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HomeMy WebLinkAboutPR 16032: FLINT HILLS RESOURCES, LP INDUSTRIAL DISTRICT AGREEMENT interoffice MEMORANDUM To: Mayor, City Council, and City Manager„f_Q ApoZ From: Val Tizeno, City Attorney 6 ��" Date: August 16, 2010 Subject: P. R. No. 16032; Council Meeting September 7, 2010 Attached is P. R. No. 16032 granting a Consent to the Assignment of the Industrial District Agreement with Flint Hills Resources, LP (2009 to 2013) by and between the City of Port Arthur and Flint Hills Resources, LP, dated January 1, 2009. VRT:ts Attachment Cc: Jeff Wilkes Executive Vice President - Operations Clark T. Colvin Regional Director - Community Affairs FLINT HILLS RESOURCES PORT ARTHUR, LLC 4241 Savannah Avenue Port Arthur, TX 77640 Anthony J. Sementelli Executive Vice President /CFO FLINT HILLS RESOURCES, LP 4111 East 37 Street North P. O. Box 2917 Wichita, KS 67201 -2917 s.pr16032_memo P. R. No. 16032 08/16/10 is RESOLUTION NO. A RESOLUTION GRANTING CONSENT TO THE ASSIGNMENT OF INDUSTRIAL DISTRICT AGREEMENT WITH FLINT HILLS RESOURCES, LP (2009 -2013) BY AND BETWEEN THE CITY OF PORT ARTHUR AND FLINT HILLS RESOURCES, LP, DATED JANUARY 1, 2009 (THE "AGREEMENT ") WHEREAS, On August 4, 2010, the City received a letter from Flint Hills Resources' Legal Department requesting a "Consent of Assignment of Industrial District Agreement with Flint Hills Resources LP (2009 to 2013) by and between the City of Port Arthur and Flint Hills Resources, LP, dated January 1, 2009 ", a copy of which is attached hereto as Exhibit "A "; and WHEREAS, pursuant to a corporate restructuring scheduled to close November 1, 2010 (the "Closing Date "), Flint Hills Resources, LP ( "FHR, LP ") will contribute its U. S. operating assets to subsidiary operating entities organized along plant and product lines (the "Transaction "). Specifically, the Transaction anticipates FHR, LP transferring the assets of its Port Arthur chemicals facility (the "Facility ") to a subsidiary operating entity known as Flint Hills Resources Port Arthur, LLC ( "FHR PA "), with FHR PA assuming operation of the Facility effective as of the Closing Date; and WHEREAS, the City was given notice that upon the closing of s.pr16032 the Transaction, FHR, LP will assign to FHR PA and FHR PA will assume all of FHR, LP's rights and the obligations of FHR, LP under the Agreement that are incurred and that are to be performed on or after the Closing Date. In accordance with Section 8 of the Industrial Distrct Agreement, FHR, LP and FHR PA have asked that the City Council provide written consent to this assignment by a duly adopted Resolution. FHR PA warrants it will operate the Facility as a reasonably prudent operator, act as a good corporate citizen, and will assume and abide by the terms of the Agreement; and WHEREAS, there will be no change in the operations of the Facility and the leadership, employees, corporate support, and commitment to compliance will remain the same. NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PORT ARTHUR, TEXAS: Section 1. That the facts and opinions in the preamble are true and correct. Section 2. That the request of Flint Hills for a Consent to the Assignment of the Industrial District Agreement, as delineated in the letter attached hereto as Exhibit "A ", is herein approved. Section 3. That a copy of the caption of this Resolution be spread upon the Minutes of the City Council. READ, ADOPTED AND APPROVED on this day of s.pr16032 A.D., 2010, at a Meeting of the City Council of the City of Port Arthur, Texas, by the following vote: AYES: Mayor Councilmembers NOES: MAYOR ATTEST: ACTING CITY SECRETARY SHERRY BELLARD APPROVED AS TO FORM: 7 /74/6 CITY AT SRN Y APPROVED FOR ADMINISTRATION: CITY MANAGER s.pr16032 EXHIBIT "A" F LINT M H L L S 4111 East 37th Street North RESOURCES Wichita, Kansas 67220 Legal Department Ro. Box 2917 Wichita, Kansas 67201 -2917 July 29, 2010 Via Certified Mail Return Receipt Requested Mr. Stephen Fitzgibbons City Manager City of Port Arthur 444 4 Street Port Arthur, TX 77640 VMs. Valecia R. Tizeno City AttUvr City of Port Arthur 444 4 Street Port Arthur, TX 77640 Re: Consent to assignment of and between the Ci Flint of Port Arthurand Hills Resources LP (2009 to 2013) by lint Hills Resources, LP, dated January 1, 2009 (the "Agreement ") Dear Mr. Fitzgibbons and Ms. Tizeno: Pursuant to a corporate restructuring scheduled to close November 1, 2010 (the "Closing Date"), Flint Hills Resources, LP ( "FHR, LP ") will contribute its U.S. operating assets to subsidiary operating entities organized along plant and product lines (the "Transaction "). Specifically, the Transaction anticipates FHR, LP transferring the assets of -its Port Arthur chemicals facility (the "Facility ") to a subsidiary operating entity known as Flint Hills Resources Port Arthur, LLC ( "FHR PA "), with FHR PA assuming operation of the Facility effective as of the Closing Date. This letter constitutes notice that, upon the closing of the Transaction, FHR, LP will FHR a cCinn to FH DA And FHR P4. w ill a ccumo all of FHR, I_D'c ri and the nhlinafinnc of FHR, LP under the Agreement that are incurred and that are to be performed on or after the Closing Date. In accordance with Section 8 of the Agreement, FHR, LP and FHR PA herein ask that the City Council provide written consent to this assignment by a duly adopted Resolution. FHR PA herein warrants it will operate the Facility as a reasonably prudent operator, act as a good corporate citizen, and will assume and abide by the terms of the Agreement. • Practically speaking, the community will see no change in the operations of the Facility. The leadership, employees, corporate support, and commitment to compliance will remain the same. City of Port Arthur 2 July 29, 2010 Page 2 Your prompt attention to this matter is very much appreciated. If you have any questions regarding the restructure or the change of operating entity, please contact FHR Counsel, Logan Overman, at 316- 828 -7648 or via e-mail at logan.overman @fhr.com. We look forward to working with you to finalize the Resolution. Sincerely, / eriOAV Z /// A Piny J. Sementelli Jeff Wilkes Exec. • e Pres. /CFO Exec. Vice Pres. - Operations Flint Hills Resources, LP Flint Hills Resources Port Arthur, LLC • wp LWO /crl • •