or solid) and estimation of bottom sludge; and |
• | Any specific gauging or sampling limitations (i.e. fresh air, no roof ladder). |
(F.) | GAUGING/SAMPLING PROTOCOL: |
(G.) | EQUIPMENT ACCURACY: |
(H.) | PRE-COMMENCEMENT DATE INVENTORY PROCEDURES: |
(I.) | FACILITY PHYSICAL INVENTORY PROCEDURES: |
• | Clean metal sample pressure cylinders, as supplied by PRC’s laboratory or the IIC, will be used for sampling the propane bullet Tanks and the LPG spheres. |
• | Tank location, Tank number, any Tank seal numbers and Tank type by site; |
• | Date and time of gauging and sampling; |
• | Tank contents (product/grade); |
• | Manual gauge in feet and inches, and fraction thereof (if a Tank is so equipped) specifying outage or innage (as defined below), and equivalent quantity in appropriate units (“Manual Gross Tank Inventory”) determined according to customary practice at the Refinery or Tank type as follows: |
• | Cone or external/internal floating roof Tanks: vertical distance in feet, inches and fractions thereof from Tank bottom or datum plate to the uppermost point where Product level is identified on the gauge tape, (“innage”); |
• | Tanks containing sludge or compromised datum plate: vertical distance in feet, inches and fractions thereof, from Tank reference point to the uppermost Product level as identified on the gauge tape (“outage”); |
• | Temperature readings in accordance with API Chapter 7; |
• | Free water level (“water cut”); |
• | Automatic product gauge reading measure in feet and inches, and fraction thereof, (if Tank is so equipped) specifying outage or innage, and equivalent quantity in appropriate units (“Automatic Gross Tank Inventory”); and |
• | Representative samples, as described in Section I.6 above, shall be drawn to determine BS&W, API gravity and any other properties as determined by the Inventory Team. |
• | Tank location, Tank number, any Tank seal numbers and Tank type by site; |
• | Date and time of gauging and sampling; |
• | Tank contents (product/grade); |
• | Any Automatic Gross Tank Inventory; |
• | Temperature readings from the Tank’s temperature gauge according to Chapter 7 API Standard; |
• | Pressure reading from the Tank’s automatic pressure gauge (if available); and |
• | Pressure cylinders samples shall be drawn to determine the Tank contents, purity, density and any other properties as requested by the Inventory Team. The Inventory Team will determine which Products should be subjected to this step. |
(J.) | METER READINGS – LOADING RACKS AND PIPELINES: |
(K.) | POST-INVENTORY PROCEDURES: |
(L.) | CALCULATION OF FINAL INVENTORY QUANTITY: |
(M.) | POST-COMMENCEMENT DATE STATEMENT: |
1. |
2013 Schedule of Insurance | |||||
Named Insureds: PBF Holding Company LLC; PBF Energy & all subsidiaries | (Active Policies) | ||||
rv 6.19.13 atv | |||||
Coverage | Policy Number | Underwriting Company | Limits of Liability/Deductible | Deductible | Policy Period |
CASUALTY | |||||
Work Comp - Monopolistic | 1618685 | State of Ohio - BWC State Fund | Statutory - Guaranteed Cost | 7/1/12 - 7/1/13 | |
Workers Compensation | WC 025889212 | AIG - Ins Co of the ST of PA | 1MM | $500K | 12/17/12 - 12/17/13 |
General Liability | GL 2819954 | AIG- Nat'l l Union Fire Ins Co of Pitts, PA | 5MM | SIR - $5M | 12/17/12 - 12/17/13 |
Business Auto | CA 1949547 | AIG- Nat'l l Union Fire Ins Co of Pitts, PA | 1MM | $500K | 12/17/12 - 12/17/13 |
Lead Umbrella - Domestic | XOO G25910242 | ACE USA Excess Casualty (ACE American Ins. Co.) | 25M - Lead | Primary | 12/17/12 - 12/17/13 |
Excess Liability - lst | G24183099 003 | Westchester Fire Insurance Company thru AmWINS (Atlanta, GA) | 25M x/s 25M | 12/17/12 - 12/17/13 | |
Excess Liability - 2nd | EXC10003840800 | Endurance American Specialty Ins Co thru AmWINS (Atlanta, GA) | 25M p/o 50M x/s 50M | 12/17/12 - 12/17/13 | |
Excess Liability - 2nd | EAU756753012012 | AXIS Surplus Insurance Company thru AmWINS (Atlanta, GA) | 25M p/o 50M x/s 50M | 12/17/12 - 12/17/13 | |
Excess Liability - 3rd | 1236101 | Ironshore Specialty Insurance Company | 25M x/s 100M | 12/17/12 - 12/17/13 |
Excess Liability - 4th | SLSLXNR03047012 | Starr Surplus Lines Insurance Company | 25M x/s 125M | 12/17/12 - 12/17/13 | |
Excess Liability - 5th - Bermuda | ARGO-CAS-OR-000334 | Argo Re (Bermuda) | 25M p/o 100M x/s 150M | 12/17/12 - 12/17/13 | |
Excess Liability - 5th | U920153-1210 | OIL Casualty Insurance Ltd. (Bermuda) | 25M p/o 100M x/s 150M | 12/17/12 - 12/17/13 | |
Excess Liability - 5th | BM00026704LI12A | XL Insurance (Bermuda) Ltd. | 25M p/o 100M x/s 150M | 12/17/12 - 12/17/13 | |
Excess Liability - 6th | BM00026705LI12A | XL Insurance (Bermuda) Ltd. | 50M x/s 250M | 12/17/12 - 12/17/13 | |
MARINE | |||||
Marine Terminal Operators Liab | MASILNY00024011 | Starr Indemnity & Liability Company | 10M | $5M | 12/17/12 - 12/17/13 |
Charterers Liability | Cert of Entry #238.113 | GARD | $750M | $50K pollution/$25 All other | 2/20/13 - 2/20/14 |
Freight,Demurrage&Defense | Same | GARD | $10MM | 25% ded - $5,000 minimum. | 2/20/13 - 2/20/14 |
Cargo | OMC9150152/MA1202204 | Grt Amer Ins Co/Lloyds of London | $150MM | 1/2 of 1% Cargo Value | 1/1/13 - Cont'd |
PROPERTY | $1.3B - TOTAL Limits | ||||
Property - Domestic | 638 18 112 | National Union Fire Ins. Co. of Pittsburgh, PA (Chartis) | 115M p/o 500M | PD - $5M / BI 60 days | 12/17/12 - 12/17/13 |
Property | 638 18 113 | National Union Fire Ins. Co. of Pittsburgh, PA (Chartis) | 80M p/o 800M x/s 500M | 12/17/12 - 12/17/13 | |
Property | CLP 3013874 | Allianz Global Corporate & Specialty | 162.5M p/o 1.3B | 12/17/12 - 12/17/13 | |
Property | H12-TP10212-00 | HCC Technical Property Risks (Houston Casualty Co.) | 24.750 p/o 550M x/s 750M | 12/17/12 - 12/17/13 | |
Property | XPD12328-00 | HDI-Gerling America Insurance Company | 800M x/s 500M | 12/17/12 - 12/17/13 | |
Property | 868702 | Ironshore Insurance Services, Inc. | 1.750M p/o 100M | 12/17/12 - 12/17/13 | |
Property | 3DAACMXO003 | Liberty Mutual Insurance Co. | 84.5M p/o 1.3B | 12/17/12 - 12/17/13 | |
Property | S5LPY0252600S | Maiden Specialty | 10M p/o 400M x/s 100M | 12/17/12 - 12/17/13 | |
Property | 2012 10F145356 - 1 | GSINDA (General Security Indemnity of Arizona) | 52.5M p/o 750M x/s 5M | 12/17/12 - 12/17/13 | |
Property | 2012 10F145356 - 1 | GSINDA (General Security Indemnity of Arizona) | 16.2M p/o 400M x/s 100m x/s 5M | 12/17/12 - 12/17/13 | |
Property | EPRN09148449 | ACE American Insurance Company | 104M p/o 1.3B | 12/17/12 - 12/17/13 |
Property | 31375457 | Westport Insurance Corporation (Swiss Re) | 1.3B | 12/17/12 - 12/17/13 | |
Property | AJZ118526C12 | Lloyd's Sydicate No. 1183 (TAL - Talbot) | 39M p/o 1.3B | 12/17/12 - 12/17/13 | |
Property | AJY155483A12 | Lloyd's Sydicate No. 1183 (TAL - Talbot) | 1.1M p/o 550M | 12/17/12 - 12/17/13 | |
Property | US00012494PR12A | XL Insurance America Inc. | 50M p/o 1B | 12/17/12 - 12/17/13 | |
Property - London | EL1200311 - Total | Millennium Consortium (Navigators,Pembroke,Chaucer, Catlin) | 750M | ||
Property | EL1200318 | Great Lakes Reinsurance (UK) PLC | 1B | 12/17/12 - 12/17/13 | |
Property | EL1200319 | Infrassure Ltd | 800M x/s 500M | 12/17/12 - 12/17/13 | |
Property | EL1200321 | International Insurance Company of Hannover Ltd | 800M x/s 500M | 12/17/12 - 12/17/13 | |
Property | EL1200323 | Llloyd's Sundicate No. 1414 (ASC - Ascot) | 550M x/s 750M | 12/17/12 - 12/17/13 | |
Property | EL1200324 | Lloyd's Syndicate No. 1967 (WRB - Berkley) | 100M | 12/17/12 - 12/17/13 | |
Property | EL1200325 | Lloyd's Syndicate No. 0510 (KLN - Kiln) | 50M | 12/17/12 - 12/17/13 | |
Property | EL1200330 | Lloyd's Syndicate No. 0382 (HDU - Hardy) | 550M x/s 750M | 12/17/12 - 12/17/13 | |
Property | EL1200332 | Lloyd's Syndicate No. 2791 (MAP) | 50M x/s 50M | 12/17/12 - 12/17/13 | |
Property | EL1200335 | Lloyd's Syndicate No. 2001 (AML - Amlin) | 250M x/s 750M | 12/17/12 - 12/17/13 | |
Property | EL1200336 - Total | Lloyd's Syndicate No. 0457 (WTK - Watkins) 0609 AUW | 300M x/s 1B | ||
Property - Bermuda Direct | EL1200333 | Arch Insurance Europe | 1B | 12/17/12 - 12/17/13 | |
Property | PBFE 01282P02 | ACE Bermuda | 49.05M p/o 300M x/s 1B | 12/17/12 - 12/17/13 | |
Property | P118450 | Ariel Re Bermuda Ltd. | 15M p/o 800M x/s 500M | 12/17/12 - 12/17/13 | |
Property | P-100000-1212 | OIL Casualty Insurance, Ltd | 15M p/o 800M x/s 500M | 12/17/12 - 12/17/13 | |
Property - Engineering Fee | EPRN09148449 | ACE American Insurance Company | 104M p/o 1.3B | 12/17/12 - 12/17/13 | |
PROPERTY - TERRORISM |
Property Terrorism - Domestic | AFD1184049C12 | Talbot | 100M p/o 1B | PD - $5M / BI 60 days | 12/17/12 - 12/17/13 |
Property Terrorism - London | RQ1200316 | Lloyds Syndicate Various -RQ1200316 - VariousTotal: | 500M | 12/17/12 - 12/17/13 | |
Property Terrorism - London | RQ1200378 | Lloyd's Syndicate No. 0033 (HIS - Hiscox) | 500M | 12/17/12 - 12/17/13 | |
Property Terrorism - London | RQ1203529 | Lloyd's Syndicate Various - RQ1203529 Lancashire Leader | 500M x/s 500M | 12/17/12 - 12/17/13 | |
ENVIRONMENTAL | |||||
Underground Storage Tanks | G24684830 001 | ACE Environmental Risk | $2MM | 7/30/2012 - 7/30/2013 | |
Legal Remediation Run Off- DCR | PLS91956502/ /EEL211137700 | Chartis/Great American | $75MM | 6/1/10 - 6/1/20 | |
Legal Remediation Run Off - PRC | PLS14159793/EXCG24890715/A2SRD309007 | Chartis/ACE/Nat'l Marine Fire | $75MM | 12/17/10- 12/17/20 | |
Legal Pollution - NSR Project DCR | PCL109374700 | Grt American | $20MM | $1M | 1/25/13-16 |
Legal Pollution - Master- Primary | PEC0041228 | XL (Greenwich) | 50MM | $5M | 6/1/13- 6/1/16 |
lst Excess | TBD | AIG | $25MM xs $50MM | 6/1/13- 6/1/16 | |
2nd Excess | AEC 5955871-00 | Zurich (Steadfast) | $25MM xs $75MM | 6/1/13- 6/1/16 | |
3rd Excess | XSV676055-0616 | Catlin Speciality | $15MM xs $100MM | 6/1/13- 6/1/16 | |
4th Excess | 1697400 | Ironshore | $25MM xs $115MM | 6/1/13- 6/1/16 | |
5th Excess | 0308-4327 | AWAC | $ 5MM xs $140MM | 6/1/13- 6/1/16 | |
6th Excess | EEL 190317800 | Great American | $15MM xs $145MM | 6/1/13- 6/1/16 | |
7th Excess | EXC G2727075A | ACE | $25MM xs $160MM | 6/1/13- 6/1/16 | |
8th Excess | EEL 190317800 | Great American | $15MM xs $185MM | 6/1/13- 6/1/16 | |
Sub-Total: Environ - Master ($200MM) |
If to Aron, to: | ||
Trading and Sales: Simon Collier 200 West Street New York N.Y. 10282 (212) 902 0776 Simon.Collier@gs.com | Chrissy Benson 200 West Street New York N.Y. 10282 (212) 902 0776 Christine.Benson@gs.com | |
Thomas Love 200 West Street New York N.Y. 10282 (212) 357 4239 Thomas.Love@gs.com | ||
Scheduling Jim Brush 200 West Street New York N.Y. 10282 Direct: (212) 902 9874 Hotline: (212) 902 7349 Fax: (212) 493 9847 ficc-jaron-oilops@ny.email.gs.com | Andrew Snyder 200 West Street New York N.Y. 10282 Direct: (212) 902 4037 Hotline: (212) 902 7349 Fax: (212) 493 9847 ficc-jaron-oilops@ny.email.gs.com | |
Confirmations: | ||
Primary: Patricia Hazel 200 West Street New York N.Y. 10282 Tel.: (212) 902 7305 Fax: (212) 493 9849 gs-commod-ny-drafting@ny.email.gs.com | Alternate: Michael Caserta 200 West Street New York N.Y. 10282 Tel.: (212) 357 0779 Fax: (212) 493 9849 gs-commod-ny-drafting@ny.email.gs.com |
Payments: | |
Primary: Jeffrey Fernandez 200 West Street New York N.Y. 10282 Tel: (212) 357 9345 Fax: (646) 835 8748 ficc-struct-sett@ny.email.gs.com | Alternate: Kristen O’Neill 200 West Street New York N.Y. 10282 Tel: (212) 902 7311 Fax: (646) 835 8748 ficc-struct-sett@ny.email.gs.com |
Invoicing/Statements: | |
Primary: Jeffrey Fernandez 200 West Street New York N.Y. 10282 Tel: (212) 357 9345 Fax: (646) 835 8748 ficc-struct-sett@ny.email.gs.com | Kristen O’Neill 200 West Street New York N.Y. 10282 Tel: (212) 902 7311 Fax: (646) 835 8748 ficc-struct-sett@ny.email.gs.com |
Alternate: Federica Pinelli 200 West Street New York N.Y. 10282 (917) 343 8156 Fax: (646) 835 8748 ficc-struct-sett@ny.email.gs.com | |
General Notices: | |
John R. Thomas Goldman, Sachs & Co. 15th Floor 200 West Street New York, NY 10282-2198 Tel: (212) 902-1806 Fax: (212) 256-2456 John.thomas@gs.com |
Page | ||||
DEFINITIONS & CONSTRUCTION | ||||
TERM & EARLY TERMINATION | ||||
SALE OF INITIAL INVENTORY AND REPURCHASE OF ENDING INVENTORY | ||||
TARGET PRODUCT INVENTORY LEVELS; APPLICABLE SPREADS | ||||
ADDITIONAL INCLUDED LOCATIONS | ||||
PRODUCT SALES & REPORTING | ||||
PRODUCT SPECIFICATIONS, QUALITY & BLENDING | ||||
TITLE, RISK OF LOSS & CUSTODY | ||||
STORAGE | ||||
10. | CERTAIN REPRESENTATIONS | |||
WARRANTIES | ||||
PRICING & PAYMENT | ||||
FINANCIAL INFORMATION; NOTIFICATIONS; CREDIT SUPPORT | ||||
TAXES | ||||
INSURANCE | ||||
FORCE MAJEURE | ||||
REPRESENTATIONS, WARRANTIES & COVENANTS | ||||
TERMINATION EVENTS, DEFAULT & EARLY TERMINATION | ||||
INDEMNIFICATION & CLAIMS | ||||
LIMITATION ON DAMAGES | ||||
INFORMATION & INSPECTION RIGHTS | ||||
GOVERNING LAW & DISPUTES | ||||
ASSIGNMENT | ||||
NOTICES | ||||
NATURE OF THE TRANSACTION & RELATIONSHIP OF THE PARTIES | ||||
CONFIDENTIALITY | ||||
CHANGE IN LAW | ||||
MISCELLANEOUS | ||||
1. | DEFINITIONS & CONSTRUCTION |
1.1 | Definitions. For purposes of this Agreement, including the foregoing recitals, the following terms shall have the meanings indicated below. |
1.2 | Interpretation. Unless the context otherwise requires or except where specifically stated otherwise, in this Agreement: |
1.2.1 | words using the singular or plural number also include the plural or singular number, respectively; |
1.2.2 | references to any Party shall be construed as a reference to such Party’s successors in interest and permitted assigns; |
1.2.3 | references to a provision of Applicable Law or Applicable Laws are references to that provision or Applicable Laws generally, as may be amended, extended or re-enacted from time to time; |
1.2.4 | references to “days,” “months” and “years” mean calendar days, months and years, respectively, and a “day” consists of the 24-hour period commencing at 12:00:00 a.m. EPT and ending on 11:59:59 EPT on that day; |
1.2.5 | references to “dollars” or “$” mean U.S. dollars; |
1.2.6 | the (i) volumes of record for purposes of this Agreement shall be in barrels (i.e., 42 net U.S. gallons, measured at 60° F) and (ii) prices of record for purposes of this Agreement shall be in dollars per barrel or dollars per gallon, as applicable. |
1.2.7 | references to “Exhibits,” “Sections” and “Schedules” in this Agreement, or to a provision contained therein, shall be construed as references to |
1.2.8 | References to any agreement or other document or to a provision contained in any of those shall be construed, at the particular time, as a reference to it as it may then have been amended, supplemented, modified, superseded, replaced, refinanced, assigned, novated and/or waived by the counterparties thereto in accordance with its terms from time to time; |
1.2.9 | references to “assets” include present and future properties, revenues and rights of every description; |
1.2.10 | references herein to “consent” mean, unless otherwise specified, the prior written consent of the Party at issue, which shall not be unreasonably withheld, delayed or conditioned; |
1.2.11 | the terms “hereof,” “herein,” “hereby,” “hereto” and similar words refer to this entire Agreement and not any particular Exhibit, Section, subsection, Schedule or subdivision of this Agreement; |
1.2.12 | the words “include” or “including” shall be deemed to be followed by “without limitation” or “but not limited to” whether or not they are followed by such phrases or words of like import; |
1.2.13 | references to a “judgment” include any order, injunction, determination, award or other judicial or arbitral measure in any jurisdiction; |
1.2.14 | the example calculations set forth in the Schedules hereto shall not be construed as creating any duty or obligation of the Parties; such examples are for illustrative purposes only and do not take precedence over any terms or conditions set forth in the remainder of this Agreement; |
1.2.15 | references to “obligations” shall be construed to mean a Party’s prompt and complete performance of its covenants and obligations required pursuant to this Agreement; and |
1.2.16 | references to any “person” include any natural person, corporation, partnership, limited liability company, joint venture, trust or unincorporated organization, estate, association, partnership, statutory body, joint stock company or any other private entity or organization, Governmental Authority, court or any other legal entity, whether acting in an individual, fiduciary or other capacity. |
1.3 | If there is any ambiguity, inconsistency, discrepancy or conflict between this Agreement and any other Transaction Document, this Agreement shall govern and prevail (except if the ambiguity, inconsistency, discrepancy or conflict is with respect to the Intercreditor Agreement, in which case the Intercreditor Agreement will govern and prevail). |
1.4 | Unless otherwise specified, in computing any period of time under this Agreement the day of the act, event or default from which such period begins to run shall be day “zero” and not included. If the last day of the period so computed is not a Business Day then, unless this Agreement provides otherwise, the period shall run until the end of the next Business Day. |
1.5 | The provisions of this Agreement shall be construed in accordance with the natural meanings of their terms. The Parties agree that each has had the opportunity to review the terms and provisions of this Agreement with counsel of its choosing and to negotiate any desired changes or clarifications and that the terms of this Agreement will not be interpreted against one Party or the other on the ground that such Party drafted or revised a particular provision. Instead, in the event of any ambiguity, this Agreement will be interpreted in accordance with the intent of the Parties as evidenced by the Agreement, taken as a whole. |
2. | TERM & EARLY TERMINATION |
2.1 | Initial Term. This Agreement shall be effective as of the Effective Date solely with respect to DCR’s determination of the Estimated Initial Inventory under Section 3.1. Subject to satisfaction of the conditions in Section 2.6, the initial term of this Agreement with respect to all other rights and obligations hereunder shall then commence as of the Commencement Date and continue in full force and effect until July 1, 2015 at 11:59:59 p.m. EPT (the “Initial Term”); provided, however, that this Agreement is subject to earlier termination as provided in Sections 2.3, 2.4 and 2.5. |
2.2 | Renewal Term. As of the expiration of the Initial Term, DCR and Aron may, by mutual agreement and no less than 180 days prior to the expiration of the Initial Term, renew this Agreement for one additional one-year term until July 1, 2016 at 11:59:59 p.m. EPT (or such longer term as may be agreed to by DCR and Aron) (the “Renewal Term”). |
2.3 | Specified Early Termination Rights. In addition to the termination rights in Section 2.4 and 2.5, DCR may, at its option and in its sole discretion, by providing no less than 60 days’ prior written notice to Aron, to be effective at 11:59:59 p.m. EPT on January 1, 2014 or, if later, at 11:59:59 p.m. EPT on the first day of the month immediately following the month during which such 60-day notice period expires (unless such 60-day notice period expires on the first day of a month, in which event such termination will be effective on such day) (but no later than July 1, 2014), terminate this Agreement, in which case this Agreement shall terminate in its entirety and the Specified Early Termination Fee will be due and payable by DCR to the |
2.4 | General Early Termination Right. In addition to the termination rights in Section 2.3 and 2.5, DCR may, at its option and in its sole discretion, by providing no less than 60 days’ prior written notice to Aron, to be effective at 11:59:59 p.m. EPT on July 1, 2014 or, if later, at 11:59:59 p.m. EPT on the first day of the month immediately following the month during which such 60-day notice period expires (unless such 60-day notice period expires on the first day of a month, in which event such termination will be effective on such day), terminate this Agreement, in which case this Agreement shall terminate in its entirety and the Early Termination Fee will be due and payable by DCR to the extent applicable as set forth in Section 3.8.8 as part of the Step-out Payment Amount; provided that such termination notice shall not be effective unless (i) PRCLLC (with PBFH) has concurrently elected to exercise its right to terminate the Related Agreement pursuant to Section 2.4 thereof (in which case, the Early Termination Fee as provided for thereunder would become due to the extent applicable) or (ii) Aron has agreed to the continuation of the Related Agreement following such early termination of this Agreement (in which case, no “Early Termination Fee” will be due under this Agreement or pursuant to Section 2.4 of the Related Agreement at such time). |
2.5 | Termination Right Upon Aron Transaction. *****. |
2.6 | Conditions to Commencement. |
2.6.1 | Conditions to Obligations of Aron. The obligations of Aron contemplated by this Agreement shall be subject to satisfaction by DCR of the following conditions precedent on and as of the Commencement Date: |
2.6.2 | Conditions to Obligations of DCR. The obligations of DCR contemplated by this Agreement shall be subject to satisfaction by Aron of the following conditions precedent on and as of the Commencement Date: |
3. | SALE OF INITIAL INVENTORY AND REPURCHASE OF ENDING INVENTORY |
3.1 | Estimated Initial Inventory (Estimated Step-in Inventory). On Thursday, June 27, 2013, DCR shall prepare its good faith estimate of the Initial Inventory to be sold by DCR to Aron hereunder as of the Commencement Date (the “Estimated Initial Inventory”) based on the volumes held in the Included Locations as of 11:59:59 p.m. EPT on Wednesday, June 26, 2013, and shall deliver a written statement thereof to Aron by 5:00:00 p.m. EPT on Thursday, June 27, 2013. |
3.2 | Initial Purchase (Initial Step-in Purchase). On the Commencement Date, and subject to satisfaction of the conditions set forth in Section 2.6.1, Aron agrees to purchase the Initial Inventory from DCR, subject to Section 3.5, based on the sum of, for each Product Group, the product of (a) the Estimated Step-in Product Benchmark applicable to each Product Group and (b) the Estimated Initial Inventory (based on |
3.3 | Payment for Estimated Initial Inventory (Initial Step-in Payment). Promptly after the opening of financial markets in New York, New York on the Commencement Date, and subject to satisfaction of the conditions set forth in Section 2.6.1, Aron shall pay *****% of the Estimated Initial Inventory Purchase Price to DCR by wire transfer of immediately available funds; provided, however, that DCR may, at its election, direct that all or a portion of the Estimated Initial Inventory Purchase Price be paid to MSCG on DCR’s behalf in accordance with the Payment Direction Letter, and the Parties agree to use commercially reasonable efforts to coordinate the respective timing of payments made pursuant to the Payment Direction Letter; provided, further, for the avoidance of doubt, title to the Initial Inventory shall pass from DCR to Aron, consistent with DCR’s warranty of title set forth in Section 11.1.1 and at and as of the time specified in the definition of the Commencement Date, subject to DCR’s confirmation of receipt of funds in an amount equal to such Estimated Initial Inventory Purchase Price. |
3.4 | Determination of Actual Initial Inventory (Actual Step-in Inventory). The Parties shall determine the actual volumes of the Initial Inventory sold by DCR to Aron hereunder as of the Commencement Date (the “Actual Initial Inventory”) in accordance with the procedures set forth in Schedule D. The Final Inventory Quantity Report shall thereafter be delivered to the Parties pursuant to the procedures set forth in Schedule D. |
3.5 | Initial Purchase True-Up (Step-in True-Up). No later than 5:00 p.m. EPT on the fifth Business Day after the delivery of the Final Inventory Quantity Report pursuant to the procedures set forth in Exhibit D, Aron shall deliver a written statement to DCR showing a calculation of the sum of, for each Product Group, the product of (i) the Actual Initial Inventory (based on the Final Inventory Quantity Report) and (ii) the Actual Step-in Product Benchmark applicable to each such Product Group (the “Actual Initial Inventory Purchase Price”). If (a) the amount of the Actual Initial Inventory Purchase Price exceeds the amount of the Estimated Initial Inventory Purchase Price, then Aron shall pay to DCR the amount of the resulting excess and (b) the amount of the Actual Initial Inventory Purchase Price is less than the amount of the Estimated Initial Inventory Purchase Price, then DCR shall pay to Aron the absolute value of the resulting difference, in each case pursuant to Section 3.6. |
3.6 | Payment of Initial Purchase True-Up (Payment of Step-in True-Up). No later than 5:00:00 p.m. EPT on the Initial Purchase True-Up Date, Aron or DCR, as applicable, shall pay the amount calculated as due and payable thereunder to the other Party by wire transfer of immediately available funds. If such amount is owed to DCR then DCR may, at its election, direct that all or a portion of such amount be paid by Aron to MSCG on DCR’s behalf in accordance with the Payment Direction Letter. If such |
3.7 | Arrangement Fee. |
3.7.1 | Concurrently with the calculation of Actual Initial Inventory Purchase Price under Section 3.5, Aron shall calculate the actual setup fee due in connection herewith (the “Actual Setup Fee”), which shall be equal to the product of the Setup Fee Rate and the Actual Maximum Step-in Value. |
3.7.2 | No later than 12:00:00 p.m. EPT on the third Business Day following the delivery of Aron’s written statement to DCR under Section 3.5, subject to the consummation of the transactions set forth in Section 3.3 and concurrently with the payment (if any) required to be made pursuant to Section 3.6, DCR shall pay the Actual Setup Fee to Aron by wire transfer of immediately available funds. |
3.8 | Purchase Upon Termination or Expiration (Step-out). |
3.8.1 | Upon the termination or expiration of this Agreement for any reason other than as a result of a Termination Event (the effective date of such termination or expiration being the “Step-out Date”), the Parties covenant and agree to proceed as provided in this Section 3.8; provided that (x) the terms of this Agreement applicable to any continuing obligations shall continue in effect following the Step-out Date until all obligations are finally settled as contemplated by this Section 3.8 and (y) the provisions of this Section 3.8 shall in no way limit the rights and remedies which the Performing Party may have as a result of a Termination Event, whether pursuant to Section 18 or otherwise. |
3.8.2 | DCR agrees to purchase from Aron all Aron Inventory located in situ in the Included Locations and owned by Aron on the Step-out Date (the “Step-out Inventory”), as follows: |
3.8.3 | The “Actual Step-out Inventory” of each Product Group shall be determined as of 11:59:59 p.m. EPT on the Step-out Date in accordance with Schedule D (with the necessary changes having been made therein to reflect a determination of such volumes using the procedures therein as of the Step-out Date, instead of as the Commencement Date). The Final Inventory Quantity Report shall be delivered to the Parties pursuant to the procedures set forth in Schedule D (as so modified). |
3.8.4 | The “Step-out Payment Amount” shall equal the sum of the following items (without duplication), as determined by Aron in a commercially reasonable manner: |
3.8.5 | The Parties acknowledge that Aron may not be able to definitively determine one or more of the components of the Step-out Payment Amount by the Step-out Date (provided, however, that Aron shall use its commercially reasonable efforts to determine all such components by the Step-out Date to the maximum extent practicable) and therefore agree in such event that Aron shall, in a commercially reasonable manner, estimate each of such components and use such estimated components to determine an estimate of the Step-out Payment Amount (the “Estimated Step-out Payment Amount”). Without limiting the generality of the foregoing, the Parties agree that the estimated amount with respect to clause (i) of Section 3.8.4 shall be the Estimated Step-out Inventory Purchase Price. Aron shall prepare, and provide DCR with, a statement of the Estimated Step-out Payment Amount, together with appropriate supporting documentation, at least two Business Days prior to the Step-out Date. Aron shall update its calculation of the Estimated Step-out Payment Amount by no later than 5:00 p.m. EPT on the Business Day immediately preceding the Step-out Date. If Aron is able to provide such updated amount by such time, that amount shall constitute the Estimated Step-out Payment Amount and shall be due and payable by no later than 5:00 p.m. EPT on the Step-out Date. Otherwise, the initial Estimated Step-out Payment Amount shall be the amount payable by such time on the Step-out Date. |
3.8.6 | No later than 30 days after the Step-out Date, Aron shall prepare, and provide DCR with, (i) a statement showing the calculation, as of the Step-out Date, of the Step-out Payment Amount and (ii) a statement (the “Step-out Reconciliation Statement”) reconciling the Step-out Payment Amount with the Estimated Step-out Payment Amount and indicating any amount remaining to be paid by one Party to the other as a result of such reconciliation. Within three Business Days after receiving the Step-out Reconciliation Statement and the related supporting documentation, the Parties will make any and all payments required pursuant thereto so that the Step-out Payment Amount shall have been paid in full by wire transfer of immediately available funds. |
3.8.7 | DCR agrees to pay Aron, only if this Agreement is terminated in its entirety pursuant to Section 2.3 on or prior to July 1, 2014 at 11:59:59 p.m. EPT (to the extent applicable under Section 2.3), an amount equal to the product of: (a) the amount calculated as the sum of, for each Product |
3.8.8 | DCR agrees to pay Aron, only if this Agreement is terminated in its entirety pursuant to Section 2.4 on or prior to July 1, 2015 at 11:59:59 p.m. EPT, but after July 1, 2014 at 11:59:59 p.m. EPT (to the extent applicable under Section 2.4), an amount equal to the product of: (a) the amount calculated as the sum of, for each Product Group, the product of (i) the Actual Step-out Inventory Product Benchmark and (ii) the Maximum Inventory, (b) the Early Termination Margin and (c) a fraction, the numerator of which is the number of days between the date of such early termination and July 1, 2015 and the denominator of which is 365 (the “Early Termination Fee”). |
3.8.9 | Notwithstanding anything herein to the contrary (including Section 1.2), it is agreed that the final month of the Term hereof (including if occurring upon an early termination of this Agreement pursuant to Section 2.3 or 2.4) shall be a “long” month consisting of a calendar month and the first day of the immediately following calendar month (and that if the operation of such provisions would result in a termination of this Agreement on a day that is not a Business Day then notwithstanding anything herein to the contrary, the effective date of any such termination shall occur on the next Business Day). |
3.9 | Disputes. If a Party in good faith disputes the accuracy of any amount calculated pursuant to this Section 3, the non-calculating Party shall provide written notice stating the reasons why the remaining disputed amount is incorrect, along with reasonable supporting documentation. In the event the Parties are unable to resolve such dispute, the matter shall be resolved in accordance with Section 22. |
4. | TARGET PRODUCT INVENTORY LEVELS; APPLICABLE SPREADS |
4.1 | Target Product Inventory. Subject to Section 4.2, in connection with establishing the Target Product Inventory for each Product Group, the Parties agree to follow the procedures set forth on Schedule F. |
4.2 | Initial Targets. No later than 5:00 p.m. EPT on Thursday, June 27, 2013, DCR shall deliver a written statement of the initial Target Product Inventory for each Product Group for the month of July 2013 (notwithstanding anything in Schedule F to the contrary). |
4.3 | Differentials. |
(a) | No later than 5:00 p.m. EPT on Friday, June 28, 2013, DCR shall deliver to Aron a statement listing the initial Differentials to be used hereunder as of |
(b) | Prior to the second to last Business Day of each month, DCR and Aron shall discuss whether to adjust any of the Differentials and, if either Party believes an adjustment is appropriate, the Parties shall negotiate in good faith and in a commercially reasonable manner to agree on such adjusted Differentials. If any such adjusted Differentials are agreed to by the second to last Business Day of such month, the Parties will promptly confirm such agreement in writing, and such adjusted Differential shall become applicable for purposes of determining the Product Benchmarks starting with the immediately following month. The Parties acknowledge that each such agreement to adjust the Differentials shall apply only prospectively starting in the following month and that successive adjustments may be made, in each case with the most recent adjustment superseding any prior adjustment on a going forward basis. |
(c) | Each time the Parties agree to adjusted Differentials, Aron shall determine the Differential Adjustment Amount as provided on Schedule G and such amount shall be included in the Aggregate Monthly Product True-Up Amount that is incorporated into the Monthly True-Up Payment in the immediately following month. |
4.4 | Hedging Activities. Any hedges, swaps, options, positions or any other instruments or strategies executed by either Party related in any way to the Products, shall be for the relevant Party’s own account (including with regard to the Aron Hedges, which shall be for Aron’s own account), and any Taxes and/or Liabilities incurred, directly or indirectly resulting from such activities, shall be borne exclusively by such relevant Party (provided that the foregoing shall not affect the treatment of Specified Unwind Costs pursuant to the express terms and conditions of Section 3.8 or 18). |
5. | ADDITIONAL INCLUDED LOCATIONS |
5.1 | From time to time after the Commencement Date, DCR may notify Aron that DCR wishes to add a third-party storage location as an Included Location for purposes of this Agreement. Following such notification, Aron shall promptly undertake a due diligence review of the proposed Included Location to reasonably determine whether Aron is prepared to hold Product inventory at such proposed Included Location. Aron shall be under no further obligation with respect to such proposed Included Location if Aron reasonably determines that, based on such due diligence review, it is not prepared to hold Product inventory at such proposed Included Location. Aron |
5.2 | If Aron advises DCR that Aron is prepared to hold Product inventory at such proposed Included Location, then DCR may endeavor to negotiate and implement Required Storage Arrangements pursuant to which DCR may transfer and assign to Aron DCR’s (and/or its Affiliates’) right to use the proposed Included Location; provided that (a) upon and concurrently with implementing any Required Storage Arrangement, the Parties shall execute such amendments to this Agreement and/or the Exhibits and/or Schedules hereto as are necessary or appropriate to add such proposed Included Location as an Included Location hereunder, (b) to the extent requested by Aron, the Parties shall amend any other applicable Transaction Document to include any inventory transferred to Aron as a result of such assignment, designation or arrangement and (c) no change shall occur in the Minimum Inventory or the Maximum Inventory in connection with the implementation of such Required Storage Arrangements unless agreed to by Aron. Notwithstanding anything to the contrary in this Section 5.2, DCR shall nevertheless be free in its sole discretion to enter into storage agreements with third parties, provided such storage agreements are not at a location that is an Included Location. |
5.3 | The Parties will cooperate in good faith with regard to the negotiation, preparation and execution of any Required Storage Arrangements upon commercially reasonable terms, in form and substance reasonably satisfactory to both Parties. |
5.4 | If any Required Storage Arrangements are entered into in connection with additional Included Locations and, thereafter, DCR shall materially fail to (i) perform its obligations under, (ii) comply with or (iii) maintain such Required Storage Arrangements in effect; provided, in each case that if DCR fails to cure any such failure within three Business Days after receiving written notice thereof from Aron, then Aron may, in its reasonable discretion, require that such location be removed from the Included Locations and that DCR at the time such location is removed purchase all Aron Inventory then located at such location on terms comparable to those that apply to a termination of this Agreement under Section 3.8. |
6. | PRODUCT SALES & REPORTING |
6.1 | Products Sales to Aron by DCR. Aron agrees to purchase from DCR, and DCR agrees to sell to Aron, the Products produced by the Refinery or delivered to the Refinery, and delivered by DCR into the Included Locations at the prices determined pursuant to this Agreement and otherwise in accordance with the terms and conditions of this Agreement (in each case, other than with regard to any Excess Quantities); provided that (i) Aron shall not be obligated at any time to purchase Products from DCR if such purchase would result in Aron owning Products in any Product Group in the Included Locations in excess of the Maximum Inventory for such Product Group specified on Schedule E (as such Maximum Inventory is adjusted |
6.2 | Products Sales to DCR by Aron. DCR agrees to purchase from Aron, and Aron agrees to sell to DCR, the Products delivered out of the Included Locations at the prices determined pursuant to this Agreement and otherwise in accordance with the terms and conditions of this Agreement; provided that DCR agrees that its purchases and receipt of Products from Aron shall be in sufficient quantities so that Aron shall, at all times during the Term, have available storage capacity in the Included Locations to take delivery of any Products to be sold by DCR to Aron pursuant to Section 6.1. |
6.3 | Daily Report of Inventory Volumes. On or prior to 5:00 p.m. EPT on each Business Day, DCR shall deliver to Aron a report, in the form provided on Exhibit 3, setting forth a good faith estimate of the volumes of each Product (the “Inventory Volumes”) held in the Included Locations as of 11:59:59 p.m. EPT on the immediately prior Business Day and any prior, non-reported days (including holidays and weekends), including the total Aron Inventory levels as to each grade of Product, in each case based on the best available information, by applying the Volume Determination Procedures, together with comparable information with respect to any then-existing Commingled Quantities and/or Excluded Third Party Inventories, any Tanks which pursuant to Section 6.4.5 are not then Included Locations and any Tanks which pursuant to Section 9 have been substituted for other Tanks (the “Daily Report of Inventory Volumes”). |
6.4 | Excess Inventory Levels. |
6.4.1 | If DCR intends to designate an Excess Inventory Level for any whole or partial month for any Product Group, then DCR shall use commercially reasonable efforts to notify Aron of DCR’s intention prior to the Target Cutoff Date for such whole or partial month. If DCR fails to provide such notice in a timely manner, it shall not be entitled for that whole or partial month to designate an Excess Inventory Level for the relevant Product Group and Sections 6.4.4 and 6.4.5 shall apply. |
6.4.2 | If, pursuant to Section 6.4.1, DCR provides timely notice of its intention to designate an Excess Inventory Level for a Product Group, then Aron shall promptly advise DCR whether Aron accepts such Excess Inventory Level (in which case Section 6.4.3 shall apply) or rejects such Excess Inventory Level (in which case Section 6.4.4 and 6.4.5 shall apply). |
6.4.3 | If Aron accepts an Excess Inventory Level for any whole or partial month, then, for all purposes of this Agreement, such Excess Inventory Level shall constitute the Maximum Inventory for the relevant Product Group for such whole or partial month; provided that such Excess Inventory Level shall not apply to any other whole or partial month unless expressly |
6.4.4 | If Aron rejects an Excess Inventory Level for any whole or partial month or DCR fails to provide notice to Aron of its intention to designate an Excess Inventory Level in a timely manner for any whole or partial month, then the following provisions shall apply: |
(a) | DCR shall identify to Aron which Tanks holding Aron Inventory will also hold Commingled Quantities; and |
(b) | DCR shall, to the extent practicable and commercially reasonable, endeavor to use smaller capacity Tanks before larger capacity Tanks to hold Commingled Quantities. |
6.4.5 | In the event that DCR determines, in its reasonable discretion, that it does not wish to designate an Excess Inventory Level for a particular Product Group (or the applicable time for such designation pursuant to Section 6.4.1 has passed) during a whole or partial month and that the Maximum Inventory for such whole or partial month would otherwise be exceeded, then the following provisions shall apply: |
6.5 | Purchase Price of Products. The purchase price payable by Aron for any Product sold to it under Section 6.1 and by DCR for any Product sold to it under Section 6.2 shall be such prices as are established pursuant to Section 12.1 and as further adjusted pursuant to Section 12.5. |
6.6 | Ancillary Costs. DCR agrees to reimburse Aron for all Ancillary Costs incurred by Aron, subject to the provisions of this Section 6.6. Aron may demand such reimbursement from time to time and payment will be due as set forth in Section 12.5.2 after delivery to DCR of the relevant Backup Certificate. All refunds or adjustments of any type received by Aron related to any Ancillary Costs shall be reflected in the Monthly True-Up Payment as provided in Section 12.5 below. Upon requesting reimbursement for Ancillary Costs, Aron will deliver to DCR an officer’s |
7. | PRODUCT SPECIFICATIONS, QUALITY & BLENDING |
7.1 | Specifications. The Products sold and delivered to Aron shall generally conform to the typical properties set forth for each grade of Product listed on Schedule A, as amended by the Parties by mutual written agreement from time to time. |
7.2 | Blending of Products at the Refinery. In its role as a “fuel manufacturer” and a “refiner” (as such terms are defined under 40 C.F.R. Part 79 and Part 80) DCR shall be responsible for: (i) registering the Products and the Refinery with the EPA, (ii) designating all of the volumes of Products that it may produce by refining and/or blending in accordance with EPA requirements, (iii) testing and certifying Product batches in accordance with EPA requirements, (iv) compliance with all applicable EPA recordkeeping and reporting requirements, (v) properly administering the product transfer document requirements of the EPA, (vi) meeting the renewable volume obligation compliance requirements as required under the RFS2 program and (vii) any and all other “fuel manufacturer” and “refiner” requirements set forth by the EPA under 40 C.F.R. Part 79 and Part 80. In all cases and for all Products, DCR shall be solely entitled to all “renewable identification numbers” or “RINs” applicable to or associated with all Products under this Agreement. |
8. | TITLE, RISK OF LOSS & CUSTODY |
8.1 | Transfer of Title. |
8.1.1 | Title to Products purchased by Aron pursuant to the terms of this Agreement shall pass from DCR to Aron as the Product passes the inlet flange of the Tank (including tanks at any other Included Locations added to the scope of this Agreement after the Commencement Date pursuant to Section 5) to which such Products are being delivered. All Products shall be delivered by DCR, at DCR’s cost, to Aron into the Tanks (including tanks at any other Included Locations added to the scope of this Agreement after the Commencement Date pursuant to Section 5). |
8.1.2 | Title to Products purchased by DCR pursuant to the terms of this Agreement shall pass from Aron to DCR as the Products pass the outlet flange of the Tank (including tanks at any other Included Locations added to the scope of this Agreement after the Commencement Date pursuant to Section 5) from which such Products are being delivered. Provided no Event of Default has occurred and is continuing with respect to DCR, DCR shall be permitted to withdraw from the Tanks (including tanks at any other Included Locations added to the scope of this Agreement after |
8.2 | Ownership. Aron shall own and have title to all of the Aron Inventory stored in the Included Locations (it being agreed and acknowledged that (i) Excess Quantities do not constitute Aron Inventory and (ii) upon DCR purchasing any Aron Inventory pursuant to Section 6.4.5, such quantities shall not constitute Aron Inventory unless and until the quantities in the affected Tanks are repurchased by Aron pursuant to Section 6.4.5). DCR, for itself and on behalf of its Affiliates, fully acknowledges Aron’s title to and interest in the Aron Inventory and further represents and warrants that neither it nor any of its Affiliates shall have any Lien on the Aron Inventory and waives any Lien held by it (if any) in the Aron Inventory. |
8.3 | Transfer of Custody. DCR shall maintain custody of all Products owned by Aron pursuant to the terms of this Agreement and shall be responsible for maintaining the insurance required of DCR pursuant to Section 15. DCR shall hold all Aron Inventory in the Included Locations solely as bailee. During the Term, neither DCR nor any of its Affiliates shall (and DCR shall not permit any of its Affiliates or any other person to) use any Aron Inventory for any purpose except as may be permitted by this Agreement. Solely in its capacity as bailee, DCR shall have custody of Aron Inventory from the time such Aron Inventory passes the inlet flange of the Tanks (including tanks at the Included Locations) until such time as such Aron Inventory passes the outlet flange of the Tanks (including tanks at the Included Locations). |
8.4 | Refinery Operations. At all times DCR shall have and retain complete control of the Refinery and its maintenance and operations, including utilization or maintenance of Tanks. |
9. | STORAGE |
9.1 | Services. DCR hereby undertakes the following obligations with respect to the Services to be provided by DCR under this Agreement, for and in consideration of the mutual covenants and undertakings set forth in this Agreement: |
9.1.1 | It agrees, in accordance with the terms and conditions of this Agreement, to provide to Aron the Services at the Refinery and the Tanks. |
9.1.2 | It shall comply with all Applicable Laws and any applicable safety guidelines, procedures or policies in connection with operations at the Refinery and the Tanks. |
9.1.3 | It shall maintain the Tanks in accordance with Accepted Industry Practice. |
9.2 | Tanks. DCR shall make available to Aron all of DCR’s and its Affiliates’ rights to use the Tanks for the Term of this Agreement to store the Aron Inventory sold by DCR to Aron pursuant to this Agreement. Aron may only store Aron Inventory in the Tanks that has been purchased from DCR pursuant to this Agreement. Notwithstanding anything in this Agreement to the contrary, DCR, as the owner and the operator of the Tanks and the Refinery, retains the right to manage the utilization of the Tanks (including by removing from service, changing the type of Product service of, or otherwise replacing or substituting with alternate tankage, any of the Tanks listed on Schedule B), in its sole discretion and in accordance with Accepted Industry Practice; provided that such utilization management activities by DCR do not prejudice Aron’s rights to the Aron Inventory hereunder and that the use of any alternate tankage shall be covered by all of the terms and conditions of this Agreement. |
9.3 | No Commingling. Except (i) to the extent permitted in accordance with Section 6, or (ii) in the event that a Change in Law occurs whereby any Governmental Authority has the right to purchase Products in the Tanks and/or to create or hold Liens in any such Products in the Tanks, or otherwise becomes entitled to exercise rights or powers substantially equivalent to the foregoing, DCR shall not store any Products owned by DCR or any of its Affiliates or a third party in any Tank without Aron’s prior written consent. Aron agrees that DCR may commingle Products only in the circumstances and subject to the terms and conditions described and referenced in this Section 9.3. |
9.4 | Receipts Into and Deliveries Out of the Included Locations. From and after the Commencement Date, (i) Aron shall accept and receive Products delivered by DCR to Aron into the Included Locations in connection with each sale by DCR to Aron pursuant to this Agreement and (ii) DCR shall withdraw Products from the Included Locations in connection with each sale by Aron to DCR pursuant to this Agreement. |
9.5 | Measurement. The quantity and quality of Products received into and delivered from the Included Locations, as well the quantity and quality of Aron Inventory in the Included Locations at any given time, shall be determined by applying the Volume Determination Procedures in accordance with the latest established API/ASTM standards, or other mutually agreed to specifications, and shall include tank heels and working inventory. All volumes shall be temperature corrected to 60° Fahrenheit in accordance with the latest supplement or amendment to the appropriate ASTM-IP Petroleum Measurement Tables. DCR shall calibrate the Tanks as needed and verify the accuracy of the sampling and measurement equipment at the Refinery pursuant to applicable standards set by the API/ASTM, including the latest revisions thereto. |
9.6 | Aron Inventory. DCR shall be liable for contamination of the Aron Inventory, unless such contamination is due to Aron’s or its representative’s negligence or willful misconduct. As to contamination to the Aron Inventory for which DCR is liable |
9.7 | Condition and Maintenance of Tanks. |
9.7.1 | The execution of this Agreement by the Parties does not impose any obligation or responsibility on Aron in connection with: (i) any existing or future environmental condition at the Refinery, the Tanks and/or any related facilities (collectively, the “Facility”), including the presence of a regulated or hazardous substance on or in environment media at the Facility (including the presence in surface water, groundwater, soils or subsurface strata or air), including the subsequent migration of any such substance; (ii) any Environmental Law; (iii) the Required Permits; or (iv) any requirements arising under or relating to any Applicable Law pertaining or relating to the operation of the Facility, except to the extent of any Liabilities that are caused by the negligence or misconduct of Aron or its Representatives or are otherwise within the scope of Aron’s indemnification obligations under Sections 19.2 or 21.2, inclusive of when any Representatives of Aron are present at the Facility and cause a release or other event. |
9.7.2 | Products may require the application of heat or steam by DCR to maintain the same in a liquid free-flowing or pumpable state; DCR agrees to provide such required heat at DCR’s expense. Recalibration, or strapping, of the Tanks may be performed from time to time in accordance with the terms of this Agreement. In the event that recalibration of meters, gauges or other measurement equipment is reasonably requested by Aron consistent with Accepted Industry Practice such as “strapping,” the Parties shall select a mutually agreeable U.S. Customs & Border Protection bonded, ISO-accredited independent petroleum inspection company to conduct such recalibration and Aron shall bear all costs associated therewith. |
9.7.3 | DCR may clean the Tanks during the Term of this Agreement for the following reasons: to perform maintenance, to perform inspections, in case of an emergency, to ensure product quality or as DCR otherwise deems appropriate in accordance with Accepted Industry Practice. In the event of Tank cleaning pursuant to this Section 9.7.3, DCR shall be responsible for the full cost of removing the Aron Inventory, cleaning the Tanks and disposing of any contaminants. DCR may identify substitute tank(s) for Aron during such time that a Tank is unavailable due to Tank |
9.8 | Certain Covenants Relating to Storage. |
9.8.1 | DCR agrees: |
9.8.2 | Each Party agrees that it shall, in the performance of its obligations under this Agreement, comply in all material respects with Applicable Law, including all Environmental Laws. Each Party shall maintain the records required to be maintained by Environmental Law and shall make such records available to the other Parties upon their reasonable request. Each Party also shall promptly notify the other Parties of any material violation or alleged material violation of any Environmental Law relating to any Products stored under this Agreement and, upon request, shall provide to the other Parties all evidence of environmental inspections or audits by any Governmental Authority with respect to such Products. |
10. | CERTAIN REPRESENTATIONS |
10.1 | The Parties intend that: |
10.1.1 | each purchase and sale of Product between them, whether or not further documented, shall constitute a “forward contract” under section 101(25) and a “commodity forward agreement” as such term is used in clause (A)(i)(VIII) of the definition of “swap agreement” under section 101(53B) of the Bankruptcy Code, protected by, inter alia, section 556 and section 560 of the Bankruptcy Code, and that it will be treated as such under and in all proceedings related to any bankruptcy, insolvency or similar law |
10.1.2 | as a result of the foregoing, (i) the Performing Party’s right to liquidate, collect, net and set off rights and obligations under this Agreement and liquidate and terminate this Agreement shall not be stayed, avoided or otherwise limited by the Bankruptcy Code, including sections 362(a), 547, 548 or 553 thereof; (ii) the Performing Party shall be entitled to the rights, remedies and protections afforded by and under, among other sections, sections 362(b)(6), 362(b)(17), 362(b)(27), 362(o), 546(e), 546(g), 546(j), 548(d), 553, 556, 560, 561 and 562 of the Bankruptcy Code; and (iii) any cash, securities or other property provided as performance assurance, credit support or collateral with respect to the transactions contemplated hereby shall constitute “margin payments” as defined in section 101(38) of the Bankruptcy Code and all payments for, under or in connection with the transactions contemplated hereby shall constitute “settlement payments” as defined in section 101(51A) of the Bankruptcy Code; and |
10.1.3 | this Agreement and each transaction between the Parties hereunder constitutes a “master netting agreement” under section 101(38A) of the Bankruptcy Code; and that the rights in Section 18 hereto include the rights referred to in section 561(a) of the Bankruptcy Code. |
10.2 | Single Agreement. This Agreement and all transactions hereunder form a single integrated agreement between the Parties. |
11. | WARRANTIES |
11.1 | Warranties of Title. |
11.1.1 | DCR warrants that on the Commencement Date it shall transfer, or cause to be transferred, to Aron good and marketable title to the Initial Inventory free and clear of any Liens (other than inchoate tax Liens and/or as contemplated in the Intercreditor Agreement), and that it has full right and authority to transfer such title and effect delivery of such Initial Inventory to Aron. |
11.1.2 | Each Party represents and warrants to the other Party that, as of each date of delivery of Products sold hereunder to the other Party, it has good and marketable title to the Products sold and delivered pursuant to this Agreement, free and clear of any Liens (other than inchoate tax Liens) or as contemplated in the Intercreditor Agreement, and that it has full right and authority to transfer such title and effect delivery of such Products. |
11.2 | Disclaimer of Warranties. EXCEPT FOR THE WARRANTY OF TITLE, THE PARTY SELLING PRODUCT HEREUNDER MAKES NO WARRANTY, CONDITION OR OTHER REPRESENTATION, WRITTEN OR ORAL, EXPRESS OR IMPLIED, OF MERCHANTABILITY, FITNESS OR SUITABILITY OF THE PRODUCT FOR ANY PARTICULAR PURPOSE OR OTHERWISE. |
12. | PRICING & PAYMENT |
12.1 | Interim Payment and Netting. |
12.1.1 | For each Production Week, Aron shall provide DCR with a net settlement statement setting forth: |
(1) | Using the Daily Report of Inventory Volumes provided by DCR, Aron will calculate the “Daily Net Volume” for all Aron Inventory at the Included Locations as follows: the Inventory Volumes for the prior reported day minus the Inventory Volumes for such day. The “Weekly Net Volume” shall be equal to the sum of the Daily Net Volumes by Product Group for each day in the Production Week. |
(2) | For each Product Group, the “Weekly Product Value” shall be an amount equal to (a) the Weekly Net Volume for such Product Group multiplied by (b) the applicable Weekly Product Benchmark for such Product Group. |
12.1.2 | On or before 2:00 p.m. EPT on each applicable “Invoice Date” set forth on Schedule I, Aron shall provide DCR with a statement setting forth: |
12.1.3 | The Party owing the Interim Net Payment Amount shall pay such amount to the other Party on or prior to the applicable “Payment Date” set forth on Schedule I, subject to Section 12.3; provided, however, that if such payment is due from DCR to Aron and Aron failed to deliver the statement required pursuant to Section 12.1.2 by 2:00 p.m. EPT on the applicable “Invoice Date” set forth on Schedule I, then such Interim Net Payment Amount shall not be due and payable until the next Business Day following the applicable “Payment Date” set forth on Schedule I. |
12.2 | Payments. Unless otherwise set forth herein, all payments to be made under this Agreement shall be made by wire transfer of same day funds in U.S. Dollars to such bank account at such bank as the payee shall designate in writing to the payor from time to time. All payments shall be deemed received on the Business Day on which same day funds therefor are received by the payee. Payments received after any applicable time set forth in this Agreement on any Business Day or on a day that is not a Business Day shall be deemed to have been received on the following Business Day. Except as otherwise expressly provided in this Agreement, all payments by DCR or Aron shall be made in full without discount, offset, withholding, counterclaim or deduction whatsoever for any claims which one Party may now have or hereafter acquire against the other Party, whether pursuant to the terms of this Agreement or otherwise, except as expressly provided herein. |
12.3 | Disputed Invoices. If an invoiced Party in good faith disputes the accuracy of the amount invoiced, the invoiced Party shall pay such amount as it in good faith believes to be correct and provide written notice stating the reasons why the remaining disputed amount is incorrect, along with supporting documentation. In the event the Parties are unable to resolve such dispute, the matter shall be resolved in accordance with Section 22. |
12.4 | Interest on Late Payments. Interest shall accrue on late payments under this Agreement at the lesser of (i) LIBOR plus the sum of 2.00% and the Applicable Margin and (ii) the maximum rate of interest per annum permitted by Applicable Law, from and including the date that payment is due until but excluding the date that payment is actually received by the Party to whom it is payable. |
12.5 | Monthly True-Up Payment. Aron shall use commercially reasonable efforts to provide to DCR, on the applicable “True Up Date” set forth on Schedule I, the Monthly True-Up Statement, showing the net true up amount due from one Party to the other Party (the “Monthly True-Up Payment”), and including the following amounts (without duplication): |
12.5.1 | the Aggregate Monthly Product True-Up Amount; plus |
12.5.2 | the Ancillary Costs for such month not otherwise paid or satisfied hereunder pursuant to Section 6.6, and as evidenced in the relevant Backup Certificate; and plus or minus, as applicable, |
12.5.3 | any other adjustments to amounts payable by one Party to the other Party pursuant to this Agreement. |
12.6 | Monthly True-Up Invoicing and Payment. If the amount of the Monthly True-Up Payment is a positive number, such amount shall be due from DCR to Aron, and if the amount of the Monthly True-Up Payment is a negative number, then the absolute value thereof shall be due from Aron to DCR. The Party owing the Monthly True-Up Payment shall pay such amount as shown on the Monthly True-Up Statement to the other Party on or prior to 5:00 p.m. EPT on the second Business Day following Aron’s delivery to DCR of the Monthly True-Up Statement and all related supporting documentation, subject to Section 12.3. |
13. | FINANCIAL INFORMATION; NOTIFICATIONS; CREDIT SUPPORT |
13.1 | Provision of Financial Information. DCR shall provide Aron, and Aron shall provide to DCR, (i) within 120 days following the end of each of its fiscal years, (a) a copy of the annual report, containing audited consolidated financial statements of PBFH or Aron, as applicable, and its consolidated subsidiaries for such fiscal year certified by independent certified public accountants and (b) the balance sheet, statement of income and statement of cash flow of PBFH or Aron, as applicable, for such fiscal year, as reviewed by PBFH’s or Aron’s, as applicable, independent certified public accountants, and (ii) within 90 days after the end of its first three fiscal quarters of each fiscal year, a copy of the quarterly report, containing unaudited consolidated financial statements of PBFH or Aron, as applicable, and its consolidated subsidiaries for such fiscal quarter; provided that so long as PBF or The Goldman Sachs Group, Inc., as applicable, is required to make public filings of its quarterly (on form 10-Q) and annual (on form 10-K) financial results pursuant to the Exchange Act, such filings are available on the SEC’s EDGAR database and such filings are made in a timely manner, then DCR or Aron, as applicable, will not be required to provide such annual or quarterly financial reports to the other Party. |
13.2 | Additional Information. Upon reasonable notice, DCR shall provide to Aron, and Aron shall provide to DCR, such additional information as Aron or DCR, as |
13.3 | Notifications. Each Party shall notify the other Party in writing within two Business Days of learning of any of the following events: |
13.3.1 | any Event of Default or Additional Termination Event, specifying the nature and extent thereof and the corrective action (if any) taken or proposed to be taken with respect thereto; |
13.3.2 | any event that is reasonably expected to be a Material Adverse Change with respect to such party; |
13.3.3 | it or its Guarantor consolidates or amalgamates with, merges with or into, or transfers all or substantially all of its assets to another person; and |
13.3.4 | in the case of DCR, |
13.4 | Credit Support Guaranties. |
13.4.1 | As security for the prompt payment and performance in full when due of Aron’s obligations under this Agreement, Aron shall cause its Guarantor to (i) deliver to DCR prior to the Commencement Date its Guaranty in form and substance reasonably acceptable to DCR and (ii) maintain such Guaranty in effect for the Term hereof. |
13.4.2 | As security for the prompt payment and performance in full when due of DCR’s obligations under this Agreement, DCR shall cause its Guarantor to (i) deliver to Aron prior to the Commencement Date its Guaranty in form and substance reasonably acceptable to Aron and (ii) maintain such Guaranty in effect for the Term hereof. |
13.5 | Back-up Security Interest. The Parties intend that the transactions contemplated by this Agreement constitute purchase and sale transactions. If, notwithstanding the intent of the Parties, such transactions are deemed to constitute loans, then DCR shall be deemed to have pledged and granted to Aron, a first priority lien and security interest in all quantities of Product intended to constitute Aron Inventory hereunder and all proceeds thereof as security for the performance of all of DCR’s obligations and liabilities hereunder, and any UCC filings by Aron with respect to such quantities of Product shall serve to perfect such pledge and security interest. However, the filing of any UCC financing statements made pursuant to this Agreement shall in no way be construed as being contrary to the intent of the Parties that the transactions contemplated by this Agreement be treated as purchase and sale transactions. |
13.6 | Adequate Assurances. |
13.6.1 | Aron may, in its reasonable discretion and upon written notice to DCR, require that PBFH provide it with satisfactory security for or adequate assurance of its or its Guarantor’s performance within a specified time period as appropriate (but not less than two Business Days from delivery of such notice), when a Material Adverse Change has occurred as with respect to DCR or its Guarantor. |
13.6.2 | DCR may, in its reasonable discretion and upon notice to Aron, require that Aron provide it with satisfactory security for or adequate assurance of its or its Guarantor’s performance within a specified time period as appropriate (but not less than two Business Days from delivery of such notice), when a Material Adverse Change has occurred as with respect to Aron or its Guarantor. |
13.6.3 | DCR or Aron, as applicable, shall provide performance assurance to DCR or Aron, as applicable, on or prior to the second Business Day following written demand therefor in the form of Acceptable Credit Support. The performance assurance provided by DCR or Aron, as applicable, shall be for a reasonable duration and in an amount reasonably sufficient to cover a value up to DCR’s or Aron’s, as applicable, good faith estimated financial exposure under this Agreement. If performance assurance is provided in the form of a letter of credit, such letter of credit shall be issued by an Acceptable Letter of Credit Issuer and shall be in a form reasonably acceptable to DCR or Aron, as applicable, in the exercise of its good faith, reasonable discretion. All bank charges relating to any letter of credit and any fees, commissions, costs and expenses incurred with respect to furnishing security are for the account of DCR or Aron, as applicable. |
13.7 | Further Assurances. Each Party agrees, at any time and from time to time upon the request of the other Party, to execute, deliver and acknowledge, or cause to be executed, delivered and acknowledged, such further documents and instruments and |
14. | TAXES |
14.1 | Taxes. |
14.1.1 | Each Party represents that it is registered, and covenants that it will continue to be so registered, with the Internal Revenue Service and the Delaware Department of Transportation and the Delaware Division of Revenue to engage in tax-free transactions with respect to Products. Prior to the date of delivery of Products hereunder each Party shall provide to the other Party proper notification, exemption, motor fuel licenses or resale certificates or direct pay permits as may be required or permitted by Applicable Law. If a Party does not furnish such certificates and licenses to the other Party or if the transaction is subject to Tax under Applicable Law because no exemption exists, the applicable Party shall reimburse and indemnify the other Party for all Taxes that the other Party remits to a Governmental Authority or that are incurred by that Party, together with all penalties and interest thereon. |
14.2 | Each Party acknowledges and agrees that it will be solely responsible for any Excluded Taxes owed by it or any similar taxes such as gross earnings, gross receipts or similar taxes that are based upon gross receipts, gross earnings or gross revenues. Each Party hereby irrevocably waives and releases the other Party from, and agrees not to assert any reimbursement or other indemnification claims against the other party with respect to, any Liabilities (including pursuant to Section 19) with respect to the imposition or incurrence of any Excluded Taxes (including any such gross receipt taxes pursuant to Title 30 of the Delaware Code as in effect from time to time). |
14.3 | Any other provision of this Agreement to the contrary notwithstanding, this Section 14 shall survive until 90 days after the expiration of the statute of limitations for the assessment, collection and levy of any Tax. |
15. | INSURANCE |
15.1 | Insurance Required to be provided by DCR. DCR, directly or through an Affiliate, shall procure and maintain in full force and effect throughout the Term insurance |
15.1.1 | property damage coverage on an “all risk” basis in an amount sufficient to cover the market value or potential full replacement cost of all of the Aron Inventory. Such insurance shall be endorsed to include Aron as loss payee with respect to the Aron Inventory. Notwithstanding anything to the contrary herein, Aron may, at its option and expense, endeavor to procure and provide such property damage coverage for the Products; provided that to the extent any such insurance is duplicative with insurance procured by DCR, the insurance procured by DCR shall in all cases represent, and be written to be, the primary coverage. |
15.1.2 | Workers Compensation coverage in compliance with Applicable Laws; |
15.1.3 | automobile liability coverage in a minimum amount of $1,000,000; and |
15.1.4 | comprehensive or commercial general liability coverage and umbrella or excess liability coverage, which includes bodily injury, broad form property damage, contractual liability, products/completed operations liability, sudden and accidental pollution liability coverages, in a minimum amount of $300,000,000 per occurrence and in the aggregate. Such policies shall include Aron as an additional insured. |
15.2 | Additional Insurance Requirements. |
15.2.1 | DCR shall cause its insurance carriers to furnish insurance certificates to Aron, in a form reasonably satisfactory to Aron, evidencing the existence of the coverages required pursuant to Section 15.1. The certificate shall specify that the insurer will endeavor to mail 30 days’ written notice prior to cancelation of insurance becoming effective. Upon Aron’s request, DCR shall provide renewal certificates within 30 days of the expiration of the previous policy under which coverage is maintained. |
15.2.2 | The foregoing insurance in Section 15.1 shall include an endorsement indicating that the underwriters agree to waive all rights of subrogation against Aron. |
15.3 | Current Insurance. Schedule H sets forth DCR’s current applicable insurance coverages as of the Commencement Date. |
16. | FORCE MAJEURE |
16.1 | Neither Party shall be liable to the other Party if it is rendered unable by a Force Majeure Event to perform in whole or in part any obligation or condition of this |
16.2 | To the extent reasonably practicable, the affected Party rendered unable to perform shall give written notice to the other Party within 24 hours after receiving notice of the occurrence of a Force Majeure Event, including, to the extent feasible, the details and the expected duration of the Force Majeure Event and the volume of Product affected. Such Party also shall promptly notify the other when the Force Majeure Event has terminated. |
17. | REPRESENTATIONS, WARRANTIES & COVENANTS |
17.1 | Mutual Representations and Warranties. Each Party represents and warrants to the other Party as of the Effective Date, and shall be deemed to represent and warrant as of the date of any purchase of Product hereunder, that: |
17.1.1 | it is (i) an “eligible contract participant” as defined in the U.S. Commodity Exchange Act, as amended, and (ii) a “forward contract merchant” under section 101(26) and a “master netting agreement participant” under section 101(38B), for purposes of the Bankruptcy Code; |
17.1.2 | it is duly organized and validly existing under the laws of the jurisdiction of its organization or incorporation and, if relevant under such laws, in good standing, has the power to execute and deliver this Agreement and any other related documentation that it is required by this Agreement to deliver and to perform its obligations under this Agreement, and has taken all necessary action to authorize such execution, delivery and performance; |
17.1.3 | such execution, delivery and performance do not violate or conflict with, in any material respect, any Applicable Law, any provision of its constitutional documents or any order or judgment of any court or Governmental Authority; |
17.1.4 | all governmental and other authorizations, approvals, consents, notices and filings that are required to have been obtained or submitted by it with respect to this Agreement have been obtained or submitted and are in full force and effect; |
17.1.5 | its obligations under this Agreement constitute its legal, valid and binding obligations, enforceable in accordance with their respective terms (subject to applicable bankruptcy, reorganization, insolvency, moratorium or similar laws affecting creditors’ rights generally and subject, as to enforceability, to equitable principles of general application regardless of whether enforcement is sought in a proceeding in equity or at law); |
17.1.6 | no Termination Event has occurred and is continuing, and no such event or circumstance would occur as a result of its entering into or performing its obligations under this Agreement; |
17.1.7 | there is not pending, nor to its knowledge threatened against it, any action, suit or proceeding at law or in equity or before any court, tribunal, Governmental Authority, official or arbitrator that is likely to affect the legality, validity or enforceability against it of this Agreement or its ability to perform its obligations under this Agreement; |
17.1.8 | it has entered into the Transaction Documents and will enter into any transaction thereunder as principal (and not as advisor, agent, broker or in any other capacity, fiduciary or otherwise) and with a full understanding of the material terms and risks of the same, and has made its own independent decision to enter into the Transaction Documents and any transaction and as to whether the Transaction Documents and any transaction are appropriate or suitable for it based upon its own judgment and upon advice from such advisers as it has deemed necessary and not in reliance upon any view expressed by any other Party; |
17.1.9 | it is capable of assessing the merits of and understanding (on its own behalf or through independent professional advice) the Transaction Documents and any transaction, understands and accepts the terms, conditions and risks of the Transaction Documents and any transaction and is capable of assuming and assumes the risks of the Transaction Documents and any transactions contemplated thereunder; |
17.1.10 | it is not bound by any agreement that would preclude or hinder its execution, delivery or performance of any of the Transaction Documents; |
17.1.11 | neither it nor any of its Affiliates has been contacted by or negotiated with any finder, broker or other intermediary in connection with the sale of Product hereunder who is entitled to any compensation with respect thereto; and |
17.1.12 | none of its directors, officers, employees or agents or those of its Affiliates has received or will receive any commission, fee, rebate, gift or |
17.2 | Mutual Covenants. |
17.2.1 | Compliance with Applicable Laws. Each Party undertakes and covenants to the other Party that it shall comply in all material respects with all Applicable Laws, including all Environmental Laws, to which it may be subject in connection with the performance of any obligation or exercise of any rights under any of the Transaction Documents or in connection with any transaction contemplated by or undertaken pursuant to this Agreement. |
17.2.2 | Books and Records. All records or documents provided by any Party to the other Party shall, to the best knowledge of such Party, accurately and completely reflect the facts or estimates about the activities and transactions to which they relate. Each Party shall promptly notify the other Party if at any time such Party has reason to believe that any records or documents previously provided to the other Party no longer are materially accurate or complete. |
17.2.3 | Payments. All payments made under this Agreement shall be made in U.S. Dollars, the lawful currency of the United States. |
17.3 | DCR’s Representations and Covenants. |
17.3.1 | DCR represents and warrants that the Tanks have been maintained, repaired, inspected and serviced in accordance with Accepted Industry Practice and are generally in serviceable condition (normal wear and tear excepted) in all material respects. |
17.3.2 | DCR agrees that neither it nor any of its subsidiaries shall have any interest in or the right to dispose of, and shall not create or consent to the creation of any Liens with respect to, the Aron Inventory (it being acknowledged that (i) Excess Quantities do not constitute Aron Inventory and (ii) upon DCR purchasing any Aron Inventory pursuant to Section 6.4.5, such quantities shall not constitute Aron Inventory unless and until repurchased by Aron pursuant to Section 6.4.5). DCR authorizes Aron to file at any time and from time to time any UCC financing statements identifying the Aron Inventory subject to this Agreement and Aron’s ownership thereof and title thereto, and DCR shall execute and deliver to Aron, and DCR hereby authorizes Aron to file (with or without DCR’s signature), at any time and from time to time, all amendments to financing statements, assignments, continuation financing statements, termination statements and other documents and instruments, in form reasonably satisfactory to each of Aron and DCR, as Aron may reasonably request, |
17.3.3 | DCR agrees that it will not incur, create, assume or guaranty any Specified Indebtedness if, in connection with such incurrence, creation, assumption or guaranty or proposed incurrence, creation, assumption or guaranty of Specified Indebtedness, the ratings assigned to the 8.25% notes due 2020 issued by PBFH and certain Affiliates thereof are (or would be) lower than B2 (or its then-current equivalent) by Moody’s Investors Service, Inc. (or any successor rating agency thereto) and B (or its then-current equivalent) by Standard & Poor’s Ratings Service (or any successor rating agency thereto), as rated by both such rating agencies. |
17.4 | Acknowledgement. DCR and Aron each acknowledge and agree that (1) each is a merchant of crude oil and petroleum products and may, from time to time, be dealing with prospective counterparties, or pursuing trading or hedging strategies, in connection with aspects of their respective business that are unrelated hereto and that such dealings and such trading or hedging strategies may be different from or |
17.5 | Outside Activities. Each of DCR and Aron acknowledge and agree that (a) all of its respective Outside Activities are conducted at its sole discretion and solely for its own account, (b) as a consequence, each shall solely be responsible to retain and pay, discharge and perform as and when due all Liabilities with respect to its own respective Outside Activities and (c) to the fullest extent permitted by Applicable Law, it shall defend, indemnify and hold harmless the other Party and its Affiliates from and against any Liabilities incurred by such other Party or its Affiliates as a result of or related to such first Party’s respective Outside Activities. |
18. | TERMINATION EVENTS, DEFAULT & EARLY TERMINATION |
18.1 | Events of Default. Notwithstanding any other provision of this Agreement, the occurrence and continuance of any of the following events or circumstances shall constitute an “Event of Default”: |
18.1.1 | A Party fails to make a payment when due and payable under this Agreement within two Business Days following receipt of a written demand for payment by the other Party. |
18.1.2 | A Party (or, if applicable, any Affiliate of such Party that is party to a Transaction Document) breaches any representation or warranty made or repeated, or deemed to have been made or repeated, by the Party in any material respect, or any representation or warranty proves to have been incorrect or misleading in any material respect when made or repeated or deemed to have been made or repeated under this Agreement or any Transaction Document; provided, however, that if such breach is curable, such breach is not cured to the reasonable satisfaction of the |
18.1.3 | Other than a default more specifically described in this Section 18.1, a Party (or, if applicable, any Affiliate of such Party that is party to a Transaction Document) fails to perform any material obligation or breaches a material covenant required under this Agreement or any Transaction Document, which, if capable of cure, is not cured to the reasonable satisfaction of the other Party (acting in good faith and in a commercially reasonable manner) within ten Business Days from the date that such Party receives written notice that corrective action is needed. |
18.1.4 | A Party or such Party’s Guarantor (or, in the case of DCR, PBF) becomes or is Bankrupt; |
18.1.5 | A Party’s Guarantor (i) fails to satisfy, perform or comply with any material obligation in accordance with its Guaranty in favor of the other Party (the “Receiving Party”) if such failure continues after any applicable grace or notice period, (ii) breaches any covenant or any representation or warranty proves to have been incorrect or misleading in any material respect under its Guaranty, which is not cured within any applicable grace or notice period, or (iii) repudiates, disclaims, disaffirms or rejects (in each case, in writing), in whole or part, any obligation under its Guaranty, or challenges the validity of its Guaranty (in each case, in writing). |
18.1.6 | (i) Either Party or any of its Designated Affiliates (1) defaults under a Specified Transaction and, after giving effect to any applicable notice requirement or grace period, there occurs a liquidation of, an acceleration of obligations under or any early termination of, that Specified Transaction, or (2) disaffirms, disclaims, repudiates or rejects, in whole or in part, a Specified Transaction (or such action is taken by any person or entity appointed or empowered to operate it or act on its behalf), provided, that the other Party shall first give notice thereof to such first Party, and such default or other applicable event is not cured (if capable of being cured) to the reasonable satisfaction of the other Party within five Business Days from the date that such Party receives such notice (it being acknowledged and agreed that the foregoing shall not alter or extend the applicable notice or grace period, if any, applicable to such Specified Transaction and that the foregoing five Business Day period applies only to the right of a Party to declare an Event of Default under this Section 18.1.6); or (ii) either Party or any Affiliate of such Party that is a party to any credit support document provided pursuant to the terms and conditions of this Agreement disaffirms, disclaims, repudiates or |
18.1.7 | Any Lien (other than a Lien granted by Aron and other than inchoate tax Liens) is placed on any material portion of the Aron Inventory due to an act or with the consent of DCR. Upon the occurrence of such event, DCR shall be deemed to be a Defaulting Party hereunder and Aron shall be deemed to be the Performing Party. |
18.1.8 | A Party fails to provide adequate assurances in accordance with, and within the time periods set forth in, Section 13.6. |
18.2 | Additional Termination Events. Notwithstanding any other provision of this Agreement, the occurrence of any of the events or circumstances specified in this Section 18.2 shall constitute an “Additional Termination Event” and, in each instance, DCR shall be deemed to be the “Affected Party” and Aron shall be deemed to be the Performing Party for purposes of determining the rights and remedies available to the Performing Party under Section 18.3. |
18.2.1 | Except in the case of any Refinery maintenance or turnaround, either (i) operations at the Refinery shall have ceased (other than as a result of a Force Majeure Event) for a period of at least 90 consecutive days or (ii) there occurs an inability to receive into, deliver Products out of or store Products (other than as a result of a Force Majeure Event) in the Tanks (taken as a whole) in any material respect for a period of at least 90 consecutive days. |
18.2.2 | A Force Majeure Event affecting the Refinery has occurred and is continuing for a period of at least 90 consecutive days. |
18.2.3 | The obligations under any Credit Agreement have become due and payable (i) at their scheduled maturity and have not been repaid in full on or prior to such date (after giving effect to any grace or cure periods) or (ii) prior to their scheduled maturity as a result of the occurrence and continuance of an event of default thereunder and the acceleration of the scheduled maturity of such obligations. |
18.2.4 | An “Event of Default” exists with respect to PRCLLC or PBFH under the Related Agreement. |
18.2.5 | DCR or any of its Affiliates sells, leases, subleases, transfers or otherwise disposes of, in one transaction or a series of related transactions, all or substantially all of the assets of the Refinery (provided that the foregoing event shall not constitute an Additional Termination Event if DCR has, in a timely manner, exercised its early termination right in connection |
18.2.6 | PBFH or DCRC (i) consolidates or amalgamates with, merges with or into, or transfers all or substantially all of its assets to, another person (including an Affiliate) or any such consolidation, amalgamation, merger or transfer is consummated, and (ii)(A) the successor resulting from any such consolidation, amalgamation or merger or the person that otherwise acquires all or substantially all of the assets of PBFH or DCRC does not assume, either by operation of law or without amendment or modification of the applicable Transaction Documents (other than any amendments or modifications that are ministerial in nature), all of DCR’s obligations hereunder and under the other Transaction Documents, or (B) in the reasonable judgment of Aron, the creditworthiness of the resulting, surviving or transferee person, taking into account any guaranties, is materially weaker than DCR immediately prior to the consolidation, amalgamation, merger or transfer (provided that the foregoing event shall not constitute an Additional Termination Event if DCR has, in a timely manner, exercised its early termination right in connection with such event pursuant to Section 2.3 or 2.4 and complied with all applicable terms and conditions hereof in connection with exercising such right). |
18.2.7 | A Change of Control with respect to PBF (provided that the foregoing event shall not constitute an Additional Termination Event if DCR has, in a timely manner, exercised its early termination right in connection with such event pursuant to Section 2.3 or 2.4 and complied with all applicable terms and conditions hereof in connection with exercising such right); provided that any Early Termination Date designated by Aron as a result of such occurrence shall occur no earlier than the effective date of such Change of Control event. |
18.2.8 | The Intercreditor Agreement ceases to be in full force and effect or the “Revolving Agent” (as defined therein) repudiates, disclaims, disaffirms or rejects (in each case, in writing), in whole or part, any of its material obligations thereunder or challenges the validity thereof (in each case, in writing). |
18.3 | Remedies Generally. Notwithstanding any other provision of this Agreement or any Specified Transaction, upon the occurrence and continuance of an Event of Default with respect to a Party (such Party referred to as the “Defaulting Party”), or upon the occurrence and continuance of an Additional Termination Event with respect to the Affected Party, the other Party in each case (the “Performing Party”) may, in its sole discretion, in addition to all other remedies available to it and without incurring any Liabilities, do any or all of the following: |
18.3.1 | suspend its performance under this Agreement, including any Product sale, purchase, receipt, delivery or payment obligations, upon written notice to the Defaulting Party or Affected Party; |
18.3.2 | declare all or any portion of the Defaulting Party’s or Affected Party’s, as applicable, obligations under this Agreement to be forthwith due and payable, all without presentment, demand, protest or further notice of any kind, all of which are expressly waived by the Defaulting Party or Affected Party, as applicable; |
18.3.3 | upon written notice to the Defaulting Party or the Affected Party, specify a date (the “Early Termination Date”) on which to terminate this Agreement; |
18.3.4 | terminate all other Transaction Documents and all other agreements that may then be outstanding between the Parties that relate specifically to this Agreement; |
18.3.5 | close out any Specified Transactions pursuant to Section 18.4; |
18.3.6 | determine the Settlement Amount pursuant to Section 18.5; |
18.3.7 | determine the Termination Amount as provided in Section 18.6; and |
18.3.8 | exercise any rights and remedies provided or available to the Performing Party under this Agreement or at law or equity, including such remedies as provided for under the UCC. |
18.4 | Export of Defaults to and Liquidation of Specified Transactions. If the Performing Party gives written notice to the Non-Performing Party pursuant to Section 18.3.3 declaring an Early Termination Date, the occurrence thereof shall constitute a material breach and an event of default, howsoever described, under all Specified Transactions by the Non-Performing Party, and the Performing Party may, by giving notice to the Non-Performing Party, designate an early termination date (which shall be no earlier than the Early Termination Date) for all Specified Transactions and, upon such designation, terminate, liquidate, accelerate and otherwise close out all Specified Transactions that lawfully may be closed out and terminated or, to the extent that in the reasonable opinion of the Performing Party certain of such Specified Transactions may not be liquidated and terminated under Applicable Law on such Early Termination Date, as soon thereafter as is reasonably practicable in which case the actual termination date for such Specified Transactions will be the Early Termination Date, subject to the final sentence of this Section 18.4. In such event, the Performing Party shall calculate the payments due upon early termination of such Specified Transactions in accordance with the terms set forth in such Specified Transactions and in a commercially reasonable manner and without duplication of any amounts payable pursuant to Section 18.5, which shall be aggregated or netted |
18.5 | Determination of Settlement Amount in the Event of Early Termination. |
18.5.1 | Notwithstanding any other provision of this Agreement, if the Performing Party terminates this Agreement pursuant to Section 18.3.3, the Performing Party shall have the right, immediately and for 60 days thereafter, to terminate any other contract or agreement that may then be outstanding among the Parties that relates specifically to this Agreement, including any Transaction Document and, subject to Section 18.5.2, to liquidate and terminate any or all rights and obligations under this Agreement; provided that, in the event Aron is the Performing Party, this Agreement shall not be deemed to have terminated in full until Aron shall have disposed of all of the Aron Inventory (but in any event within 60 days thereafter); and provided further that such 60 day period shall be extended to the extent that the Performing Party is subject to or required to comply with the order of any court of competent jurisdiction that limits its ability to exercise such rights or remedies or if the exercise of such rights or remedies is impracticable due to circumstances beyond the Performing Party’s reasonable control (which, with the exercise of due diligence, such Party cannot avoid or overcome). The “Settlement Amount” shall mean the amount, expressed in U.S. Dollars, of all actual, reasonable losses and costs that are incurred by the Performing Party (expressed as a positive number) or gains that are realized by the Performing Party (expressed as a negative number) as a result of the liquidation and termination of all rights and obligations under this Agreement, each determined in a commercially reasonable manner. The determination of the Settlement Amount shall include (without duplication): (w) for any Specified Period designated by DCR or otherwise established pursuant to the provisions of Schedule F prior to the Early Termination Date that ends after such Early Termination Date, the net present values as of the Early Termination Date of the Inventory Intermediation Roll Fees that would have become due as of the end of such Specified Period absent the early termination (where the discount rate to be used in the net present value calculation shall be equal to LIBOR |
18.5.2 | The Settlement Amount shall be determined by the Performing Party, acting in good faith, in a commercially reasonable manner, based on the applicable liquidated and terminated rights and obligations and shall be payable by one Party to the other. The Performing Party shall determine the Settlement Amount commencing as of the date on which such termination occurs by reference to such futures, forward, swap and options markets as it shall select in its commercially reasonable judgment; provided that the Performing Party is not required to effect such terminations and/or determine the Settlement Amount on a single day, but rather may effect such terminations and determine the Settlement Amount over a commercially reasonable period of time (but in any event within 60 days thereafter, subject to extension of such 60 day period on the same basis as the 60 day period referred to in Section 18.5.1 may be extended thereunder). In calculating the Settlement Amount, the Performing Party shall discount to present value (in a commercially reasonable manner based on LIBOR) any amount which would be due at a later date and shall add interest (at a rate determined in the same manner) to any amount due prior to the date of the calculation. |
18.6 | Determination of the Termination Amount in the Event of Early Termination. The amount payable in respect of early termination due to an Event of Default shall comprise (without duplication) all of the following amounts, which shall be aggregated or netted to a single liquidated amount (the “Termination Amount”) owing from one Party to the other Party: |
18.6.1 | the Settlement Amount; |
18.6.2 | the Specified Transaction Close-Out Amount as determined pursuant to Section 18.4; |
18.6.3 | the amount of any performance assurance, credit support or collateral provided by or on behalf of DCR under any Specified Transaction held by Aron at the Early Termination Date, which shall be applied as a credit to DCR; |
18.6.4 | without duplication, all actual out-of-pocket losses, damages and expenses reasonably and necessarily incurred by the Performing Party as a result of the termination and liquidation of this Agreement, in each case including reasonable (i) attorneys’ fees, (ii) court costs, (iii) collection costs, (iv) interest charges and (v) other reasonable disbursements; and |
18.6.5 | all Unpaid Amounts, including any purchase price for Product that has not yet been paid. |
18.7 | Payment of Termination Amount. The Performing Party shall notify the Non-Performing Party of the Termination Amount due from or due to such Party. If the Non-Performing Party owes the Termination Amount to the Performing Party, the Non-Performing Party shall pay the Termination Amount on the second Business Day after it receives the statement. If the Performing Party owes the Termination Amount to the Non-Performing Party, the Performing Party shall pay the Termination Amount once it has reasonably determined all amounts owed by the Non-Performing Party to it under all Specified Transactions and its rights of close-out and setoff under Section 18.9. |
18.8 | Certain Rights of Aron as Performing Party. Without limiting any other rights or remedies hereunder, if Aron is the Performing Party, Aron may, in its commercially reasonable discretion, (i) withdraw from storage any and all of the Products then in the Included Locations, (ii) otherwise arrange for the disposition of any Products then in the Included Locations and (iii) liquidate in a commercially reasonable manner any credit support, margin or collateral, to the extent not already in the form of cash (including applying any other margin or collateral) and apply and set off such credit support, margin or collateral or the proceeds thereof against any obligation owing by DCR to Aron. Aron shall be under no obligation to prioritize the order with respect to which it exercises any one or more rights and remedies available hereunder. DCR shall in all events remain liable to Aron for any amount payable by DCR in respect of any of its obligations remaining unpaid after any such liquidation, application and set off. |
18.9 | Setoff Rights of Performing Party. If the Performing Party elects to designate an Early Termination Date under Section 18.3.3, the Performing Party shall be entitled, at its option and in its discretion (and without prior notice to the Non-Performing Party), to setoff against the Termination Amount (whether such Termination Amount |
18.10 | Non-Exclusive Remedies. The Performing Party’s rights under this Section 18 are in addition to, and not in limitation or exclusion of, any other rights of setoff, recoupment, combination of accounts, Lien or other right which it may have, whether by agreement, operation of law or otherwise. No delay or failure on the part of a Performing Party to exercise any right or remedy shall constitute an abandonment of such right or remedy and the Performing Party shall be entitled to exercise such right or remedy at any time after a Termination Event has occurred and is continuing. |
18.11 | Indemnification. The Non-Performing Party shall reimburse the Performing Party for its reasonable costs and expenses, including reasonable attorneys’ fees, actually incurred in connection with the enforcement of, suing for or collecting any amounts payable by the Non-Performing Party. The Non-Performing Party shall indemnify and hold harmless the Performing Party for any reasonable damages, losses and expenses actually incurred by the Performing Party as a result of any Termination Event. |
19. | INDEMNIFICATION & CLAIMS |
19.1 | To the fullest extent permitted by Applicable Law and except as specified otherwise elsewhere in this Agreement (including the indemnification provisions in Section 21.2 and subject to Section 14), DCR shall defend, indemnify and hold harmless Aron, its Affiliates and their Representatives, agents and contractors from and against any Liabilities caused by DCR or its Representatives, agents or contractors in performing its obligations under this Agreement, except to the extent that such Liabilities were caused by the negligence or willful misconduct on the part of Aron or its Representatives, agents or contractors. |
19.2 | To the fullest extent permitted by Applicable Law and except as specified otherwise elsewhere in this Agreement (including the indemnification provisions in Section 21.2 and subject to Section 14), Aron shall defend, indemnify and hold harmless DCR, its Affiliates and their Representatives, agents and contractors from and against any Liabilities caused by Aron or its Representatives, agents or contractors in performing its obligations under this Agreement, except to the extent that such Liabilities were caused by the negligence or willful misconduct on the part of DCR or its Representatives, agents or contractors. |
19.3 | In addition to the indemnification obligations set forth in Sections 19.1 and 19.2 and elsewhere in this Agreement (except as set forth in the indemnification provisions in Section 21.2, and subject to Section 14), each Party (referred to as the “Indemnifying Party”) shall indemnify and hold the other Party (the “Indemnified Party”), its Affiliates and their Representatives, agents and contractors harmless from and against any and all Liabilities directly or indirectly arising from (i) the Indemnifying Party’s breach of any of its obligations under or covenants made in this Agreement; (ii) the Indemnifying Party’s negligence or willful misconduct; (iii) the Indemnifying Party’s failure to comply with Applicable Law with respect to the sale, transportation, storage, handling or disposal of Product or violation of any Environmental Law caused by the Indemnifying Party or its Representatives, agents or contractors, unless such violation liability results from the Indemnified Party’s negligence or willful misconduct; or (iv) the Indemnifying Party’s representations, covenants or warranties made herein having been proven to be to be materially incorrect or misleading when made. |
19.4 | The Parties’ obligations to defend, indemnify and hold each other harmless under the terms of this Agreement shall not vest any rights in any third party, nor shall they be considered an admission of liability or responsibility for any purposes other than those enumerated in this Agreement. |
19.5 | Each Party agrees to notify the other Party as soon as practicable after receiving notice of any suit brought against it within the indemnities of this Agreement, shall furnish to the other the complete details within its knowledge and shall render all reasonable assistance requested by the other in the defense. Each Party shall have the right but not the duty to participate, at its own expense, with counsel of its own selection, in the defense and settlement thereof without relieving the other of any obligations hereunder. Notwithstanding the foregoing, the Indemnifying Party shall not be entitled to assume responsibility for and control of any judicial or administrative proceeding if such proceeding involves a Termination Event by the Indemnifying Party under this Agreement which shall have occurred and be continuing. Furthermore, the Indemnifying Party shall not, without the Indemnified Party’s prior written consent, settle or compromise any claim or consent to the entry of any judgment, which (i) does not include as a term thereof the giving by the claiming party or the plaintiff to the Indemnified Party of an unconditional release from all Liability in respect of such claim, (ii) grants non-monetary relief to the claiming party or the plaintiff or (iii) involves an admission of liability or guilt by the Indemnified Party. |
20. | LIMITATION ON DAMAGES |
20.1 | Unless otherwise expressly provided in this Agreement, the Parties’ Liability for damages is limited to direct, actual damages only and neither Party shall be liable for specific performance, lost profits or other business interruption damages, or special, consequential, incidental, punitive, exemplary or indirect damages, in tort, contract or otherwise, of any kind, arising out of or in any way connected with the |
21. | INFORMATION & INSPECTION RIGHTS |
21.1 | Audit Rights. Upon the reasonable request of either Party, the other Party shall provide the requesting Party with copies of all relevant documents and records in its possession that reasonably relate to the calculation of any formula, invoice, statement or the amount of any payment under this Agreement. The provisions of this Section 21 shall survive the termination of this Agreement for 18 months. |
21.2 | Right to Physical Inspection. From time to time during the Term, Aron shall have the right, at its own cost and expense, to have an Independent Inspector or its Representatives conduct surveys and inspections of any of the Tanks or facilities at the Refinery that are used to handle, store or transfer the Product from the Refinery process units to the Tanks, and to observe any Product transfer, handling, metering or related activities (including any aspects of the Volume Determination Procedures applied by DCR pursuant to Sections 6.3 and 9.5); provided that such surveys, inspections and observations shall be made during normal working hours, be subject to the Refinery’s security, safety and other rules and procedures, and be upon reasonable notice and not disrupt the Refinery’s normal operations. DCR agrees to provide Aron’s Independent Inspector and other Representatives with reasonable rights of access to and egress from the Tanks by crossing over, around and about the Facility in connection with this Section 21.2. Aron, when undertaking such survey, inspection or observation, either with its own personnel or a contractor or other Representative, shall be responsible for such personnel, contractor or Representative and DCR shall have the right, but not the obligation, to accompany such person at all times while at the Refinery. Neither Aron nor its Representatives may conduct any sampling, boring, drilling, probing, digging or other invasive investigative activity or inspections (other than a visual inspection) and none may operate any equipment or machinery or conduct any testing of the same in the course of such inspection. Aron (on behalf of Aron, its Affiliates and their Representatives, agents and contractors), to the fullest extent permitted by Applicable Law, hereby releases DCR, its Affiliates and their Representatives, agents and contractors from, and agrees to indemnify, defend and hold harmless DCR from any Liabilities, whether incurred by DCR or any of its parent entities, subsidiaries or Affiliates, directly or indirectly, including for (i) personal injuries to Aron’s and its Affiliate’s Representatives, agents and contractors and/or (ii) damages to the property of Aron’s and its Affiliate’s Representatives, agents and contractors, to the extent relating to, arising out of or connected with, directly or indirectly, Aron’s survey, inspection or observation of the Refinery and Tanks or Aron Representatives’ travel to or from or presence at the Refinery and Tanks in connection with this Agreement, even if such indemnified event relates to, arises out of or in connection with the active or passive, sole, concurrent or comparative negligence, strict liability, breach of duty (statutory or |
21.3 | Disputes Regarding Volume Determination Procedures. If a Party in good faith believes that the Volume Determination Procedures have not been applied correctly, including based on the report of any Independent Inspector, the disputing Party shall provide written notice stating the reasons why the Volume Determination Procedures were applied incorrectly, along with supporting documentation, and the Parties shall thereafter reasonably cooperate in order to resolve the dispute, including considering the report of any Independent Inspector, if applicable. In the event the Parties are unable to resolve such dispute, the matter shall be resolved in accordance with Section 22. |
22. | GOVERNING LAW & DISPUTES |
22.1 | Dispute Resolution. In the event the Parties are unable to resolve any claim, dispute or controversy regarding this Agreement or any matters arising in connection therewith, prior to initiating any arbitration or litigation as permitted herein, a Party shall refer the matter to a senior representative of such Party. Upon such referral, senior representatives of the Parties having authority to resolve the matter shall meet at a mutually acceptable time and place within ten days thereafter in order to exchange relevant information and to attempt to resolve the matter. If a senior representative intends to be accompanied to a meeting by an attorney, he or she shall give the other Party’s senior representative at least three Business Days’ prior notice of such intention so that he or she also can be accompanied by an attorney. If a Party’s senior representative does not meet with the other Party’s senior representative within such ten-day period or if the senior representatives are unable to resolve the dispute, then, following the expiration of such ten-day period, either Party may pursue any remedy available at law or in equity to enforce its rights hereunder available to it, subject in any event to the remainder of this Section 22. |
22.2 | Governing Law. |
22.2.1 | General Governing Law. Other than as set forth in Section 22.2.2, this Agreement and all matters arising in connection therewith, including validity and enforcement, contractual matters (except as otherwise set forth in Section 22.2.2) and any contractual payments owed hereunder, shall be governed by, interpreted and construed in accordance with the laws of the State of New York, without giving effect to its conflicts of laws principles that would result in the application of a different law. As to this Section 22.2.1: |
22.2.1.1 | Disputes involving amounts in controversy less than $1,000,000 shall be resolved by one arbitrator pursuant to Section 22.4. |
22.2.1.2 | Disputes involving amounts in controversy of $1,000,000 or more, but less than $2,500,000 shall be resolved by three arbitrators pursuant to Section 22.4. |
22.2.1.3 | As to matters involving amounts in controversy of $2,500,000 or more, each Party hereby submits itself to the exclusive jurisdiction of (i) any federal court of competent jurisdiction situated in the City of Wilmington, Delaware, and agrees not to contest the laying of venue in such forum, or (ii) if any such federal court declines to exercise or does not have jurisdiction, any Delaware state court in the City of Wilmington, Delaware, and agrees not to contest the laying of venue in such forum. |
22.2.2 | Governing Law Exceptions. As to claims for personal injury and any claims directly or indirectly based on torts, personal injury, environmental claims and any and all claims in respect of indemnities and releases of claims among the Parties hereunder relating to any claims brought by any party other than DCR, Aron and their respective Affiliates or any Governmental Authority, this Agreement and all matters arising in connection therewith, shall be governed by, interpreted and construed in accordance with the laws of the State of Delaware, without giving effect to its conflicts of laws principles that would result in the application of a different law. As to this Section 22.2.2, each Party hereby submits itself to the exclusive jurisdiction of (i) any federal court of competent jurisdiction situated in the City of Wilmington, Delaware, and agrees not to contest the laying of venue in such forum, or (ii) if any such federal court declines to exercise or does not have jurisdiction, any Delaware state court in the City of Wilmington, Delaware and agrees not to contest the laying of venue in such forum. |
22.3 | EACH PARTY HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION TO THE JURISDICTION OF ANY COURT PURSUANT TO THIS SECTION 22 OR TO THE VENUE THEREIN OR ANY CLAIM OF INCONVENIENT FORUM OF SUCH COURT. EACH PARTY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY PROCEEDINGS RELATING TO THIS AGREEMENT. |
22.4 | Arbitration. Any dispute governed by Section 22.2.1.1 or 22.2.1.2 shall be resolved exclusively through final and binding arbitration using a single arbitrator, as to Section 22.2.1.1, or three arbitrators, as to Section 22.2.1.2, applying by reference the Commercial Arbitration Rules (the “AAA Rules”) of the American Arbitration Association (the “AAA”) as in effect on the date such dispute arises, as supplemented to the extent necessary to determine any procedural appeal questions by the Federal |
22.4.1 | Arbitration must be initiated within the time period allowed by the applicable statute of limitations. |
22.4.2 | As to Section 22.2.1.1, if the Parties are unable to jointly select an arbitrator within 30 days following the initiation of the dispute, the AAA will name the arbitrator within 30 days after expiration of such period. The Parties each shall pay one-half of the compensation and expenses of the arbitrator(s). |
22.4.3 | As to Section 22.2.1.2, the initiating Party’s notice shall identify the arbitrator such Party is appointing. The responding Party shall respond within 30 days after receipt of such notice, identifying the arbitrator such Party is appointing. If such Party does not name an arbitrator within the 30 days, the AAA will name the arbitrator for such Party within 30 days after expiration of such period. The two arbitrators so appointed or named shall select a third arbitrator within 30 days after the second arbitrator has been appointed or named. If the two appointed or named arbitrators cannot reach agreement upon the third arbitrator within the 30 day period, the AAA shall promptly name an independent arbitrator to act as the third arbitrator. The Parties each shall pay one-half of the compensation and expenses of the arbitrators. |
22.4.4 | All arbitrators must (i) be neutral persons who have never been officers, directors, employees or consultants or had other business or personal relationships (except acting as arbitrator) with the Parties or any of their Affiliates, officers, directors or employees and (ii) have experience in or be knowledgeable about the matters in dispute. |
22.4.5 | The location of all arbitration proceedings shall be the City of Wilmington, Delaware. |
22.4.6 | The Parties and the arbitrators shall proceed diligently so that the award can be made as promptly as possible. If the amount in controversy is less than $1,000,000 the hearing shall commence as promptly as practicable after the selection of the arbitrator. If the amount in controversy is equal to or exceeds $1,000,000, the hearing shall commence at such time as agreed to by the Parties and the arbitrators but no later than three months after the selection of the third arbitrator. Expedited discovery will be permitted if and as agreed to by the Parties. If the Parties are unable to agree, the arbitrators shall resolve any discovery disputes consistent with the AAA Rules. Any matter involving |
22.4.7 | Except as provided in the Federal Arbitration Act, the decision of the arbitrators shall be binding on and non-appealable by the Parties. In rendering any decision or award, the arbitrators must abide by all terms and conditions of this Agreement, including the exclusion of consequential, incidental, exemplary, special, indirect and punitive damages set forth in Section 20. |
22.4.8 | The Parties shall each bear their own costs and expenses (including attorneys’ fees) incurred in arbitrating any dispute pursuant to this Section 22.4. |
22.5 | Availability of Remedies. The Parties acknowledge and agree that damages may not be an adequate remedy for a breach of the provisions of this Agreement. For this reason, among others, the Parties could be irreparably harmed if this Agreement is not deemed to be specifically enforceable or any other legal or equitable remedy or relief is deemed not to be available, and the Parties hereby agree that, without prejudice to Section 18, this Agreement shall be specifically enforceable and that all other legal and equitable remedies and relief shall be available. |
23. | ASSIGNMENT |
23.1 | This Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors and permitted assigns. |
23.2 | DCR shall not assign this Agreement or its rights or interests hereunder in whole or in part, or delegate its obligations hereunder in whole or in part, without the express written consent of Aron, except as set forth in Section 23.4 and 23.5. Aron shall not assign this Agreement or its rights or interests hereunder, directly or indirectly, through consolidation, amalgamation, merger or transfer, by operation of law or otherwise, in whole or in part, or delegate its obligations hereunder in whole or in part, without the express written consent of DCR, except that Aron may, without DCR’s express written consent, assign and delegate all of Aron’s rights and obligations hereunder to any Affiliate of Aron; provided that the obligations of such Affiliate hereunder are guaranteed by The Goldman Sachs Group, Inc. |
23.3 | If written consent is given for any assignment, the assignor shall remain jointly and severally liable with the assignee for the full performance of the assignor’s obligations under this Agreement unless the Parties otherwise agree in writing. |
23.4 | Either Party may create a security interest in (but may not otherwise assign any interest in) its receivables under this Agreement as to a third party without the consent of the other Party; provided that no such security interest shall impair or limit any |
23.5 | DCR may assign its rights and obligations under this Agreement to any and all lenders, security, note or bond holders, lien holders, investors, equity providers and other persons providing any interim or long term equity or debt financing, refinancing or recapitalization for the Refinery, their successors and assigns and any trustees or agents acting on their behalf. Additionally, if DCR wishes to assign (i) its rights and obligations under this Agreement, (ii) any Specified Transactions or (iii) any assets, including the Refinery and/or the Tanks, related to this Agreement to a master limited partnership that is an Affiliate of DCR, Aron agrees that it will cooperate with DCR in good faith and in a commercially reasonable manner to accommodate such assignment on terms that preserve for Aron, in all material respects, the economic and legal substance of the transactions contemplated by this Agreement and the Transaction Documents. |
23.6 | Any prohibited assignment in violation of this Section 23 shall be null and void ab initio and the non-assigning Party shall have the right, without prejudice to any other rights or remedies it may have hereunder or otherwise, to terminate this Agreement effective immediately upon notice to the Party attempting such assignment. |
24. | NOTICES |
24.1 | Notices in Writing. Any notice, demand or document that a Party is required or may desire to give hereunder, except to the extent specifically provided otherwise herein, must be (i) in writing and (ii) given by personal delivery, overnight courier, facsimile or U.S. mail registered or certified mail, return receipt requested, with the postage prepaid and properly addressed or communicated to such Party at its address or facsimile number set forth on Schedule K, or at such other address as either Party may have furnished to the other by notice given in accordance with this Section 24.1. Other than notices relating to a Termination Event, termination of this Agreement, indemnification, assignment and disputes, notice may also be given by electronic mail at such e-mail address as is typically used for such type of matter in the conduct of the recipient’s business. Any notice delivered or made by personal delivery, overnight courier, facsimile or U.S. mail shall be deemed to be given on the date of actual delivery as shown by the receipt for personal delivery or overnight courier delivery, the addresser’s machine confirmation for facsimile deliver or the registry or certification receipt for registered or certified mail. |
25. | NATURE OF THE TRANSACTION & RELATIONSHIP OF THE PARTIES |
25.1 | Neither this Agreement nor any other Transaction Document or transaction under any of them, nor the performance by the Parties of their respective obligations under this Agreement, any other Transaction Document or any transaction shall constitute or create a joint venture, partnership or legal entity of any kind between the Parties. It is understood that each Party has complete charge of its employees and agents in |
26. | CONFIDENTIALITY |
26.1 | This Agreement and all documents related to the foregoing and any information pertaining thereto made available by a Party or its Representatives to the other Party or its Representatives are confidential (collectively, “Confidential Information”), which obligation supersedes in all respects the Mutual Confidentiality Agreement dated as of April 18, 2013 by and between Aron and PBFH (the “Confidentiality Agreement”). Each Party shall at a minimum use the same efforts and standard of care with respect to Confidential Information provided by the other Party that it uses to preserve its own confidential information, and in no event less than commercially reasonable efforts. Confidential Information shall not be discussed with or disclosed to any third party by any Party except for such information (i) as may become generally available to the public through no breach of this Section 26.1 or any other agreement between the Parties, (ii) as may be required or appropriate in response to any summons, subpoena or otherwise in connection with any litigation or to comply with any Applicable Law or accounting disclosure rule or standard or request by any supervisory or regulatory authority, (iii) as may be obtained from a non-confidential source that disclosed such information in a manner that did not violate its obligations to the other Party or its credit support provider in making such disclosure or (iv) as may be furnished to the disclosing Party’s Affiliates or to its Representatives, all of whom are required to keep the information that is disclosed in confidence. This Section 26.1 shall remain in effect for two years following the termination of this Agreement. |
26.2 | In the case of disclosure covered by clause (ii) of Section 26.1, the disclosing Party shall notify the other Party in writing of any proceeding of which it is aware which may result in disclosure (provided that the disclosing Party shall not be required to waive any attorney-client or work product privilege) and shall use reasonable efforts to prevent or limit such disclosure. The Parties may exercise all remedies available at law or in equity to enforce or seek relief in connection with the confidentiality obligations contained in this Agreement. |
27. | CHANGE IN LAW |
27.1 | Each Party shall make reasonable efforts to monitor any proposed Change in Law that may reasonably be expected to have an impact on Aron’s ability to perform any of its obligations under any of the Aron Hedges in a commercially reasonable manner and shall promptly notify the other Party upon becoming aware of any such proposed Change in Law. Such notice shall identify the proposed Change in Law and set out in reasonable detail the effects the notifying Party anticipates such Change in Law |
27.2 | Each Party shall make reasonable efforts to monitor any proposed Change in Law that results from, or is relevant to, any Taxes, Liabilities or sanctions in respect of any gross receipts tax pursuant to Title 30 of the Delaware Code as in effect from time to time (a “Delaware Tax Change in Law”), and that may reasonably be expected to have an impact on either Party’s (or its Guarantor’s) ability to perform any of its obligations under any of the Transactions Documents in a commercially reasonable manner and shall promptly notify the other Party upon becoming aware of any such proposed Delaware Tax Change in Law. Such notice shall identify the proposed Delaware Tax Change in Law and set out in reasonable detail the effects the notifying Party anticipates such Delaware Tax Change in Law would have upon such performance of any such Transaction Documents if enacted. The Parties shall in good faith meet to discuss what, if any, measures can be taken by either Party (or both) to minimize and/or mitigate the effect of any such proposed Delaware Tax Change in Law. If a Delaware Tax Change in Law results or would result in a Party or its Guarantor (the “Adversely Tax Affected Party”) incurring Taxes, Liabilities or other sanctions of a monetary nature in excess of $1,500,000 per annum solely as a result of such Party’s (or its Guarantor’s) performance of the Transaction Documents, in each case the Adversely Tax Affected Party shall be entitled to request that the Parties meet for purposes of addressing such Delaware Tax Change in Law by providing written notice (a “Change in Tax Law Notice”) to the other Party (the |
28. | MISCELLANEOUS |
28.1 | Survival. Termination or expiration of this Agreement shall not affect any rights or obligations that may have accrued prior to termination, including any in respect of antecedent breaches and, for the avoidance of doubt but subject to the terms of this Agreement, any rights or obligations under this Agreement or any of the other Transaction Documents in respect of transactions entered into up to and including the date of termination or expiration of this Agreement. The obligations of each Party that expressly survive termination, are required to take effect on or give effect to termination or the consequences of termination or which by their very nature must survive termination shall continue in full force and effect notwithstanding termination of this Agreement. |
28.2 | Entire Agreement; Amendments. This Agreement constitutes the entire agreement of the Parties regarding the matters contemplated herein or related thereto and no representations or warranties shall be implied or provisions added hereto in the absence of a written agreement to such effect between the Parties after the Effective Date; provided, however, that nothing in this Agreement shall limit, impair or contravene the Parties’ or their Affiliates’ rights as set forth in any Specified Transaction (whether entered into prior to, on or after the Effective Date) regarding the collection and determination of margin and collateral, the exporting or importing of events of default, termination events or the netting and setting off of amounts due. This Agreement may not be altered, amended, modified or otherwise changed in any |
28.3 | Severability. If at any time any court of competent jurisdiction declares that any provision of this Agreement is or any provision of this Agreement becomes illegal, invalid or unenforceable in any respect under any Applicable Law of any jurisdiction, neither the legality, validity or enforceability of the remaining provisions nor the legality, validity or enforceability of such provision under the Applicable Law of any other jurisdiction will be affected or impaired in any way. The Parties will negotiate in good faith with a view to reform this Agreement in order to give effect to the original intention of the Parties and produce as nearly as is practicable in all the circumstances the appropriate balance of the commercial interests of the Parties. The failure to agree upon such provisions for any reason or no reason shall not be considered a breach of this Agreement. |
28.4 | Waiver and Cumulative Remedies. No failure to exercise, nor any delay in exercising, any right, power or remedy under this Agreement or provided by Applicable Law shall operate as a waiver, nor shall any single or partial exercise of any right, power or remedy prevent any further or other exercise or the exercise of any other right, power or remedy. The rights, powers and remedies provided in this Agreement are cumulative and not exclusive of any rights, powers or remedies. Any waiver of any breach of this Agreement shall not be deemed to be a waiver of any subsequent breach. |
28.5 | Time Is of the Essence. Time shall be of the essence for this Agreement with respect to all aspects of each Party’s performance of its obligations under this Agreement. |
28.6 | No Third-Party Beneficiaries. There are no third party beneficiaries to this Agreement and the provisions of this Agreement shall not impart any legal or equitable right, remedy or claim enforceable by any person, firm or organization other than the Parties and their successors in interest and permitted assigns. |
28.7 | Announcements. At no time during the Term of this Agreement, and for a period of two years following its expiration or termination, shall any Party issue any press announcement or public statement regarding this Agreement without the prior written consent of the other Party, except as may be required by Applicable Law or applicable stock exchange rules or requirements or to the extent public disclosure is required under the circumstances described in any relevant confidentiality agreement entered into between the Parties. The issuing Party will: |
28.7.1 | use all reasonable efforts to notify the other Party of the content of such announcement at least three Business Days prior to such issue (unless |
28.7.2 | take the other Party’s comments on the proposed announcement into account as is reasonable under the circumstances, provided such comments are received within two Business Days of the notification. |
28.8 | Expenses. Each Party shall pay its own costs, fees and expenses, including attorneys’ fees, incurred by such Party in connection with the Transaction Documents and any costs, fees and expenses incident to the negotiation, execution and delivery of this Agreement and the consummation of the transactions contemplated thereunder. |
28.9 | Counterparts. This Agreement may be executed by the Parties in separate counterparts and all such counterparts shall together constitute one and the same instrument. In the event that any signature is delivered by facsimile or electronic transmission, such signature shall create a valid and binding obligation of the Party executing (or on whose behalf the signature is executed) the same with the same force and effect as if such facsimile or electronic signature page were an original thereof. |
PBF Corporate Standard | Product Group |
Alkylate | Gasoline |
CBOB Prm 13.5# | Gasoline |
CBOB Prm 15.0# | Gasoline |
CBOB Prm 9.0# | Gasoline |
CBOB Reg 10.0# | Gasoline |
CBOB Reg 13.5# | Gasoline |
CBOB Reg 15.0# | Gasoline |
CBOB Reg 7.8# | Gasoline |
CBOB Reg 9.0# | Gasoline |
Diesel-Strtrun | Distillate |
Distillate Blendstk | Distillate |
Gasoline for Export | Gasoline |
Gasoline-Hvy Cat | Gasoline |
Gasoline-Lt Cat | Gasoline |
Gasoline-Lt Strtrun | Gasoline |
Gasoline-Poly | Gasoline |
Jet A | Distillate |
Kerosene ULS | Distillate |
Kerosene-Strtrun | Distillate |
LCO | Distillate |
LGO | Distillate |
Naphtha | Gasoline |
Naphtha-Hvy Cat | Gasoline |
Naphtha-Hvy Coker | Gasoline |
No 2 HO 2000 UD | Distillate |
No 2 ULSD 15 | Distillate |
PBOB Prm 11.5# | Gasoline |
PBOB Prm 13.5# | Gasoline |
PBOB Prm 15.0# | Gasoline |
PBOB Prm V1 | Gasoline |
Raffinate | Gasoline |
RBOB Reg 11.5# | Gasoline |
RBOB Reg 13.5# | Gasoline |
RBOB Reg 15.0# | Gasoline |
RBOB Reg V1 | Gasoline |
Reformate-Hvy | Gasoline |
Reformate-Lt | Gasoline |
Tank List | Typical Contents |
44 | Naphtha |
45 | Distillate Blendstock |
47 | Naphtha |
48 | Straight Run Diesel |
50 | Naphtha |
51 | Untreated Straight Run Kerosene |
73 | Naphtha |
135 | CBOB Unl Reg |
136 | RBOB Unl Reg |
137 | PBOB Unl Prem |
139 | No 2 ULS (15 ppm) Diesel |
145 | CBOB Unl Reg |
149 | No 2 ULS (15 ppm) Diesel |
150 | No 2 ULS (15 ppm) Diesel |
161 | RBOB Unl Reg |
162 | RBOB Unl Reg |
163 | RBOB Unl Reg |
165 | Raffinate |
166 | Alkylate |
167 | Raffinate |
182 | RBOB Unl Reg |
183 | RBOB Unl Reg |
185 | Heavy Cat Gasoline |
201 | Light Straight Run Gasoline |
203 | Light Cat Gasoline |
205 | Heavy Reformate |
221 | Light Straight Run Gasoline |
222 | Alkylate |
223 | Alkylate |
224 | Alkylate |
241 | Poly Gasoline |
242 | Naphtha |
243 | No 2 ULS (15 ppm) Diesel |
244 | Distillate Blendstock |
245 | ULS Kerosene |
246 | Distillate Blendstock |
248 | Distillate Blendstock |
261 | Poly Gasoline |
263 | No 2 ULS (15 ppm) Diesel |
264 | Distillate Blendstock |
265 | Jet A |
266 | No 2 ULS (15 ppm) Diesel |
283 | No 2 HS (2000 ppm) Heating Oil-Undyed |
284 | No 2 HS (2000 ppm) Heating Oil-Undyed |
286 | No 2 HS (2000 ppm) Heating Oil-Undyed |
(A.) | OVERVIEW: |
(B.) | HYDROCARBON INVENTORY INCLUSIONS AND EXCLUSIONS: |
• | Intra-Refinery linefill; |
• | BS&W in storage tanks; |
• | Unit fill at the Refinery. |
(C.) | INDEPENDENT INSPECTION: |
(D.) | ACCEPTANCE AND REVIEW - INVENTORY TEAM: |
(E.) | INVENTORY QUANTIFICATION PROCEDURES: |
• | Tank location, Tank number, type of roof and Tank type by site; |
• | Status at Commencement Date (active, inactive or out of service); |
• | Tank contents (product/grade); |
• | Tank equipment (i.e., mixers, heating coils or tubes); |
• | Tank reference gauge height; |
• | Tank calibration (ullage or innage), last Tank calibration date and Tank “critical zone”; |
• | Total Tank volume and heel volume; |
• | Design of Tank gauging tube (slotted or solid) and estimation of bottom sludge; and |
• | Any specific gauging or sampling limitations (i.e. fresh air, no roof ladder). |
(F.) | GAUGING/SAMPLING PROTOCOL: |
(G.) | EQUIPMENT ACCURACY: |
(H.) | PRE-COMMENCEMENT DATE INVENTORY PROCEDURES: |
(I.) | FACILITY PHYSICAL INVENTORY PROCEDURES: |
• | Clean metal sample pressure cylinders, as supplied by DCR’s laboratory or the IIC, will be used for sampling the propane bullet Tanks and the LPG spheres. |
• | Tank location, Tank number, any Tank seal numbers and Tank type by site; |
• | Date and time of gauging and sampling; |
• | Tank contents (product/grade); |
• | Manual gauge in feet and inches, and fraction thereof (if a Tank is so equipped) specifying outage or innage (as defined below), and equivalent quantity in appropriate units (“Manual Gross Tank Inventory”) determined according to customary practice at the Refinery or Tank type as follows: |
• | Cone or external/internal floating roof Tanks: vertical distance in feet, inches and fractions thereof from Tank bottom or datum plate to the uppermost point where Product level is identified on the gauge tape, (“innage”); |
• | Tanks containing sludge or compromised datum plate: vertical distance in feet, inches and fractions thereof, from Tank reference point to the uppermost Product level as identified on the gauge tape (“outage”); |
• | Temperature readings in accordance with API Chapter 7; |
• | Free water level (“water cut”); |
• | Automatic product gauge reading measure in feet and inches, and fraction thereof, (if Tank is so equipped) specifying outage or innage, and equivalent quantity in appropriate units (“Automatic Gross Tank Inventory”); and |
• | Representative samples, as described in Section I.6 above, shall be drawn to determine BS&W, API gravity and any other properties as determined by the Inventory Team. |
• | Tank location, Tank number, any Tank seal numbers and Tank type by site; |
• | Date and time of gauging and sampling; |
• | Tank contents (product/grade); |
• | Any Automatic Gross Tank Inventory; |
• | Temperature readings from the Tank’s temperature gauge according to Chapter 7 API Standard; |
• | Pressure reading from the Tank’s automatic pressure gauge (if available); and |
• | Pressure cylinders samples shall be drawn to determine the Tank contents, purity, density and any other properties as requested by the Inventory Team. The Inventory Team will determine which Products should be subjected to this step. |
(J.) | METER READINGS – LOADING RACKS AND PIPELINES: |
(K.) | POST-INVENTORY PROCEDURES: |
(L.) | CALCULATION OF FINAL INVENTORY QUANTITY: |
(M.) | POST-COMMENCEMENT DATE STATEMENT: |
1. |
2013 Schedule of Insurance | |||||
Named Insureds: PBF Holding Company LLC; PBF Energy & all subsidiaries | (Active Policies) | ||||
rv 6.19.13 atv | |||||
Coverage | Policy Number | Underwriting Company | Limits of Liability/Deductible | Deductible | Policy Period |
CASUALTY | |||||
Work Comp - Monopolistic | 1618685 | State of Ohio - BWC State Fund | Statutory - Guaranteed Cost | 7/1/12 - 7/1/13 | |
Workers Compensation | WC 025889212 | AIG - Ins Co of the ST of PA | 1MM | $500K | 12/17/12 - 12/17/13 |
General Liability | GL 2819954 | AIG- Nat'l l Union Fire Ins Co of Pitts, PA | 5MM | SIR - $5M | 12/17/12 - 12/17/13 |
Business Auto | CA 1949547 | AIG- Nat'l l Union Fire Ins Co of Pitts, PA | 1MM | $500K | 12/17/12 - 12/17/13 |
Lead Umbrella - Domestic | XOO G25910242 | ACE USA Excess Casualty (ACE American Ins. Co.) | 25M - Lead | Primary | 12/17/12 - 12/17/13 |
Excess Liability - lst | G24183099 003 | Westchester Fire Insurance Company thru AmWINS (Atlanta, GA) | 25M x/s 25M | 12/17/12 - 12/17/13 | |
Excess Liability - 2nd | EXC10003840800 | Endurance American Specialty Ins Co thru AmWINS (Atlanta, GA) | 25M p/o 50M x/s 50M | 12/17/12 - 12/17/13 | |
Excess Liability - 2nd | EAU756753012012 | AXIS Surplus Insurance Company thru AmWINS (Atlanta, GA) | 25M p/o 50M x/s 50M | 12/17/12 - 12/17/13 | |
Excess Liability - 3rd | 1236101 | Ironshore Specialty Insurance Company | 25M x/s 100M | 12/17/12 - 12/17/13 |
Excess Liability - 4th | SLSLXNR03047012 | Starr Surplus Lines Insurance Company | 25M x/s 125M | 12/17/12 - 12/17/13 | |
Excess Liability - 5th - Bermuda | ARGO-CAS-OR-000334 | Argo Re (Bermuda) | 25M p/o 100M x/s 150M | 12/17/12 - 12/17/13 | |
Excess Liability - 5th | U920153-1210 | OIL Casualty Insurance Ltd. (Bermuda) | 25M p/o 100M x/s 150M | 12/17/12 - 12/17/13 | |
Excess Liability - 5th | BM00026704LI12A | XL Insurance (Bermuda) Ltd. | 25M p/o 100M x/s 150M | 12/17/12 - 12/17/13 | |
Excess Liability - 6th | BM00026705LI12A | XL Insurance (Bermuda) Ltd. | 50M x/s 250M | 12/17/12 - 12/17/13 | |
MARINE | |||||
Marine Terminal Operators Liab | MASILNY00024011 | Starr Indemnity & Liability Company | 10M | $5M | 12/17/12 - 12/17/13 |
Charterers Liability | Cert of Entry #238.113 | GARD | $750M | $50K pollution/$25 All other | 2/20/13 - 2/20/14 |
Freight,Demurrage&Defense | Same | GARD | $10MM | 25% ded - $5,000 minimum. | 2/20/13 - 2/20/14 |
Cargo | OMC9150152/MA1202204 | Grt Amer Ins Co/Lloyds of London | $150MM | 1/2 of 1% Cargo Value | 1/1/13 - Cont'd |
PROPERTY | $1.3B - TOTAL Limits | ||||
Property - Domestic | 638 18 112 | National Union Fire Ins. Co. of Pittsburgh, PA (Chartis) | 115M p/o 500M | PD - $5M / BI 60 days | 12/17/12 - 12/17/13 |
Property | 638 18 113 | National Union Fire Ins. Co. of Pittsburgh, PA (Chartis) | 80M p/o 800M x/s 500M | 12/17/12 - 12/17/13 | |
Property | CLP 3013874 | Allianz Global Corporate & Specialty | 162.5M p/o 1.3B | 12/17/12 - 12/17/13 | |
Property | H12-TP10212-00 | HCC Technical Property Risks (Houston Casualty Co.) | 24.750 p/o 550M x/s 750M | 12/17/12 - 12/17/13 | |
Property | XPD12328-00 | HDI-Gerling America Insurance Company | 800M x/s 500M | 12/17/12 - 12/17/13 | |
Property | 868702 | Ironshore Insurance Services, Inc. | 1.750M p/o 100M | 12/17/12 - 12/17/13 | |
Property | 3DAACMXO003 | Liberty Mutual Insurance Co. | 84.5M p/o 1.3B | 12/17/12 - 12/17/13 | |
Property | S5LPY0252600S | Maiden Specialty | 10M p/o 400M x/s 100M | 12/17/12 - 12/17/13 | |
Property | 2012 10F145356 - 1 | GSINDA (General Security Indemnity of Arizona) | 52.5M p/o 750M x/s 5M | 12/17/12 - 12/17/13 | |
Property | 2012 10F145356 - 1 | GSINDA (General Security Indemnity of Arizona) | 16.2M p/o 400M x/s 100m x/s 5M | 12/17/12 - 12/17/13 | |
Property | EPRN09148449 | ACE American Insurance Company | 104M p/o 1.3B | 12/17/12 - 12/17/13 |
Property | 31375457 | Westport Insurance Corporation (Swiss Re) | 1.3B | 12/17/12 - 12/17/13 | |
Property | AJZ118526C12 | Lloyd's Sydicate No. 1183 (TAL - Talbot) | 39M p/o 1.3B | 12/17/12 - 12/17/13 | |
Property | AJY155483A12 | Lloyd's Sydicate No. 1183 (TAL - Talbot) | 1.1M p/o 550M | 12/17/12 - 12/17/13 | |
Property | US00012494PR12A | XL Insurance America Inc. | 50M p/o 1B | 12/17/12 - 12/17/13 | |
Property - London | EL1200311 - Total | Millennium Consortium (Navigators,Pembroke,Chaucer, Catlin) | 750M | ||
Property | EL1200318 | Great Lakes Reinsurance (UK) PLC | 1B | 12/17/12 - 12/17/13 | |
Property | EL1200319 | Infrassure Ltd | 800M x/s 500M | 12/17/12 - 12/17/13 | |
Property | EL1200321 | International Insurance Company of Hannover Ltd | 800M x/s 500M | 12/17/12 - 12/17/13 | |
Property | EL1200323 | Llloyd's Sundicate No. 1414 (ASC - Ascot) | 550M x/s 750M | 12/17/12 - 12/17/13 | |
Property | EL1200324 | Lloyd's Syndicate No. 1967 (WRB - Berkley) | 100M | 12/17/12 - 12/17/13 | |
Property | EL1200325 | Lloyd's Syndicate No. 0510 (KLN - Kiln) | 50M | 12/17/12 - 12/17/13 | |
Property | EL1200330 | Lloyd's Syndicate No. 0382 (HDU - Hardy) | 550M x/s 750M | 12/17/12 - 12/17/13 | |
Property | EL1200332 | Lloyd's Syndicate No. 2791 (MAP) | 50M x/s 50M | 12/17/12 - 12/17/13 | |
Property | EL1200335 | Lloyd's Syndicate No. 2001 (AML - Amlin) | 250M x/s 750M | 12/17/12 - 12/17/13 | |
Property | EL1200336 - Total | Lloyd's Syndicate No. 0457 (WTK - Watkins) 0609 AUW | 300M x/s 1B | ||
Property - Bermuda Direct | EL1200333 | Arch Insurance Europe | 1B | 12/17/12 - 12/17/13 | |
Property | PBFE 01282P02 | ACE Bermuda | 49.05M p/o 300M x/s 1B | 12/17/12 - 12/17/13 | |
Property | P118450 | Ariel Re Bermuda Ltd. | 15M p/o 800M x/s 500M | 12/17/12 - 12/17/13 | |
Property | P-100000-1212 | OIL Casualty Insurance, Ltd | 15M p/o 800M x/s 500M | 12/17/12 - 12/17/13 | |
Property - Engineering Fee | EPRN09148449 | ACE American Insurance Company | 104M p/o 1.3B | 12/17/12 - 12/17/13 | |
PROPERTY - TERRORISM |
Property Terrorism - Domestic | AFD1184049C12 | Talbot | 100M p/o 1B | PD - $5M / BI 60 days | 12/17/12 - 12/17/13 |
Property Terrorism - London | RQ1200316 | Lloyds Syndicate Various -RQ1200316 - VariousTotal: | 500M | 12/17/12 - 12/17/13 | |
Property Terrorism - London | RQ1200378 | Lloyd's Syndicate No. 0033 (HIS - Hiscox) | 500M | 12/17/12 - 12/17/13 | |
Property Terrorism - London | RQ1203529 | Lloyd's Syndicate Various - RQ1203529 Lancashire Leader | 500M x/s 500M | 12/17/12 - 12/17/13 | |
ENVIRONMENTAL | |||||
Underground Storage Tanks | G24684830 001 | ACE Environmental Risk | $2MM | 7/30/2012 - 7/30/2013 | |
Legal Remediation Run Off- DCR | PLS91956502/ /EEL211137700 | Chartis/Great American | $75MM | 6/1/10 - 6/1/20 | |
Legal Remediation Run Off - PRC | PLS14159793/EXCG24890715/A2SRD309007 | Chartis/ACE/Nat'l Marine Fire | $75MM | 12/17/10- 12/17/20 | |
Legal Pollution - NSR Project DCR | PCL109374700 | Grt American | $20MM | $1M | 1/25/13-16 |
Legal Pollution - Master- Primary | PEC0041228 | XL (Greenwich) | 50MM | $5M | 6/1/13- 6/1/16 |
lst Excess | TBD | AIG | $25MM xs $50MM | 6/1/13- 6/1/16 | |
2nd Excess | AEC 5955871-00 | Zurich (Steadfast) | $25MM xs $75MM | 6/1/13- 6/1/16 | |
3rd Excess | XSV676055-0616 | Catlin Speciality | $15MM xs $100MM | 6/1/13- 6/1/16 | |
4th Excess | 1697400 | Ironshore | $25MM xs $115MM | 6/1/13- 6/1/16 | |
5th Excess | 0308-4327 | AWAC | $ 5MM xs $140MM | 6/1/13- 6/1/16 | |
6th Excess | EEL 190317800 | Great American | $15MM xs $145MM | 6/1/13- 6/1/16 | |
7th Excess | EXC G2727075A | ACE | $25MM xs $160MM | 6/1/13- 6/1/16 | |
8th Excess | EEL 190317800 | Great American | $15MM xs $185MM | 6/1/13- 6/1/16 | |
Sub-Total: Environ - Master ($200MM) |
If to Aron, to: | ||
Trading and Sales: Simon Collier 200 West Street New York N.Y. 10282 (212) 902 0776 Simon.Collier@gs.com | Chrissy Benson 200 West Street New York N.Y. 10282 (212) 902 0776 Christine.Benson@gs.com | |
Thomas Love 200 West Street New York N.Y. 10282 (212) 357 4239 Thomas.Love@gs.com | ||
Scheduling Jim Brush 200 West Street New York N.Y. 10282 Direct: (212) 902 9874 Hotline: (212) 902 7349 Fax: (212) 493 9847 ficc-jaron-oilops@ny.email.gs.com | Andrew Snyder 200 West Street New York N.Y. 10282 Direct: (212) 902 4037 Hotline: (212) 902 7349 Fax: (212) 493 9847 ficc-jaron-oilops@ny.email.gs.com | |
Confirmations: | ||
Primary: Patricia Hazel 200 West Street New York N.Y. 10282 Tel.: (212) 902 7305 Fax: (212) 493 9849 gs-commod-ny-drafting@ny.email.gs.com | Alternate: Michael Caserta 200 West Street New York N.Y. 10282 Tel.: (212) 357 0779 Fax: (212) 493 9849 gs-commod-ny-drafting@ny.email.gs.com |
Payments: | |
Primary: Jeffrey Fernandez 200 West Street New York N.Y. 10282 Tel: (212) 357 9345 Fax: (646) 835 8748 ficc-struct-sett@ny.email.gs.com | Alternate: Kristen O’Neill 200 West Street New York N.Y. 10282 Tel: (212) 902 7311 Fax: (646) 835 8748 ficc-struct-sett@ny.email.gs.com |
Invoicing/Statements: | |
Primary: Jeffrey Fernandez 200 West Street New York N.Y. 10282 Tel: (212) 357 9345 Fax: (646) 835 8748 ficc-struct-sett@ny.email.gs.com | Kristen O’Neill 200 West Street New York N.Y. 10282 Tel: (212) 902 7311 Fax: (646) 835 8748 ficc-struct-sett@ny.email.gs.com |
Alternate: Federica Pinelli 200 West Street New York N.Y. 10282 (917) 343 8156 Fax: (646) 835 8748 ficc-struct-sett@ny.email.gs.com | |
General Notices: | |
John R. Thomas Goldman, Sachs & Co. 15th Floor 200 West Street New York, NY 10282-2198 Tel: (212) 902-1806 Fax: (212) 256-2456 John.thomas@gs.com |
/s/ Thomas J. Nimbley | ||
Thomas J. Nimbley Chief Executive Officer |
/s/ Matthew C. Lucey | ||
Matthew C. Lucey Senior Vice President and Chief Financial Officer |
/s/ Thomas J. Nimbley | ||
Thomas J. Nimbley Chief Executive Officer |
/s/ Matthew C. Lucey | ||
Matthew C. Lucey Senior Vice President and Chief Financial Officer |
1. | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of PBF Energy. |
/s/ Thomas J. Nimbley | |
Thomas J. Nimbley | |
Chief Executive Officer | |
August 8, 2013 |
1. | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of PBF Energy. |
/s/ Matthew C. Lucey | |
Matthew C. Lucey | |
Senior Vice President and Chief Financial Officer | |
August 8, 2013 |
1. | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of PBF Holding. |
/s/ Thomas J. Nimbley | |
Thomas J. Nimbley | |
Chief Executive Officer | |
August 8, 2013 |
1. | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of PBF Holding. |
/s/ Matthew C. Lucey | |
Matthew C. Lucey | |
Senior Vice President and Chief Financial Officer | |
August 8, 2013 |
DIVIDENDS AND DISTRIBUTIONS
|
6 Months Ended |
---|---|
Jun. 30, 2013
|
|
Equity [Abstract] | |
DIVIDENDS AND DISTRIBUTIONS | DIVIDENDS AND DISTRIBUTIONS With respect to dividends and distributions paid during the six months ended June 30, 2013, PBF Holding paid $155,802 in distributions to PBF LLC. PBF LLC used $57,952 of this amount ($0.30 per unit) to make two separate non-tax distributions to its members, of which $14,168 was distributed to PBF Energy and the balance was distributed to its other members on March 15, 2013 and June 7, 2013. PBF Energy used this $14,168 to pay two separate equivalent cash dividends of $0.30 per share of Class A common stock on March 15, 2013 and June 7, 2013. PBF LLC used the remaining $97,850 from PBF Holding's distribution to make tax distributions to its members during the six months ended June 30, 2013, with $19,689 distributed to PBF Energy, of which $567 was paid by PBF LLC directly to the applicable taxing authorities on behalf of PBF Energy. |
SUBSEQUENT EVENTS (Details) (Subsequent Event [Member], USD $)
In Thousands, except Per Share data, unless otherwise specified |
1 Months Ended | 0 Months Ended |
---|---|---|
Aug. 02, 2013
|
Jul. 31, 2013
Class A Common Stock [Member]
PBF Energy [Member]
|
|
Subsequent Event [Line Items] | ||
Dividends declared per share | $ 0.30 | |
Amount received for services on a monthly basis | $ 40 |
Condensed Consolidated Statements of Operations (USD $)
In Thousands, except Share data, unless otherwise specified |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2013
|
Jun. 30, 2012
|
Jun. 30, 2013
|
Jun. 30, 2012
|
|
Revenues | $ 4,678,293 | $ 5,077,015 | $ 9,476,141 | $ 9,793,121 |
Cost and expenses: | ||||
Cost of sales, excluding depreciation | 4,295,979 | 4,279,046 | 8,731,081 | 8,939,239 |
Operating expenses, excluding depreciation | 202,583 | 170,702 | 408,599 | 358,845 |
General and administrative expenses | 19,141 | 25,286 | 49,235 | 39,100 |
Loss (gain) on sale of assets | 0 | 53 | 0 | (2,450) |
Depreciation and amortization expense | 27,563 | 22,422 | 54,093 | 42,963 |
Total cost and expenses | 4,545,266 | 4,497,509 | ||
Income from operations | 133,027 | 579,506 | 233,133 | 415,424 |
Other income (expense) | ||||
Change in fair value of contingent consideration | 0 | (692) | 0 | (1,384) |
Change in fair value of catalyst lease | 6,820 | 5,371 | 5,481 | (978) |
Interest expense, net | (21,708) | (28,443) | (43,319) | (59,851) |
Income before income taxes | 118,139 | 555,742 | 195,295 | 353,211 |
Income tax expense | (10,969) | 0 | (18,413) | 0 |
Net income (loss) | 107,170 | 555,742 | 176,882 | 353,211 |
Less: net income attributable to noncontrolling interest | 90,344 | 148,649 | ||
Net income attributable to PBF Energy Inc. | 16,826 | 28,233 | ||
Basic (in shares) | 26,944,055 | 25,276,137 | ||
Diluted (in shares) | 27,706,696 | 26,110,976 | ||
Basic (in usd per share) | $ 0.62 | $ 1.12 | ||
Diluted (in usd per share) | $ 0.61 | $ 1.08 | ||
Dividend per common share | $ 0.30 | $ 0.60 | ||
PBF Holding Company LLC [Member]
|
||||
Revenues | 4,678,293 | 5,077,015 | 9,476,141 | 9,793,121 |
Cost and expenses: | ||||
Cost of sales, excluding depreciation | 4,295,979 | 4,279,046 | 8,731,081 | 8,939,239 |
Operating expenses, excluding depreciation | 202,583 | 170,702 | 408,599 | 358,845 |
General and administrative expenses | 19,141 | 25,286 | 49,235 | 39,100 |
Loss (gain) on sale of assets | 0 | 53 | 0 | (2,450) |
Depreciation and amortization expense | 27,563 | 22,422 | 54,093 | 42,963 |
Total cost and expenses | 4,545,266 | 4,497,509 | 9,243,008 | 9,377,697 |
Income from operations | 133,027 | 579,506 | 233,133 | 415,424 |
Other income (expense) | ||||
Change in fair value of contingent consideration | 0 | (692) | 0 | (1,384) |
Change in fair value of catalyst lease | 6,820 | 5,371 | 5,481 | (978) |
Interest expense, net | (21,738) | (28,443) | (43,349) | (59,851) |
Net income (loss) | $ 118,109 | $ 555,742 | $ 195,265 | $ 353,211 |
INVENTORIES
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
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Inventory Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INVENTORIES | INVENTORIES Inventories consisted of the following:
Inventory under inventory supply and offtake arrangements includes crude oil stored at the Company’s Paulsboro and Delaware City refineries' storage facilities that the Company will purchase as it is consumed in connection with the crude supply agreements; feedstocks and blendstocks sold to counterparties that the Company will repurchase for further blending into finished products; lube products sold to a counterparty that the Company will repurchase; and light finished products sold to a counterparty in connection with the offtake agreement and stored in the Paulsboro and Delaware City refineries' storage facilities pending shipment by the counterparty. At June 30, 2013 and December 31, 2012, the replacement value of inventories exceeded the LIFO carrying value by approximately $4,551 and $79,859, respectively. |
NONCONTROLLING INTEREST OF PBF ENERGY (Tables)
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
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Noncontrolling Interest [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
The ownership percentage in PBF LLC | The noncontrolling interest ownership percentage as of June 30, 2013, June 12, 2013 (the completion date of the Secondary Offering) and December 31, 2012 is calculated as follows:
——————————
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Summary of the allocation of equity between the controlling and noncontrolling interests of PBF Energy | The following table summarizes the changes in equity for the controlling and noncontrolling interests of PBF Energy for the six months ended June 30, 2013:
|
EMPLOYEE BENEFIT PLANS
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
|
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Defined Benefit Pension Plans and Defined Benefit Postretirement Plans Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
EMPLOYEE BENEFIT PLANS | EMPLOYEE BENEFIT PLANS The components of net periodic benefit cost related to the Company’s defined benefit plans consisted of the following:
|
FAIR VALUE MEASUREMENTS (Fair Value and Carrying Value of Debt) (Details) (USD $)
In Thousands, unless otherwise specified |
Jun. 30, 2013
|
Dec. 31, 2012
|
||||||||
---|---|---|---|---|---|---|---|---|---|---|
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Long-term debt | $ 799,963 | $ 709,980 | ||||||||
Long-term debt, excluding current maturities, Fair value | 821,180 | 744,405 | ||||||||
Senior secured notes [Member]
|
||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Long-term debt, Carrying value | 667,002 | [1] | 666,538 | [1] | ||||||
Long-term debt, Fair value | 688,219 | [1] | 700,963 | [1] | ||||||
Long-term Line of Credit | 95,000 | [2] | 0 | [2] | ||||||
Lines of Credit, Fair Value Disclosure | 95,000 | [2] | 0 | [2] | ||||||
Catalyst lease [Member]
|
||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Long-term debt, Carrying value | 37,961 | [3] | 43,442 | [3] | ||||||
Long-term debt, Fair value | $ 37,961 | [3] | $ 43,442 | [3] | ||||||
|
DEFERRED CHARGES AND OTHER ASSETS, NET (Details) (USD $)
In Thousands, unless otherwise specified |
Jun. 30, 2013
|
Dec. 31, 2012
|
---|---|---|
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Deferred turnaround costs, net | $ 71,785 | $ 78,128 |
Catalyst | 63,957 | 66,377 |
Deferred financing costs, net | 29,318 | 30,987 |
Restricted cash | 12,116 | 12,114 |
Linefill | 8,735 | 8,042 |
Intangible assets, net | 869 | 1,085 |
Other | 457 | 616 |
Deferred charges and other assets | $ 187,237 | $ 197,349 |
ACCRUED EXPENSES (Tables)
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
|
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Payables and Accruals [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of accrued expenses | PBF Holding Accrued expenses consisted of the following:
PBF Energy Accrued expenses consisted of the following:
|
DEFERRED CHARGES AND OTHER ASSETS, NET (Tables)
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
|
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Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of deferred charges and other assets, net | Deferred charges and other assets, net consisted of the following:
|
FAIR VALUE MEASUREMENTS (Measured on Recurring Basis) (Details) (Fair Value, Measurements, Recurring [Member], USD $)
In Thousands, unless otherwise specified |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2013
Catalyst lease obligations [Member]
Level 1 [Member]
|
Dec. 31, 2012
Catalyst lease obligations [Member]
Level 1 [Member]
|
Jun. 30, 2013
Catalyst lease obligations [Member]
Level 2 [Member]
|
Dec. 31, 2012
Catalyst lease obligations [Member]
Level 2 [Member]
|
Jun. 30, 2013
Catalyst lease obligations [Member]
Level 3 [Member]
|
Dec. 31, 2012
Catalyst lease obligations [Member]
Level 3 [Member]
|
Jun. 30, 2013
Catalyst lease obligations [Member]
Total [Member]
|
Dec. 31, 2012
Catalyst lease obligations [Member]
Total [Member]
|
Jun. 30, 2013
Derivatives included with inventory supply arrangement obligations [Member]
Level 1 [Member]
|
Jun. 30, 2013
Derivatives included with inventory supply arrangement obligations [Member]
Level 3 [Member]
|
Dec. 31, 2012
Contingent consideration for refinery acquisition [Member]
Level 1 [Member]
|
Dec. 31, 2012
Contingent consideration for refinery acquisition [Member]
Level 2 [Member]
|
Dec. 31, 2012
Contingent consideration for refinery acquisition [Member]
Level 3 [Member]
|
Jun. 30, 2013
Contingent consideration for refinery acquisition [Member]
Level 3 [Member]
Discounted Cash Flow [Member]
|
Dec. 31, 2012
Contingent consideration for refinery acquisition [Member]
Total [Member]
|
Jun. 30, 2013
Commodity contract [Member]
Level 1 [Member]
|
Dec. 31, 2012
Commodity contract [Member]
Level 1 [Member]
|
Dec. 31, 2012
Commodity contract [Member]
Level 2 [Member]
|
Dec. 31, 2012
Commodity contract [Member]
Level 3 [Member]
|
Dec. 31, 2012
Commodity contract [Member]
Total [Member]
|
Dec. 31, 2012
Inventory Supply and Offtake Arrangements [Member]
Total [Member]
|
Jun. 30, 2013
Money market funds [Member]
Level 1 [Member]
|
Dec. 31, 2012
Money market funds [Member]
Level 1 [Member]
|
Jun. 30, 2013
Money market funds [Member]
Level 2 [Member]
|
Dec. 31, 2012
Money market funds [Member]
Level 2 [Member]
|
Jun. 30, 2013
Money market funds [Member]
Level 3 [Member]
|
Dec. 31, 2012
Money market funds [Member]
Level 3 [Member]
|
Jun. 30, 2013
Money market funds [Member]
Total [Member]
|
Dec. 31, 2012
Money market funds [Member]
Total [Member]
|
Dec. 31, 2012
Commodity contract [Member]
Level 1 [Member]
|
Jun. 30, 2013
Commodity contract [Member]
Level 2 [Member]
|
Dec. 31, 2012
Commodity contract [Member]
Level 2 [Member]
|
Jun. 30, 2013
Commodity contract [Member]
Level 3 [Member]
|
Dec. 31, 2012
Commodity contract [Member]
Level 3 [Member]
|
Jun. 30, 2013
Commodity contract [Member]
Total [Member]
|
Dec. 31, 2012
Commodity contract [Member]
Total [Member]
|
Dec. 31, 2012
Derivatives included with inventory supply arrangement obligations [Member]
Level 1 [Member]
|
Jun. 30, 2013
Derivatives included with inventory supply arrangement obligations [Member]
Level 2 [Member]
|
Dec. 31, 2012
Derivatives included with inventory supply arrangement obligations [Member]
Level 2 [Member]
|
Dec. 31, 2012
Derivatives included with inventory supply arrangement obligations [Member]
Level 3 [Member]
|
Jun. 30, 2013
Derivatives included with inventory supply arrangement obligations [Member]
Total [Member]
|
|
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||||||||||||||||||||||||||||||||||
Assets | $ 0 | $ 0 | $ 5,855 | $ 175,786 | $ 0 | $ 0 | $ 0 | $ 0 | $ 5,855 | $ 175,786 | $ 3,303 | $ 0 | $ 0 | $ 3,303 | $ 0 | $ 2,724 | $ 5,595 | $ 0 | $ 2,724 | ||||||||||||||||||||||
Liabilities | $ 0 | $ 0 | $ 37,961 | $ 43,442 | $ 0 | $ 0 | $ 37,961 | $ 43,442 | $ 0 | $ 0 | $ 21,358 | $ 21,358 | $ 6,191 | $ 0 | $ 1,872 | $ 0 | $ 1,872 | $ 5,595 | $ 125 | $ 0 | $ 6,316 | ||||||||||||||||||||
Valuation method used to measure financial instruments [Abstract] | |||||||||||||||||||||||||||||||||||||||||
Risk free interest rate | 0.16% | ||||||||||||||||||||||||||||||||||||||||
Credit rate spread | 4.38% | ||||||||||||||||||||||||||||||||||||||||
Discount rate | 4.54% |
DESCRIPTION OF THE BUSINESS AND BASIS OF PRESENTATION (Details) (USD $)
In Thousands, except Share data, unless otherwise specified |
0 Months Ended | 0 Months Ended | ||||
---|---|---|---|---|---|---|
Jun. 30, 2013
PBF Holding Company LLC [Member]
|
Jun. 30, 2013
Senior Secured Notes Issued in 2012 [Member]
Senior Notes [Member]
PBF Holding Company LLC [Member]
|
Dec. 18, 2012
Initial Public Offering [Member]
PBF LLC [Member]
|
Dec. 12, 2012
Initial Public Offering [Member]
Class A Common Stock [Member]
|
Jun. 12, 2013
Secondary Public Offering [Member]
PBF LLC [Member]
|
Jun. 12, 2013
Secondary Public Offering [Member]
Class A Common Stock [Member]
|
|
Description of Business [Line Items] | ||||||
Public offering (in shares) | 23,567,686 | 15,950,000 | ||||
Public offering, offering price per share | $ 26.00 | $ 27.00 | ||||
Percentage of voting interest acquired | 24.40% | 16.60% | ||||
Payments of Stock Issuance Costs | $ 1,388 | |||||
Debt fixed interest rate | 2.50% | 8.25% |
DELAWARE ECONOMIC DEVELOPMENT AUTHORITY LOAN (Details) (USD $)
In Thousands, unless otherwise specified |
6 Months Ended | ||
---|---|---|---|
Jun. 30, 2013
|
Dec. 31, 2012
|
Jun. 30, 2010
|
|
Debt Instrument [Line Items] | |||
Delaware Economic Development Authority loan | $ 16,000 | $ 20,000 | $ 20,000 |
Annual conversion of loan to grant | 4,000 | ||
Term of loan conversion | 5 years | ||
Minimum man hours of labor utilized | 600000 hours | ||
Minimum qualified capital expenditures | $ 125,000 | ||
Zero Percent Interest Note [Member]
|
|||
Debt Instrument [Line Items] | |||
Debt fixed interest rate | 0.00% |
DERIVATIVES (Narrative) (Details) (USD $)
In Thousands, unless otherwise specified |
3 Months Ended | 6 Months Ended | ||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2013
|
Jun. 30, 2012
|
Jun. 30, 2013
|
Jun. 30, 2012
|
Jun. 30, 2013
Crude Oil and Feedstock Inventory [Member]
Not Designated as Hedging Instrument [Member]
bbl
|
Dec. 31, 2012
Crude Oil and Feedstock Inventory [Member]
Not Designated as Hedging Instrument [Member]
bbl
|
Jun. 30, 2013
Crude Oil and Feedstock Inventory [Member]
Fair Value Hedging [Member]
bbl
|
Dec. 31, 2012
Crude Oil and Feedstock Inventory [Member]
Fair Value Hedging [Member]
bbl
|
Jun. 30, 2013
Crude Oil Commodity Contract [Member]
Not Designated as Hedging Instrument [Member]
bbl
|
Dec. 31, 2012
Crude Oil Commodity Contract [Member]
Not Designated as Hedging Instrument [Member]
bbl
|
Jun. 30, 2013
Refined Product Commodity Contract [Member]
Not Designated as Hedging Instrument [Member]
bbl
|
Dec. 31, 2012
Refined Product Commodity Contract [Member]
Not Designated as Hedging Instrument [Member]
bbl
|
|
Derivative [Line Items] | ||||||||||||
Derivative, notional amount, volume | 0 | 0 | 1,158,048 | 2,529,447 | 12,114,000 | 9,234,000 | 713,000 | 1,310,000 | ||||
Loss on fair value hedge ineffectiveness | $ 3,351 | |||||||||||
Gain on fair value hedge ineffectiveness | $ 11,273 | $ 634 | $ 525 |
DERIVATIVES (Tables)
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Fair Value of Derivative Instruments | The following tables provide information about the fair values of these derivative instruments as of June 30, 2013 and December 31, 2012 and the line items in the consolidated balance sheet in which the fair values are reflected.
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Schedule of Derivative Instruments, Gain (Loss) Recognized in Income | The following tables provide information about the gain or loss recognized in income on these derivative instruments and the line items in the consolidated financial statements in which such gains and losses are reflected.
|
COMMITMENTS AND CONTINGENCIES (Details) (USD $)
In Thousands, unless otherwise specified |
6 Months Ended | 12 Months Ended | 6 Months Ended | ||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2013
|
Jun. 12, 2013
|
Dec. 31, 2012
|
Dec. 31, 2010
Environmental Issue [Member]
ppm
|
Jun. 30, 2013
Environmental Issue [Member]
|
Dec. 31, 2012
Environmental Issue [Member]
|
Jun. 30, 2013
Environmental Issue [Member]
Valero [Member]
|
Jun. 30, 2013
Environmental Issue [Member]
PBF Energy and Valero [Member]
|
||||||
Loss Contingencies [Line Items] | |||||||||||||
Environmental liability | $ 11,070 | $ 9,669 | |||||||||||
Discount rate used for environmental liability assessment | 8.00% | ||||||||||||
Restricted cash for environmental liabilities | 12,116 | 12,114 | 12,116 | 12,114 | |||||||||
Maximum pre-disposal environmental obligations of Valero | 20,000 | ||||||||||||
Payments to acquire environmental insurance policies | $ 75,000 | ||||||||||||
Term of insurance policies | 10 years | ||||||||||||
Maximum amount of sulfur allowed in heating oil (in ppm) | 15 | ||||||||||||
Percent of tax benefit received from increases in tax basis paid to stockholders | 85.00% | ||||||||||||
Percentage of ownership in PBF LLC | 100.00% | [1] | 100.00% | [1] | 100.00% | [1] | |||||||
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INVENTORIES (Tables)
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6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
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Inventory Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Inventory | Inventories consisted of the following:
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RECENT ACCOUNTING PRONOUCEMENTS
|
6 Months Ended |
---|---|
Jun. 30, 2013
|
|
Accounting Changes and Error Corrections [Abstract] | |
RECENT ACCOUNTING PRONOUCEMENTS | RECENT ACCOUNTING PRONOUNCEMENTS On January 1, 2013, the Company adopted changes issued by the Financial Accounting Standards Board ("FASB") to the disclosure of offsetting assets and liabilities. These changes require an entity to disclose gross and net information about instruments and transactions eligible for offset in the statement of financial position and instruments and transactions subject to an agreement similar to a master netting arrangement. The enhanced disclosures will enable users of an entity's financial statements to understand and evaluate the effect or potential effect of master netting arrangements on an entity's financial position, including the effect or potential effect of rights of setoff associated with certain financial instruments and derivative instruments. As of June 30, 2013, the impact of offsetting assets and liabilities was not material to the Company and additional disclosure is not included in this Form 10-Q. On January 1, 2013, the Company adopted changes issued by the FASB to the reporting of amounts reclassified out of accumulated other comprehensive income. These changes require an entity to report the effect of significant reclassifications out of accumulated other comprehensive income on the respective line items in net income if the amount being reclassified is required to be reclassified in its entirety to net income. For other amounts that are not required to be reclassified in their entirety to net income in the same reporting period, an entity is required to cross-reference other disclosures that provide additional detail about those amounts. These requirements are to be applied to each component of accumulated other comprehensive income. For the three and six months ended June 30, 2013, the impact of reclassification out of accumulated other comprehensive income was not material to the Company and additional disclosure is not included in this Form 10-Q. |
DEFERRED CHARGES AND OTHER ASSETS, NET
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
|
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Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
DEFERRED CHARGES AND OTHER ASSETS, NET | DEFERRED CHARGES AND OTHER ASSETS, NET Deferred charges and other assets, net consisted of the following:
|
NONCONTROLLING INTEREST OF PBF ENERGY
|
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
|
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Noncontrolling Interest [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
NONCONTROLLING INTEREST OF PBF ENERGY | NONCONTROLLING INTEREST OF PBF ENERGY As a result of the PBF Energy IPO and the related reorganization transactions on December 18, 2012, PBF Energy became the sole managing member of, and had a controlling interest in, PBF LLC which represented 24.4% of the outstanding units. As the sole managing member of PBF LLC, PBF Energy operates and controls all of the business and affairs of PBF LLC and its subsidiaries. In connection with the Secondary Offering, Blackstone and First Reserve exchanged 15,950,000 Series A Units of PBF LLC for an equivalent number of shares of Class A common stock of PBF Energy, which increased PBF Energy's interest in PBF LLC to 41.0%. PBF Energy consolidates the financial results of PBF LLC and its subsidiaries, and records a noncontrolling interest for the economic interest in PBF Energy held by the members of PBF LLC other than PBF Energy. Noncontrolling interest on the consolidated statements of operations represents the portion of net income or loss attributable to the economic interest in PBF Energy held by the members of PBF LLC other than PBF Energy. Noncontrolling interest on the consolidated balance sheets represents the portion of net assets of PBF Energy attributable to the members of PBF LLC other than PBF Energy. The noncontrolling interest ownership percentage as of June 30, 2013, June 12, 2013 (the completion date of the Secondary Offering) and December 31, 2012 is calculated as follows:
——————————
The following table summarizes the changes in equity for the controlling and noncontrolling interests of PBF Energy for the six months ended June 30, 2013:
|
INCOME TAXES (Details) (USD $)
In Thousands, unless otherwise specified |
3 Months Ended | 6 Months Ended | ||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2013
|
Jun. 30, 2012
|
Jun. 30, 2013
|
Jun. 30, 2012
|
Jun. 12, 2013
|
Dec. 31, 2012
|
Jun. 30, 2013
Class A Common Stock [Member]
PBF Energy [Member]
|
Jun. 12, 2013
Class A Common Stock [Member]
PBF Energy [Member]
|
Dec. 31, 2012
Class A Common Stock [Member]
PBF Energy [Member]
|
Dec. 18, 2012
Class A Common Stock [Member]
PBF Energy [Member]
|
|||||||
Percentage of ownership in PBF LLC | 100.00% | [1] | 100.00% | [1] | 100.00% | [1] | 100.00% | [1] | 41.00% | 41.00% | 24.40% | 24.40% | ||||
Current tax expense | $ 1,744 | $ 1,744 | ||||||||||||||
Deferred tax expense | 9,225 | 16,669 | 0 | |||||||||||||
Total tax expense | $ 10,969 | $ 0 | $ 18,413 | $ 0 | ||||||||||||
Effective tax rate | 39.50% | 39.50% | ||||||||||||||
|
INCOME TAXES (Tables)
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2013
|
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Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of the income tax provision | The income tax provision in the PBF Energy condensed consolidated financial statements of operations consists of the following:
|
NET INCOME PER SHARE OF PBF ENERGY (Tables)
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
|
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Computation of basic and diluted net income per common share | For the period subsequent to the IPO, the following table sets forth the computation of basic and diluted net income per Class A common share attributable to PBF Energy:
——————————
|