Exhibit 10.1
UNITED REFINING
COMPANY
$25,000,000
10 1 / 2
% Senior Notes Due
2012
Purchase Agreement
February 10, 2005
Citigroup Global Markets
Inc.
388 Greenwich Street
New York, New York 10013
Ladies and Gentlemen:
United Refining Company, a
corporation organized under the laws of Pennsylvania (the “
Company ”), proposes to issue and sell to Citigroup
Global Markets Inc. (the “ Initial Purchaser ”),
$25,000,000 principal amount of its 10 1 / 2
% Senior Notes Due 2012
(the “ Notes ”). The Notes are to be issued
under an indenture, dated as of August 6, 2004 (the
“Indenture”), among the Company, the Guarantors (as
defined herein) and The Bank of New York, as trustee (the “
Trustee ”), pursuant to which $200,000,000 of notes of
the same series were previously issued (the “Initial
Notes”). The Company’s obligations under the Notes will
be guaranteed (the “ Guarantees ,” and, together
with the Notes, the “ Securities ”) on a senior
unsecured basis by each of the guarantors listed on the signature
pages hereto (collectively, the “ Guarantors ,”
and together with the Company, the “ Issuers
”).
The Securities will have the benefit
of a registration rights agreement (the “ Registration
Rights Agreement ”), to be dated as of the Closing Date
(as defined herein), among the Issuers and the Initial Purchaser,
pursuant to which the Issuers will agree to register the Securities
under the Act subject to the terms and conditions therein
specified. The use of the neuter in this Agreement shall include
the feminine and masculine wherever appropriate. Certain terms used
herein are defined in Section 18 hereof.
The sale of the Securities to the
Initial Purchaser will be made without registration of the
Securities under the Act in reliance upon exemptions from the
registration requirements of the Act.
In connection with the sale of the
Securities, the Issuers have prepared an offering memorandum, dated
February 10, 2005 (as amended or supplemented at the Execution
Time, including any and all exhibits thereto and any information
incorporated by reference therein, the “ Offering
Memorandum ”). The Offering Memorandum sets forth certain
information concerning the Issuers and the Securities. Each of the
Issuers hereby confirms that it has authorized the use of the
Offering Memorandum, and any amendment or supplement thereto, in
connection with the offer and sale of the Securities by the Initial
Purchaser as contemplated by this Agreement and the Offering
Memorandum. Unless stated to the contrary, any references herein to
the terms “amend”, “amendment” or
“supplement” with respect to the Offering Memorandum
shall be deemed to refer to and include any information filed under
the Exchange Act subsequent to the Execution Time that is
incorporated by reference therein.
Representations and
Warranties . The Issuers, jointly
and severally, represent and warrant to the Initial Purchaser as
set forth below in this Section 1.
At the Execution Time and on the
Closing Date, respectively, the Offering Memorandum did not and
will not (and any amendment or supplement thereto, at the date
thereof and at the Closing Date will not) contain any untrue
statement of a material fact or omit to state any material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
provided , however , that the Issuers make no
representation or warranty as to the information contained in or
omitted from the Offering Memorandum, or any amendment or
supplement thereto, in reliance upon and in conformity with
information furnished in writing to the Company by or on behalf of
the Initial Purchaser specifically for inclusion
therein.
None of the Issuers, their
Affiliates, or any person acting on their behalf has, directly or
indirectly, made offers or sales of any security, or solicited
offers to buy, any security under circumstances that would require
the registration of the Securities under the Act; provided,
however, that the Initial Purchaser acknowledges that the Company
has registered $200 million in aggregate principal amount of
10 1
/ 2 % Senior Notes due 2012 under the
Act, which notes have been or will be exchanged for the Initial
Notes pursuant to an exchange offer by the Company (the
“Initial Note Exchange Offer”) .
None of the Issuers, their
Affiliates, or any person acting on their behalf has: (i) engaged
in any form of general solicitation or general advertising (within
the meaning of Regulation D) in connection with any offer or sale
of the Securities or (ii) engaged in any directed selling efforts
(within the meaning of Regulation S) with respect to the
Securities; and each of the Issuers, their Affiliates and each
person acting on their behalf has complied with the offering
restrictions requirement of Regulation S.
The Securities satisfy the
eligibility requirements of Rule 144A(d)(3) under the
Act.
No registration under the Act of the
Securities is required for the offer and sale of the Securities to
or by the Initial Purchaser in the manner contemplated herein and
in the Offering Memorandum assuming, in each case: (i) that the
purchasers who buy the Securities in the resales are either
“qualified institutional buyers” (as defined under Rule
144A of the Act) or institutional “accredited
investors” (as defined in Rule 501(a)(1), (2), (3) or (7) of
Regulation D) and (ii) the accuracy of and compliance with the
Initial Purchaser’s representations, warranties and covenants
contained in Section 4 of this Agreement.
No Issuer is, or after giving effect
to the offering and sale of the Securities and the application of
the proceeds thereof as described in the Offering Memorandum will
not be, an “investment company” as defined in the
Investment Company Act, without taking account of any exemption
arising out of the number of holders of the Issuers’
securities.
Each Issuer is subject to and in
full compliance with the reporting requirements of Section 13 or
Section 15(d) of the Exchange Act.
No Issuer has paid or agreed to pay
to any person any compensation for soliciting another to purchase
any securities of any Issuer under circumstances that would require
the registration of the Securities under the Act (except as
contemplated in this Agreement).
No Issuer has taken, directly or
indirectly, any action designed to cause or result, under the
Exchange Act or otherwise, in stabilization or manipulation of the
price of any security of any Issuer to facilitate the sale or
resale of the Securities.
Each Issuer has been duly
incorporated and is validly existing as a corporation in good
standing under the laws of the jurisdiction in which it is
chartered or organized with full corporate power and authority to
own or lease, as the case may be, and to operate its properties and
conduct its business as described in the Offering Memorandum, and
is duly qualified to do business as a foreign corporation and is in
good standing under the laws of each jurisdiction that requires
such qualification, or is subject to no material liability by
reason of the failure to be so qualified in any such
jurisdiction.
All the outstanding shares of
capital stock of each subsidiary have been duly authorized and
validly issued and are fully paid and nonassessable, and, except as
otherwise set forth in the Offering Memorandum, all outstanding
shares of capital stock of the subsidiaries are owned by the
Company either directly or through wholly owned subsidiaries free
and clear of any security interest, claim, lien or
encumbrance.
The statements set forth in the
Offering Memorandum under the caption “Description of
Notes,” insofar as they purport to constitute a summary of
the terms of the Securities, and under the caption “Certain
United States Federal Tax “Considerations,” insofar as
they purport to describe United States tax considerations to
holders of the Securities, fairly summarize the matters described
therein.
This Agreement has been duly
authorized, executed and delivered by each Issuer; the Indenture
has been duly authorized, executed and delivered by each Issuer
and, assuming due authorization, execution and delivery thereof by
the Trustee, is a legal, valid, binding instrument enforceable
against each Issuer in accordance with its terms (subject, as to
the enforcement of remedies, to applicable bankruptcy,
reorganization, insolvency, moratorium or other laws affecting
creditors’ rights generally from time to time in effect and
to general principles of equity); the Notes have been duly
authorized by the Company and, when executed by the Company and
authenticated by the Trustee in accordance with the provisions of
the Indenture and delivered to and paid for by the Initial
Purchaser, will constitute the legal, valid and binding obligations
of the Company entitled to the benefits of the Indenture (subject,
as to the enforcement of remedies, to applicable bankruptcy,
reorganization, insolvency, moratorium or other laws affecting
creditors’ rights generally from time to time in effect and
to general principles of equity); and the Registration Rights
Agreement has been duly authorized by each Issuer and, when
executed by each Issuer and delivered by each Issuer, will
constitute the legal, valid, binding and enforceable instrument of
each Issuer (subject, as to the enforcement of remedies, to
applicable bankruptcy, reorganization, insolvency, moratorium or
other laws affecting creditors’ rights generally from time to
time in effect and to general principles of equity).
Each of the Guarantees has been duly
authorized by the applicable Guarantor and, when executed by the
applicable Guarantor and delivered to the Trustee in accordance
with the terms of the Indenture, will constitute the legal, valid
and binding obligation of such Guarantor enforceable against such
Guarantor in accordance with its terms (subject as to the
enforcement of remedies, to applicable bankruptcy, reorganization,
insolvency (including, without limitation, all laws relating to
fraudulent transfers), moratorium or other laws affecting
creditors’ rights generally from time to time in effect and
to the general principles of equity).
No consent, approval, authorization,
filing with or order of any court or governmental agency or body is
required in connection with the transactions contemplated herein,
in the Indenture or in the Registration Rights Agreement, except
such as may be required under the blue sky laws of any jurisdiction
in which the Securities are offered and sold and, in the case of
the Registration Rights Agreement, such as will be obtained under
the Act and the Trust Indenture Act.
None of the execution and delivery
by the Issuers of the Indenture, this Agreement or the Registration
Rights Agreement, the issuance and sale of the Securities, or the
consummation of any other of the transactions herein or therein
contemplated, or the fulfillment of the terms hereof or thereof
will conflict with, result in a breach or violation or imposition
of any lien, charge or encumbrance upon any property or assets of
any Issuer pursuant to, (i) the charter or by-laws of any Issuer;
(ii) the terms of any indenture, contract, lease, mortgage, deed of
trust, note agreement, loan agreement or other agreement,
obligation, condition, covenant or instrument to which any Issuer
is a party or bound or to which its property is subject; or (iii)
any statute, law, rule, regulation, judgment, order or decree of
any court, regulatory body, administrative agency, governmental
body, arbitrator or other authority having jurisdiction over an
Issuer or any of its properties, except where such breach or
violation or imposition of any lien, charge or encumbrance upon any
property or assets of any Issuer as set forth in clauses (ii) or
(iii) above would not reasonably be expected to have a material
adverse effect on the condition (financial or otherwise), earnings,
business or properties of the Company and its subsidiaries, taken
as a whole, whether or not arising from transactions in the
ordinary course of business (a “ Material Adverse
Effect ”), except as set forth in or contemplated in the
Offering Memorandum (exclusive of any amendment or supplement
thereto).
The consolidated historical
financial statements and schedules of the Company and its
consolidated subsidiaries included or incorporated by reference in
the Offering Memorandum present fairly the financial condition,
results of operations and cash flows of the Company as of the dates
and for the periods indicated, comply as to form with the
applicable accounting requirements of Regulation S-X and have been
prepared in conformity with generally accepted accounting
principles applied on a consistent basis throughout the periods
involved (except as otherwise noted therein); the selected
financial data set forth under the caption “Selected
Consolidated Financial and Other Operating Data” in the
Offering Memorandum, the summary financial data set forth under the
caption “Summary Historical and Pro Forma Consolidated
Financial and Other Operating Data” in the Offering
Memorandum, and financial information set forth under the caption
“Capitalization” in the Offering Memorandum, fairly
presents, on the basis stated in the Offering Memorandum, the
information included therein.
No action, suit or proceeding by or
before any court or governmental agency, authority or body or any
arbitrator involving any of the Issuers or their property is
pending or, to the best knowledge of any Issuer, threatened that
(i) would reasonably be expected to have a material adverse effect
on the performance of this Agreement, the Indenture, the Securities
or the Registration Rights Agreement, or the consummation of any of
the transactions contemplated hereby or thereby or (ii) would not
have a Material Adverse Effect, except as set forth in or
contemplated in the Offering Memorandum (exclusive of any amendment
or supplement thereto).
Each Issuer owns or leases all such
properties as are necessary to the conduct of its operations as
presently conducted.
No Issuer is in violation or default
of: (i) any provision of its charter or bylaws or other
organizational or governing documents; (ii) the terms of any
indenture, contract, lease, mortgage, deed of trust, note
agreement, loan agreement or other agreement, obligation,
condition, covenant or instrument to which it is a party or bound
or to which its property is subject; or (iii) any statute, law,
rule, regulation, judgment, order or decree applicable to any
Issuer of any court, regulatory body, administrative agency,
governmental body, arbitrator or other authority having
jurisdiction over the Issuers or any of their properties, as
applicable, except where such violation or default as set forth in
clause (ii) or (iii) would not have a Material Adverse
Effect.
BDO Seidman, LLP, who have certified
certain financial statements of the Company and its consolidated
subsidiaries and delivered their report with respect to the audited
consolidated financial statements and schedules incorporated by
reference in the Offering Memorandum, are independent public
accountants with respect to the Company within the meaning of the
Act.
The Issuers have filed all foreign,
federal, state and local tax returns that are required to be filed
or has requested extensions thereof (except in any case in which
the failure so to file would not have a Material Adverse Effect and
except as set forth in or contemplated in the Offering Memorandum
(exclusive of any amendment or supplement thereto)) and have paid
all taxes required to be paid by them and any other assessment,
fine or penalty levied against them, to the extent that any of the
foregoing is due and payable, except for any such assessment, fine
or penalty that is currently being contested in good faith or as
would not have a Material Adverse Effect and except as set forth in
or contemplated in the Offering Memorandum (exclusive of any
amendment or supplement thereto).
No labor problem or dispute with the
employees of any of the Issuers exists or, to the knowledge of the
Company, is threatened or imminent, and the Company is not aware of
any existing or imminent labor disturbance by the employees of any
of the Issuers’ principal suppliers, contractors or
customers, except as would not have a Material Adverse Effect, and
except as set forth in or contemplated in the Offering Memorandum
(exclusive of any amendment or supplement thereto).
The Issuers are insured by insurers
of recognized financial responsibility against such losses and
risks and in such amounts as are prudent and customary in the
businesses in which they are engaged, and no Issuer has any reason
to believe that it will not be able to renew its existing insurance
coverage as and when such coverage expires or to obtain similar
coverage from similar insurers as may be necessary to continue its
business at a cost that would not have a Material Adverse Effect,
except as set forth in or contemplated in the Offering Memorandum
(exclusive of any amendment or supplement thereto).
No subsidiary of the Company is
currently prohibited, directly or indirectly, from paying any
dividends to the Company, from making any other distribution on
such subsidiary’s capital stock, from repaying to the Company
any loans or advances to such subsidiary from the Company or from
transferring any of such subsidiary’s property or assets to
the Company or any other subsidiary of the Company, except (i) as
described in or contemplated in the Offering Memorandum (exclusive
of any amendment or supplement thereto) and (ii) in connection with
the Revolving Credit Facility.
The Issuers possess all licenses,
certificates, permits and other authorizations issued by the
appropriate federal, state or foreign regulatory authorities
necessary to conduct their respective businesses, and no Issuer
has
received any notice of proceedings relating to
the revocation or modification of any such certificate,
authorization or permit which, singly or in the aggregate, if the
subject of an unfavorable decision, ruling or finding, would have a
Material Adverse Effect, except as set forth in or contemplated in
the Offering Memorandum (exclusive of any amendment or supplement
thereto).
Each Issuer maintains a system of
internal accounting controls sufficient to provide reasonable
assurance that (i) transactions are executed in accordance with
management’s general or specific authorizations; (ii)
transactions are recorded as necessary to permit preparation of
financial statements in conformity with generally accepted
accounting principles and to maintain asset accountability; (iii)
access to assets is permitted only in accordance with
management’s general or specific authorization; and (iv) the
recorded accountability for assets is compared with the existing
assets at reasonable intervals and appropriate action is taken with
respect to any differences.
Each Issuer (i) is in compliance
with any and all applicable foreign, federal, state and local laws
and regulations relating to the protection of human health and
safety, the environment or hazardous or toxic substances or wastes,
pollutants or contaminants (“ Environmental Laws
”); (ii) has received and is in compliance with all permits,
licenses or other approvals required of it under applicable
Environmental Laws to conduct its respective businesses; and (iii)
has not received notice of any actual or potential liability under
any Environmental Law, except where such non-compliance with
Environmental Laws, failure to receive required permits, licenses
or other approvals, or liability would not, individually or in the
aggregate, have a Material Adverse Effect, except as set forth in
or contemplated in the Offering Memorandum (exclusive of any
amendment or supplement thereto). Except as set forth in the
Offering Memorandum, no Issuer has been named as a
“potentially responsible party” under the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980, as
amended, except in such cases that would not have a Material
Adverse Effect.
The Issuers have no costs and
liabilities associated with Environmental Laws (including, without
limitation, any capital or operating expenditures required for
clean-up, closure of properties or compliance with Environmental
Laws, or any permit, license or approval, any related constraints
on operating activities and any potential liabilities to third
parties) that would, singly or in the aggregate, have a Material
Adverse Effect, except as set forth in or contemplated in the
Offering Memorandum (exclusive of any amendment or supplement
thereto).
The minimum funding standard under
Section 302 of the Employee Retirement Income Security Act of 1974,
as amended, and the regulations and published interpretations
thereunder (“ ERISA ”), has been satisfied by
each “pension plan” (as defined in Section 3(2) of
ERISA) which has been established or maintained by the Issuers, and
the trust forming part of each such plan which is intended to be
qualified under Section 401 of the Code is so qualified; each
Issuer has fulfilled its obligations, if any, under Section 515 of
ERISA; each pension plan and welfare plan established or maintained
by the Issuers is in compliance in all material respects with the
currently applicable provisions of ERISA; and no Issuer has
incurred or could reasonably be expected to incur any withdrawal
liability under Section 4201 of ERISA, any liability under Section
4062, 4063, or 4064 of ERISA, or any other liability under Title IV
of ERISA.
The statistical and market-related
data included in the Offering Memorandum (exclusive of any
amendment or supplement thereto) are based on or derived from
sources which the Issuers believe to be reliable and
accurate.
None of the Issuers or any agent
acting on their behalf has taken or will take any action that might
cause this Agreement or the sale of the Securities to violate
Regulation T, U or X of the Board of Governors of the Federal
Reserve System, in each case as in effect, or as the same may
hereafter be in effect, on the Closing Date.
No Issuer or, to the knowledge of
the Issuers, any director, officer, agent, employee or Affiliate of
any Issuer is aware of or has taken any action, directly or
indirectly, that would result in a violation by such Persons of
Foreign Corrupt Practices Act of 1977, as amended, and the rules
and regulations thereunder (the “ FCPA ”),
including, without limitation, making use of the mails or any means
or instrumentality of interstate commerce corruptly in furtherance
of an offer, payment, promise to pay or authorization of the
payment of any money, or other property, gift, promise to give, or
authorization of the giving of anything of value to any
“foreign official”
(as such term is defined in the FCPA) or any
foreign political party or official thereof or any candidate for
foreign political office, in contravention of the FCPA; and the
Issuers and, to the knowledge of the Issuers, their Affiliates have
conducted their businesses in compliance with the FCPA.
The Company is in compliance with
all the applicable provisions of the Sarbanes-Oxley Act of 2002
(the “ Sarbanes-Oxley Act ”) that are currently
in effect and require compliance by the Company on or before the
Execution Time.
None of the Company, any of its
subsidiaries or, to the knowledge of the Company, any director,
officer, agent, employee or Affiliate of the Company or any of its
subsidiaries is currently subject to any U.S. sanctions
administered by the Office of Foreign Assets Control of the U.S.
Department of the Treasury (“ OFAC ”); and the
Company will not directly or indirectly use the proceeds of the
offering of the Securities hereunder, or lend, contribute or
otherwise make available such proceeds to any subsidiary, joint
venture partner or other person or entity, for the purpose of
financing the activities of any person currently subject to any
U.S. sanctions administered by OFAC.
All of the Company’s
subsidiaries are listed on Schedule I hereto and each such
subsidiary will be a Guarantor unless indicated otherwise on such
schedule.
Any certificate signed by any
officer of any Issuer and delivered to the Initial Purchaser or
counsel for the Initial Purchaser in connection with the offering
of the Securities shall be deemed a representation and warranty by
each such Issuer, as to matters covered thereby, to the Initial
Purchaser.
Purchase and Sale
. Subject to
the terms and conditions and in reliance upon the representations
and warranties herein set forth, the Issuers agree to sell to the
Initial Purchaser, and the Initial Purchaser agrees to purchase
from the Issuers, at a purchase price of 100.5% of the principal
amount thereof, plus accrued interest, if any, from February 15,
2005 to the Closing Date, the entire principal amount of
Securities.
Delivery and Payment
. Delivery
of and payment for the Securities shall be made at 10:00 A.M., New
York City time, on February 17, 2005 or at such time on such later
date not more than three Business Days after the foregoing date as
the Initial Purchaser shall designate, which date and time may
b
