Quarterly Report — Form 10-Q
Filing Table of Contents
Document/Exhibit Description Pages Size
1: 10-Q Amoco Corporation 10-Q 15± 62K
2: EX-2 Exhibit 2 (A) 10± 37K
3: EX-2 Exhibit 2 (B) 44± 183K
4: EX-2 Exhibit 2 (C) 13± 53K
5: EX-12 Statement re: Computation of Ratios 1 6K
6: EX-27 Financial Data Schedule (Pre-XBRL) 2 8K
EX-2 — Exhibit 2 (B)
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Exhibit 2 (b)
EXECUTION COPY
AGREEMENT AND PLAN
OF MERGER
Among
THE BRITISH PETROLEUM COMPANY p.l.c.,
AMOCO CORPORATION
and
EAGLE HOLDINGS, INC.
Dated as of August 11, 1998
This AGREEMENT AND PLAN OF MERGER, dated as of
August 11, 1998 (this "Agreement"), among THE BRITISH PETROLEUM
COMPANY p.l.c. ("BP"), an English public limited company, AMOCO
CORPORATION, an Indiana corporation ("Amoco"), and EAGLE
HOLDINGS, INC., an Indiana corporation and a direct, wholly owned
subsidiary of BP ("Merger Sub" and, together with Amoco, the
"Constituent Corporations");
W I T N E S S E T H :
WHEREAS, the respective Boards of Directors of each of
Amoco, BP and Merger Sub (each, a "Party" and, together, the
"Parties") have each determined that it is in the best interest
of their respective companies and shareholders to combine their
respective businesses as BP Amoco p.l.c. to conduct their
operations on a unified basis, under the governance arrangements
set forth herein;
WHEREAS, in futherance of such combination, the
respective Boards of Directors of Amoco and Merger Sub have each
adopted this Agreement and approved the merger (the "Merger") of
Merger Sub with and into Amoco in accordance with the Indiana
Business Corporation Law, as amended (the "BCL"), and upon the
terms and subject to the conditions set forth herein;
WHEREAS, it is intended that, for U.S. federal income
tax purposes, the Merger shall qualify as a reorganization under
the provisions of Section 368(a) of the Internal Revenue Code of
1986, as amended, and the rules and regulations promulgated
thereunder (the "Code");
WHEREAS, it is intended that, for financial accounting
purposes, the Merger shall be accounted for as a "pooling of
interests" under generally accepted accounting principles in the
United States ("U.S. GAAP"), and using merger accounting methods
under generally accepted accounting principles in the United
Kingdom ("U.K. GAAP");
WHEREAS, as an inducement to the willingness of BP to
enter into this Agreement, the board of directors of Amoco has
approved the grant to BP of an option to purchase shares of
common stock, without par value, of Amoco ("Amoco Common Shares")
pursuant to a stock option agreement, dated as of the date of
this Agreement, between Amoco and BP (the "Stock Option
Agreement"), and each of Amoco and BP has duly authorized,
executed and delivered the Stock Option Agreement as of the date
hereof; and
WHEREAS, Amoco and BP desire to make certain
representations, warranties, covenants and agreements in
connection with this Agreement.
NOW, THEREFORE, in consideration of the mutual
representations, warranties, covenants and agreements contained
herein, the parties hereto, intending to be legally bound, hereby
agree as follows:
ARTICLE I
THE CLOSING AND THE MERGER
1.1. Closing. The closing of the Merger (the "Closing") shall
take place (i) at 9:00 A.M. (New York time) at the offices of
Sullivan & Cromwell, 125 Broad Street, New York, New York, on the
third business day after the day on which the last to be
fulfilled or waived of the conditions set forth in Article IV
(other than those conditions that by their nature are to be
fulfilled at the Closing, but subject to the fulfillment or
waiver of such conditions) shall be fulfilled or waived in
accordance with this Agreement or (ii) at such other places and
time and/or on such other date as Amoco and BP may agree in
writing (the "Closing Date"). It is the intention of the Parties
to target December 31, 1998 as the Closing Date, based on the
currently anticipated timetable for the Merger.
1.2. The Merger.
1.2.1. Upon the terms and subject to the conditions set forth in
this Agreement, at the Effective Time (as defined in Section
1.2.2), Merger Sub shall be merged with and into Amoco in
accordance with the BCL, whereupon the separate existence of
Merger Sub shall cease, and Amoco shall be the surviving
corporation in the Merger (the "Surviving Corporation").
1.2.2. As soon as practicable after satisfaction or waiver (to the
extent herein permitted) of the conditions to the obligations of
the parties to consummate the Merger set forth in Article IV,
Amoco and Merger Sub will file articles of merger (the "Articles
of Merger") with the Secretary of State of the State of Indiana
and make all other filings or recordings required by applicable
law in connection with the Merger. The Merger shall become
effective at such time as the Articles of Merger are duly filed
with the Secretary of State of the State of Indiana or at such
later time as is specified in the Articles of Merger (the
"Effective Time").
1.2.3. From and after the Effective Time, title to all real estate
and other property owned by each of the Constituent Corporations
shall be vested in the Surviving Corporation and the Surviving
Corporation shall have all liabilities of the Constituent
Corporations, all as provided under the BCL.
1.3. Conversion and Exchange of Shares. At the Effective Time:
1.3.1. Each Amoco Common Share owned by BP or any Subsidiary (as
defined in Section 2.1.1) of BP or Amoco immediately prior to the
Effective Time (each, an "Excluded Amoco Share") shall, by virtue
of the Merger, and without any action on the part of the holder
thereof, no longer be outstanding, shall be cancelled and retired
without payment of any consideration therefor and shall cease to
exist.
1.3.2. Each Amoco Common Share outstanding immediately prior to the
Effective Time, other than Excluded Amoco Shares, shall be
converted into and shall be cancelled in exchange for the right
to receive 3.97 (the "Exchange Ratio") ordinary shares, of
nominal value 25p each ("BP Ordinary Shares"), which shall be in
the form of American depositary shares, each representing the
right to receive six BP Ordinary Shares, or such other form of BP
Ordinary Shares as BP and Amoco may agree in accordance with
Section 1.4.7 (the "BP Depositary Shares"), and the BP Depositary
Shares shall be evidenced by one or more receipts ("BP ADRs")
issued in accordance with the Amended and Restated Deposit
Agreement, dated as of August 1, 1992, as amended through the
date hereof (as it may be amended with the consent of Amoco from
time to time, the "Deposit Agreement"), among BP, Morgan Guaranty
Trust Company of New York, as Depositary (the "Depositary"), and
the holders of BP ADRs, or such other arrangements as BP and
Amoco may agree (the "Merger Consideration"). At the Effective
Time, all Amoco Common Shares shall no longer be outstanding,
shall be canceled and retired and shall cease to exist, and each
certificate (a "Certificate") formerly representing any of such
Amoco Common Shares (other than Excluded Amoco Shares) shall
thereafter represent only the right to the Merger Consideration
and the right, if any, to receive pursuant to Section 1.6 cash in
lieu of fractional BP Depositary Shares, respectively, and any
distribution or dividend pursuant to Section 1.4.6, in each case
without interest. The BP Ordinary Shares and BP Depositary
Shares issued as provided in this Section 1.3.2 shall be of the
same class and shall have the same terms as the currently
outstanding BP Ordinary Shares and the currently outstanding BP
Depositary Shares, respectively. BP shall, following the
Closing, pay all stamp duties, stamp duty reserve tax and other
taxes and similar levies imposed in connection with the issuance
or creation of the BP Depositary Shares and any BP ADRs in
connection therewith.
1.3.3. Each share of common stock of Merger Sub, no par value
("Merger Sub Common Stock"), outstanding immediately prior to the
Effective Time shall be cancelled and, in consideration for the
allotment of the BP Ordinary Shares referred to in Section 1.3.4
below, the Surviving Corporation shall issue to BP at the
Effective Time such number of shares of common stock as is equal
to the number of shares of Merger Sub Common Stock with the same
rights, powers and privileges as the Amoco Common Shares and
shall constitute the only outstanding shares of common stock of
the Surviving Corporation.
1.3.4. In consideration of the issue to BP by the Surviving
Corporation of shares of common stock of the Surviving
Corporation pursuant to Section 1.3.3 hereof, BP shall allot
(subject to satisfaction of the condition set forth in Section
4.1.5 hereof) such number of BP Ordinary Shares as is equal to
the number of Amoco Common Shares outstanding as of the Effective
Time (other than the Excluded Amoco Shares) multiplied by the
Exchange Ratio to permit the issuance of BP Depositary Shares to
the holders of such Amoco Common Shares for the purpose of giving
effect to the issue of the Merger Consideration referred to in
Section 1.3.2 of this Agreement.
1.3.5. In the event that, subsequent to the date of this Agreement
but prior to the Effective Time, Amoco changes the number of
Amoco Common Shares, or BP changes the number of BP Ordinary
Shares, issued and outstanding as a result of a stock split,
reverse stock split, stock dividend, recapitalization,
redenomination of share capital or other similar transaction, the
Exchange Ratio and other items dependent thereon shall be
appropriately adjusted.
1.4. Surrender and Payment.
1.4.1. Prior to the Effective Time, BP shall appoint the Depositary
or, failing the Depositary, another agent acceptable to Amoco as
exchange agent (the "Exchange Agent") for the purpose of
exchanging Certificates for BP ADRs as provided in Section 1.3.2.
Promptly after the Effective Time, the Surviving Corporation will
send, or will cause the Exchange Agent to send, to each holder of
record as of the Effective Time of Amoco Common Shares a letter
of transmittal, in such form as Amoco and BP may reasonably
agree, for use in effecting delivery of Amoco Common Shares to
the Exchange Agent. To the extent required, the Exchange Agent
will requisition from the Depositary, from time to time, such
number of BP ADRs as are issuable in respect of Amoco Common
Shares properly delivered to the Exchange Agent. BP shall, prior
to the Effective Time, conditionally allot the BP Ordinary Shares
referred to in Section 1.3.4, subject to the terms and conditions
of this Agreement.
1.4.2. Each holder of any Amoco Common Shares that have been
converted into a right to receive the consideration set forth in
Section 1.3.2, upon surrender to the Exchange Agent of a
Certificate or Certificates, together with a properly completed
letter of transmittal covering the Amoco Common Shares
represented by such Certificate or Certificates, will be entitled
to receive (i) the number of whole BP Depositary Shares included
in the Merger Consideration in respect of such Amoco Common
Shares in the form of BP ADRs, and (ii) a check in the amount
(after giving effect to any required tax withholdings) of (A) any
cash in lieu of fractional shares to be paid pursuant to Section
1.6, plus (B) any cash dividends or other distributions that such
holder has the right to receive pursuant to Section 1.4.6. Until
so surrendered, each Certificate shall, after the Effective Time,
represent for all purposes only the right to receive the number
of whole BP Depositary Shares included in the Merger
Consideration and the applicable amounts provided in the
foregoing clause (ii).
1.4.3. If any BP ADRs are to be issued to a person other than the
registered holder of the Amoco Common Shares represented by the
Certificate or Certificates surrendered with respect thereto, it
shall be a condition to such issue that the Certificate or
Certificates so surrendered shall be properly endorsed or
otherwise be in proper form for transfer and that the person
requesting such issue shall pay to the Exchange Agent any
transfer or other taxes required as a result of such issue to a
person other than the registered holder of such Amoco Common
Shares or establish to the satisfaction of the Exchange Agent
that such tax has been paid or is not payable.
1.4.4. After the close of the stock transfer books of Amoco on the
day prior to the Effective Time, there shall be no further
registration of transfers of Amoco Common Shares that were
outstanding prior to the Effective Time. After the Effective
Time, Certificates presented to the Surviving Corporation for
transfer shall be cancelled and exchanged for the consideration
provided for, and in accordance with the procedures set forth, in
this Article I.
1.4.5. Any BP Ordinary Shares allotted in respect of BP Depositary
Shares pursuant to this Article I and any cash in lieu of
fractional interests of BP Ordinary Shares to be paid pursuant to
Section 1.6, plus any cash dividend or other distribution that
such holder has the right to receive pursuant to Section 1.4.6,
that remains unclaimed by the holders of Amoco Common Shares six
months after the Effective Time shall (i) (as to BP Ordinary
Shares so allotted) be deemed to have lapsed, and (ii) (as to any
cash) be returned to BP upon demand. Any such holder who has not
delivered his Amoco Common Shares to the Exchange Agent in
accordance with this Article I prior to that time shall
thereafter look only to BP and the Surviving Corporation for
issuance of BP Ordinary Shares in respect of his Amoco Common
Shares and payment of cash dividends or other distributions in
respect thereof, issuable and/or payable pursuant to Section
1.4.6. Notwithstanding the foregoing, BP shall not be liable to
any holder of Amoco Common Shares for any securities delivered or
any amount paid to a public official pursuant to applicable
abandoned property laws. Any BP Ordinary Shares remaining
unclaimed by holders of Amoco Common Shares three years after the
Effective Time (or such earlier date immediately prior to such
time as such securities would otherwise escheat to or become
property of any governmental entity or as is otherwise provided
by applicable Law(as defined herein)) shall, to the extent
permitted by applicable Law, become the property of the Surviving
Corporation or BP, as the case may be, free and clear of any
claims or interest of any Person previously entitled thereto.
1.4.6. No dividends, interest or other distributions with respect
to securities of BP or the Surviving Corporation issuable with
respect to Amoco Common Shares shall be paid to the holder of any
unsurrendered Certificates until such Certificates are
surrendered as provided in this Section. Subject to the effect
of applicable Law, upon such surrender, there shall be issued
and/or paid to the holder of the BP Depositary Shares issued in
exchange therefor, without interest, (A) at the time of such
surrender, the dividends or other distributions payable with
respect to such BP Depositary Shares with a record date after the
Effective Time and a payment date on or prior to the date of such
surrender and not previously paid and (B) at the appropriate
payment date, the dividends or other distributions payable with
respect to such BP Depositary Shares with a record date after the
Effective Time but with a payment date subsequent to such
surrender. For purposes of dividends or other distributions in
respect of BP Depositary Shares, all BP Depositary Shares to be
issued pursuant to the Merger shall be deemed issued and
outstanding as of the Effective Time.
1.4.7. Option to Issue BP Ordinary Shares. BP and Amoco may
jointly determine that it is more practical and desirable for BP
to cause BP Ordinary Shares to be issued to the holders of Amoco
Common Shares in complete satisfaction of BP's obligations under
this Article I or cause the BP Ordinary Shares to be
redenominated in a currency other than sterling or issued in
bearer or registered form (which may or may not be in the form of
BP Depositary Shares evidenced by BP ADRs). If BP and Amoco make
the requisite determination under this Section, then all
references in this Agreement to BP Depositary Shares or BP ADRs
issuable to such persons, shall mean BP Ordinary Shares as so
redenominated and in such form as is hereafter agreed by the
Parties and any BP Depositary Shares or other certificates, or BP
ADRs evidencing such BP Depositary Shares or other certificates,
if any, representing such redenominated BP Ordinary Shares.
1.5. Amoco Stock Options.
1.5.1. At the Effective Time, all employee and director stock
options to purchase Amoco Common Shares (each, an "Amoco Stock
Option") which are then outstanding and unexercised shall cease
to represent a right to acquire Amoco Common Shares and shall be
converted automatically into options to purchase BP Ordinary
Shares, and BP shall assume each such Amoco Stock Option subject
to the terms of any of the Amoco Stock Plans (as defined in
Section 2.1.2.1), and the agreements evidencing grants
thereunder; provided, however, that from and after the Effective
Time, (i) the number of BP Ordinary Shares purchasable upon
exercise of each such Amoco Stock Option shall be equal to the
number of Amoco Common Shares that were purchasable under such
Amoco Stock Option immediately prior to the Effective Time
multiplied by the Exchange Ratio, subject to adjustment as
provided in Section 1.3.5, and rounding down to the nearest whole
BP Ordinary Share (or, if issued in the form of BP Depositary
Shares, the nearest whole BP Depositary Share), and (ii) the per
BP Ordinary Share exercise price under each such Amoco Stock
Option shall be obtained by dividing the per share exercise price
of each such Amoco Stock Option by the Exchange Ratio, subject to
adjustment as provided in Section 1.3.5, and rounding down to the
nearest cent. Notwithstanding the foregoing, the number of BP
Ordinary Shares and the per BP Ordinary Share exercise price of
each Amoco Stock Option which is intended to be an "incentive
stock option" (as defined in Section 422 of the Code) shall be
adjusted in accordance with the requirements of Section 424 of
the Code. Accordingly, with respect to any incentive stock
options, fractional BP Ordinary Shares shall be rounded down to
the nearest whole number of BP Ordinary Shares (or, if
applicable, BP Depositary Shares) and where necessary the per BP
Ordinary Share exercise price shall be rounded up to the nearest
cent. BP Ordinary Shares to be issued upon the exercise of Amoco
Stock Options, shall, unless otherwise requested by the holders
of such Amoco Stock Options, be delivered in the form of BP
Depositary Shares represented by depositary receipts having the
same terms as BP ADRs.
1.5.2. Prior to the Effective Time, BP shall make available for
issuance the number of BP Ordinary Shares necessary to satisfy
BP's obligations under Section 1.5.1. At the Effective Time, BP
shall file with the Securities and Exchange Commission (the
"SEC") a registration statement on an appropriate form or a post-
effective amendment to a previously filed registration statement
under the Securities Act of 1933, as amended (the "Securities
Act"), with respect to the BP Ordinary Shares and the BP ADRs
subject to options issued pursuant to Section 1.5.1, and shall
use its best reasonable efforts to maintain the current status of
the prospectus contained therein, as well as comply with any
applicable state securities or "blue sky" laws, for so long as
such options remain outstanding.
1.6. Fractional BP Depositary Shares. No fraction of a BP
Depositary Share will be issued, but in lieu thereof each holder
of Amoco Common Shares otherwise entitled to receive a fraction
of a BP Depositary Share will be entitled to receive in
accordance with the provisions of this Section 1.6 from the
Exchange Agent a cash payment in lieu of such fraction of a BP
Depositary Share representing such holder's proportionate
interest in the net proceeds from the sale by the Exchange Agent
on behalf of all such holders of the aggregate of the fractions
of BP Depositary Shares which would otherwise be issued ("Excess
Shares"). The sale of the Excess Shares by the Exchange Agent
shall be executed on the New York Stock Exchange, Inc. (the
"NYSE") through one or more member firms of the NYSE and shall be
executed in round lots to the extent practicable. Until the net
proceeds of such sale or sales have been distributed to the
holders of Amoco Common Shares, the Exchange Agent will hold such
proceeds in trust for the holders of Amoco Common Shares (the
"Common Shares Trust"). BP shall pay all commissions, transfer
taxes and other out-of-pocket transaction costs, including the
expenses and compensation, of the Exchange Agent incurred in
connection with such sale of the Excess Shares. The Exchange
Agent shall determine the portion of the Common Shares Trust to
which each holder of Amoco Common Shares shall be entitled, if
any, by multiplying the amount of the aggregate net proceeds
comprising the Common Shares Trust by a fraction the numerator of
which is the amount of the fractional BP Depositary Share
interest to which such holder of Amoco Common Shares is entitled
and the denominator of which is the aggregate amount of
fractional share interests to which all holders of Amoco Common
Shares are entitled. As soon as practicable after the
determination of the amount of cash, if any, to be paid to
holders of Amoco Common Shares in lieu of any fractional BP
Depositary Share interests, the Exchange Agent shall make
available such amounts to such holders of Amoco Common Shares
without interest.
1.7. The Surviving Corporation.
1.7.1. The articles of incorporation of Amoco in effect at the
Effective Time shall be the articles of incorporation of the
Surviving Corporation until amended in accordance with applicable
law.
1.7.2. The bylaws of Amoco in effect at the Effective Time shall be
the bylaws of the Surviving Corporation until amended in
accordance with applicable law.
1.7.3. From and after the Effective Time, until successors are duly
elected or appointed and qualified in accordance with applicable
law, (i) the directors of Merger Sub at the Effective Time shall
be the directors of the Surviving Corporation, and (ii) the
officers of Amoco at the Effective Time shall be the officers of
the Surviving Corporation.
1.8. Lost, Stolen or Destroyed Certificates. In the event any
Certificate shall have been lost, stolen or destroyed, upon the
making of an affidavit of that fact by the Person claiming such
Certificate to be lost, stolen or destroyed and, if required by
BP, the posting by such Person of a bond in customary amount as
indemnity against any claim that may be made against it with
respect to such Certificate, the Exchange Agent will issue in
exchange for such lost, stolen or destroyed Certificate, BP
Depositary Shares and any cash payable and any unpaid dividends
or other distributions in respect thereof pursuant to Section
1.4.2 upon due surrender of and deliverable in respect of the
Amoco Common Shares represented by such Certificate pursuant to
this Agreement.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
2.1. Representations and Warranties of Amoco and BP. Except as
set forth in the corresponding sections or subsections of the
disclosure letter, dated the date hereof and signed by an
authorized officer, delivered by Amoco to BP or by BP to Amoco
(each a "Disclosure Letter," and the "Amoco Disclosure Letter"
and the "BP Disclosure Letter," respectively), as the case may
be, Amoco (except for subparagraphs 2.1.2.2, 2.1.3.2, 2.1.5.2,
2.1.9(ii), 2.1.11.2 and 2.1.12 below and references in paragraph
2.1.1 below to documents made available by BP to Amoco) hereby
represents and warrants to BP, and BP (except for subparagraphs
2.1.2.1, 2.1.3.1, 2.1.5.1, 2.1.8, 2.1.9(i) and 2.1.11.1 below and
references in paragraph 2.1.1 below to documents made available
by Amoco to BP), hereby represents and warrants to Amoco, that:
2.1.1. Organization, Good Standing and Qualification. Each of it
and its Subsidiaries (as defined below) is duly organized,
validly existing and in good standing (with respect to
jurisdictions that recognize the concept of good standing) under
the laws of its respective jurisdiction of organization and has
all requisite corporate or similar power and authority, and has
been duly authorized by all necessary approvals and orders, to
own, operate and lease its properties and assets and to carry on
its business as presently conducted and is duly qualified to do
business and is in good standing in each jurisdiction where the
ownership, operation or leasing of its assets or properties or
conduct of its business requires such qualification, except where
the failure to be so organized, qualified or in good standing, or
to have such power or authority, when taken together with all
other such failures, is not reasonably likely to have a Material
Adverse Effect (as defined below) on it. Amoco has made
available to BP complete and correct copies of its articles of
incorporation and by-laws, and BP has made available to Amoco
complete and correct copies of its memorandum and articles of
association, in all cases as amended to date. Such articles of
incorporation and by-laws or memorandum and articles of
association, as the case may be, as so made available are in full
force and effect.
As used in this Agreement, the term (i) "Subsidiary"
means, with respect to Amoco, any entity, whether incorporated or
unincorporated, in which Amoco owns, directly or indirectly, more
than fifty percent of the securities or other ownership interests
having by their terms ordinary voting power to elect more than
fifty percent of the directors or other persons performing
similar functions, or the management and policies of which Amoco
otherwise has the power to direct, and, with respect to BP, any
body corporate which is a subsidiary or subsidiary undertaking,
in each case within the meaning of the Companies Act of 1985 of
the United Kingdom, as amended (the "Companies Act"), (ii)
"Material Adverse Effect" means, with respect to any Person (as
defined below), a material adverse effect on the financial
condition, properties, business or results of operations of such
Person and its Subsidiaries taken as a whole, (iii) "Person"
shall mean any individual, corporation (including not-for-
profit), general or limited partnership, limited liability or
unlimited liability company, joint venture, estate, trust,
association, organization, Governmental Entity (as defined in
paragraph 2.1.4 (Governmental Filings; No Violations)) or other
entity of any kind or nature, and (iv) "Affiliate" shall have the
meaning specified in Rule 12b-2 of the Securities Exchange Act of
1934, as amended (the "Exchange Act").
2.1.2. Capital Structure.
2.1.2.1. The authorized capital stock of Amoco consists of
1,600,000,000 Amoco Common Shares, of which 953,684,773 Amoco
Common Shares were issued and outstanding as of the close of
business on August 4, 1998, 50,000,000 shares of Voting Preferred
Stock, without par value ("Amoco Voting Preferred Shares"), and
50,000,000 shares of Non-Voting Preferred Stock, without par
value ("Amoco Non-Voting Preferred Shares"), none of which Amoco
Voting Preferred Shares or Amoco Non-Voting Preferred Shares is
outstanding as of the date hereof. All of the outstanding Amoco
Common Shares have been duly authorized and validly issued and
are fully paid and nonassessable. Amoco has no Amoco Common
Shares, Amoco Voting Preferred Shares or Amoco Non-Voting
Preferred Shares reserved for or otherwise subject to issuance,
except that (i) as of the close of business on August 4, 1998,
there were 36,319,340 Amoco Common Shares subject to issuance
pursuant to options outstanding under the plans of Amoco
identified in paragraph 2.1.2.1 of the Amoco Disclosure Letter as
being the only compensation or benefit plans or agreements
pursuant to which Amoco Common Shares may be issued (the "Amoco
Stock Plans") and (ii) as of the date hereof, there are not less
than 189,783,270 Amoco Common Shares reserved for issuance
pursuant to the Stock Option Agreement. Each of the outstanding
shares of capital stock or other ownership interests of each of
Amoco's Subsidiaries that constitutes a "Significant Subsidiary"
(as defined in Rule 1-02(w) of Regulation S-X promulgated under
the Exchange Act) is duly authorized, validly issued, fully paid
and nonassessable and owned by Amoco or a direct or indirect
wholly owned subsidiary of Amoco, in each case free and clear of
any lien, pledge, security interest, claim or other encumbrance.
Except as set forth above, there are no preemptive or other
outstanding rights, options, warrants, conversion rights, stock
appreciation rights, redemption rights, repurchase rights,
agreements, arrangements, calls, commitments or rights of any
kind which obligate Amoco or any of its Subsidiaries to issue or
sell any shares of capital stock or other securities of Amoco or
any of its Subsidiaries or any securities or obligations
convertible or exchangeable into or exercisable for, or giving
any Person a right to subscribe for or acquire from Amoco or any
of its Subsidiaries, any securities of Amoco or any of its
Subsidiaries, and no securities or obligations evidencing such
rights are authorized, issued or outstanding. The Amoco Common
Shares issuable pursuant to the Stock Option Agreement have been
duly reserved for issuance by Amoco, and upon any issuance of
such Amoco Common Shares in accordance with the terms of the
Stock Option Agreement, such Amoco Common Shares will be duly
authorized, validly issued, fully paid and nonassessable and free
and clear of any lien, pledge, security interest, claim or other
encumbrance. Amoco does not have outstanding any bonds,
debentures, notes or other obligations the holders of which have
the right to vote (or which are convertible into or exercisable
for securities having the right to vote) with the shareholders of
Amoco on any matter.
2.1.2.2. The authorized share capital of BP is 2,000 million
(pound sterling). As of the close of business on August 4, 1998,
the allotted share capital of BP consisted of 5,851,031,121
ordinary shares of nominal value 25p each ("BP Ordinary Shares"),
not more than 7,232,838 shares of 8% cumulative first preference shares, of
nominal value 1 (pound sterling) each ("BP First Preference Shares"), and not
more than 5,473,414 9% cumulative second preference shares, of
nominal value 1 (pound sterling) each ("BP Second Preference Shares").
All of the outstanding BP Ordinary Shares, BP First Preference Shares
and BP Second Preference Shares have been, and the BP Ordinary
Shares to be issued as Merger Consideration shall be, duly
authorized and validly issued and are or will be, as the case may
be, fully paid or credited as fully paid. BP has no BP Ordinary
Shares, BP First Preference Shares, or BP Second Preference
Shares reserved for or otherwise subject to issuance. Of the BP
Ordinary Shares described in the first sentence of this
paragraph, as of the close of business on August 4, 1998, there
were 37,956,426 BP Ordinary Shares held by the BP Employee Share
Scheme (Jersey) Ltd. in relation to the option schemes identified
in subparagraph 2.1.2.2 of the BP Disclosure Letter as being the
only compensation or benefit plans or agreements pursuant to
which BP Ordinary Shares may be issued (the "Option Schemes").
Each of the outstanding shares of capital stock or other
ownership interests of each of BP's Significant Subsidiaries is
duly authorized, validly issued, fully paid and nonassessable and
owned by BP or a direct or indirect wholly owned Subsidiary of
BP, in each case free and clear of any lien, pledge, security
interest, claim or other encumbrance. Except as set forth above
or as contemplated by this Agreement, there are no pre-emptive or
other outstanding rights, options, warrants, conversion rights,
stock appreciation rights, redemption rights, repurchase rights,
agreements, arrangements, calls, commitments or rights of any
kind which obligate BP or any of its Subsidiaries to issue or to
sell any shares of capital stock or other securities of BP or any
of its Subsidiaries or any securities or obligations convertible
or exchangeable into or exercisable for, or giving any Person a
right to subscribe for or acquire from BP or any of its
Subsidiaries, any securities of BP or any of its Subsidiaries,
and no securities or obligations evidencing such rights are
authorized, issued or outstanding. BP does not have outstanding
any bonds, debentures, notes or other obligations the holders of
which have the right to vote (or which are convertible into or
exercisable for securities having the right to vote) with the
shareholders of BP on any matter.
2.1.3. Corporate Authority; Approval and Fairness.
2.1.3.1. Amoco has all requisite corporate power and authority
and has taken all corporate action necessary in order to execute,
deliver and perform its obligations under this Agreement and the
Stock Option Agreement and to consummate the Merger and the other
transactions contemplated hereby and thereby, subject only to the
approval of the Merger by the vote of the holders of not less
than a majority of all of the votes entitled to be cast at the
Amoco Shareholders Meeting (as defined in Section 3.4
(Shareholders Meetings)) by holders of Amoco Common Shares (the
"Amoco Requisite Vote"). The execution and delivery of this
Agreement and the Stock Option Agreement have been duly
authorized by all necessary corporate action on the part of Amoco
and, assuming the due authorization, execution and delivery of
this Agreement and the Stock Option Agreement by BP, this
Agreement and the Stock Option Agreement constitute valid and
binding agreements of Amoco enforceable against Amoco in
accordance with their terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws
of general applicability relating to or affecting creditors'
rights and to general equity principles (the "Bankruptcy and
Equity Exception"). The Board of Directors of Amoco (A) has
approved this Agreement, the Stock Option Agreement, the Merger
and the other transactions contemplated hereby and thereby and
(B) has received the opinion of its financial advisor, Morgan
Stanley & Co. Incorporated, to the effect that, as of the date of
this Agreement, the Exchange Ratio is fair to the holders of
Amoco Common Shares from a financial point of view.
2.1.3.2. BP has all requisite corporate power and authority and
has taken all corporate action necessary in order to execute,
deliver and perform its obligations under this Agreement and the
Stock Option Agreement and to consummate the Merger and the other
transactions contemplated hereby and thereby, subject only to the
approval of the Merger and the other transactions contemplated
hereby by, on a show of hands, not less than the requisite
majority of the holders of the outstanding BP Ordinary Shares, BP
First Preference Shares and BP Second Preference Shares
(collectively, the "BP Shares") present in person or, on a poll,
by the holders of not less than the requisite majority of the
votes attaching to the BP Shares who vote in person or by proxy
at the BP Shareholders Meeting (as defined in Section 3.4
(Shareholders Meetings)) (the "BP Requisite Vote"). The
execution and delivery of this Agreement and the Stock Option
Agreement have been duly authorized by all necessary corporate
action on the part of BP, and, assuming the due authorization,
execution and delivery of this Agreement and the Stock Option
Agreement by Amoco, this Agreement and the Stock Option Agreement
constitute valid and binding agreements of BP, enforceable
against BP in accordance with their terms, subject to the
Bankruptcy and Equity Exception. The Board of Directors of BP
has approved this Agreement, the Stock Option Agreement, the
Merger and the other transactions contemplated hereby and thereby
and the Board of Directors has received the opinion of its
financial advisor, Morgan Guaranty Trust Company of New York, to
the effect that, as of the date of this Agreement, the Exchange
Ratio is fair, from a financial point of view, to BP.
2.1.4. Governmental Filings; No Violations.
2.1.4.1. Other than the necessary filings, notices, approvals,
confirmations, consents, declarations and/or decisions (A)
pursuant to Sections 1.2.2 and 3.3.1, (B) under the Hart-Scott-
Rodino Antitrust Improvements Act of 1976, as amended (the "HSR
Act"), the Exchange Act, the Securities Act of 1933, as amended
(the "Securities Act") and the Exon-Florio provisions of the
Omnibus Trade and Competitiveness Act of 1988 ("Exon-Florio"),
(C) to comply with the rules and regulations of the NYSE or the
London Stock Exchange Limited (the "LSE"), (D) from the European
Commission, in accordance with Article 6(1)(b), 8(2) or 10(6) of
Council Regulation (EEC) No 4064/89 as amended (the "Regulation")
(insofar as the Merger constitutes a concentration with a
Community dimension within the scope of the Regulation), (E) from
the UK Office of Fair Trading that it is not the intention of the
UK Secretary of State for Trade and Industry to refer the Merger
or any matters arising therefrom to the UK Monopolies and Mergers
Commission (the "MMC") or from the Secretary of State for Trade
and Industry in the event that the Merger or any matters arising
therefrom are referred to the MMC (insofar as the Merger
qualifies for investigation by the MMC under the UK Fair Trading
Act 1973 or a referral is made by the European Commission to the
UK Competent Authority under Article 9 of the Regulation) and (F)
from H.M. Treasury pursuant to section 765 of the Income and
Corporation Taxes Act 1988 (or the confirmation from H.M.
Treasury or the Inland Revenue that no such consent is required
to the transactions contemplated by this Agreement) (such
filings, notices, approvals, confirmations, consents,
declarations and/or decisions to be made, given or obtained by
Amoco being, if any, the "Amoco Required Consents" and by BP
being the "BP Required Consents"), no filings, notices,
declarations and/or decisions are required to be made by it with,
nor are any approvals or other confirmations or consents required
to be obtained by it from, any governmental or regulatory
(including stock exchange) authority, agency, court, commission,
body or other governmental entity (including the Panel on
Takeovers and Mergers) ("Governmental Entity"), in connection
with the execution and delivery by it of this Agreement and the
Stock Option Agreement and the consummation by it of the Merger
and the other transactions contemplated hereby and thereby,
except those the failure of which to make, give or obtain,
individually or in the aggregate, is not reasonably likely to
have a Material Adverse Effect on it or prevent, materially delay
or materially impair its ability to consummate the Merger and the
other transactions contemplated by this Agreement and the Stock
Option Agreement.
2.1.4.2. The execution, delivery and performance of this
Agreement and the Stock Option Agreement by it do not, and the
consummation by it of the Merger and the other transactions
contemplated hereby and thereby (including, in the case of BP,
the allotment of BP Ordinary Shares and the deposit of BP
Ordinary Shares with the Depositary against issuance of BP
Depositary Shares in accordance with the Deposit Agreement) will
not, constitute or result in (A) a breach or violation of, or a
default under, its articles of incorporation or by-laws, in the
case of Amoco, or memorandum or articles of association, in the
case of BP, or the comparable governing instruments of any of the
Significant Subsidiaries of Amoco and BP (in each case as amended
from time to time), (B) subject to making, giving or obtaining
all necessary filings, notices, approvals, confirmations,
declarations and/or decisions in Subparagraph 2.1.4.1 and all
other necessary third-party consents as set forth in Subparagraph
2.1.4.2 of its Disclosure Letter, a breach or violation of, or a
default under, the acceleration of any obligations or the
creation of a lien, pledge, security interest, right of purchase,
sale or termination or other encumbrance on the assets of it or
any of its Subsidiaries (with or without notice, lapse of time or
both) pursuant to any agreement, lease, license, contract, note,
mortgage, indenture, arrangement or other obligation
("Contracts") binding upon it or any of its Subsidiaries or any
law, ordinance, regulation, judgment, order, decree, arbitration,
award, license or permit of any Governmental Entity ("Law") or
governmental or non-governmental permit or license to which it or
any of its Subsidiaries is subject, or (C) any change in the
rights or obligations of either Party under any of its Contracts,
except, in the case of clause (B) or (C) above, for any breach,
violation, default, acceleration, creation or change that,
individually or in the aggregate, is not reasonably likely to
have a Material Adverse Effect on it or prevent, materially delay
or materially impair its ability to consummate the Merger and the
other transactions contemplated by this Agreement and the Stock
Option Agreement.
2.1.5. Reports; Financial Statements.
2.1.5.1. Amoco has made available to BP copies of each
registration statement, report, proxy statement or information
statement prepared by it or its Subsidiaries and filed with the
SEC since December 31, 1997 (December 31, 1997 being the "Amoco
Audit Date"), including Amoco's Annual Report on Form 10-K for
the year ended December 31, 1997, each in the form (including
exhibits, annexes and any amendments thereto) filed with the SEC
(collectively, including any such registration statement, report,
proxy statement or information statement filed with the SEC
subsequent to the date hereof, the "Amoco Reports"). As of their
respective dates, the Amoco Reports did not, and any Amoco
Reports filed with the SEC subsequent to the date hereof will
not, contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary
to make the statements made therein, in the light of the
circumstances under which they were made, not misleading. Each
of the consolidated statements of financial condition included in
or incorporated by reference into the Amoco Reports (including
the related notes and schedules) fairly presents, or will fairly
present, in all material respects, the consolidated financial
position of Amoco and its Subsidiaries as of its date and each of
the related consolidated statements of income, shareholders'
equity and cash flows included in or incorporated by reference
into the Amoco Reports (including any related notes and
schedules) fairly presents, or will fairly present in all
material respects, the consolidated results of operations,
retained earnings and changes in financial position, as the case
may be, of Amoco and its Subsidiaries for the periods set forth
therein (subject, in the case of unaudited statements, to notes
and normal year-end audit adjustments that will not be material
in amount or effect), in each case in accordance with U.S. GAAP
consistently applied during the periods involved except as may be
noted therein.
2.1.5.2. BP has made available to Amoco copies of (A) each
registration statement, report or annual report prepared by it or
its Subsidiaries and filed with the SEC since December 31, 1997
(the "BP Audit Date," with the BP Audit Date and the Amoco Audit
Date each being referred to herein as the relevant Party's "Audit
Date"), including BP's Annual Report on Form 20-F for the year
ended December 31, 1997, each in the form (including exhibits,
annexes and any amendments thereto) filed with the SEC and each
quarterly report distributed by BP to its shareholders
(collectively, including any such registration statement, report
or annual report filed with the SEC or, in the case of quarterly
reports, distributed to BP shareholders subsequent to the date
hereof, the "BP Reports"); and (B) all circulars, reports and
other documents distributed by BP to its shareholders since its
Audit Date. As of their respective dates, the BP Reports did
not, and any BP Report filed, distributed or delivered subsequent
to the date hereof will not, contain any untrue statement of a
material fact or omit to state a material fact required to be
stated therein or necessary to make the statements made therein,
in the light of the circumstances under which they were made, not
misleading. Each of the audited consolidated balance sheets of
BP and its Subsidiaries included in or incorporated by reference
into the BP Reports (including the related notes and schedules)
fairly presents, or will fairly present, in all material
respects, the consolidated financial position of BP and its
Subsidiaries as of its date, and each of the related consolidated
statements of income, changes in shareholders' interest, total
recognized gains and losses and cash flows included in or
incorporated by reference into the BP Reports (including any
related notes and schedules) fairly presents, or will fairly
present, in all material respects, the consolidated results of
its operations, retained earnings and cash flows of BP and its
Subsidiaries for the periods set forth therein (subject, in the
case of unaudited statements, to notes and normal year-end audit
adjustments that will not be material in amount or effect), in
each case in accordance with U.K. GAAP consistently applied
during the periods involved except as may be noted therein. The
related notes reconciling to U.S. GAAP such consolidated balance
sheet, consolidated statement of income, statement of changes in
shareholders' interest, and statement of cash flows comply in all
material respects with the requirements of the SEC applicable to
such reconciliation. The Amoco Reports and the BP Reports are
collectively referred to herein as the "Reports."
2.1.6. Absence of Certain Changes. Except as disclosed in the
Reports filed prior to the date hereof, or as expressly
contemplated by this Agreement, since its respective Audit Date
it and its Subsidiaries have conducted their respective
businesses only in, and have not engaged in any material
transaction other than according to, the ordinary and usual
course of such businesses, and there has not been (i) any change
in the financial condition, properties, business or results of
operations of it and its Subsidiaries except those changes that,
individually or in the aggregate, have not had and are not
reasonably likely to have a Material Adverse Effect on it; (ii)
any declaration, setting aside or payment of any dividend or
other distribution in cash, stock or property in respect of its
capital stock, except for dividends or other distributions on its
capital stock publicly announced prior to the date hereof and
except as expressly permitted hereby; (iii) any split in its
capital stock, combination, subdivision or reclassification of
any of its capital stock or issuance or authorization of any
issuance of any other securities in respect of, in lieu of or in
substitution for shares of its capital stock, except as expressly
contemplated hereby or, in the case of Amoco, in the Stock Option
Agreement; or (iv) any change by it in accounting principles,
practices or methods except as required by changes in U.S. GAAP
or U.K. GAAP, as the case may be. Since its respective Audit
Date, except as provided for herein or as disclosed in the
Reports filed prior to the date hereof, there has not been any
increase in the compensation payable or that could become payable
by it or any of its Subsidiaries to officers or key employees or
any amendment of any of its compensation or benefit plans or
agreements other than increases or amendments in the ordinary
course or as contemplated by this Agreement.
2.1.7. Litigation and Liabilities. Except as disclosed in the
Reports filed prior to the date hereof, there are no (i) civil,
criminal or administrative actions, suits, claims, hearings,
investigations or proceedings pending or, to the knowledge of, in
the case of Amoco, its Chief Executive Officer, Chief Operating
Officer, Chief Financial Officer or General Counsel ("Amoco
Officers"), and, in the case of BP, its Chief Executive Officer,
Deputy Chief Executive Officer, Chief Financial Officer or
General Counsel ("BP Officers"), threatened against it or any of
its Affiliates or (ii) obligations or liabilities, whether or
not accrued, contingent or otherwise and whether or not required
to be disclosed, or any other facts or circumstances of which, in
the case of Amoco, the Amoco Officers, and, in the case of BP,
the BP Officers, have knowledge that would reasonably be expected
to result in any claims against, or obligations or liabilities
of, it or any of its Affiliates, except, in each case, for those
that, individually or in the aggregate, have not had and are not
reasonably likely to have a Material Adverse Effect on it or
prevent, materially delay or materially impair its ability to
consummate the Merger and the other transactions contemplated by
this Agreement and the Stock Option Agreement.
2.1.8. Takeover Statutes. The board of directors of Amoco has
taken or will take all appropriate and necessary action such that
the "Business Combinations" provisions of the BCL ( 23-1-43-1
et seq.) will not have any effect on the Merger or the other
transactions contemplated by this Agreement, and the Stock Option
Agreement. No other "fair price," "moratorium," "control share
acquisition" or other similar anti-takeover statute or
regulation, including such Business Combinations provisions of
the BCL (each, a "Takeover Statute"), and no anti-takeover
provision in the amended articles of incorporation or by-laws of
Amoco is, or at the Effective Time will be, applicable to the
Merger or any of the other transactions contemplated by this
Agreement and the Stock Option Agreement.
2.1.9. Brokers and Finders. Neither it nor any of its
Subsidiaries, officers, directors or employees has employed any
broker or finder or incurred any liability for any brokerage
fees, commissions or finders' fees in connection with the
execution and delivery of this Agreement, the Stock Option
Agreement, the Merger or the other transactions contemplated by
this Agreement and the Stock Option Agreement, except that (i)
Amoco has retained Morgan Stanley & Co. Incorporated as its
financial advisors, the arrangements with which have been
disclosed to BP prior to the date hereof and (ii) BP has employed
Morgan Guaranty Trust Company of New York, Merrill Lynch, Pierce,
Fenner & Smith Incorporated and Cazenove & Co. as its financial
advisors, the arrangements with which have been disclosed to
Amoco prior to the date hereof.
2.1.10. Accounting Treatment. It is not aware of any fact or
circumstance with respect to itself or the Merger that would
cause the Merger to fail to (i) qualify as a pooling of interests
under U.S. GAAP or (ii) be accounted for using merger accounting
methods under U.K. GAAP.
2.1.11. Ownership of Other Party's Common Stock.
2.1.11.1. Neither Amoco nor any of its Subsidiaries "beneficially
owns" (as such term is defined in Rule 13d-3 under the Exchange
Act) any BP Ordinary Shares or BP Depositary Shares.
2.1.11.2. Neither BP nor any of its Subsidiaries "beneficially
owns" (as such term is defined in Rule 13d-3 under the Exchange
Act) any Amoco Common Shares.
2.1.12. Merger Sub's Operations. Merger Sub was formed solely
for the purpose of engaging in the transactions contemplated
hereby and has not (i) engaged in any business activities,
(ii) conducted any operations other than in connection with the
transactions contemplated hereby or (iii) incurred any
liabilities other than in connection with the transactions
contemplated hereby. The execution and delivery of this
Agreement has been duly authorized by all necessary corporate
action on the part of Merger Sub and, assuming the due
authorization, execution and delivery of this Agreement by Amoco,
this Agreement constitutes a valid and binding agreement of
Merger Sub enforceable against Merger Sub in accordance with its
terms, subject to the Bankruptcy and Equity Exception. BP, as
Merger Sub's sole stockholder has approved Merger Sub's execution
of this Agreement.
ARTICLE III
COVENANTS
3.1. Interim Operations. Each of Amoco and BP covenants and
agrees as to itself and its Subsidiaries that, after the date
hereof and until the Effective Time (unless the other Party shall
otherwise approve in writing and except as otherwise expressly
contemplated by or provided in this Agreement, or as required by
applicable Law):
3.1.1. the business of it and its Subsidiaries shall be conducted
in the ordinary and usual course and, to the extent consistent
therewith, it and each of its Subsidiaries shall use its best
reasonable efforts to preserve its business organization intact
and maintain its existing relations and goodwill with customers,
suppliers, creditors, regulators, lessors, employees and business
associates;
3.1.2. it shall not (i) amend its articles of incorporation or by-
laws, in the case of Amoco, or memorandum and articles of
association, in the case of BP; (ii) split, combine, subdivide or
reclassify its outstanding shares of capital stock; (iii) subject
to Section 3.10.2, declare, set aside or pay any dividend or
distribution payable in cash, stock or property in respect of any
capital stock other than (A) in the case of Amoco, regular
quarterly cash dividends consistent with past practice, including
periodic dividend increases and (B) in the case of BP, regular
quarterly cash dividends and scrip alternative in respect thereof
payable under BP's gross scrip dividend scheme, in each case,
consistent with past practice, including periodic dividend
increases, and regular cash dividends on the issued and
outstanding BP First Preference Shares and BP Second Preference
Shares; or (iv) repurchase, redeem or otherwise acquire, or
permit any of its Subsidiaries to purchase or otherwise acquire
(except for repurchases, redemptions or acquisitions (A) required
by the terms of its capital stock or securities outstanding on
the date hereof or (B) required by or in connection with the
respective terms as of the date hereof of, any Amoco Stock Plans,
in the case of Amoco, or Option Schemes, in the case of BP, or
any dividend reinvestment plans as in effect on the date hereof
in the ordinary course of the operation of such plans), any
shares of the capital stock of BP or Amoco, as the case may be,
or any securities convertible into or exchangeable or exercisable
for any shares of its capital stock;
3.1.3. neither it nor any of its Subsidiaries shall (i) issue,
sell, pledge, dispose of or encumber any shares of, or securities
convertible into or exchangeable or exercisable for, or rights,
options, warrants, conversion rights, stock appreciation rights,
redemption rights, repurchase rights, agreements, arrangements,
calls, commitments or rights of any kind to acquire, the capital
stock of BP or Amoco, as the case may be, of any class (other
than (x) in the case of Amoco, Amoco Common Shares issuable
pursuant to options outstanding on the date hereof under the
Amoco Stock Plans or pursuant to the Stock Option Agreement,
additional options or rights to acquire Amoco Common Shares
granted under the terms of any Amoco Stock Plan as in effect on
the date hereof in the ordinary course of the operation of such
Amoco Stock Plan, (y) in the case of BP, BP Ordinary Shares
issuable or transferable pursuant to options outstanding on the
date hereof under the Option Schemes and additional options or
rights to acquire BP Ordinary Shares granted under the terms of
any Option Scheme as in effect on the date hereof in the ordinary
course of the operation of such Option Scheme and the BP Ordinary
Shares to be issued in February, 1999, in lieu of dividends
pursuant to BP's gross scrip dividend scheme, and (z) issuances
of securities in connection with grants or awards of stock-based
compensation made in accordance with paragraph 3.1.4 hereof);
(ii) incur or modify any significant indebtedness or other
liability except in the ordinary and usual course of business,
pursuant to financial plans previously communicated to the other
Party, or for long-term indebtedness incurred in connection with
the refinancing of existing indebtedness, without first
consulting with the other Party; or (iii) make any decision or
commitment with respect to a significant investment or divestment
except in the ordinary and usual course of business or pursuant
to financial plans previously communicated to the other Party
without first consulting with the other Party;
3.1.4. neither it nor any of its Subsidiaries shall terminate,
establish, adopt, enter into, make any new grants or awards of
stock-based compensation or other benefits under, amend or
otherwise modify any compensation or benefit plan or agreement or
increase the salary, wage, bonus or other compensation of any
directors, officers or employees except for grants or awards to
directors, officers and employees of it or its Subsidiaries under
existing compensation or benefit plans or agreements in the
normal and usual course of business (which shall include normal
periodic performance reviews) and related compensation and
benefit increases, annual reestablishment of compensation or
benefit plans or agreements and the provision of individual
compensation or benefit plans or agreements for newly hired or
appointed officers and employees and the adoption of compensation
or benefit plans or agreements for employees of new Subsidiaries
or for actions necessary to satisfy existing contractual
obligations under compensation or benefit plans or agreements
existing as of the date hereof;
3.1.5. neither it nor any of its Subsidiaries shall take any action
or omit to take any action for the purpose of preventing,
delaying or impeding the consummation of the Merger or the other
transactions contemplated by this Agreement and the Stock Option
Agreement including any action or omission that would cause (i)
the Merger to (A) fail to qualify as a "pooling of interests"
under U.S. GAAP or fail to be accounted for using merger
accounting methods under U.K. GAAP (and each Party agrees to use
its best reasonable efforts to remove any impediment that would
cause the Merger to fail to qualify as a "pooling-of-interests"
under U.S. GAAP or fail to be accounted for using merger
accounting methods under U.K. GAAP) or (B) fail to qualify as a
reorganization under Section 368(a) of the Code or (ii) the
exchange of Amoco Common Stock for BP Ordinary Shares in the
Merger to fail to qualify for nonrecognition of gain (except with
respect to cash received in lieu of fractional BP Depositary
Shares); and
3.1.6. neither it nor any of its Subsidiaries shall authorize or
enter into an agreement to do any of the foregoing.
3.2. Acquisition Proposals.
3.2.1. Each of Amoco and BP agrees that, subject to paragraph 3.2.3
and except as expressly contemplated by this Agreement, neither
it nor any of its Subsidiaries nor any of the officers or
directors of it or its Subsidiaries shall, and that it shall
direct and use its best efforts to cause its and its
Subsidiaries' officers, directors, employees, investment bankers,
attorneys, accountants, financial advisors, agents or other
representatives (collectively, with respect to each of Amoco and
BP, such Person's "Representatives") not to, directly or
indirectly, initiate, solicit, encourage or otherwise facilitate
any inquiries or the making of any proposal or offer with respect
to a merger, reorganization, share exchange, dual-holding company
transaction, consolidation or similar transaction involving Amoco
or BP, or any purchase of, or offer to purchase, all or
substantially all of the equity securities of Amoco or BP, as the
case may be, or of its and its Subsidiaries' assets taken as a
whole (any such proposal or offer being hereinafter referred to
as an "Acquisition Proposal"). Each of Amoco and BP further
agrees that neither it nor any of its Subsidiaries nor any of its
or its Subsidiaries' officers or directors shall, and that it
shall direct and use its best efforts to cause its
Representatives not to, directly or indirectly, have any
discussions with or provide any confidential information or data
to any Person relating to an Acquisition Proposal or engage in
any negotiations concerning an Acquisition Proposal, or otherwise
facilitate any effort or attempt to make or implement an
Acquisition Proposal; provided, however, that nothing contained
in this Agreement shall prevent either Amoco or BP or its board
of directors from (i) making any disclosure to its shareholders
if, in the good faith judgment of its board of directors, failure
so to disclose would be inconsistent with its obligations under
applicable Law; (ii) negotiating with or furnishing information
to any Person who has made a bona fide written Acquisition
Proposal which did not result from a breach of this Section
3.2.1; or (iii) recommending such an Acquisition Proposal to its
shareholders, if and only to the extent that, in the case of
actions referred to in clause (ii) or clause (iii), such
Acquisition Proposal is a Superior Proposal (as defined below).
For purposes of this Agreement, a "Superior Proposal" means in
respect of Amoco or BP, as applicable, any Acquisition Proposal
by a third party (y) on terms which the board of directors of
such Party determines in its good faith judgment (i) after
consultation with its financial advisors (whose advice shall be
communicated to the other Party), to be more favorable from a
financial point of view to its shareholders than the Merger and
the other transactions contemplated hereby and (ii) to be more
favorable to such Party than the Merger and the other
transactions contemplated hereby after taking into account any
additional constituencies (including shareholders) and other
relevant factors permitted under the Laws of the State of
Indiana, in the case of Amoco, and the Laws of England or any
requirement of any regulatory authority therein (including the
City Code on Takeovers and Merger (the "City Code")), in the case
of BP, and after giving the other Party at least seven business
days to respond to such third party Acquisition Proposal and (z)
which the board of directors of such Party determines in its good
faith judgment to constitute a transaction that is reasonably
likely to be consummated on the terms set forth, taking into
account all legal, financial, regulatory and other aspects of
such proposal. Each of Amoco and BP agrees that it will
immediately cease and cause to be terminated any existing
activities, discussions or negotiations with any Person conducted
heretofore with respect to any Acquisition Proposal. Each of
Amoco and BP also agrees that if it has not already done so, it
will promptly request each Person, if any, that has heretofore
executed a confidentiality agreement within the 12 months prior
to the date hereof in connection with its consideration of any
Acquisition Proposal to return or destroy all confidential
information heretofore furnished to such Person by or on behalf
of it or any of its Subsidiaries.
3.2.2. Each of Amoco and BP agrees that it will take the necessary
steps promptly to inform its Subsidiaries and its and its
Subsidiaries' Representatives of the obligations undertaken in
this Section 3.2 (Acquisition Proposals). Each of Amoco and BP
agrees that it will notify the other promptly if any such
inquiries, proposals or offers relating to or constituting an
Acquisition Proposal are received by, any such information is
requested from, or any such discussions or negotiations are
sought to be initiated or continued with, any of its or its
Subsidiaries' Representatives indicating, in connection with such
notice, the name of such Person and the material terms and
conditions of any proposals or offers and thereafter shall keep
the other informed, on a current basis, of the status and
material terms of any such proposals or offers.
3.2.3. Nothing contained herein shall prohibit a Party from taking
and disclosing to its shareholders a position contemplated by
Rule 14e-2(a) under the Exchange Act with respect to an
Acquisition Proposal by means of a tender or exchange offer or,
in the case of BP, taking such action and making such
recommendations as the directors of BP reasonably consider
necessary so as to comply with any obligations imposed on them or
BP by the City Code or the Takeover Panel in relation to any
Acquisition Proposal (provided that it is hereby acknowledged,
for the avoidance of doubt, that no provision of the City Code
requires BP or its directors to solicit or initiate any
Acquisition Proposal).
3.3. Information Supplied.
3.3.1. Registration Statement.
3.3.1.1. Each of BP and Amoco shall cooperate and promptly
prepare and BP shall file with the SEC as soon as practicable a
Registration Statement on Form F-4 (the "Form F-4") under the
Securities Act, with respect to the issuance of the BP Depositary
Shares and the BP ADRs in the Merger and, if applicable, the
allotment of BP Ordinary Shares in the Merger, a portion of which
Form F-4 shall also serve as the Amoco Proxy Statement (as
defined in Section 3.3.1.2), the prospectus with respect to the
BP Depositary Shares and BP ADRs issuable in the Merger and, so
far as appropriate, the BP Documents (as defined in Section
3.3.2). The Parties will cause the Form F-4 to comply as to form
in all material respects with the applicable provisions of the
Securities Act and the rules and regulations thereunder. Each of
BP and Amoco shall use its respective best reasonable efforts to
have the Form F-4 declared effective by the SEC as promptly as
practicable after such filing. BP shall use its reasonable
efforts to obtain, prior to the effective date of the Form F-4,
all necessary state securities law or "Blue Sky" permits or
approvals required to carry out the transactions contemplated by
this Agreement. BP will advise Amoco, promptly after it receives
notice thereof, of the time when the Form F-4 has become
effective or any supplement or amendment has been filed, the
issuance of any stop order, the suspension of the qualification
of the BP ADRs or BP Ordinary Shares issuable in connection with
the Merger for offering or sale in any jurisdiction, or any
request by the SEC for amendment of the Amoco Proxy Statement or
the Form F-4 or comments thereon and responses thereto or
requests by the SEC for additional information.
3.3.1.2. Amoco and BP each agrees, as to itself and its
Subsidiaries, that none of the information supplied or to be
supplied by it or its Subsidiaries for inclusion or incorporation
by reference in the Form F-4, including, without limitation the
proxy statement/prospectus constituting a part thereof (the
"Amoco Proxy Statement"), and any amendment or supplement thereto
will, at the time the Form F-4 becomes effective under the
Securities Act, at the date of mailing to shareholders and at the
time or times of the Amoco Shareholders Meeting, contain any
untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary in order to make
the statements therein, in the light of the circumstances under
which they were made, not misleading. If at any time prior to
the date of the Amoco Shareholders Meeting any information
relating to Amoco or BP, or any of their respective Affiliates,
officers or directors, should be discovered by Amoco or BP which
should be set forth in an amendment to the Form F-4 or a
supplement to the Amoco Proxy Statement, so that such document
would not include any misstatement of a material fact or omit to
state any material fact required to be stated therein or
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, the
Party which discovers such information shall promptly notify the
other Party and, to the extent required by Law, an appropriate
amendment or supplement describing such information shall be
promptly filed with the SEC and, to the extent required by law,
disseminated to the Amoco shareholders.
3.3.1.3. Each of BP and Amoco will use its best reasonable
efforts to cause the BP Documents and the Amoco Proxy Statement,
respectively, to be mailed to its shareholders as promptly as
practicable after the date hereof.
3.3.2. Amoco and BP shall cooperate and promptly prepare and BP
shall file with the LSE (a) a circular to be sent to BP
shareholders in connection with the BP Shareholders Meeting (as
defined in Section 3.4 (Shareholders Meetings)) (the "BP
Circular"), containing (i) a notice convening the BP Shareholders
Meeting, (ii) such other information (if any) as may be required
by the LSE and (iii) such other information as BP and Amoco shall
agree to include therein; and (b) listing particulars relating to
BP and its Subsidiaries and the BP Ordinary Shares (the "BP
Listing Particulars," and the BP Circular and the BP Listing
Particulars together being the "BP Documents"). Amoco and BP
each agrees, as to itself and its Subsidiaries, that the BP
Documents and any supplements thereto and any other circulars or
documents issued to shareholders, employees or debentureholders
of BP, will contain all particulars relating to Amoco and BP
required to comply in all material respects with all United
Kingdom statutory and other legal provisions (including, without
limitation, the Companies Act, the Financial Services Act 1986
(the "FSA") and the rules and regulations made thereunder, and
the rules and requirements of the LSE) and all such information
contained in such documents will be substantially in accordance
with the facts and will not omit anything material likely to
affect the import of such information.
3.4. Shareholders Meetings. Amoco will take all action necessary
to convene a meeting of the holders of Amoco Common Shares at
which the holders of Amoco Common Shares shall consider approval
of the Merger and the other transactions contemplated hereby (the
"Amoco Shareholders Meeting") as promptly as practicable after
the Form F-4 has been declared effective by the SEC. BP will
take all action necessary to convene an extraordinary general
meeting of BP shareholders at which resolutions will be proposed
to approve the Merger and the other transactions contemplated
hereby (the "BP Shareholders Meeting") as promptly as practicable
after the BP Documents are cleared by the LSE and the Form F-4
has been declared effective by the SEC. BP shall include in the
notice of meeting referred to above, resolutions inter alia to
approve: (i) the Merger and the other transactions contemplated
hereby; (ii) a change of name of BP to BP Amoco p.l.c.; (iii) an
alteration to BP's articles of association to permit BP to
declare and pay dividends in U.S. dollars; and (iv) the
appointment of the Persons referred to in Section 3.8.3 as
directors of BP, in each case subject to and with effect at the
Effective Time. BP and Amoco each agrees to use all reasonable
efforts such that, to the extent practical, the Amoco
Shareholders Meeting and the BP Shareholders Meeting shall be
held as promptly as practicable after the conditions precedent to
holding such meetings have been fulfilled. Subject to fiduciary
obligations and the requirements of applicable Law and the terms
of this Agreement, including the provisions of Section 3.2
(Acquisition Proposals), the board of directors of each of BP and
Amoco shall recommend to its respective shareholders the approval
of the Merger and the other transactions contemplated hereby and
shall use best reasonable efforts to solicit such approval.
3.5. Filings; Other Actions; Notification.
3.5.1. Amoco and BP shall each cooperate with the other and (i) use
(and shall use best reasonable efforts to cause their respective
Subsidiaries to use) all their respective best reasonable efforts
promptly to take or cause to be taken all actions, and do or
cause to be done all things, necessary, proper or advisable under
this Agreement, the Stock Option Agreement and applicable Laws to
consummate and make effective the Merger and the other
transactions contemplated by this Agreement and the Stock Option
Agreement as soon as practicable, including preparing and filing
as promptly as practicable all documentation to effect all
necessary filings, notices, petitions, statements, registrations,
submissions of information, applications and other documents,
(ii) use (and shall use best reasonable efforts to cause their
respective Subsidiaries to use) all their respective best
reasonable efforts to obtain as promptly as practicable all
approvals, consents, registrations, permits, authorizations and
other confirmations required to be obtained from any third party
(other than Amoco Required Consents and BP Required Consents)
necessary, proper or advisable to consummate the Merger and the
other transactions contemplated by this Agreement and the Stock
Option Agreement, and (iii) use (and shall use best reasonable
efforts to cause their respective Subsidiaries to use) their
respective best efforts to take or cause to be taken all actions,
and do or cause to be done all things, necessary, proper or
advisable to obtain the Amoco Required Consents or BP Required
Consents, as the case may be; provided that neither Party shall
be required by this Section 3.5.1(iii) to accept or agree to any
conditions, terms or restrictions in connection with any such
Amoco Required Consent or BP Required Consent, as the case may
be, which, individually or in the aggregate, would be reasonably
likely to have a Material Adverse Effect on BP or Amoco after the
Effective Time (it being understood that, for this purpose,
materiality shall be considered with reference to the total
equity market value of BP and Amoco). Subject to applicable Laws
relating to the exchange of information, Amoco and BP shall have
the right to review in advance, and to the extent practicable
each will consult the other on, all the information relating to
Amoco and its Subsidiaries or BP and its Subsidiaries, as the
case may be, that appears in any filing made with, or written
materials submitted to, any third party and/or any Governmental
Entity in connection with the Merger and the other transactions
contemplated by this Agreement and the Stock Option Agreement.
In exercising the foregoing right, each of Amoco and BP shall act
reasonably and as promptly as practicable.
3.5.2. Amoco and BP each shall, upon request by the other, furnish
the other with all information concerning itself, its
Subsidiaries, directors, officers and shareholders and such other
matters as may be reasonably necessary or advisable in connection
with the Form F-4, the Amoco Proxy Statement, the BP Circular or
any other necessary or appropriate filing, notice, statement,
registration, submission of information or application made by or
on behalf of Amoco or BP or any of their respective Subsidiaries
to any third party and/or any Governmental Entity in connection
with the Merger and the other transactions contemplated by this
Agreement and the Stock Option Agreement.
3.5.3. Amoco and BP each shall keep the other apprised of the
status of matters relating to completion of the Merger and the
other transactions contemplated by this Agreement and the Stock
Option Agreement, including promptly furnishing the other with
copies of notices or other communications received by Amoco or
BP, as the case may be, or any of its Subsidiaries, from any
third party and/or any Governmental Entity with respect to the
Merger and the other transactions contemplated by this Agreement
and the Stock Option Agreement. Amoco and BP each shall give
prompt notice to the other of any change that is reasonably
likely to result in a Material Adverse Effect on it or of any
failure of any condition set forth in Article IV to the other
Party's obligations to effect the Merger.
3.5.4. Prior to making any filing, notice, petition, statement,
registration, submission of information or application to or with
any third party and/or Governmental Entity (including any
domestic or foreign national securities exchange) in connection
with the consummation of the Merger and the other transactions
contemplated by this Agreement and the Stock Option Agreement and
except as may be required by Law or by obligations pursuant to
any listing agreement with or rules of any domestic or foreign
national securities exchange, each Party shall make all
reasonable efforts to consult with the other Party with respect
to the content of such filing, notice, petition, statement,
registration, submission of information or application and to
provide the other Party with copies of the proposed filing,
notice, petition, statement, registration, statement of
information or application. Amoco and BP each shall not agree to
participate in any meeting with any Governmental Entity in
respect of any filings, investigation or other inquiry relating
to the Merger and the other transactions contemplated by this
Agreement unless it consults with the other Party in advance and,
to the extent practicable and permitted by such Governmental
Entity, gives the other Party the opportunity to attend and
participate thereat.
3.5.5. In the event any claim, action, suit, investigation or other
proceeding by any Governmental Entity or other Person or other
legal or administrative proceeding is commenced that questions
the validity or legality of this Agreement, the Stock Option
Agreement, or the Merger or the other transactions contemplated
by this Agreement and the Stock Option Agreement or claims
damages in connection therewith, the Parties agree to cooperate
and use their best efforts, subject to the limitations set forth
in Section 3.5.2, to defend against and respond thereto.
3.6. Access. In order to facilitate consummation of the Merger
and the other transactions contemplated by this Agreement, the
Parties hereby agree that upon reasonable request to any
executive officer of BP or Amoco, as the case may be, designated
for the purpose, and except as may otherwise be required by
applicable Law, Amoco and BP each shall (and shall cause its
Subsidiaries to) afford the other's Representatives access,
during normal business hours throughout the period prior to the
Effective Time, to its properties, books, contracts and records
and, during such period, each shall (and shall cause its
Subsidiaries to) furnish promptly to the other all information
concerning its business, properties and personnel as may
reasonably be requested, provided that no receipt of information
pursuant to this Section shall affect or be deemed to modify any
representation or warranty made by Amoco or BP hereunder, and
provided, further, that the foregoing shall not require Amoco or
BP to permit any inquiry, or to disclose any information, that in
the reasonable judgment of Amoco or BP, as the case may be, would
(i) violate any antitrust or competition Law or (ii) result in
the disclosure of any trade secrets of third parties or violate
any of its obligations with respect to confidentiality to third
parties if Amoco or BP, as the case may be, shall have used
reasonable efforts to obtain the consent of such third party to
such inspection or disclosure. All such information shall be
governed by the terms of the Confidentiality Agreement, dated
July 24, 1998, between the Parties (the "Confidentiality
Agreement"), including without limitation all such information
disclosed in the Disclosure Letters, and Amoco and BP, and each
of their respective Subsidiaries, shall use their respective best
reasonable efforts to maintain the confidentiality of all such
information disclosed in the Disclosure Letters.
3.7. Publicity. The initial press release concerning this
Agreement, the Merger and the other transactions contemplated by
this Agreement and the Stock Option Agreement shall be a joint
press release, and thereafter Amoco and BP shall consult with
each other prior to issuing any press releases or otherwise
making public announcements with respect to the Merger and the
other transactions contemplated by this Agreement and the Stock
Option Agreement.
3.8. Benefits and Other Matters.
3.8.1 Employee Benefits.
3.8.1.1. Employee Benefits. It is the specific intention that
the compensation and benefit programs (including annual and long-
term incentive programs) to be provided by BP and its
Subsidiaries for current and former employees and directors of
Amoco will be competitive with those provided generally by large
industrial companies for each respective home-country market,
both with respect to the type and variety of programs as well as
the level of compensation and benefits afforded.
3.8.1.2. (a) For at least two years following the Effective
Time (such period, the "Initial Period"), BP shall provide or
cause to be provided to current and former employees and
directors of Amoco and its Subsidiaries compensation and benefits
that are at least as favorable in the aggregate as the
compensation and benefits they were entitled to receive
immediately prior to the Effective Time (including, without
limitation, benefits pursuant to qualified and non-qualified
restoration retirement plans, savings plans, medical plans and
programs, deferred compensation arrangements, incentive plans,
and retiree benefit plans, policies and arrangements); provided,
however, that, with respect to employees who are subject to
collective bargaining, all benefits shall be provided in
accordance with the applicable collective bargaining or other
labor agreements; and provided, further, that all incentive,
bonus and similar plans shall after the Effective Time be
substantially performance-based. BP shall cause Amoco's general
severance program as in effect immediately prior to the Effective
Time to continue without any reduction in benefits for at least
two years following the Effective Time.
(b) Following the Effective Time, BP shall, and shall cause its
Subsidiaries to, recognize service with Amoco and its
Subsidiaries and any predecessor entities (and any other service
credited by Amoco under similar benefit plans) prior to the
Effective Time for all purposes (including, without limitation,
eligibility to participate, vesting, benefit accrual, eligibility
to commence benefits and severance) under any benefit plans of BP
or its Subsidiaries in which the particular employee or former
employee of Amoco (or its respective Subsidiaries) participates;
provided, however, that the foregoing shall not result in any
duplication of benefits. From and after the Effective Time, BP
shall, and shall cause its Subsidiaries to, recognize any and all
appropriate out-of-pocket expenses of each employee or former
employee of Amoco and its Subsidiaries for purposes of
determining such employee's and former employee's (including
their beneficiaries and dependents) deductible and copayment
expenses.
3.8.1.3. (a) From and after the Effective Time, BP shall honor,
and shall cause its Subsidiaries to honor, in accordance with its
terms, each existing employment, change of control, severance and
termination agreement between Amoco or any of its Subsidiaries,
and any officer, director or employee of such company, including
without limitation all legal and contractual obligations pursuant
to outstanding restoration plans, bonus deferral plans, vested
and accrued benefits and similar employment and benefit
arrangements and agreements in effect as of the Effective Time.
(b) At or prior to the Effective Time, BP shall enter into
employment agreements substantially in the form previously
provided by Amoco to BP with the Amoco officers, and on the
principal terms, identified in the Amoco Disclosure Letter.
3.8.2. Director and Officer Liability.
(a) BP agrees that all rights to indemnification and all
limitations on liability existing in favor of any Indemnitee (as
defined below) in respect of acts or omissions of such
Indemnitees on or prior to the Effective Time as provided in the
articles of incorporation and by-laws of Amoco or an agreement
between an Indemnitee and Amoco or its Subsidiaries in effect as
of the date hereof shall continue in full force and effect in
accordance with the terms thereof.
(b) For six years after the Effective Time, BP shall indemnify
and hold harmless the individuals who on or prior to the
Effective Time were officers or directors of Amoco or any of its
Subsidiaries (the "Indemnitees") to the same extent as set forth
in Subsection (a) above with respect to all actions or omissions
by them in their capacities as officers or directors of Amoco, or
taken by them at the request of, Amoco or any of its
Subsidiaries. In the event any claim in respect of which
indemnification is available pursuant to the foregoing provisions
is asserted or made within such six-year period, all rights to
indemnification shall continue until such claim is disposed of or
all judgments, orders, decrees or other rulings in connection
with such claim are duly satisfied.
(c) For six years after the Effective Time, BP shall procure the
provision of officers' and directors' liability insurance in
respect of acts or omissions occurring prior to the Effective
Time covering each such Person currently covered by Amoco's
officers' and directors' liability insurance policy on terms with
respect to coverage and in amounts no less favorable than those
of such policy in effect on the date hereof; provided, however,
that during such period, BP shall procure as much coverage as can
be obtained for the remainder of such period for an annual
premium not in excess of 300% of the current annual premium paid
by Amoco for its existing coverage.
(d) The obligations of BP under this Section 3.8.2 shall not be
terminated or modified in such a manner as to adversely affect
any Indemnitee to whom this Section 3.8.2 applies without the
consent of such affected Indemnitee (it being expressly agreed
that the Indemnitees to whom this Section 3.8.2 applies shall be
third party beneficiaries of this Section 3.8.2).
3.8.3. Directors of BP. At the Effective Time, the board of
directors of BP shall consist of 22 directors, 13 of which shall
be directors designated prior to the Effective Time by BP, of
which seven shall be non-executive directors, and nine of which
shall be directors designated by Amoco, of which seven shall be
non-executive directors, and such Amoco and BP director designees
shall be the "New Directors." Those New Directors shall be
nominated for election by shareholders with effect from the
Effective Time. BP agrees to procure such resignations of its
respective directors as may be necessary so that at the Effective
Time the New Directors are the only directors of BP. BP shall be
entitled to designate the chairman of each of the nominating,
compensation and policy committees of the BP board of directors.
Following the Effective Time, a majority of the meetings of the
board of directors of BP in each year shall be held in London.
3.8.4. Officers. At the Effective Time, the following persons, so
long as they are willing and able to serve, shall be duly
appointed to the following offices: (A) Peter Sutherland and
Larry Fuller to the office of Co-Chairman, (B) Sir John Browne to
the office of Chief Executive Officer of BP Amoco p.l.c., and
(C) such persons as are as set forth in Section 3.8.4 of the
Amoco Disclosure Letter (the "List of New Officers"), to the
offices set forth therein. If at or immediately prior to the
Effective Time, any person designated on the List of New Officers
shall be unwilling or unable to serve, a person to fill such
position shall be designated by mutual agreement of BP and Amoco.
3.9. Expenses. Except as otherwise provided in Section 5.5
(Effect of Termination and Abandonment), whether or not the
Merger is consummated, all costs and expenses incurred in
connection with this Agreement, the Stock Option Agreement, the
Merger and the other transactions contemplated by this Agreement
and the Stock Option Agreement shall be paid by the party
incurring such expense, except that the parties shall share
equally the costs and expenses of filing, printing and
distributing the Form F-4, the Amoco Proxy Statement, the BP
Documents and related documents.
3.10. Other Actions by Amoco and BP.
3.10.1. Takeover Statutes. If any Takeover Statute is or may
become applicable to the Merger or the other transactions
contemplated by this Agreement and the Stock Option Agreement,
each of Amoco and BP and its board of directors shall, subject to
applicable Law, grant such approvals and take such actions as are
necessary so that the Merger and the other transactions
contemplated by this Agreement and the Stock Option Agreement may
be consummated as promptly as practicable on the terms
contemplated by this Agreement and the Stock Option Agreement,
and otherwise act to eliminate or minimize the effects of such
Takeover Statute on such transactions.
3.10.2. Dividends. For a period of at least five years after
the Closing, dividends on the BP Ordinary Shares will be declared
in U.S. dollars. After the date of this Agreement, each of BP
and Amoco shall coordinate with the other the declaration of any
dividends in respect of BP Ordinary Shares and Amoco Common
Shares and the record dates and payment dates related thereto, it
being the intention of the Parties that record dates with respect
to such dividends do not occur more or less frequently than once
each calendar quarter with respect to BP Ordinary Shares or Amoco
Common Shares.
3.11. Listing Applications/Establishment of BP ADRs. BP shall
promptly prepare and submit to the LSE a listing application with
respect to the BP Ordinary Shares, and to the NYSE a listing
application in respect of the BP ADRs issuable in the Merger, and
shall use its best efforts to obtain, prior to the Effective
Time, approval for the listing of such BP Ordinary Shares, in the
case of the LSE, subject to allotment, and such BP ADRs, in the
case of the NYSE, subject to official notice of issuance under
the symbol "BPA", or such other symbol as the Parties agree. BP
will enter into all necessary agreements with the Depositary and
other parties to establish the BP ADRs issuable pursuant to the
Merger.
3.12. Letters of Accountants.
(a) Amoco shall use its best reasonable efforts to cause to be
delivered to BP "comfort" letters of PricewaterhouseCoopers LLP,
Amoco's independent public accountants, dated the effective date
of the Form F-4 and the Closing Date, respectively, and addressed
to BP and its directors, in form reasonably satisfactory to BP
and customary in scope and substance for "comfort" letters
delivered by independent public accountants in connection with
registration statements similar to the Form F-4.
(b) BP shall use its best reasonable efforts to cause to be
delivered to Amoco "comfort" letters of Ernst & Young, BP's
independent public accountants, dated the effective date of the
Form F-4 and the Closing Date, respectively, and addressed to
Amoco and its directors, in form reasonably satisfactory to Amoco
and customary in scope and substance for "comfort" letters
delivered by independent public accountants in connection with
registration statements similar to the Form F-4.
3.13. Agreements of Rule 145 Affiliates.
3.13.1. Prior to the date of the Amoco Shareholders Meeting,
Amoco shall cause to be prepared and delivered to BP a list
identifying all persons who, at the time of the Amoco
Shareholders Meeting, Amoco believes may be deemed to be
"affiliates" of Amoco for purposes of applicable interpretation
regarding use of the "pooling-of-interests" accounting method or
for purposes of Rule 145 under the Securities Act (the "Amoco
Rule 145 Affiliates"). BP shall be entitled to place restrictive
legends on any BP ADRs received by such Amoco Rule 145
Affiliates. Amoco shall use its best efforts to cause each
person who is identified as an Amoco Rule 145 Affiliate in such
list to deliver to BP, at or prior to the date of the Amoco
Shareholders Meeting, a written agreement, in the form to be
approved by the Parties, that such Amoco Rule 145 Affiliate will
not sell, pledge, transfer or otherwise dispose of any BP ADRs
issued to such Amoco Rule 145 Affiliate pursuant to the Merger,
except pursuant to an effective registration statement or in
compliance with Rule 145 or an exemption from the registration
requirements of the Securities Act. Amoco shall use its best
efforts to cause each person who is identified as an Amoco Rule
145 Affiliate in such list to sign on or prior to the date of the
Amoco Stockholders Meeting a written agreement, in the form to be
approved by Amoco and BP, that such party will not sell or in any
other way reduce such party's risk relative to any Amoco Common
Shares held prior to the Closing or BP ADRs received in the
Merger (within the meaning of Section 201.01 of the SEC's
Codification of Financial Policies), until such time as financial
results (including combined sales net income) covering at least
30 days of post-merger operations have been published, except as
permitted by and in accordance with Staff Accounting Series
Release 135 and SEC Staff Accounting Bulletins No. 65 and 76 (or
any successor thereto) issued by the SEC. Any BP Ordinary Shares
held by any Amoco Rule 145 Affiliate shall not be transferable,
regardless of whether such affiliate has provided the applicable
written agreement referred to in this Section, if such transfer,
either alone or in the aggregate with other transfers by
affiliates, would preclude BP's ability to account for the
business combination to be effected by the Merger as a pooling of
interests. BP shall not register the transfer of any BP Ordinary
Shares unless such transfer is made in compliance with the
foregoing.
3.13.2. Prior to the Effective Time, BP shall cause to be
prepared and delivered to Amoco a list identifying all persons
who, at the time of the BP Shareholders Meeting, BP believes may
be deemed to be "affiliates" of BP for purposes of Rule 145 under
the Securities Act (the "BP Rule 145 Affiliates"). BP shall use
its best efforts to cause each person who is identified as a BP
Rule 145 Affiliates in such list to sign on or prior to the
thirtieth day prior to the Effective Time a written agreement, in
the form to be approved by Amoco and BP, that such party will not
sell or in any other way reduce such party's risk relative to any
BP Ordinary Shares owned by such party (within the meaning of
Section 201.01 of the SEC's Codification of Financial Policies,
until such time as financial results (including combined sales
and net income) covering at least 30 days of post-merger
operations have been published, except as permitted by and in
accordance with Staff Accounting Series Release 135 and SEC Staff
Accounting Bulletins No. 65 and 76 (or any successor thereto)
issued by the SEC. Any BP Ordinary Shares held by any BP Rule
145 Affiliate shall not be transferable, regardless of whether
such affiliate has provided the applicable written agreement
referred to in this Section, if such transfer, either alone or in
the aggregate with other transfers by affiliates, would preclude
BP's ability to account for the business combination to be
effected by the Merger as a pooling of interests. BP shall not
register the transfer of any BP Ordinary Shares unless such
transfer is made in compliance with the foregoing.
3.14. Accounting and Tax Matters. The Parties agree that after
the Closing the primary consolidated financial statements of BP
shall be prepared in accordance with U.K. GAAP in U.S. dollars.
Further, for a period of time not less than five years from the
date of the Closing, BP shall prepare supplemental consolidated
financial statements, which include a restatement or
recalculation prepared in accordance with U.S. GAAP in U.S.
dollars. Subsequent to the Closing, neither Party shall take any
action that would cause, or omit to take any action the omission
of which would cause, (i) the Merger to fail to qualify as a
pooling of interests under U.S. GAAP or to be accounted for using
merger accounting methods under U.K. GAAP, (ii) the Merger to
fail to qualify as a reorganization under Section 368(a) of the
Code or (iii) the conversion of Amoco Common Stock into BP
Ordinary Shares to fail to qualify for nonrecognition of gain
(except with respect to cash received in lieu of fractional BP
Depositary Shares) and in connection therewith shall satisfy the
tax reporting and filing requirements contained in the Code.
3.15. BP SEC Filings. Within 45 days after the end of each of its
first three fiscal quarters, BP agrees that it will make filings
with the SEC on Form 6-K, providing for such disclosures as are
comparable to those required by Form 10-Q. BP further agrees
that it will make any requisite filings on Form 20-F with the SEC
within 90 days after the end of its fiscal year.
ARTICLE IV
CONDITIONS
4.1. Conditions to Each Party's Obligation to Effect the Merger.
The respective obligations of BP, Merger Sub and Amoco to effect
the Merger are subject to the satisfaction or waiver of each of
the following conditions:
4.1.1. Shareholder Approvals. The Merger and the other
transactions contemplated by this Agreement shall have been duly
approved by holders of Amoco Common Shares constituting the Amoco
Requisite Vote and by the shareholders of BP constituting the BP
Requisite Vote.
4.1.2. Regulatory Consents. All Amoco Required Consents and BP
Required Consents from or with any Governmental Entity
(collectively, "Governmental Consents") in connection with the
consummation of the Merger and the other transactions
contemplated hereby shall have been made or obtained, and such
Governmental Consents shall not contain any terms or impose any
condition or restriction relating or applying to, or requiring
changes in or limitations on, the operation of any asset or
businesses of Amoco, BP or any of their respective Subsidiaries
which term, condition or restriction, individually or in the
aggregate, would be reasonably likely to have a Material Adverse
Effect on BP or Amoco after the Effective Time (it being
understood that, for this purpose, materiality shall be
considered with reference to the total equity market value of BP
and Amoco).
4.1.3. Laws and Orders. No Governmental Entity of competent
jurisdiction shall have enacted, issued, promulgated, enforced or
entered any Law (whether temporary, preliminary or permanent)
that is in effect and restrains, enjoins or otherwise prohibits
the consummation of the Merger or the other transactions
contemplated by this Agreement and that, individually or in the
aggregate with all other such Laws, is reasonably likely to have
a Material Adverse Effect on Amoco or BP or that would materially
frustrate the express intent and purposes of this Agreement
(collectively, an "Order"), and no Governmental Entity shall have
instituted or threatened any proceeding seeking any such Order.
4.1.4. Effectiveness of Form F-4. The Form F-4 shall have become
effective and no stop order with respect thereto shall be in
effect.
4.1.5. Exchange Listing. The BP Ordinary Shares to be issued
pursuant to the Merger shall have been admitted to the Official
List of the LSE and such admission shall have become effective in
accordance with the rules and regulations of the LSE and the BP
ADRs shall have been authorized for listing on the NYSE, subject
to official notice of issuance.
4.2. Conditions to Obligations of BP. The obligation of BP to
effect the Merger is also subject to the satisfaction or waiver
by BP prior to the Effective Time of the following conditions:
4.2.1. Representations and Warranties of Amoco. The
representations and warranties of Amoco set forth in this
Agreement (i) to the extent qualified by Material Adverse Effect
or any other materiality qualification shall be true and correct
and (ii) to the extent not qualified by Material Adverse Effect
or any other materiality qualification shall be true and correct
(provided that this clause (ii) shall be deemed satisfied so long
as any failures of such representations and warranties to be true
and correct, taken together, do not have a Material Adverse
Effect on Amoco) as of the Closing Date as though made on and as
of the Closing Date (except to the extent any such representation
or warranty expressly speaks as of an earlier date), and BP shall
have received a certificate signed on behalf of Amoco by an
executive officer of Amoco to such effect.
4.2.2. Performance of Obligations of Amoco. Amoco shall have
performed all material obligations required to be performed by it
under this Agreement at or prior to the Closing Date, and BP
shall have received a certificate signed on behalf of Amoco by an
executive officer of Amoco to such effect.
4.2.3. Consents Under Agreements. BP shall have obtained the
consent or approval of each Person whose consent or approval
shall be required in order to consummate the Merger and the other
transactions contemplated by this Agreement under any Contract to
which BP or any of its Subsidiaries is a party, except those for
which the failure to obtain such consent or approval,
individually or in the aggregate, is not reasonably likely to
have a Material Adverse Effect on BP or is not reasonably likely
to prevent or materially impair the ability of BP to consummate
the Merger and the other transactions contemplated by this
Agreement.
4.2.4. Accounting Letters. BP shall have received letters from
Ernst & Young confirming that under U.S. GAAP and U.K. GAAP,
respectively, they concur with BP management's conclusion that no
conditions exist that would preclude BP from being a party to a
business combination for which pooling-of-interests accounting
would be available under U.S. GAAP and the use of merger
accounting methods would be available under U.K. GAAP.
4.3. Conditions to Obligation of Amoco. The obligation of Amoco
to effect the Merger is also subject to the satisfaction or
waiver by Amoco prior to the Effective Time of the following
conditions:
4.3.1. Representations and Warranties. The representations and
warranties of BP set forth in this Agreement (i) to the extent
qualified by Material Adverse Effect or any other materiality
qualification shall be true and correct, and (ii) to the extent
not qualified by Material Adverse Effect or any other materiality
qualification shall be true and correct (provided that this
clause (ii) shall be deemed satisfied so long as any failures of
such representations and warranties to be true and correct, taken
together, do not have a Material Adverse Effect on BP) as of the
Closing Date as though made on and as of the Closing Date (except
to the extent any such representation and warranty expressly
speaks as of an earlier date), and Amoco shall have received a
certificate signed on behalf of BP by an executive officer of BP
to such effect.
4.3.2. Performance of Obligations of BP. BP shall have performed
all material obligations required to be performed by it under
this Agreement at or prior to the Closing Date, and Amoco shall
have received a certificate signed on behalf of BP by an
executive officer of BP to such effect.
4.3.3. Consents Under Agreements. Amoco shall have obtained the
consent or approval of each Person whose consent or approval
shall be required in order to consummate the Merger and the other
transactions contemplated by this Agreement under any Contract to
which Amoco or any of its Subsidiaries is a party, except those
for which the failure to obtain such consent or approval,
individually or in the aggregate, is not reasonably likely to
have a Material Adverse Effect on Amoco or is not reasonably
likely to prevent or materially impair the ability of Amoco to
consummate the Merger and the other transactions contemplated by
this Agreement.
4.3.4. Tax Opinion. Amoco shall have received an opinion from
Wachtell, Lipton, Rosen & Katz, dated as of the Effective Time,
substantially to the effect that, on the basis of the facts,
representations and assumptions set forth in such opinion, the
Merger will be treated for U.S. federal income tax purposes as a
reorganization within the meaning of Section 368(a) of the Code
and that no gain or loss will be recognized by the stockholders
of Amoco who exchange Amoco Common Stock solely for BP ADRs
pursuant to the Merger (except with respect to cash received in
lieu of fractional BP Depositary Shares). Such opinion may note
that "5% shareholders" will qualify for such nonrecognition
treatment only if they enter into a "gain recognition agreement"
under regulations promulgated under Section 367 of the Code. In
rendering such opinion, counsel may require and rely upon certain
representations of BP and Amoco reasonably requested by such
counsel.
4.3.5. Accounting Letters. Amoco shall have received letters from
PricewaterhouseCoopers LLP confirming that under U.S. GAAP and
U.K. GAAP, respectively, they concur with Amoco management's
conclusion that no conditions exist that would preclude Amoco
from being a party to a business combination for which pooling-of-
interests accounting would be available under U.S. GAAP and the
use of merger accounting methods would be available under U.K.
GAAP.
ARTICLE V
TERMINATION
5.1. Termination by Mutual Consent. This Agreement may be
terminated and the Merger may be abandoned at any time prior to
the Effective Time, whether before or after the approvals by
shareholders of Amoco and BP referred to in paragraph 4.1.1
(Shareholder Approvals), by mutual written consent of Amoco and
BP, by action of their respective boards of directors.
5.2. Termination by Either BP or Amoco. This Agreement may be
terminated and the Merger may be abandoned at any time prior to
the Effective Time by action of the board of directors of either
BP or Amoco if (i) the Merger shall not have been consummated by
August 31, 1999, whether such date is before or after the date of
approval by the shareholders of Amoco or BP (the "Termination
Date"), (ii) any Order permanently restraining, enjoining or
otherwise prohibiting the consummation of the Merger shall have
become final and non-appealable, whether before or after the
approval by the shareholders of Amoco or BP, (iii) the Amoco
Requisite Vote shall not have been obtained at the duly held
Amoco Shareholders Meeting, including any adjournments or
postponements thereof, or (iv) the BP Requisite Vote shall not
have been obtained at the duly held BP Shareholders Meeting,
including any adjournments or postponements thereof; provided
that the right to terminate this Agreement shall not be available
to a Party that has breached in any material respect its
obligations under this Agreement in any manner that shall have
proximately contributed to the failure of the Merger to be
consummated.
5.3. Termination by Amoco. This Agreement may be terminated and
the Merger may be abandoned at any time prior to the Effective
Time, whether before or after the approval by shareholders of
Amoco referred to in paragraph 4.1.1 (Shareholder Approvals), by
action of the board of directors of Amoco, if (i) the board of
directors of BP shall have withdrawn or adversely modified its
approval or recommendation to shareholders of the Merger or
failed to reconfirm such recommendation within seven business
days after a written request by Amoco to do so; or (ii) BP or its
board of directors shall take any of the actions described in
clause (ii) or clause (iii) of the proviso to Section 3.2.1
(Acquisition Proposals); or (iii) there shall be a breach by BP
of any representation, warranty, covenant or agreement contained
in this Agreement which would result in a failure of a condition
set forth in paragraph 4.3.1 or 4.3.2 and cannot be or is not
cured prior to the Termination Date.
5.4. Termination by BP. This Agreement may be terminated and the
Merger may be abandoned at any time prior to the Effective Time,
whether before or after the approval by the shareholders of BP
referred to in paragraph 4.1.1 (Shareholder Approvals), by action
of the board of directors of BP, if (i) the board of directors of
Amoco shall have withdrawn or adversely modified its approval or
recommendation to shareholders of the Merger or failed to
reconfirm such recommendation within seven business days after a
written request by BP to do so; or (ii) Amoco or its board of
directors shall take any of the actions described in clause (ii)
or clause (iii) of the proviso to Section 3.2.1 (Acquisition
Proposals); or (iii) there shall be a breach by Amoco of any
representation, warranty, covenant or agreement contained in this
Agreement which would result in a failure of a condition set
forth in paragraph 4.2.1 or 4.2.2 and cannot be or is not cured
prior to the Termination Date.
5.5. Effect of Termination and Abandonment.
5.5.1. In the event of termination of this Agreement and the
abandonment of the Merger pursuant to this Article V, this
Agreement (other than as set forth in Section 6.1 (Survival))
shall become void and of no effect with no liability on the part
of either Party (or of any of its Representatives); provided,
however, that no such termination shall relieve either Party of
any liability for damages resulting from any willful and
intentional breach of this Agreement or from any obligation to
pay, if applicable, the amounts payable pursuant to Section 5.5.2
or 5.5.3.
5.5.2. In the event that (i) this Agreement is terminated by either
Amoco or BP pursuant to Section 5.2(iii) and at the time of the
Amoco Shareholders Meeting (or at any adjournment thereof) an
Acquisition Proposal exists with respect to Amoco or (ii) this
Agreement is terminated by BP pursuant to Section 5.4(i), 5.4(ii)
(solely with respect to the recommendation by Amoco or the Board
of Directors of Amoco of an Acquisition Proposal with respect to
Amoco) or 5.4(iii) (solely with respect to a willful and
intentional breach of Section 3.2), then Amoco shall promptly,
but in no event later than two days after the date of such
termination, pay to BP a termination payment equal to the Amoco
Termination Amount (as defined below), which amount shall be
exclusive of any expenses to be paid pursuant to Section 3.9
(Expenses), payable by wire transfer of same day funds. The term
"Amoco Termination Amount" shall mean, in the case of termination
by BP pursuant to clause (ii) of the preceding sentence,
$950,000,000 or, in the case of termination by Amoco or BP
pursuant to clause (i) of the preceding sentence, "Amoco
Termination Amount" shall mean $500,000,000, plus, if (x) Amoco
executes and delivers an agreement with respect to any
Acquisition Proposal (an "Amoco Alternative Agreement") or (y) an
Acquisition Proposal with respect to Amoco is consummated, in any
such case, within 12 months from the date of termination, an
additional $450,000,000 (which additional amount shall be paid
promptly by wire transfer in same day funds, and in no event
later than two days after the earliest date on which the event
requiring Amoco to pay such additional sum occurs). In the event
that the board of directors of Amoco recommends the acceptance by
Amoco shareholders of a third-party tender or exchange offer for
the Amoco Common Shares, such recommendation shall be treated for
purposes of this paragraph as though an Amoco Alternative
Agreement had been executed. Amoco acknowledges that the
agreements contained in this Section 5.5.2 are an integral part
of the transactions contemplated by this Agreement, and that,
without these agreements, BP would not enter into this Agreement;
accordingly, if Amoco fails promptly to pay any amount due
pursuant to this Section 5.5.2, and, in order to obtain such
payment, BP commences a suit which results in a judgment against
Amoco for the payment set forth in this Section 5.5.2, Amoco
shall pay to BP its costs and expenses (including attorneys'
fees) in connection with such suit, together with interest on the
Amoco Termination Amount from each date for payment until the
date of such payment at the prime rate of Citibank N.A. in effect
on the date such payment was required to be made plus 2 percent.
5.5.3. In the event that (i) this Agreement is terminated by either
Amoco or BP pursuant to Section 5.2(iv) and at the time of the BP
Shareholders Meeting (or at any adjournment thereof) an
Acquisition Proposal exists with respect to BP or (ii) this
Agreement is terminated by Amoco pursuant to Section 5.3(i),
5.3(ii) (solely with respect to the recommendation by BP or the
board of directors of BP of an Acquisition Proposal with respect
to BP) or 5.3(iii) (solely with respect to a willful and
intentional breach of Section 3.2), then BP shall promptly, but
in no event later than two days after the date of such
termination, pay to Amoco a termination payment equal to the BP
Termination Amount (as defined below), which amount shall be
exclusive of any expenses to be paid pursuant to Section 3.9
(Expenses), payable by wire transfer of same day funds. The term
"BP Termination Amount" shall mean, in the case of termination by
Amoco pursuant to clause (ii) of the preceding sentence,
$1,000,000,000 or, in the case of termination by Amoco or BP
pursuant to clause (i) of the preceding sentence, "BP Termination
Amount" shall mean $500,000,000, plus, if (x) BP executes and
delivers an agreement with respect to any Acquisition Proposal (a
"BP Alternative Agreement") or (y) an Acquisition Proposal with
respect to BP is consummated, in any such case, within 12 months
from the date of termination, an additional $500,000,000 (which
additional amount shall be paid promptly by wire transfer in same
day funds, and in no event later than two days after the earliest
date on which the event requiring BP to pay such additional sum
occurs). In the event that the board of directors of BP
recommends the acceptance by BP shareholders of a third-party
tender offer or exchange offer for the BP Ordinary Shares, such
recommendation shall be treated for purposes of this paragraph as
though a BP Alternative Agreement had been executed. BP
acknowledges that the agreements contained in this Section 5.5.3
are an integral part of the transactions contemplated by this
Agreement, and that, without these agreements, Amoco would not
enter into this Agreement; accordingly, if BP fails promptly to
pay any amount due pursuant to this Section 5.5.3, and, in order
to obtain such payment, Amoco commences a suit which results in a
judgment against BP for the payment set forth in this Section
5.5.3, BP shall pay to Amoco its costs and expenses (including
attorneys' fees) in connection with such suit, together with
interest on the BP Termination Amount from each date for payment
until the date of such payment at the prime rate of Citibank N.A.
in effect on the date such payment was required to be made plus 2
percent.
ARTICLE VI
MISCELLANEOUS AND GENERAL
6.1. Survival. This Article VI and the agreements of Amoco and
BP contained in Sections 3.8 (Benefits and Other Matters), 3.9
(Expenses), 3.10.2 (Dividends), 3.14 (Accounting and Tax Matters)
and 3.15 (BP SEC Filings) shall survive the Effective Time. This
Article VI (other than Section 6.2 (Modification or Amendment),
Section 6.3 (Waiver of Conditions) and Section 6.12
(Assignment)), the representations and warranties contained in
Section 2.1.3 (Corporate Authority; Approval and Fairness), the
agreements of Amoco and BP contained in Section 3.9 (Expenses),
Section 5.5 (Effect of Termination and Abandonment), and the last
sentence of Section 3.6 (Access) shall survive the termination of
this Agreement. All other representations, warranties,
agreements and covenants in this Agreement shall not survive the
Effective Time or the termination of this Agreement.
6.2. Modification or Amendment. This Agreement may be modified
or amended by agreement of the Parties, by action taken or
authorized by their respective boards of directors, at any time
prior to the Effective Time; provided, however, that, after
approval by shareholders of the matters presented at the Amoco
Shareholders Meeting or the BP Shareholders Meeting, no
modification or amendment shall be made which under applicable
Law requires further approval by such shareholders without such
further approval. This Agreement may not be modified or amended
except by an instrument in writing executed and delivered by duly
authorized officers of each of the Parties.
6.3. Waiver of Conditions. Any provision of this Agreement may
be waived prior to the Effective Time if, and only if, such
waiver is in writing and signed by the Party against whom the
waiver is to be effective.
6.4. Failure or Indulgence Not Waiver; Remedies Cumulative. No
failure or delay by any Party in exercising any right, power or
privilege hereunder shall operate as a waiver thereof, nor shall
any single or partial exercise thereof preclude any other or
further exercise thereof or the exercise of any other right,
power or privilege. Except as otherwise herein provided, the
rights and remedies herein provided shall be cumulative and not
exclusive of any rights or remedies provided by Law.
6.5. Counterparts. This Agreement may be executed in any number
of counterparts, each such counterpart being deemed to be an
original instrument, and all such counterparts shall together
constitute the same agreement.
6.6. GOVERNING LAW AND VENUE; WAIVER OF JURY TRIAL. 6.6.1. THIS
AGREEMENT SHALL BE DEEMED TO BE MADE IN, AND IN ALL RESPECTS
SHALL BE INTERPRETED, CONSTRUED AND GOVERNED BY AND IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS TO
BE PERFORMED WHOLLY IN SUCH STATE, EXCEPT TO THE EXTENT THAT IN
THE CASE OF AMOCO OR MERGER SUB, THE INDIANA BUSINESS CORPORATION
LAW AND, IN THE CASE OF BP, THE COMPANIES ACT AND ENGLISH LAW ARE
APPLICABLE. The parties hereby irrevocably submit to the
jurisdiction of the federal courts of the United States of
America located in the Borough of Manhattan, New York State
solely in respect of the interpretation and enforcement of the
provisions of this Agreement and the Stock Option Agreement and
in respect of the transactions contemplated hereby and thereby
and hereby waive, and agree not to assert, as a defense in any
action, suit or proceeding for the interpretation or enforcement
hereof, that it is not subject thereto or that such action, suit
or proceeding may not be brought or is not maintainable in said
courts or that the venue thereof may not be appropriate or that
this Agreement may not be enforced in or by such courts, and the
Parties irrevocably agree that all claims with respect to such
action or proceeding shall be heard and determined in such a
federal court. The parties hereby consent to and grant any such
court jurisdiction over the person of such Parties and over the
subject matter of such dispute and agree that mailing of process
or other papers in connection with any such action or proceeding
in the manner provided in Section 6.7 (Notices), or in such other
manner as may be permitted by Law, shall be valid and sufficient
service thereof.
6.6.2. EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY
WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE
COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE EACH SUCH PARTY
HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH
PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION
DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS
AGREEMENT, THE STOCK OPTION AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT OR THE STOCK OPTION AGREEMENT.
EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (i) NO REPRESENTATIVE,
AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (ii) EACH SUCH
PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS
WAIVER, (iii) EACH SUCH PARTY MAKES THIS WAIVER VOLUNTARILY, AND
(iv) EACH SUCH PARTY HAS BEEN INDUCED TO ENTER INTO THIS
AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION 6.6.
6.7. Notices. Notices, requests, instructions or other documents
to be given under this Agreement shall be in writing and shall be
deemed given, (i) when sent if sent by facsimile, provided that
the facsimile is promptly confirmed by telephone confirmation
thereof, (ii) when delivered, if delivered personally to the
intended recipient, and (iii) one business day later, if sent by
overnight delivery via a national courier service, and in each
case, addressed to a Party at the following address for such
Party:
if to Amoco:
Amoco Corporation
200 East Randolph Drive
Chicago, IL 60601
Attention: Stephen F. Gates, Esq.
Telecopier: (312) 856-2039
with copies to
Wachtell, Lipton, Rosen & Katz
51 West 52nd Street
New York, New York 10019
Attention: Andrew R. Brownstein, Esq.
Telecopier: (212) 403-2000
and
Freshfields
65 Fleet Street
London EC4Y 1HS
Attention: William P.L. Lawes, Esq.
Telecopier: (44) 171-832-7001
if to BP or Merger Sub:
The British Petroleum Company p.l.c
Britannic House
1 Finsbury Circus
London EC2M 7BA
Attention: Peter B.P. Bevan, Esq.
Telecopier: (44) 171-496-4571
with copies to
Sullivan & Cromwell
125 Broad Street
New York, New York 10004
Attention: Benjamin F. Stapleton, Esq.
Telecopier: (212) 558-3588
and
Linklaters & Paines
One Silk Street
London EC2Y 8HQ
Attention: David W. Cheyne, Esq.
Telecopier: (44) 171-456-2222
or to such other Persons or addresses as may be designated in
writing by the Party to receive such notice as provided above.
6.8. Entire Agreement. This Agreement (including any exhibits
hereto), the Amoco Disclosure Letter, the BP Disclosure Letter,
the Stock Option Agreement and the Confidentiality Agreement
constitute the entire agreement, and supersede all other prior
agreements, understandings, representations and warranties both
written and oral, between the Parties with respect to the subject
matter hereof. References herein to this Agreement shall for all
purposes be deemed to include references to the Amoco Disclosure
Letter and the BP Disclosure Letter. Except as set forth in
Section 3.8.2 (Director and Officer Liability), this Agreement is
not intended to confer upon any Person other than the Parties any
rights or remedies hereunder. No employee or former employee of
Amoco or BP who is not a director of Amoco or BP shall be deemed
a third party beneficiary with respect to any provision of this
Agreement. EACH PARTY HERETO AGREES THAT, EXCEPT FOR THE
REPRESENTATIONS AND WARRANTIES CONTAINED IN THIS AGREEMENT, THE
STOCK OPTION AGREEMENT OR ANY OTHER AGREEMENT CONTEMPLATED HEREBY
OR THEREBY, NONE OF AMOCO, BP OR MERGER SUB MAKES ANY OTHER
REPRESENTATIONS OR WARRANTIES, AND EACH HEREBY DISCLAIMS ANY
OTHER REPRESENTATIONS OR WARRANTIES MADE BY ITSELF OR ANY OF ITS
OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, FINANCIAL AND LEGAL
ADVISORS OR OTHER REPRESENTATIVES WITH RESPECT TO THE EXECUTION
AND DELIVERY OF THIS AGREEMENT, THE STOCK OPTION AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, NOTWITHSTANDING THE
DELIVERY OR DISCLOSURE TO THE OTHER OR THE OTHER'S
REPRESENTATIVES OF ANY DOCUMENTATION OR OTHER INFORMATION WITH
RESPECT TO ANY ONE OR MORE OF THE FOREGOING.
6.9. Obligations of BP and of Amoco. Whenever this Agreement
requires a Subsidiary of BP to take any action, such requirement
shall be deemed to include an undertaking on the part of BP to
use best reasonable efforts to cause such Subsidiary to take such
action. Whenever this Agreement requires a Subsidiary of Amoco to
take any action, such requirement shall be deemed to include an
undertaking on the part of Amoco to use best reasonable efforts
to cause such Subsidiary to take such action.
6.10. Severability. The provisions of this Agreement shall be
deemed severable and the invalidity or unenforceability of any
provision shall not affect the validity or enforceability of the
other provisions hereof. If any provision of this Agreement, or
the application thereof to any Person or any circumstance, is
invalid or unenforceable, (a) a suitable and equitable provision
shall be substituted therefor in order to carry out, so far as
may be valid and enforceable, the intent and purpose of such
invalid or unenforceable provision unless the substitution of
such provision would materially frustrate the express intent and
purposes of this Agreement and (b) the remainder of this
Agreement and the application of such provision to other Persons
or circumstances shall not be affected by such invalidity or
unenforceability, nor shall such invalidity or unenforceability
affect the validity or enforceability of such provision, or the
application thereof, in any other jurisdiction.
6.11. Interpretation. The headings herein are for convenience of
reference only, do not constitute part of this Agreement and
shall not be deemed to limit or otherwise affect any of the
provisions hereof. Where a reference in this Agreement is made
to a Section or Exhibit, such reference shall be to a Section of
or Exhibit to this Agreement unless otherwise indicated.
Whenever the words "include," "includes" or "including" are used
in this Agreement, they shall be deemed to be followed by the
words "without limitation."
6.12. Assignment. This Agreement shall not be assignable by
operation of law or otherwise, and any purported assignment in
violation of this provision shall be void.
IN WITNESS WHEREOF, this Agreement has been duly
executed and delivered by the duly authorized officers of BP,
Amoco and Merger Sub as of the date hereof.
THE BRITISH PETROLEUM COMPANY p.l.c.
By: /s/ Peter D. Sutherland
Name: Peter D. Sutherland
Title: Chairman
By: /s/ John Browne
Name: John Browne
Title: Chief Executive Officer
AMOCO CORPORATION
By: /s/ H. Laurance Fuller
Name: H. Laurance Fuller
Title: Chairman and Chief Executive
Officer
EAGLE HOLDINGS, INC.
By: /s/ Peter B. P. Bevan
Name: Peter B. P. Bevan
Title: President
Dates Referenced Herein and Documents Incorporated by Reference
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