<PAGE> 1
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1994
----------------------------
------------------
Commission file number 1-5254
----------------
MAPCO INC.
- - - --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 73-0705739
- - - ---------------------------------------------- --------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1800 South Baltimore Avenue, Tulsa, Oklahoma 74119
- - - ---------------------------------------------- --------------------------------
(Address of principal executive offices) (Zip Code)
(918) 581-1800
- - - --------------------------------------------------------------------------------
(Registrant's telephone number, including area code)
No Changes
- - - --------------------------------------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report)
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by section 13 or 15 (d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such
shorter period that the registrant was required to file such reports),
and has been subject to such filing requirements for the past 90 days.
Yes X . No .
--- ---
On November 7, 1994, 29,925,729 shares of MAPCO Inc. Common Stock, $1
par value, were outstanding.
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<PAGE> 2
MAPCO Inc.
Index
<TABLE>
<CAPTION>
Page Number
-----------
<S> <C>
PART I. Financial Information:
Condensed Consolidated Statements of Income
for the three and nine months ended
September 30, 1994 and 1993 3
Condensed Consolidated Balance Sheets,
September 30, 1994 and December 31, 1993 4
Condensed Consolidated Statements of Cash
Flows for the nine months ended
September 30, 1994 and 1993 5
Notes to Condensed Consolidated Financial
Statements 6 - 11
Management's Discussion and Analysis of
Financial Condition and Results of Operations 12 - 20
PART II. Other Information: 21
Exhibits and Reports on Form 8-K 21
Signatures 22
</TABLE>
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<PAGE> 3
PART I
FINANCIAL INFORMATION
MAPCO INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
Dollars and Shares in Millions
except per share amounts
(Unaudited)
<TABLE>
<CAPTION>
Three Months Nine Months
Ended September 30, Ended September 30,
----------------------- -----------------------
1994 1993 1994 1993
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Sales and Operating Revenues (1) $ 805.3 $ 665.6 $ 2,235.5 $ 2,020.6
---------- ---------- ---------- ----------
Expenses:
Outside purchases and operating
expenses (Note 7) (1) 712.9 555.9 2,008.0 1,710.6
Selling, general and administrative 16.5 19.5 49.9 53.5
Depreciation, depletion and amortization 25.7 24.5 74.9 72.5
Interest and debt expense 13.3 12.3 37.8 34.6
Other (income) expense - net (1.3) .4 .4 (.2)
---------- ---------- ---------- ----------
767.1 612.6 2,171.0 1,871.0
---------- ---------- ---------- ----------
Income Before Provision for
Income Taxes 38.2 53.0 64.5 149.6
---------- ---------- ---------- ----------
Provision for Income Taxes:
Current 11.0 21.2 6.8 50.4
Deferred 1.9 4.3 15.0 5.6
---------- ---------- ---------- ----------
12.9 25.5 21.8 56.0
---------- ---------- ---------- ----------
Income Before Minority Interest 25.3 27.5 42.7 93.6
Minority Interest in Earnings of Subsidiary (.6) (.6) (1.2) (1.5)
---------- ---------- ---------- ----------
Net Income $ 24.7 $ 26.9 $ 41.5 $ 92.1
========== ========== ========== ==========
Earnings per Common Share $ .83 $ .90 $ 1.39 $ 3.07
Average Common Shares Outstanding 29.9 30.0 30.0 30.0
Cash Dividends per Common Share $ .25 $ .25 $ .75 $ .75
</TABLE>
See Notes to Condensed Consolidated Financial Statements.
(1) Includes consumer excise taxes of $39.9 million and $36.2 million for the
three months ended September 30, 1994 and 1993, respectively, and $121.6
million and $106.7 million for the nine months ended September 30, 1994 and
1993, respectively.
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<PAGE> 4
MAPCO INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
Dollars in Millions
<TABLE>
<CAPTION>
September 30, 1994 December 31,
(Unaudited) 1993
------------ ------------
<S> <C> <C>
Current Assets:
Cash and cash equivalents $ 27.2 $ 69.8
Receivables 251.0 228.8
Inventories (Note 4) 119.4 113.4
Prepaid expenses 58.9 27.3
Other current assets 23.1 16.9
------------ ------------
Total current assets 479.6 456.2
------------ ------------
Property, Plant and Equipment, at cost 2,479.6 2,341.8
Less - Accumulated depreciation
and depletion (1,008.1) (974.5)
------------ ------------
1,471.5 1,367.3
------------ ------------
Other Assets 207.8 117.3
------------ ------------
$ 2,158.9 $ 1,940.8
============ ============
Current Liabilities:
Current maturities of long-term debt $ 41.1 $ 12.8
Accounts payable 235.2 247.1
Accrued taxes 35.4 47.3
Accrued payroll and related expenses 17.7 21.2
Litigation and environmental (Note 7) 31.9 13.7
Other current liabilities 60.0 40.8
------------ ------------
Total current liabilities 421.3 382.9
------------ ------------
Long-Term Debt (Note 5) 758.5 585.5
------------ ------------
Other Liabilities 77.3 101.6
------------ ------------
Deferred Income Taxes 288.5 273.5
------------ ------------
Minority Interest 24.2 23.0
------------ ------------
Contingencies (Note 7)
------------ ------------
Stockholders' Equity (Note 6):
Common stock 62.8 62.7
Capital in excess of par value 202.6 200.0
Retained earnings 1,326.0 1,306.7
------------ ------------
1,591.4 1,569.4
Less:
-Treasury stock, at cost (934.1) (926.9)
-Loan to ESOP (68.2) (68.2)
------------ ------------
589.1 574.3
------------ ------------
$ 2,158.9 $ 1,940.8
============ ============
</TABLE>
See Notes to Condensed Consolidated Financial Statements.
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<PAGE> 5
MAPCO INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Note 3)
Dollars in Millions
(Unaudited)
<TABLE>
<CAPTION>
Nine Months
Ended September 30,
---------------------
1994 1993
-------- --------
<S> <C> <C>
Cash Flows from Operating Activities:
Net Income $ 41.5 $ 92.1
Reconciliation of net income to net cash
provided by operating activities:
Depreciation, depletion and amortization 74.9 72.5
Provision for deferred income taxes 15.0 5.6
Other items not requiring cash (Note 3) 11.0 11.3
-------- --------
Funds provided by operations 142.4 181.5
Changes in operating assets and
liabilities (Note 3) (93.1) 14.1
-------- --------
Net cash provided by operating activities 49.3 195.6
-------- --------
Cash Flows from Investing Activities:
Capital expenditures and acquisitions, net of
liabilities assumed (278.5) (123.5)
Proceeds from sales of property, plant and
equipment 16.8 8.8
Other - .4
-------- --------
Net cash used in investing activities (261.7) (114.3)
-------- --------
Cash Flows from Financing Activities:
Purchase of common stock (7.2) (1.7)
Increase (decrease) in borrowings (Note 5) 199.1 (49.4)
Dividends (22.5) (22.5)
Issuance of long-term debt .1 .4
Payments on long-term debt (.2) (7.3)
Exercise of stock options .9 1.1
Other (.4) .5
-------- --------
Net cash provided by (used in)
financing activities 169.8 (78.9)
-------- --------
Increase (Decrease) in Cash and Cash Equivalents (42.6) 2.4
Cash and Cash Equivalents, January 1 69.8 55.7
-------- --------
Cash and Cash Equivalents, September 30 $ 27.2 $ 58.1
======== ========
</TABLE>
See Notes to Condensed Consolidated Financial Statements.
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<PAGE> 6
MAPCO INC.
Notes to Condensed Consolidated Financial Statements
Note 1 - In the opinion of Management, the accompanying condensed consolidated
financial statements of MAPCO Inc. and its subsidiaries ("MAPCO" or the
"Company") contain all adjustments necessary to present fairly the financial
position as of September 30, 1994 (unaudited) and December 31, 1993, the
results of operations for the three and nine months ended September 30, 1994
and 1993 (both unaudited) and the cash flows for the nine months ended
September 30, 1994 and 1993 (both unaudited). Certain reclassifications have
been made to prior year amounts to conform to current year presentations. All
significant intercompany accounts and transactions have been eliminated.
Note 2 - Acquisitions
On September 1, 1994, MAPCO completed the acquisition of the assets of Emro
Propane Company ("Emro"). Emro is engaged in the supply and retail marketing
of natural gas liquids. The purchase price included a $178 million cash
payment and the transfer to Emro Marketing Company of MAPCO Florida Inc.'s
retail convenience store assets in Florida. The cash payment was financed
through the issuance of commercial paper and money market funds. The
acquisition has been recorded using the purchase method of accounting. The
excess of the aggregate purchase price over the fair market value of net assets
acquired of approximately $79 million was recognized as goodwill and is being
amortized over 30 years. The operating results of Emro have been included in
MAPCO's condensed consolidated financial statements since the date of
acquisition.
The following unaudited pro forma combined results of operations assume the
acquisition occurred as of January 1, 1993:
<TABLE>
<CAPTION>
Nine Months
Ended September 30,
-------------------------
1994 1993
-------- --------
(In millions, except per share amounts)
<S> <C> <C>
Sales and Operating Revenues $2,247.5 $2,030.1
======== ========
Net Income $ 48.3 $ 95.5
======== ========
Earnings per Common Share $ 1.61 $ 3.18
======== ========
</TABLE>
The pro forma financial information is not necessarily indicative of the
operating results that would have occurred had the Emro acquisition been
consummated as of January 1, 1993 nor are they necessarily indicative of future
operating results.
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<PAGE> 7
Note 3 - Statements of Cash Flows
Other items not requiring (providing) cash consist of (in millions):
<TABLE>
<CAPTION>
Nine Months
Ended September 30,
-------------------------
1994 1993
-------- --------
<S> <C> <C>
Pension income $ - $ (.6)
Gain on sales of property, plant
and equipment (.1) (3.5)
Minority interest 1.2 1.5
Refinery turnaround accrual 1.9 2.4
Contingency accruals .4 9.4
Other non-cash items 7.6 2.1
-------- --------
$ 11.0 $ 11.3
======== ========
</TABLE>
Changes in operating assets and liabilities consist of (in millions):
<TABLE>
<CAPTION>
Nine Months
Ended September 30,
-------------------------
1994 1993
-------- --------
<S> <C> <C>
Decrease (increase) in:
Receivables $ (24.3) $ (6.1)
Inventories 3.2 18.8
Prepaid expenses (28.8) 3.2
Other current assets (.2) (.4)
Other assets (5.6) (1.2)
Increase (decrease) in:
Accounts payable (15.0) (26.3)
Accrued taxes (9.8) 7.6
Accrued payroll and related expenses (3.8) 11.9
Litigation and environmental (16.0) (.8)
Other current liabilities 10.7 9.6
Other liabilities (3.5) (2.2)
-------- --------
$ (93.1) $ 14.1
======== ========
</TABLE>
Income taxes paid were $36.8 million and $48.7 million for the nine months
ended September 30, 1994 and 1993, respectively.
Interest paid, net of amounts capitalized, was $26.0 million and $28.5 million
for the nine months ended September 30, 1994 and 1993, respectively.
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<PAGE> 8
Note 4 - Inventories
Inventories consist of (in millions):
<TABLE>
<CAPTION>
September 30, December 31,
1994 1993
-------- --------
<S> <C> <C>
Raw materials:
Crude oil $ 17.6 $ 25.6
-------- --------
Finished products:
Refined petroleum products 30.3 24.9
Fertilizer and natural gas liquids 40.4 46.0
Retail merchandise 21.8 12.1
Coal 9.3 4.8
-------- --------
101.8 87.8
-------- --------
Total inventories $ 119.4 $ 113.4
======== ========
</TABLE>
The cost to replace crude oil, refined petroleum products and retail
merchandise inventories in excess of their last-in, first-out (LIFO) carrying
value was $10.7 million at September 30, 1994 and $6.5 million at December 31,
1993.
Note 5 - Long-Term Debt
Long-term debt consists of (in millions):
<TABLE>
<CAPTION>
September 30, December 31,
1994 1993
------------- ------------
<S> <C> <C>
MAPCO Inc.
Commercial paper and money market funds $ 219.1 $ 20.0
8.43% ESOP Notes, payable in mortgage type
principal reductions annually through 2003 68.2 68.2
Medium Term Notes, various maturities through 2022 342.8 342.8
-------- --------
630.1 431.0
-------- --------
Subsidiaries
Senior Notes:
8.51% Notes, payable 2007 15.0 15.0
8.95% Notes, payable 2012 35.5 35.5
8.20% Notes, payable $2.5 annually 2007 through 2012 15.0 15.0
8.59% Notes, payable 2017 14.5 14.5
8.70% Notes, payable $2.0 annually 2018 through 2022 10.0 10.0
6.67% Notes, payable $15.0 annually 2001 through 2005 75.0 75.0
Other 4.5 2.3
-------- --------
169.5 167.3
-------- --------
799.6 598.3
Less - current maturities (41.1) (12.8)
-------- --------
Long-term debt $ 758.5 $ 585.5
======== ========
</TABLE>
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<PAGE> 9
Note 5 - Long-Term Debt (continued)
Interest rates on commercial paper and money market funds ranged from 3.49% to
5.11% during 1994 and from 3.10% to 4.27% during 1993. Commercial paper and
money market funds outstanding at September 30, 1994 and December 31, 1993 were
classified as long-term debt. MAPCO has the ability and intent, if necessary,
under a bank credit agreement to refinance commercial paper and money market
funds with long-term debt having maturities in excess of one year.
MAPCO has a bank credit agreement for a line of credit of $300 million. The
bank credit agreement provides for reduction of the total commitment in
quarterly increments of $25 million commencing June 30, 1998. Interest on
borrowings under the bank credit agreement would be at rates generally less
than the prime interest rate. MAPCO must pay a commitment fee to maintain the
bank credit agreement. This agreement serves as back-up for commercial paper
and money market funds. As of September 30, 1994, no borrowings were
outstanding under the bank credit agreement.
As of September 30, 1994, MAPCO had $342.8 million of Medium Term Notes
outstanding. The Notes mature at various times through 2022 and bear interest
at rates ranging from 7.00% to 8.87%.
Various loan agreements contain restrictive covenants which, among other
things, limit the payment of advances or dividends by two Natural Gas Liquids'
subsidiaries to MAPCO. At September 30, 1994, $186 million of net assets were
restricted by such provisions.
Note 6 - Employee Benefit Plans
With respect to its Employee Stock Ownership Plan ("ESOP"), MAPCO recognized
$.6 million and $1.8 million as compensation expense for the three and nine
months ended September 30, 1994, respectively, and $.5 million and $1.4 million
for the three and nine months ended September 30, 1993, respectively. Interest
expense on ESOP related debt was $1.4 million and $4.2 million for the three
and nine months ended September 30, 1994, respectively, and $1.5 million and
$4.6 million for the three and nine months ended September 30, 1993,
respectively. Dividends on the allocated and unallocated MAPCO common stock
held by the ESOP were $.6 million and $1.8 million for the three and nine
months ended September 30, 1994 and 1993, respectively, and are used for ESOP
debt service.
Note 7 - Contingencies
State Royalty Oil Settlement
The refining and marketing arm of the Company, MAPCO Petroleum Inc., operates a
refinery in Alaska through its subsidiary, MAPCO Alaska Petroleum Inc.
("MAPI"). Since 1978, MAPI (and/or its predecessor)
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<PAGE> 10
Note 7 - Contingencies (continued)
has had long-term agreements with the state of Alaska (the "State") to purchase
royalty oil from the State at prices linked to amounts payable by North Slope
oil producers in satisfaction of their royalty obligations to the State. In
1977, the State commenced suit against the producers (in an action entitled
State of Alaska v. Amerada Hess, et al.) alleging that they incorrectly
calculated their royalty payments.
As of April 1992, the State had settled its royalty oil claims against all of
the producers. On the basis of these settlements, the State billed MAPI for
retroactive increases in the prices paid by MAPI under all four of its royalty
oil purchase agreements. The State's claim against MAPI was based upon the
difference between the volume weighted average paid by the producers and the
revised royalty values adopted by the State.
The State's claim was comprised of retroactive price adjustments of $98
million, $9.2 million, $2.9 million and $6.4 million not including future
interest.
MAPI commenced litigation against the State in 1992 seeking a determination
that it was not liable for retroactive price increases. The parties have now
settled all pending claims and entered into a settlement agreement effective
August 1, 1994. Pursuant to the settlement, MAPI paid the State the entire $95
million settlement during August, September and October. MAPI accrued $68.7
million during the second quarter of 1994 related to the settlement.
Texas Explosion Litigation
On April 7, 1992, a liquefied petroleum gas explosion occurred near an
underground salt dome storage facility located near Brenham, Texas and owned by
an affiliate of the Company, Seminole Pipeline Company ("Seminole"). The
National Transportation Safety Board and the Texas Railroad Commission
essentially determined that the probable cause of the explosion was the result
of overfilling the storage facility.
The Company, as well as Seminole, Mid-America Pipeline Company and other
non-MAPCO entities have been named as defendants in civil actions filed in
state district courts in Texas. During 1993, the Company received
reimbursements from its insurers for settlements which disposed of all the
death claims and substantially all of the serious injury claims resulting from
the incident. The Company believes that complete resolution of the remaining
actions by litigation or settlement, after reimbursement of insurance coverage,
will not have a material adverse effect on the Company's business, results of
operations or consolidated financial position.
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<PAGE> 11
Note 7 - Contingencies (continued)
General Litigation
The Company is involved in various other lawsuits, claims and regulatory
proceedings incidental to their businesses. In the opinion of management, the
probability is remote that the outcome of such matters will have a material
adverse effect on the Company's business, consolidated financial position or
results of operations.
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<PAGE> 12
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
THIRD QUARTER 1994 VS. THIRD QUARTER 1993
Items which had a significant impact on the variances between third quarter
1994 and 1993 results of operations were:
- - - -- MAPCO Natural Gas Liquids acquired the assets of Emro Propane Company
on September 1, 1994. In a related transaction, MAPCO Petroleum sold
its Florida retail convenience stores to Emro Marketing Company.
- - - -- Market conditions in the third quarter of 1993 provided favorable
refined product margins at both of MAPCO's refineries. Third quarter
1994 market conditions have resulted in significantly lower margins
and refinery profits.
- - - -- The 1993 third quarter benefitted from $8.4 million received from the
settlement of a supply contract price dispute.
- - - -- Third quarter 1993 net income included an increase in federal income
taxes of $8.3 million as a result of the Omnibus Budget Reconciliation
Act of 1993.
Sales and Operating Revenues
<TABLE>
<CAPTION>
Sales and Operating Revenues
------------------------------
Three Months
Ended September 30,
------------------------------
Segment 1994 1993 Variance
- - - ----------------- ------ ------ --------
(In Millions)
<S> <C> <C> <C>
Natural Gas Liquids $100.3 $ 93.8 $ 6.5
Petroleum 614.2 480.3 133.9
Coal 106.2 102.2 4.0
Eliminations (15.4) (10.7) (4.7)
------ ------ -------
$805.3 $665.6 $ 139.7
====== ====== =======
</TABLE>
Sales and operating revenues increased $139.7 million due to the following:
- - - -- The $6.5 million increase in Natural Gas Liquids ("NGL") segment
revenues is primarily attributable to: (a) higher deliveries of
demethanized mix as higher Gulf Coast ethane prices have promoted
increased ethane recovery by producers, (b) additional throughput
volumes from new plant connections completed during the past year and
a new long-term contract with a major customer, (c) higher retail
propane sales from the acquisition of the assets of Emro, and (d)
increased Westpan gas liquids volumes.
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<PAGE> 13
- - - -- Petroleum segment sales exceeded last year's third quarter by $133.9
million, primarily due to higher petroleum product purchasing and
marketing activities and higher sales by the Memphis Refinery. The
Petroleum segment has significantly increased its petroleum product
purchasing and marketing activities during the current year, resulting
in a sales increase of $113.8 million. Sales at the Memphis Refinery
were $18.1 million higher because of increased demand and slightly
higher sales prices.
- - - -- Coal segment sales were $4.0 million higher principally reflecting the
benefit of price increases on long-term contracts and increased coal
brokerage activity.
Outside Purchases and Operating Expenses
Outside purchases and operating expenses were as follows (in millions):
<TABLE>
<CAPTION>
Three Months Ended, September 30,
---------------------------------------------------------------------------------------------------
1994 1993 Variance
------------------------------- ------------------------------- -------------------------------
Outside Operating Outside Operating Outside Operating
Segment Purchases Expenses Total Purchases Expenses Total Purchases Expenses Total
- - - ------------ --------- --------- --------- --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
NGL $ 13.7 $ 46.0 $ 59.7 $ 20.5 $ 38.8 $ 59.3 $ 6.8 $ (7.2) $ (.4)
Petroleum 527.2 41.2 568.4 380.4 36.1 416.5 (146.8) (5.1) (151.9)
Coal 10.2 74.6 84.8 6.7 73.4 80.1 (3.5) (1.2) (4.7)
--------- --------- --------- --------- --------- --------- --------- --------- ---------
$ 551.1 $ 161.8 $ 712.9 $ 407.6 $ 148.3 $ 555.9 $(143.5) $ (13.5) $ (157.0)
========= ========= ========= ========= ========= ========= ========= ========= =========
</TABLE>
Outside purchases increased $143.5 million, primarily due to significantly
higher petroleum product purchasing and marketing activities and to the higher
sales volumes at the Memphis Refinery. Natural Gas Liquids' outside purchases
decreased $6.8 million primarily because of lower prices and volumes. The $3.5
million increase in Coal's outside purchases was due to higher brokerage
volumes.
Operating expenses increased $13.5 million over the 1993 quarter because of
higher expenses in all three segments. NGL's operating expenses increased $7.2
million primarily due to higher costs resulting from the Emro acquisition and
$1.9 million in charges in the current quarter for litigation matters.
Petroleum's operating expenses increased $5.1 million primarily because last
year's costs were reduced $8.4 million by the settlement of a supply contract
pricing dispute. Excluding the supply contract settlement, Petroleum's
operating expenses were $3.3 million lower than last year because last year's
third quarter costs included significant environmental accruals. Coal's
operating expenses were $1.2 million higher primarily reflecting increased
overburden removal costs at the Martiki mine.
Selling, General and Administrative
Selling, general and administrative costs decreased $3.0 million principally
due to lower benefits costs.
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<PAGE> 14
Depreciation, Depletion and Amortization
Depreciation, depletion and amortization increased $1.2 million because of
higher depreciation and goodwill amortization associated with the Emro
acquisition.
Interest and Debt Expense
Interest expense increased $1.0 million principally because of fixed rate debt
for Seminole Pipeline Company ("Seminole") placed in late 1993.
Other Income
Other income increased $1.7 million primarily because of a $2.2 million
contingent liability charge in 1993 associated with a non-operating business
entity.
Operating Profit
<TABLE>
<CAPTION>
Operating Profit
------------------------------
Three Months
Ended September 30,
------------------------------
Segment 1994 1993 Variance
- - - ------------------- ------ ------ --------
(In Millions)
<S> <C> <C> <C>
Natural Gas Liquids $ 22.4 $ 21.7 $ .7
Petroleum 22.1 40.0 (17.9)
Coal 10.5 11.7 (1.2)
------ ------ ------
$ 55.0 $ 73.4 $(18.4)
====== ====== ======
</TABLE>
Operating profit decreased $18.4 million primarily because of lower profits in
the Petroleum segment.
- - - -- Petroleum's operating profit in the 1993 quarter benefitted from the
receipt of $8.4 million related to the settlement of a supply contract
dispute. The remaining unfavorable variance is primarily attributable to
lower refinery margins in the current quarter. Higher crude prices at
both the Memphis and North Pole Refineries and lower refined product sales
prices at the North Pole Refinery are the principal reasons for the lower
refined product margins.
- - - -- NGL's operating profit increased $.7 million primarily because of higher
transportation profits, partially offset by lower retail propane profits.
Increased demethanized mix deliveries and higher throughput volumes from
new plant connections and a new long-term contract with a major customer
more than offset the overall increase in transportation operating
expenses. Retail propane profits are lower primarily because of
litigation liability accruals recorded in the current quarter.
14 of 27
<PAGE> 15
- - - -- Coal's operating profit decreased $1.2 million primarily reflecting higher
expenses at Martiki due to higher overburden removal costs, partially
offset by overall higher coal sales prices.
Net Income
MAPCO's consolidated net income was $24.7 million or $.83 per share for the
1994 quarter, compared to net income of $26.9 million or $.90 per share for the
1993 quarter. Average common shares outstanding were 29.9 million in the 1994
quarter and 30.0 million in the 1993 quarter. Net income in 1993 was reduced
$5.5 million, or $.18 per share, from the negative impact of the federal income
tax increase and adjustments to environmental and litigation reserves,
partially offset by the favorable resolution of the supply contract pricing
dispute.
YEAR-TO-DATE 1994 VS. YEAR-TO-DATE 1993
<TABLE>
<CAPTION>
Sales and Operating Revenues
----------------------------
Nine Months
Ended September 30,
----------------------------
Segment 1994 1993 Variance
-------------------- -------- -------- --------
(In Millions)
<S> <C> <C> <C>
Natural Gas Liquids $ 345.6 $ 334.6 $ 11.0
Petroleum 1,626.7 1,416.5 210.2
Coal 313.2 302.1 11.1
Eliminations (50.0) (32.6) (17.4)
-------- -------- -------
$2,235.5 $2,020.6 $ 214.9
======== ======== =======
</TABLE>
Sales and Operating Revenues
Sales and operating revenues increased $214.9 million due to the following:
- - - -- NGL's current year revenues have increased $11.0 million over 1993. The
increase is primarily attributable to: (a) increased pipeline deliveries
as higher Gulf Coast ethane prices have promoted increased ethane recovery
by producers, (b) additional throughput volumes from new plant
connections completed during the past year and a new long-term contract
with a major customer, (c) the completion of the Seminole Loop expansion
on May 1, 1993, and (d) higher Westpan gas liquids volumes. These
improvements were partially offset by lower retail propane sales which
resulted from a decrease in average sales prices and lower volumes. The
lower retail volumes resulted from fewer plants in operation in the
current year due to strategic plant divestitures. Retail volumes are
expected to increase significantly in the fourth quarter from the
acquisition of the assets of Emro on September 1, 1994.
15 of 27
<PAGE> 16
- - - -- Petroleum's sales and operating revenues increased $210.2 million.
Significantly higher petroleum product purchasing and marketing activity
is the primary reason for the sales increase. Higher sales by the Memphis
Refinery and Retail Marketing were offset by lower North Pole and Express
Fuels sales. Refined product sales volumes at the Memphis Refinery were
over 3 million barrels higher in the current year, which was partially
offset by lower sales prices. Retail sales increased over last year,
despite operating an average of 21 fewer stores, because of higher diesel
and merchandise sales volumes. Sales at the North Pole Refinery were
lower because of lower average sales prices. Sales also decreased due to
the sale of Express Fuels in June, 1993.
- - - -- Coal segment revenues increased $11.1 million primarily due to: (a)
increased brokerage volumes, (b) price increases on long-term contracts,
and (c) higher sales volumes related to increased production at the
Mettiki mine. These positive factors were partially offset by reduced
revenues at the Pontiki mine, reflecting lower production levels.
Outside Purchases and Operating Expenses
Outside purchases and operating expenses were as follows (in millions):
<TABLE>
<CAPTION>
Nine Months Ended, September 30,
---------------------------------------------------------------------------------------------------
1994 1993 Variance
------------------------------- ------------------------------- -------------------------------
Outside Operating Outside Operating Outside Operating
Segment Purchases Expenses Total Purchases Expenses Total Purchases Expenses Total
- - - ------------ --------- --------- --------- --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
NGL $ 74.1 $ 137.2 $ 211.3 $ 91.8 $ 121.1 $ 212.9 $ 17.7 $ (16.1) $ 1.6
Petroleum 1,351.4 193.8 1,545.2 1,146.6 115.9 1,262.5 (204.8) (77.9) (282.7)
Coal 30.3 221.2 251.5 22.6 212.6 235.2 (7.7) (8.6) (16.3)
--------- --------- --------- --------- --------- --------- --------- --------- ---------
$1,455.8 $ 552.2 $2,008.0 $1,261.0 $ 449.6 $1,710.6 $(194.8) $(102.6) $ (297.4)
========= ========= ========= ========= ========= ========= ========= ========= =========
</TABLE>
Outside purchases and operating expenses increased $194.8 million and $102.6
million, respectively, due to the following:
- - - -- Natural Gas Liquids' outside purchases decreased $17.7 million primarily
because of lower prices and volumes. Retail propane volumes have
decreased from last year as a result of plant divestitures in late 1993.
Natural Gas Liquids' operating expenses increased $16.1 million primarily
due to: (a) testing and refurbishing expenses on a portion of the
Mid-America Pipeline in connection with the commencement of a new
long-term contract with a major customer, (b) costs associated with the
buyout of a gas supply contract, (c) higher gas processing and
fractionation expenses due to increased volumes, and (d) increased
litigation reserves.
- - - -- Petroleum's outside purchases increased $204.8 million. Significantly
higher petroleum product purchasing and marketing activity resulted in a
$211.8 million increase in outside purchases. The remaining variance was
attributable to lower purchases by the North Pole Refinery which more than
offset higher outside purchases by the Memphis Refinery and Retail
Marketing. Lower average crude prices were the primary reason for the
decrease in outside purchases
16 of 27
<PAGE> 17
at the North Pole Refinery. The Memphis Refinery's higher purchases were
due to the higher volume of crude processed partially offset by lower
average crude prices. Retail Marketing's outside purchases increased
because of higher sales volumes.
Petroleum's operating expenses in 1994 were $77.9 million higher than in
1993 due to: (a) the $68.7 million accrual relative to the State Royalty
Oil settlement, (b) the supply contract pricing dispute settlement which
reduced 1993 expenses by $8.4 million, and (c) a favorable $2.0 million
environmental claim settlement which reduced last year's operating
expenses at the North Pole Refinery.
- - - -- Coal's outside purchases were $7.7 million higher principally due to
additional brokerage volumes.
Coal's operating expenses increased $8.6 million reflecting: (a) increased
overburden removal costs at the Martiki mine, (b) higher operating levels
at the Mettiki mine, (c) the combination of adverse mining conditions and
equipment failures at the Pontiki mine, and (d) less favorable mining
conditions at the Dotiki mine.
Interest and Debt Expense
Interest and debt expense increased $3.2 million primarily because of fixed
rate debt for Seminole placed in late 1993 and higher amounts of interest
capitalized in 1993 relative to the Seminole Loop expansion project.
Operating Profit
<TABLE>
<CAPTION>
Operating Profit
------------------------------
Nine Months
Ended September 30,
------------------------------
Segment 1994 1993 Variance
- - - ------------------- ------ ------ --------
(In Millions)
<S> <C> <C> <C>
Natural Gas Liquids $ 81.4 $ 83.7 $ (2.3)
Petroleum 8.9 82.6 (73.7)
Coal 29.4 35.7 (6.3)
------ ------ ------
$119.7 $202.0 $(82.3)
====== ====== ======
</TABLE>
Year-to-date operating profit was $82.3 million less than the prior year.
Excluding the $68.7 million charge in the second quarter of 1994 associated
with the State Royalty Oil settlement, operating profit decreased $13.6
million.
- - - -- NGL's operating profit was $2.3 million less than in 1993 because lower
transportation and gas processing profits more than offset increased
retail propane profits. Higher transportation operating expenses,
particularly in the first quarter when a major pipeline testing and
refurbishing project was underway, more than offset
17 of 27
<PAGE> 18
increased throughput volumes from increased ethane recovery, new plant
connections and a new long-term contract with a major customer. Gas
processing's operating profit was negatively impacted by lower NGL sales
prices and higher operating expenses. Retail propane profits improved
primarily because higher propane margins resulting from lower propane
supply costs more than offset higher operating expenses.
- - - -- Petroleum's operating profit was $73.7 million lower than in 1993.
Excluding the State Royalty Oil settlement charge, Petroleum's operating
profit was $5.0 million lower than last year. The decrease is
attributable to lower North Pole Refinery profits partially offset by
higher Memphis Refinery profits. North Pole's lower profits are due to
lower year-to-date margins which have been affected by lower refined
product sales prices and because last year's operating profit benefitted
from the supply contract pricing dispute settlement. Memphis Refinery's
profits have increased due to the high margins and operating profit
experienced in the first quarter of 1994.
- - - -- Coal's operating profit was $6.3 million below 1993 primarily because of
the combination of higher overburden removal costs at the Martiki mine,
adverse mining conditions and equipment failures at the Pontiki mine and
less favorable mining conditions at the Dotiki mine. These unfavorable
factors were partially offset by higher production volumes, sales prices
and profits at the Mettiki mine.
Income Taxes
MAPCO's effective income tax rate through September 30, 1994 was 33.8% compared
to 37.4% at September 30, 1993. The decrease in the effective tax rate is
primarily due to the impact on 1993 deferred tax expense of the corporate tax
rate increase prescribed by the Omnibus Budget Reconciliation Act of 1993
("OBRA"). The difference between the statutory Federal income tax rate of 35%
and the effective tax rate is primarily due to statutory depletion, partially
offset by state income taxes.
Net Income
MAPCO's consolidated net income was $41.5 million or $1.39 per share compared
to $92.1 million or $3.07 per share in 1993. Average common shares outstanding
for the nine months ended September 30, 1994 and 1993 were 30.0 million. Net
income was reduced $1.52 per share in the second quarter of 1994 due to
additional amounts accrued relative to the State Royalty Oil settlement. Last
year's net income was reduced $.18 per share from the negative impact of OBRA
and certain environmental accruals, partially offset by the positive impact of
the supply contract settlement.
18 of 27
<PAGE> 19
FINANCIAL CONDITION
Cash Generation (Usage)
Cash generation (usage) was as follows (in millions):
<TABLE>
<CAPTION>
Nine Months Ended, September 30, 1994 1993
-------- --------
<S> <C> <C>
Funds provided by operations $ 142.4 $ 181.5
Changes in operating assets and liabilities (93.1) 14.1
-------- --------
Net cash provided by operating activities 49.3 195.6
Net cash used in investing activities (261.7) (114.3)
Net cash provided by (used in)
financing activities 169.8 (78.9)
-------- --------
Cash generation (usage) $ (42.6) $ 2.4
======== ========
</TABLE>
Funds provided by operations in 1994 as compared to 1993 decreased primarily
due to lower operating profit in the Petroleum segment resulting from the State
Royalty Oil settlement. The negative impact of the change in operating assets
and liabilities of $93.1 million in 1994 was primarily due to: (a) a decrease
in litigation reserves and taxes payable due to the payment of the State
Royalty Oil settlement, (b) an increase in receivables resulting from higher
Petroleum segment sales, and (c) a decrease in payables resulting from less
favorable terms for foreign crude purchases. These items were partially offset
by the impact on payables of higher Petroleum segment purchases and higher
accrued interest.
Capital expenditures in 1994 were $278.5 million, of which $43.4 million was
for capital items necessary to maintain existing operations, compared to
capital expenditures of $123.5 million in 1993, of which $38.3 million was for
capital items necessary to maintain existing operations. Capital expenditures
in 1994 included $191 million for the acquisition of the assets of Emro.
Capital expenditures in 1993 included $51 million for expansion of the Seminole
Pipeline.
Financing activities for the first nine months of 1994 included: (a)
borrowings of $199.1 million to fund the acquisition of the assets of Emro and
the State Royalty Oil settlement, (b) dividend payments of $22.5 million, and
(c) the repurchase of 119,466 shares of MAPCO common stock for $7.2 million.
Financing activities for the first nine months of 1993 included the repayment
of $56.7 million of debt and the payment of $22.5 million of dividends.
Capitalization
Capitalization, which includes long-term debt (excluding current maturities)
and stockholders' equity, increased from $1,160 million at December 31, 1993 to
$1,348 million at September 30, 1994. The increase is primarily attributable
to debt incurred for the acquisition of the assets of Emro and for payments
made on the State Royalty Oil settlement. MAPCO's long-term debt as a percent
of capitalization was 56% at September 30, 1994 compared to 50% at December 31,
1993.
19 of 27
<PAGE> 20
Various loan agreements contain restrictive covenants which, among other
things, limit the payment of advances or dividends by two NGL subsidiaries to
MAPCO. At September 30, 1994, $186 million of net assets were restricted by
such provisions.
Liquidity and Capital Resources
MAPCO's primary sources of liquidity are its cash and cash equivalents,
internal cash generation, and external financing. At September 30, 1994 MAPCO
had $27.2 million of cash and cash equivalents.
MAPCO's external financing sources include its bank credit agreement, its
uncommitted bank credit lines and its ability to issue public or private debt,
including commercial paper. MAPCO renegotiated its bank credit agreement in
April 1994, obtaining a $300 million commitment. The total commitment under
the bank credit agreement reduces in quarterly amounts of $25 million beginning
June 30, 1998. This agreement serves as a back-up for commercial paper and
bank borrowings outstanding. As of September 30, 1994, no borrowings were
outstanding under the bank credit agreement.
In 1990, MAPCO filed a shelf registration statement with the Securities and
Exchange Commission providing for the issuance of up to $400 million of debt
securities. As of September 30, 1994, MAPCO had outstanding $343 million of
Medium Term Notes under this registration. MAPCO has the authorization to
issue up to an additional $47 million of Medium Term Notes. The proceeds from
any debt issued under the shelf registration statement have been and will
continue to be used for general corporate purposes, including working capital,
capital expenditures, reduction of other debt and acquisitions.
MAPCO reached a settlement with the state of Alaska in connection with
litigation over royalty oil payments and paid the settlement during August,
September and October. See Note 7 - Contingencies for a detailed discussion of
this matter.
Capital expenditures in 1994 are expected to be approximately $337 million, of
which approximately $266 million will be for acquisitions and expansion
projects. On September 1, 1994, MAPCO completed the acquisition of the assets
of Emro which included the transfer to Emro Marketing Company of MAPCO Florida
Inc.'s retail convenience store assets in Florida. The purchase price of this
acquisition has been reflected in the expected capital expenditures for 1994.
MAPCO financed this acquisition through the issuance of commercial paper and
money market funds. MAPCO's existing debt and credit agreements contain
covenants which limit the amount of additional indebtedness the Company can
incur. Management believes, however, that MAPCO has sufficient capacity to
fund its anticipated needs. MAPCO's liquidity is expected to be sufficient to
meet currently projected capital expenditures, environmental compliance costs,
debt service and dividends. MAPCO anticipates that future excess internal cash
generation will be used primarily for debt reduction and capital expenditures.
20 of 27
<PAGE> 21
PART II
OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a). Exhibits
Exhibit 10 - Settlement Agreement between MAPCO Alaska Petroleum
Inc. and the state of Alaska executed on August 31, 1994, and
effective August 1, 1994.
Exhibit 11 - Statement Regarding Computation of per Share
Earnings.
Exhibit 12 - Computation of Ratio of Earnings to Fixed Charges.
Exhibit 27 - Financial Data Schedule.
(b). Reports on Form 8-K
- Current Report on Form 8-K filed September 2, 1994, regarding
the settlement of litigation between the state of Alaska and
MAPCO Alaska Petroleum Inc.
- Current Report on Form 8-K filed September 12, 1994, relating
to the Company's completion of its acquisition of the assets of
Emro Propane Company, as amended and supplemented by Current
Report on Form 8-K/A (Amendment No. 1) filed November 7, 1994,
and Current Report on Form 8-K/A (Amendment No. 2) filed November
10, 1994.
21 of 27
<PAGE> 22
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
MAPCO Inc.
Date: November 10, 1994 /s/ FRANK S. DICKERSON, III
Frank S. Dickerson, III
Senior Vice President,
Chief Financial Officer,
and Treasurer
Date: November 10, 1994 /s/ DONALD R. WELLENDORF
Donald R. Wellendorf
Vice President and Controller
22 of 27
<PAGE> 23
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Page
Number
------
<S> <C> <C>
Exhibit 10 Settlement Agreement between MAPCO Alaska
Petroleum Inc. and the state of Alaska
executed on August 31, 1994, and effective
August 1, 1994.
Exhibit 11 Statement Regarding Computation of per
Share Earnings 24-25
Exhibit 12 Computation of Ratio of Earnings to Fixed
Charges 26
Exhibit 27 Financial Data Schedule 27
</TABLE>
23 of 27
<PAGE> 1
EXHIBIT 10
SETTLEMENT AGREEMENT
1. PARTIES. This Agreement is by and between MAPCO Alaska
Petroleum Inc. ("MAPCO") and the State of Alaska (the "State"). The effective
date of this Agreement is August 1, 1994.
2. RECITALS. This Agreement is made with reference to the
following facts:
2.1 Certain disputes and controversies have arisen
between the parties hereto.
2.2 Such disputes and controversies include, but are not
limited to, the claims, demands, and cause or causes of action set forth by the
parties hereto in the following civil actions pending in the Alaska Superior
Court:
2.2.1 MAPCO Alaska Petroleum Inc. v. State of
Alaska, Case No. 3AN-92-7813 Civil.
2.2.2 State of Alaska v. MAPCO Inc., et al., Case
No. 1JU-92-1684 CI (including counterclaims).
2.2.3 MAPCO Inc., et al. v. State of Alaska, Case
No. 3AN-93-1120 CI (including counterclaims) (consolidated under 3AN-92-7813).
2.3 Such disputes and controversies also include, but are
not limited to, the claims, demands, and cause or causes of action that arise
out of or in connection with the interpretation, application, and performance
of the following agreements:
2.3.1 MAPCO and the State are parties to an
agreement for the sale and purchase of royalty oil taken in-kind by the State,
dated March 27, 1978 (the
- - - --------------------------------------------------------------------------------
STATE OF ALASKA/MAPCO ALASKA PETROLEUM INC.
SETTLEMENT AGREEMENT PAGE -1-
<PAGE> 2
"MAPCO/State RIK Contract"). The MAPCO/State RIK Contract provides for the
sale to MAPCO of oil which the State takes in kind as its royalty from oil
produced by lessees of Alaska North Slope Prudhoe Bay oil fields.
2.3.2 In accordance with a decision of the Superior
Court in State v. MAPCO, Case No. 1JU-92-1684 CI, MAPCO is the assignee of
Golden Valley Electric Association's ("GVEA") rights and liabilities under
three agreements, as amended, between GVEA and the State for the sale and
purchase of royalty oil taken in-kind by the State, dated April 12, 1977,
May 9, 1984, and February 8, 1985 (the "GVEA/State RIK Contracts").
2.3.3 MAPCO and GVEA are parties to a certain
agreement entitled "Assignment and Product Sales Agreement," dated May 1, 1980,
and to a certain agreement entitled "Petroleum Products Agreement," dated
May 1, 1980.
2.3.4 MAPCO, GVEA, and the State are parties to an
agreement, dated February 8, 1985, that is entitled "Exhibit A" and was entered
into in connection with the February 8, 1985 GVEA/State RIK Contract.
3. PAYMENT. MAPCO shall cause to be delivered to the State by
wire transfer the following amounts on the following dates:
3.1 Upon execution of this Agreement by Seller, MAPCO
shall deliver to the State $15,000,000.
3.2 On August 31, 1994, MAPCO shall deliver to the State
$32,500,000.
3.3 On September 30, 1994, MAPCO shall deliver to the
State $32,500,000.
- - - --------------------------------------------------------------------------------
STATE OF ALASKA/MAPCO ALASKA PETROLEUM INC.
SETTLEMENT AGREEMENT PAGE -2-
<PAGE> 3
3.4 On October 31, 1994, MAPCO shall deliver to the State
$15,000,000.
4. DISMISSAL. Immediately following execution of this Agreement,
MAPCO and the State shall dismiss, with prejudice, as to all parties, each
party bearing its own costs, the civil actions referenced in paragraph 2.2.
Each party hereby irrevocably authorizes and directs its attorneys of record to
execute and deliver to the courts a stipulation and order of dismissal in the
form attached hereto as Exhibit A, by reference made a part hereof, so that the
same may be lodged with the courts immediately following execution of this
Agreement.
5. LIMITED RELEASES. In consideration of the mutual releases
contained herein, and for other good and valuable consideration, the receipt of
which is acknowledged by each party hereto, the parties promise, agree, and
release as follows:
5.1 Except as to such rights or claims as may be created
by this Agreement, the State hereby releases, remises, and forever discharges
MAPCO, MAPCO Inc., and their past and present agents, directors, officers,
employees, partners, attorneys, auditors, subsidiaries, affiliates,
shareholders, representatives, successors, predecessors, and assigns from any
and all claims, demands, and cause or causes of action existing as of the
effective date hereof and arising out of, connected with, or incidental to (1)
the claims, demands, and cause or causes of action reflected in the civil
actions referenced in paragraph 2.2; (2) any and all disputes, claims, demands,
and cause or causes of action arising under the agreements set forth in
paragraph 2.3 in connection with the purchase price, any retroactive price
adjustments, or claims concerning the methods and means of calculating prices
under those agreements prior to August 1, 1994; and (3) any and all claims
arising under the agreements set forth in
- - - --------------------------------------------------------------------------------
STATE OF ALASKA/MAPCO ALASKA PETROLEUM INC.
SETTLEMENT AGREEMENT PAGE -3-
<PAGE> 4
paragraph 2.3 provided that no claims arising under Articles 20, 21, 26, and 27
of the MAPCO/State RIK Contract are released or compromised by this paragraph
5.1.
5.2 Except as to such rights or claims as may be created
by this Agreement, MAPCO and MAPCO Inc. hereby release, remise, and forever
discharge the State and its past and present agents, employees, attorneys,
auditors, representatives, and assigns from any and all claims, demands, and
cause or causes of action existing as of the effective date hereof and arising
out of, connected with, or incidental to (1) the claims, demands, and cause or
causes of action reflected in the civil actions referenced in paragraph 2.2;
(2) any and all disputes, claims, demands, and cause or causes of action
arising under the agreements set forth in paragraph 2.3 in connection with the
purchase price, any retroactive price adjustments, or claims concerning the
methods and means of calculating prices under those agreements prior to
August 1, 1994; and (3) any and all claims arising under the agreements set
forth in paragraph 2.3 provided that no claims arising under Articles 20, 21,
26, and 27 of the MAPCO/State RIK Contract are released or compromised by
this paragraph 5.2.
5.3 As a part of their releases, each party to this
Agreement specifically assumes the risk of and waives all claims of the type
described and released under paragraphs 5.1 and 5.2 which it does not now know
or suspect to exist in its favor at the time of executing these releases.
5.4 Annexed hereto as Exhibit B and incorporated herein
by this reference is a mutual general release by and between GVEA and MAPCO for
all disputes, claims, demands, and cause or causes of action in connection with
or arising out of the claims, demands, and cause or causes of action reflected
in the civil actions referenced in paragraph 2.2
- - - --------------------------------------------------------------------------------
STATE OF ALASKA/MAPCO ALASKA PETROLEUM INC.
SETTLEMENT AGREEMENT PAGE -4-
<PAGE> 5
above, and any and all claims arising under the agreements referenced in
paragraph 2.3 above for the period prior to August 1, 1994, including, without
limiting the generality of the foregoing, claims for additional retroactive
adjustments to the date hereof, and any and all disputes, claims, demands, and
cause or causes of action in connection with the purchase price, retroactive
price adjustments, or methods and means of calculating prices under those
agreements.
6. REPRESENTATIONS AND WARRANTIES. Each of the parties to this
Agreement represents and warrants to, and agrees with, each other party hereto,
as follows:
6.1 Each party has received independent legal advice from
its attorneys with respect to all aspects of this settlement, including, but
not limited to, the advisability of making the settlement provided for herein
and with respect to the advisability of executing this Agreement.
6.2 No party (or any officer, agent, employee,
representative, or attorney of or for any party) has made any statement or
representation, or failed to make any statement or representation to any other
party regarding any fact relied upon in entering into this Agreement, and each
party does not rely upon any statement, representation, omission, or promise of
any other party (or of any officer, agent, employee, representative, or
attorney for any other party) in executing this Agreement, or in making the
settlement provided for herein, except as expressly stated in this Agreement.
6.3 Each party to this Agreement has made such
investigation of the facts pertaining to this settlement and this Agreement,
and of all the matters pertaining thereto, as it deems necessary.
- - - --------------------------------------------------------------------------------
STATE OF ALASKA/MAPCO ALASKA PETROLEUM INC.
SETTLEMENT AGREEMENT PAGE -5-
<PAGE> 6
6.4 Each party or responsible officer or employee, agent,
or representative thereof has read this Agreement and understands the contents
hereof. Each of the persons executing this Agreement on behalf of his or her
respective party is empowered to do so and thereby binds such party.
6.5 In entering into this Agreement and the settlement
provided for herein, each party assumes the risk of any misrepresentation,
concealment, or mistake, either of fact or of law. If any party should
subsequently discover that any fact relied upon by it in entering into this
Agreement was untrue, or that any fact was concealed from it, or that its
understanding of the facts or of the law was incorrect, such party shall not be
entitled to any relief in connection therewith, including, without limitation
on the generality of the foregoing, any alleged right or claim to set aside or
rescind this Agreement. This Agreement is intended to be and is final and
binding between the parties hereto, regardless of any claims of
misrepresentation, promise made without the intention to perform, concealment
of fact, mistake of fact or law, or of any other circumstance whatsoever.
6.6 Except as provided in the settlement agreement dated
May 5, 1993, between Seller and GVEA, each party has not heretofore assigned,
transferred, or granted, or purported to assign, transfer, or grant, any of the
claims, demands, and cause or causes of action disposed of by this Agreement.
6.7 Each party is aware that it may hereafter discover
claims or facts in addition to or different from those it now knows or believes
to be true with respect to the matters related herein. Nevertheless, it is the
intention of the parties to fully, finally, and forever to settle and release
all claims as provided in paragraph 5 which do now exist, may
- - - --------------------------------------------------------------------------------
STATE OF ALASKA/MAPCO ALASKA PETROLEUM INC.
SETTLEMENT AGREEMENT PAGE -6-
<PAGE> 7
exist, or heretofore have existed between them. In furtherance of such
intention, the releases given herein shall be and remain in effect as full and
complete mutual limited releases of all such matters, notwithstanding the
discovery or existence of any additional or different claims or facts relative
thereto.
6.8 The parties will execute all such further and
additional documents as shall be reasonable, convenient, necessary, or
desirable to carry out the provisions of this Agreement.
7. SETTLEMENT. This Agreement effects the settlement of claims
which are denied and contested, and nothing contained herein shall be construed
as an admission by any party hereto of any liability of any kind to any other
party. Each of the parties hereto denies any liability in connection with any
claim and intends hereby solely to avoid litigation and buy its peace.
- - - --------------------------------------------------------------------------------
STATE OF ALASKA/MAPCO ALASKA PETROLEUM INC.
SETTLEMENT AGREEMENT PAGE -7-
<PAGE> 8
8. MISCELLANEOUS.
8.1 The parties agree that the deposition of David Cooley
taken in Case No. 3AN-92-7813 Civil, including any exhibits thereto, and the
periodic MAPCO Market Summary Reports which have been produced by MAPCO in the
RIK Litigation may be used by the State in taxpayer litigation with the
producers following entry of a protective order in each taxpayer case in a form
satisfactory to MAPCO. Other than this exception, the terms of the Protective
Order entered on October 20, 1993, by Judge Fabe in Case No. 3AN-92-7813
(consolidated) shall remain in full force and effect. Except as provided in
this paragraph, the discovery rights of the parties in future litigation
between them or with other parties are not affected, limited, or expanded in
any way.
8.2 This Agreement shall be deemed to have been executed
and delivered within the State of Alaska, and the rights and obligations of the
parties hereto shall be construed and enforced in accordance with, and governed
by, the laws of the State of Alaska.
8.3 This Agreement is the entire agreement between the
parties with respect to the subject matter hereof and supersedes all prior and
contemporaneous oral and written agreements and discussions. This Agreement
may be amended only by an agreement in writing, signed by the parties hereto.
8.4 This Agreement is binding upon and shall inure to the
benefit of the parties hereto, their respective agents, employees,
representatives, officers, directors, divisions, subsidiaries, affiliates,
assigns, heirs, successors, and predecessors in interest and shareholders.
- - - --------------------------------------------------------------------------------
STATE OF ALASKA/MAPCO ALASKA PETROLEUM INC.
SETTLEMENT AGREEMENT PAGE -8-
<PAGE> 9
8.5 Each party has cooperated in the drafting and
preparation of this Agreement. This Agreement shall be construed according to
its plain meaning and shall not be construed for or against any party.
8.6 This Agreement may be executed in counterparts, and
when each party has signed and delivered at least one such counterpart, each
counterpart shall be deemed an original and, when taken together with other
signed counterparts, shall constitute one Agreement, which shall be binding
upon and effective as to all parties.
9. PRICING UNDER THE CONTRACTS.
9.1 Annexed hereto as Exhibit C is a final schedule
listing by contract the monthly prices and quantities for royalty oil purchased
under each contract listed in paragraph 2.3 from the date of inception of each
contract up to and including oil delivered on July 31, 1994.
A Final Adjustment will be made in the values shown for
barrels delivered in July 1994, but solely to go from estimated to actual
volumes and actual values as first reported by the producers for that month.
The Final Adjustment for oil delivered in July 1994 is necessary because both
the volume and the price for July 1994 barrels were estimated in the bill sent
to MAPCO on August 1, 1994. The estimated volume was 1,147,379.63 barrels and
the estimated Exhibit B price was $12.11988 per barrel. The producers are
obligated to file their royalty reports for July 1994 on or about August 31,
1994. No later than September 15, 1994, the Seller will calculate the actual
Exhibit B price and volume for barrels delivered in July 1994 based on the
producers' initial royalty returns for July 1994 (including, if filed before
September 13, 1994, any amended returns filed by the producers to correct
errors -- but not
- - - --------------------------------------------------------------------------------
STATE OF ALASKA/MAPCO ALASKA PETROLEUM INC.
SETTLEMENT AGREEMENT PAGE -9-
<PAGE> 10
make other adjustments -- in the initial returns filed by the producers). The
Final Adjustment for barrels delivered in July 1994 is the difference between
the estimated bill sent on August 1, 1994 and the bill calculated using the
volumes and Exhibit B prices from the producers' initial royalty returns for
July 1994 (including, if filed before September 13, 1994, any amended returns
filed by the producers to correct errors -- but not make other adjustments --
in the initial returns filed by the producers). The July 1994 volumes and
prices will not be further adjusted for any reasons whatsoever even if the
producers later file amended returns changing the values reported or if the
State challenges or otherwise attempts to modify the values reported. The
Final Adjustment for July 1994 shall be paid by Purchaser or credited to
Purchaser when Purchaser makes its September 1994 payment for oil delivered in
August 1994. The Final Adjustment for July 1994 shall not bear interest
provided payment, if any, is timely made. With the sole exception of the Final
Adjustment for July 1994, absolutely no further adjustments will be made in the
Exhibit C volumes and prices for any reason whatsoever.
9.2 Effective midnight on July 31, 1994, the Exhibit B
interim price term set forth in the MAPCO/State RIK Contract shall be and
hereby is terminated as to deliveries that occur after that date and time.
Seller shall retain all payments made under the Exhibit B interim price term.
9.3 The MAPCO/State RIK Contract section 6.4 shall be
replaced in its entirety with the following:
6.4 Adjustments to Billings. For oil delivered on or
after August 1, 1994, each month Seller shall adjust its
statement of accounts to reflect the actual amounts delivered
and the price or prices applicable thereto. Seller shall from
time to time adjust
- - - --------------------------------------------------------------------------------
STATE OF ALASKA/MAPCO ALASKA PETROLEUM INC.
SETTLEMENT AGREEMENT PAGE -10-
<PAGE> 11
billings for oil delivered on or after August 1, 1994 to
reflect (i) adjustments necessitated as a result of the ANS
royalty settlement agreements, including any reopeners
expressly provided for therein, previously entered in the oil
royalty portion of the litigation between Seller and the
Lessees in the case known as ANS Royalty Litigation, Case No.
1JU-77-847 Civil, in the Superior Court of the State of
Alaska, First Judicial District at Juneau; (ii) adjustments
necessitated as a result of the filing with the Seller by the
Lessees or lessees of more current reports applicable to the
billing period in question; (iii) actual adjustments
necessitated as a result of changes to values, receipts,
costs, and computations previously reported by the Lessees or
lessees and utilized by Seller as a basis for billing under
Article 6.1, if such adjustments are based upon actual later
severance tax or royalty oil payments by or refunds to the
Lessees or lessees; or (iv) adjustments required as a result
of clerical or arithmetical errors in the billings of Lessees
or lessees, or of Seller; provided, however, that no
adjustments, whether credits or debits, under Articles 6.4(ii)
through 6.4(iv) shall be made by Seller or demanded by
Purchaser more than twelve (12) months after the original
billing except as to matters which are the subject of (x)
pending litigation by either party, (y) pending regulatory
proceedings (or appeals thereof) whether or not Seller or
Purchaser is a party thereto, or (z) bona fide audits by
Seller which audits have been terminated or completed by
Seller within twenty-four (24) months after initiation of
same.
Due to the potentially large sums of money involved, any
adjustments to any billing under the provisions of this
Article VI by Seller made more than sixty (60) days after such
billing was initially rendered shall be paid to or refunded by
Purchaser or Seller over the same period over which such
adjustments accrued or thirty-six (36) months, whichever is
longer (the "Deferral Period"). Deferred payments shall be
made in equal annual
- - - --------------------------------------------------------------------------------
STATE OF ALASKA/MAPCO ALASKA PETROLEUM INC.
SETTLEMENT AGREEMENT PAGE -11-
<PAGE> 12
installments over the Deferral Period, beginning on the 30th
day of June next following the determination of the
adjustment, except that if the Deferral Period shall extend
beyond the term stipulated in Article 7.1, the remaining
balance shall be paid in a lump sum on the termination date
hereof.
Any adjustment under Article 6.4, including any adjustment
paid by or credited to Purchaser during a Deferral Period,
shall accrue interest on the outstanding balance of such
adjustment from the date the original billing was first due
until the date paid at the Bank of America prime rate,
compounded daily. For example, payment for oil produced in
January of 1995 is first due on the twenty-fifth (25th) of the
calendar month in which a statement for the oil is rendered or
fifteen (15) days after rendition of the invoice, whichever
date is later. If the price for oil produced in January of
1995 were adjusted in May of 1995, and assuming that the
invoice for the January 1995 oil was rendered on February 5,
1995, interest would begin to accrue on February 25, 1995 for
the adjustment determined in May of 1995.
9.4 Within fifteen (15) days after sending or receipt of
notice of any intent to reopen any ANS royalty settlement agreement or within
five (5) days after the initiation of any proceeding in connection with a
reopener under any ANS royalty settlement agreement, whichever date is sooner,
the Seller shall give MAPCO written notice of such reopener, intent to reopen,
or proceeding in connection with such reopener, providing MAPCO with the
provision of the settlement agreement under which the reopener is taken, the
parties to the reopening and the changes, if known, sought by the parties in
connection with the reopener, including the amounts involved and the period
covered. The Seller shall within fifteen (15) days of the receipt, sending, or
filing provide MAPCO with copies of any and all pleadings or papers
- - - --------------------------------------------------------------------------------
STATE OF ALASKA/MAPCO ALASKA PETROLEUM INC.
SETTLEMENT AGREEMENT PAGE -12-
<PAGE> 13
relating to any such reopener, as well as any and all amendments, agreements,
settlements, judgments, or orders relating to any such reopener.
To permit Purchaser to monitor the price of the oil it
purchases, Seller shall provide the following information:
(a) within fifteen (15) days of execution, any amendment
to an ANS royalty settlement agreement;
(b) by October 31, 1994, copies of all ANS royalty
settlement agreements; and
(c) a monthly summary of the producers' royalty returns.
Nothing in this paragraph requires Seller to disclose anything
designated confidential under the ANS royalty settlement agreements or by law
or regulation.
10. GUARANTY. All payments required under the terms of paragraph
3 of this Agreement are guaranteed by MAPCO Inc., and all provisions of the
Performance Guaranty of January 25, 1994 (except the last sentence of Section
3(i) permitting time payments which is deleted) shall remain in full force and
effect to guarantee each such payment. The Performance Guaranty shall
terminate immediately upon the State's receipt of the final payment, except
that Section 7 of the Performance Guaranty shall remain in full force and
effect.
- - - --------------------------------------------------------------------------------
STATE OF ALASKA/MAPCO ALASKA PETROLEUM INC.
SETTLEMENT AGREEMENT PAGE -13-
<PAGE> 14
11. NO AMENDMENT. Except as expressly amended by this Agreement,
the MAPCO/State RIK Contract is not amended and remains in full force and
effect.
Date: September 8, 1994 By /s/ Harry Noah
Commissioner of Natural Resources
Date: September 15, 1994 By /s/ Bruce Botelho
Attorney General
STATE OF ALASKA )
) ss:
THIRD JUDICIAL DISTRICT )
The foregoing instrument was acknowledged before me this 8th day of
September, 1994, by Harry Noah, Commissioner of Natural Resources for the State
of Alaska.
/s/ Julian L. Mason
Notary Public in and for Alaska
My commission expires: June 25, 1996
STATE OF ALASKA )
) ss:
1st JUDICIAL DISTRICT )
The foregoing instrument was acknowledged before me this 15th day of
September, 1994, by Bruce M. Botelho, Attorney General for the State of Alaska.
/s/ Paulette Longmire
Notary Public in and for Alaska
My commission expires: January 13, 1996
- - - --------------------------------------------------------------------------------
STATE OF ALASKA/MAPCO ALASKA PETROLEUM INC.
SETTLEMENT AGREEMENT PAGE -14-
<PAGE> 15
MAPCO Alaska Petroleum Inc.
Date: September 21, 1994 By /s/ W. Jeffrey Hart
Title President
As to Sections 5.2 and 10 of this Agreement only.
MAPCO Inc.
Date: September 20, 1994 By /s/ Robert M. Howe
Title President
STATE OF OKLAHOMA )
) ss:
OKMULGEE COUNTY )
The foregoing instrument was acknowledged before me this 21st day of
September, 1994, by W. Jeffrey Hart, of MAPCO Alaska Petroleum Inc., an Alaska
corporation, on behalf of the corporation.
/s/ Paula Lynne Gann
Notary Public in and for Oklahoma
My commission expires: November 3, 1995
STATE OF OKLAHOMA )
) ss:
OKMULGEE COUNTY )
The foregoing instrument was acknowledged before me this 20th day of
September, 1994, by Robert M. Howe, of MAPCO Inc., a Delaware corporation, on
behalf of the corporation.
/s/ Paula Lynne Gann
Notary Public in and for Oklahoma
My commission expires: November 3, 1995
- - - --------------------------------------------------------------------------------
STATE OF ALASKA/MAPCO ALASKA PETROLEUM INC.
SETTLEMENT AGREEMENT PAGE -15-
<PAGE> 16
EXHIBIT "A"
IN THE SUPERIOR COURT FOR THE STATE OF ALASKA
THIRD JUDICIAL DISTRICT AT ANCHORAGE
MAPCO ALASKA PETROLEUM INC., )
)
Plaintiff, )
)
)
vs. ) Case No. 3AN-92-7813 Civil
)
STATE OF ALASKA )
)
Defendant. )
)
__________________________________)
)
MAPCO ALASKA PETROLEUM, INC., )
)
Plaintiff, )
)
)
vs. ) Case No. 3AN-93-1120 Civil
)
STATE OF ALASKA, )
)
Defendant. ) Consolidated Under Case No.
__________________________________) 3AN-92-7813 Civil
STIPULATION FOR DISMISSAL
COME NOW the parties, through their respective counsel of record, and
pursuant to Alaska Rule of Civil Procedure 41(a) and the Settlement of the
parties, stipulate to the dismissal of these actions, including counterclaims,
with prejudice with each party bearing its own costs and attorney's fees.
1
<PAGE> 17
Attorneys for MAPCO Inc., MAPCO Attorneys for
PETROLEUM INC., MAPCO ALASKA STATE OF ALASKA
PETROLEUM INC.
SKADDEN, ARPS, SLATE, MEAGHER, CONDON, PARTNOW & SHARROCK
& FLOM
BOGLE & GATES HOSIE, WES, MCLAUGHLIN & SACKS
By: _____________________ By: _____________________
Jeffrey Dasteel Peter C. Partnow
Dated: ______________ Dated: ______________
ORDER OF DISMISSAL
Pursuant to the agreement of the parties and Alaska Rule of Civil
Procedure 41(a), the above-captioned matters, including counterclaims, are
hereby dismissed with prejudice with each party bearings its own costs and
attorney's fees.
Dated:_______________________.
__________________________
DANA FABE
SUPERIOR COURT JUDGE
2
<PAGE> 18
EXHIBIT "A"
IN THE SUPREME COURT FOR THE STATE OF ALASKA
STATE OF ALASKA, )
)
Appellant, )
)
v. )
)
MAPCO INC., MAPCO PETROLEUM )
INC., MAPCO ALASKA PETROLEUM ) Superior Court Case
) No. 1JU-92-1684 Civil
)
Appellees. )
) Supreme Court Case
__________________________________) No. 96252
STIPULATION FOR DISMISSAL
COME NOW the parties, through their respective counsel of record,
pursuant to Alaska Rule of Appellate Procedure 511(a), and the Settlement
Agreement of the parties, and agree and stipulate to the dismissal of this
appeal and the underlying action, including counterclaims, with prejudice, with
each party bearing its own costs and attorney's fees regardless of whether
incurred before the Supreme Court or the Superior Court.
Attorneys for MAPCO Inc., MAPCO Attorneys for
PETROLEUM INC., MAPCO ALASKA STATE OF ALASKA
PETROLEUM INC.
SKADDEN, ARPS, SLATE, MEAGHER, CONDON, PARTNOW & SHARROCK
& FLOM
BOGLE & GATES HOSIE, WES, MCLAUGHLIN & SACKS
By: _____________________ By: _____________________
Jeffrey Dasteel Peter C. Partnow
Dated: ______________ Dated: ______________
1
<PAGE> 19
ORDER
Pursuant to the agreement of the parties and Alaska Rule of Appellate
Procedure 511(a), the appeal in this matter as well as the underlying dispute,
including counterclaims, is hereby dismissed with prejudice with each party to
bear its own costs and attorney's fees regardless of whether incurred before
the Supreme Court or the Superior Court.
Dated:_______________________.
__________________________
CLERK OF THE COURT
2
<PAGE> 20
Exhibit "B"
SETTLEMENT AGREEMENT
1. Parties: This Agreement is by and between MAPCO Alaska
Petroleum Inc. ("MAPCO") and Golden Valley Electric Association ("GVEA"). The
effective date of this agreement is August 1, 1994.
2. RECITALS: This Agreement is made with reference to the
following facts:
2.1 Certain Disputes and controversies have arisen
between the parties hereto.
2.2 Such disputes and controversies include, but are not
limited to, the claims, demands and cause or causes of action set forth by the
parties hereto in the following civil actions pending in the Alaska Superior
Court:
2.2.1 MAPCO Alaska Petroleum Inc. v. State of
Alaska, Case No. 3AN-93-1120- Civil (Consolidated under 3AN-92-7813 Civil);
2.2.2 State of Alaska v. MAPCO Inc., et al., Case
No. 1JU-92-1684 CI (including counterclaims).
2.3 Such disputes and controversies also include, but
are not limited to, the claims, demands and cause or cause of action that
arise out of or in connection with the interpretation, application, and
performance of the following agreements:
2.3.1 In accordance with a decision of the Superior
Court in State v. MAPCO, 1JU-91-1684 Civ.,
<PAGE> 21
MAPCO is the assignee of GVEA's rights and liabilities under three agreements,
as amended, between GVEA and the State for the sale and purchase of royalty oil
taken in-kind by the State, dated April 12, 1988, May 9, 1984, and February 8,
1985 (the "GVEA/State RIK Contracts");
2.3.2 MAPCO and GVEA are parties to a certain
agreement entitle "Assignment and Product Sales Agreement," dated May, 1, 1980,
and to a certain agreement entitled "Petroleum Products Agreement," dated
May 1, 1980;
3. General Releases: In consideration of the mutual general
releases contained herein, and for other good and valuable consideration, the
receipt of which is acknowledged by each party hereto, the parties promise,
agree and generally release as follows:
3.1 Except as to such rights or claims as may be created by
this Agreement, GVEA hereby releases, remises and forever discharges MAPCO,
MAPCO Inc. and their past and present agents, directors, officers, employees,
partners, attorneys, auditors, subsidiaries, affiliates, shareholders,
representatives, successors, predecessors, and assigns from any and all claims,
demands, and cause or causes of action existing as of the effective date hereof
and arising out of, connected with or incidental to the dealings between the
parties hereto prior to the effective date hereof in connection with or arising
out of the claims, demands and cause or causes of action reflected in the
civil actions
2
<PAGE> 22
referenced in paragraph 2.2 above and the agreements referenced in paragraph
2.3 above, including, without limiting the generality of the foregoing, claims
for additional retroactive adjustments to the date hereof and any and all
disputes, claims, demands and cause or causes of action in connection with the
purchase price, retroactive price adjustments, or methods and means of
calculating prices under those agreements.
3.2 Except as to such rights or claims as may be created by
this Agreement, MAPCO and MAPCO Inc. hereby release, remise and forever
discharge GVEA and its past and present agents, employees, attorneys, auditors,
representatives, successors, predecessors, and assigns from any and all claims,
demands, and cause or causes of action existing as of the effective date hereof
and arising out of, connected with or incidental to the dealings between the
parties hereto prior to the effective date hereof in connection with or arising
out of the claims, demands and cause or causes of action reflected in the civil
actions referenced in paragraph 2.2 above and the agreements referenced in
paragraph 2.3 above, including with limiting the generality of the foregoing,
claims for additional retroactive adjustments to the date hereof and any and
all disputes, claims, demands and cause or causes of action in connection with
the purchase price, retroactive price adjustments, or methods and means or
calculating prices under those agreements.
3
<PAGE> 23
3.3 As a part of their releases, each party to this Agreement
specifically assumes the risk of and waives all claims which it does not now
know or suspect to exist in its favor at the time of executing these releases.
4. Representations and Warranties: Each of the parties to this
Agreement represents and warrants to, and agrees with, each other party hereto,
as follows:
4.1 Each party has received independent legal advice from its
attorneys with respect to all aspects of this settlement including, but not
limited to, the advisability of making the settlement provided for herein, and
with respect to the advisability of executing this Agreement.
4.2 No party (or any officer, agent, employee, representative,
or attorney of or for any party), has made any statement or representation or
failed to make any statement or representation to any other party regarding any
fact relied upon in entering into this Agreement, and each party does not rely
upon any settlement, representation omission or promise of any other party (or
of any officer, agent, employee, representative, or attorney for any other
party), in executing this Agreement, or in making the settlement provided for
herein, except as expressly stated in this Agreement.
4.3 Each party to this Agreement has made such investigation
of the facts pertaining to this settlement and this Agreement, and of all the
matters pertaining thereto,
4
<PAGE> 24
as it deems necessary.
4.4 Each party or responsible officer or employee, agent or
representative thereof has read this Agreement and understands the contents
hereof. Each of the persons executing this Agreement on behalf of his or her
respective party is empowered to do so and thereby binds such party.
4.5 In entering into this Agreement and the settlement
provided for herein, each party assumes that risk of any misrepresentation,
concealment or mistake, either of fact or of law. If any party should
subsequently discover that any fact relied upon by it in entering into this
Agreement was untrue, or that any fact was concealed from it, or that its
understanding of the facts or of the law was incorrect, each party shall not
be entitled to any relief in connection therewith including, without limitation
on the generality of the foregoing, any alleged right or claim to set aside or
rescind this Agreement. This Agreement is intended to be and is final and
binding between the parties hereto, regardless of any claims of
misrepresentation, promise made without the intention to perform, concealment
of fact, mistake of fact or law, or of any other circumstance whatsoever.
4.6 Except as provided in the Settlement Agreement between
GVEA and the State of Alaska, date May 5, 1993, each party has not heretofore
assigned, transferred, or granted, or purported to assign, transfer, or grant,
any of
5
<PAGE> 25
the claims, demands, and cause or causes of action disposed of by this
Agreement.
4.7 Each party is aware that it may hereafter discover
claims or facts in addition to or different from those it now knows or believes
to be true with respect to the matters related herein. Nevertheless, it is the
intention of the parties to fully, finally and forever to settle and release
all such matters, and all claims relative thereto, which do now exist, may
exist, or heretofore have existed between them. In furtherance of such
intention, the releases given herein shall be and remain in effect as full and
complete mutual releases of all such matters, notwithstanding the discovery or
existence of any additional or different claims or facts relative thereto.
4.8 The parties will execute all such further and additional
documents as shall be reasonable, convenient, necessary or desirable to carry
out the provisions of this Agreement.
5. Settlement: This Agreement effects the settlement of claims
which are denied and contested, and nothing contained herein shall be construed
as an admission by any party hereto of any liability of any kind to any other
party. Each of the parties hereto denies any liability in connection with any
claim and intends hereby solely to avoid litigation and buy its peace.
6
<PAGE> 26
6. Miscellaneous:
6.1 This Agreement shall be deemed to have been executed and
delivered within the State of Alaska, and the rights and obligations of the
parties hereto shall be construed and enforced in accordance with, and
governed by, the laws of the State of Alaska.
6.2 This Agreement is the entire Agreement between the parties with
respect to the subject matter hereof and supersedes all prior and
contemporaneous oral and written agreements and discussions. This Agreement
may be amended only by an agreement in writing, signed by the parties hereto.
6.3 This Agreement is binding upon and shall inure to the benefit
of the parties hereto, their respective agents, employees, representatives,
officers, directors, divisions, subsidiaries, affiliates, assigns, heirs,
successors and predecessors in interest and shareholders.
6.4 Each party has cooperated in the drafting and preparation of
this Agreement. Hence, in any construction to be made of this Agreement, the
same shall not be construed according to its plain meaning and shall not be
construed for or against any party.
6.5 This Agreement may be executed in counterparts, and when each
party has signed and delivered at least one such counterpart, each
counterpart shall be deemed
7
<PAGE> 27
an original, and when taken together with other signed counterparts, shall
constitute once Agreement, which shall be binding upon and effective as to all
parties.
GOLDEN VALLEY ELECTRIC ASSOCIATION
By: ______________________________
Mike Kelly
General Manager
As Authorized by Board of
Directors
MAPCO ALASKA PETROLEUM INC.
By: /s/ W. Jeffrey Hart
W. Jeffrey Hart
President
STATE OF ALASKA )
) as
THIRD JUDICIAL DISTRICT )
The foregoing instrument was acknowledged before me this ____
day of______, 1994, by _______________________, Golden Valley Electric
Association.
_____________________________________
Notary Public in and for Alaska
My Commission expires:_______________
STATE OF OKLAHOMA )
) as
TULSA COUNTY )
The foregoing instrument was acknowledged before me this 31st
day of August, 1994, by W. Jeffrey Hart, of MAPCO Alaska Petroleum Inc., a
Alaska corporation, on behalf of the corporation.
/s/ Paula Lynne Gann
Notary Public in and for Oklahoma
My Commission expires: 11/3/95
8
<PAGE> 28
State of Alaska
Department of Natural Resources
Division of Oil & Gas
Royalty Accounting
ANS Royalty Litigation
MAPCo
Exhibit C to the State MAPCo Settlement Agreement
1/80 - 12/91
<TABLE>
<CAPTION>
- - - ----------------------------------------------------------------------------------------------------------------------------------
Sales Volume Value ANS Previous Delta Additional Due Date Cumulative Additional Total Royalty
Month Rebilling Value Royalty Interest Interest & Interest
Rate
(a) (b) (c) (d) (e) = (c-d) (f) = (b*e) (g) (h) (i) = (f*h) (j) = (f+i)
==================================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Jan-80 21,773.24 $24.30796 $24.90435 ($0.59639) ($12,985.29) 25-Feb-80 1.69222 ($21,973.97) ($34,959.26)
Feb-80 40,745.03 $24.34240 $25.04897 ($0.70657) ($28,789.19) 25-Mar-80 1.67710 ($48,282.26) ($77,071.45)
Mar-80 66,097.23 $24.28052 $25.17021 ($0.88969) ($58,806.17) 25-Apr-80 1.65933 ($97,578.87) ($156,385.04)
Apr-80 85,377.59 $26.17656 $25.14213 $1.03443 $88,317.29 25-May-80 1.64400 $145,193.86 $233,511.15
May-80 108,781.23 $24.55479 $24.88629 ($0.33150) ($36,061.01) 25-Jun-80 1.63193 ($58,849.16) ($94,910.17)
Jun-80 126,331.35 $24.75042 $24.67356 $0.07686 $9,709.22 28-Jul-80 1.62029 $15,731.72 $25,440.94
Jul-80 150,436.77 $22.73336 $22.88663 ($0.15327) ($23,057.77) 25-Aug-80 1.61087 ($37,143.17) ($60,200.94)
Aug-80 173,081.67 $22.87895 $21.63288 $1.24607 $215,671.80 25-Sep-80 1.59968 $345,005.61 $560,677.41
Sep-80 188,484.33 $22.71382 $22.09725 $0.61657 $116,213.85 25-Oct-80 1.58753 $184,493.44 $300,707.29
Oct-80 224,775.23 $24.23306 $21.64718 $2.58588 $581,241.74 25-Nov-80 1.57370 $914,701.34 $1,495,943.08
Nov-80 320,013.65 $26.00444 $22.92468 $3.07976 $985,565.22 26-Dec-80 1.55592 $1,533,462.64 $2,519,027.86
Dec-80 371,094.09 $26.30779 $24.55014 $1.75765 $652,253.58 26-Jan-81 1.53773 $1,002,991.01 $1,655,244.59
Jan-81 437,601.81 $26.35109 $25.20463 $1.14646 $501,692.92 25-Feb-81 1.52062 $762,885.35 $1,264,578.27
Feb-81 614,809.34 $26.91444 $26.35466 $0.55978 $344,159.07 25-Mar-81 1.50590 $518,267.79 $862,426.86
Mar-81 681,758.89 $25.89060 $26.18645 ($0.29585) ($201,701.55) 27-Apr-81 1.48929 ($300,391.39) ($502,092.94)
Apr-81 655,823.82 $24.66252 $25.15590 ($0.49338) ($323,570.36) 26-May-81 1.47299 ($476,616.54) ($800,186.90)
May-81 664,968.87 $24.34822 $24.31846 $0.02976 $19,789.47 25-Jun-81 1.45565 $28,806.53 $48,596.00
Jun-81 700,048.67 $23.68548 $23.93910 ($0.25362) ($177,546.35) 27-Jul-81 1.43675 ($255,088.90) ($432,635.25)
Jul-81 811,835.74 $23.47998 $23.40673 $0.07325 $59,466.98 25-Aug-81 1.41946 $84,411.28 $143,878.26
Aug-81 811,932.71 $23.12249 $23.07964 $0.04285 $34,791.32 25-Sep-81 1.40120 $48,749.51 $83,540.83
Sep-81 788,111.25 $22.75452 $22.33355 $0.42097 $331,771.20 26-Oct-81 1.38426 $459,257.30 $791,028.50
Oct-81 808,121.38 $23.54188 $22.22486 $1.31702 $1,064,312.01 25-Nov-81 1.36922 $1,457,275.16 $2,521,587.17
Nov-81 792,621.71 $23.91452 $22.24426 $1.67026 $1,323,884.34 28-Dec-81 1.35381 $1,792,293.01 $3,116,177.35
Dec-81 805,135.07 $23.56802 $21.86890 $1.69912 $1,368,017.21 25-Jan-82 1.34077 $1,834,200.25 $3,202,217.46
</TABLE>
Note1: Interest at the Chemical Bank Prime plus 1.25% through August 31, 1994.
Page 1 of 14
<PAGE> 29
State of Alaska
Department of Natural Resources
Division of Oil & Gas
Royalty Accounting
ANS Royalty Litigation
MAPCo
Exhibit C to the State MAPCo Settlement Agreement
1/80 - 12/91
<TABLE>
<CAPTION>
- - - ----------------------------------------------------------------------------------------------------------------------------------
Sales Volume Value ANS Previous Delta Additional Due Date Cumulative Additional Total Royalty
Month Rebilling Value Royalty Interest Interest & Interest
Rate
(a) (b) (c) (d) (e) = (c-d) (f) = (b*e) (g) (h) (i) = (f*h) (j) = (f+i)
==================================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Jan-82 826,088.59 $20.57009 $21.49473 ($0.92464) ($763,834.55) 25-Feb-82 1.32576 ($1,012,660.60) ($1,776,495.15)
Feb-82 748,321.72 $19.60423 $20.13272 ($0.52849) ($395,480.56) 25-Mar-82 1.31214 ($518,926.91) ($914,407.47)
Mar-82 816,633.34 $19.69044 $18.85241 $0.83803 $684,363.24 26-Apr-82 1.29658 $887,332.39 $1,571,695.63
Apr-82 788,880.00 $20.89669 $19.07018 $1.82651 $1,440,897.21 25-May-82 1.28248 $1,847,919.36 $3,288,816.57
May-82 822,463.78 $21.82470 $19.10760 $2.71710 $2,234,716.33 25-Jun-82 1.26740 $2,832,286.03 $5,067,002.36
Jun-82 774,390.68 $22.16149 $20.98639 $1.17510 $909,988.92 26-Jul-82 1.25244 $1,139,703.96 $2,049,692.88
Jul-82 827,251.91 $21.93174 $21.05053 $0.88121 $728,982.66 25-Aug-82 1.23929 $903,418.36 $1,632,401.02
Aug-82 818,064.99 $22.26266 $21.02402 $1.23864 $1,013,288.02 27-Sep-82 1.22595 $1,242,241.34 $2,255,529.36
Sep-82 796,300.89 $22.74774 $20.88840 $1.85934 $1,480,594.52 25-Oct-82 1.21533 $1,799,417.51 $3,280,012.03
Oct-82 823,659.92 $21.19976 $20.74507 $0.45469 $374,509.93 26-Nov-82 1.20407 $450,937.73 $825,447.66
Nov-82 779,057.67 $20.59459 $20.09680 $0.49779 $387,807.12 27-Dec-82 1.19325 $462,749.06 $850,556.18
Dec-82 810,985.10 $20.03476 $19.44637 $0.58839 $477,175.51 25-Jan-83 1.18332 $564,651.67 $1,041,827.18
Jan-83 830,374.07 $20.31249 $18.81195 $1.50054 $1,246,009.50 25-Feb-83 1.17293 $1,461,482.32 $2,707,491.82
Feb-83 742,880.40 $19.60251 $17.78697 $1.81554 $1,348,729.07 25-Mar-83 1.16392 $1,569,808.19 $2,918,537.26
Mar-83 834,739.78 $18.65719 $17.60427 $1.05292 $878,914.20 25-Apr-83 1.15394 $1,014,211.77 $1,893,125.97
Apr-83 801,121.71 $18.92481 $17.55022 $1.37459 $1,101,213.90 25-May-83 1.14428 $1,260,096.64 $2,361,310.54
May-83 864,490.28 $19.40777 $17.62209 $1.78568 $1,543,702.81 27-Jun-83 1.13366 $1,750,028.50 $3,293,731.31
Jun-83 1,056,084.97 $19.69008 $17.64867 $2.04141 $2,155,902.42 25-Jul-83 1.12464 $2,424,619.82 $4,580,522.24
Jul-83 1,106,518.20 $19.98298 $17.82889 $2.15409 $2,383,539.79 25-Aug-83 1.11442 $2,656,256.38 $5,039,796.17
Aug-83 1,101,997.59 $19.79360 $18.30553 $1.48807 $1,639,849.54 26-Sep-83 1.10368 $1,809,864.07 $3,449,713.61
Sep-83 1,088,267.88 $19.42785 $18.33000 $1.09785 $1,194,754.89 25-Oct-83 1.09394 $1,306,994.97 $2,501,749.86
Oct-83 1,126,998.51 $18.84870 $18.30792 $0.54078 $609,458.26 25-Nov-83 1.08354 $660,372.35 $1,269,830.61
Nov-83 1,070,175.93 $18.48090 $18.03620 $0.44470 $475,907.23 27-Dec-83 1.07280 $510,553.37 $986,460.60
Dec-83 1,100,106.00 $18.70924 $18.12454 $0.58470 $643,231.97 25-Jan-84 1.06309 $683,813.62 $1,327,045.59
</TABLE>
Note 1: Interest at the Chemical Bank Prime plus 1.25% through August 31, 1994
Page 2 of 14
<PAGE> 30
State of Alaska
Department of Natural Resources
Division of Oil & Gas
Royalty Accounting
ANS Royalty Litigation
MAPCo
Exhibit C to the State MAPCo Settlement Agreement
1/80 - 12/91
<TABLE>
<CAPTION>
- - - ----------------------------------------------------------------------------------------------------------------------------------
Sales Volume Value ANS Previous Delta Additional Due Date Cumulative Additional Total Royalty
Month Rebilling Value Royalty Interest Interest & Interest
Rate
(a) (b) (c) (d) (e) = (c-d) (f) = (b*e) (g) (h) (i) = (f*h) (j) = (f+i)
==================================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Jan-84 1,127,573.35 $19.01753 $18.08717 $0.93036 $1,049,049.14 27-Feb-84 1.05205 $1,103,647.06 $2,152,696.20
Feb-84 1,050,669.48 $19.64110 $18.21244 $1.42866 $1,501,049.45 26-Mar-84 1.04256 $1,564,940.54 $3,065,989.99
Mar-84 999,350.78 $19.74881 $18.23401 $1.51480 $1,513,816.56 25-Apr-84 1.03183 $1,561,996.16 $3,075,812.72
Apr-84 1,113,524.32 $19.58553 $18.31212 $1.27341 $1,417,973.00 25-May-84 1.02072 $1,447,353.43 $2,865,326.43
May-84 1,147,355.34 $19.78100 $18.38429 $1.39671 $1,602,522.68 25-Jun-84 1.00906 $1,617,041.83 $3,219,564.51
Jun-84 1,039,978.23 $18.99653 $18.35523 $0.64130 $666,938.04 25-Jul-84 0.99738 $665,190.57 $1,332,128.61
Jul-84 1,102,435.26 $19.20651 $18.46910 $0.73741 $812,946.79 27-Aug-84 0.98453 $800,371.72 $1,613,318.51
Aug-84 1,127,620.93 $19.29200 $18.40834 $0.88366 $996,433.52 25-Sep-84 0.97324 $969,769.47 $1,966,202.99
Sep-84 1,110,665.14 $19.25336 $18.60059 $0.65277 $725,008.88 25-Oct-84 0.96183 $697,332.80 $1,422,341.68
Oct-84 1,114,963.22 $18.98730 $18.44870 $0.53860 $600,519.21 26-Nov-84 0.95033 $570,691.82 $1,171,211.03
Nov-84 1,089,642.78 $18.19660 $18.45132 ($0.25472) ($277,553.82) 26-Dec-84 0.94017 ($260,946.87) ($538,500.69)
Dec-84 1,069,618.62 $17.36470 $17.99954 ($0.63484) ($679,036.69) 25-Jan-85 0.93038 ($631,764.57) ($1,310,801.26)
Jan-85 1,024,761.58 $18.23941 $17.80868 $0.43073 $441,395.57 25-Feb-85 0.92040 $406,262.30 $847,657.87
Feb-85 1,054,840.28 $18.86657 $17.55458 $1.31199 $1,383,939.90 25-Mar-85 0.91139 $1,261,309.55 $2,645,249.45
Mar-85 1,152,734.57 $18.86466 $17.62286 $1.24180 $1,431,465.78 25-Apr-85 0.90141 $1,290,338.94 $2,721,804.72
Apr-85 1,059,087.73 $18.08728 $17.77798 $0.30930 $327,575.84 28-May-85 0.89091 $291,840.91 $619,416.75
May-85 1,168,572.10 $17.55982 $17.76742 ($0.20760) ($242,595.57) 25-Jun-85 0.88239 ($214,064.00) ($456,659.57)
Jun-85 1,130,456.75 $17.45807 $17.83573 ($0.37766) ($426,928.30) 25-Jul-85 0.87355 ($372,945.26) ($799,873.56)
Jul-85 1,121,011.33 $17.65742 $17.90294 ($0.24552) ($275,230.71) 26-Aug-85 0.86413 ($237,835.15) ($513,065.86)
Aug-85 1,100,104.79 $18.00424 $17.84572 $0.15852 $174,388.62 25-Sep-85 0.85529 $149,153.63 $323,542.25
Sep-85 1,110,763.40 $18.33129 $17.88462 $0.44667 $496,144.70 25-Oct-85 0.84646 $419,966.10 $916,110.80
Oct-85 1,136,004.54 $19.14611 $17.73503 $1.41108 $1,602,993.28 18-Nov-85 0.83939 $1,345,537.19 $2,948,530.47
Nov-85 1,071,008.19 $18.31720 $17.72556 $0.59164 $633,651.28 16-Dec-85 0.83114 $526,655.35 $1,160,306.63
Dec-85 1,131,409.17 $15.41598 $17.75659 ($2.34061)($2,648,187.60) 27-Jan-86 0.81877 ($2,168,267.08) ($4,816,454.68)
</TABLE>
Note 1: Interest at the Chemical Bank Prime plus 1.25% through August 31, 1994.
Page 3 of 14
<PAGE> 31
State of Alaska
Department of Natural Resources
Division of Oil & Gas
Royalty Accounting
ANS Royalty Litigation
MAPCo
Exhibit C to the State MAPCo Settlement Agreement
1/80 - 12/91
<TABLE>
<CAPTION>
- - - ----------------------------------------------------------------------------------------------------------------------------------
Sales Volume Value ANS Previous Delta Additional Due Date Cumulative Additional Total Royalty
Month Rebilling Value Royalty Interest Interest & Interest
Rate
(a) (b) (c) (d) (e) = (c-d) (f) = (b*e) (g) (h) (i) = (f*h) (j) = (f+i)
==================================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Jan-86 1,136,809.77 $9.66918 $16.22174 ($6.55256) ($7,449,014.23) 27-Feb-86 0.80964 ($6,031,048.45) ($13,480,062.68)
Feb-86 1,037,966.36 $7.50356 $11.85742 ($4.35386) ($4,519,160.21) 25-Mar-86 0.80225 ($3,625,480.80) ($8,144,641.01)
Mar-86 1,105,986.30 $5.08926 $7.84524 ($2.75598) ($3,048,076.12) 25-Apr-86 0.79361 ($2,418,982.43) ($5,467,058.55)
Apr-86 1,041,965.37 $6.09401 $6.28421 ($0.19020) ($198,181.83 27-May-86 0.78506 ($155,584.95) ($353,766.78)
May-86 1,149,952.98 $5.49749 $4.92430 $0.57319 $659,141.54 25-Jun-86 0.77732 $512,360.65 $1,171,502.19
Jun-86 1,086,981.31 $3.36392 $4.63068 ($1.26676) ($1,376,944.44) 25-Jul-86 0.76951 ($1,059,568.18) ($2,436,512.62)
Jul-86 1,143,756.43 $5.04418 $3.43736 $1.60682 $1,837,810.71 25-Aug-86 0.76165 $1,399,769.78 $3,237,580.49
Aug-86 1,094,424.07 $6.91580 $4.17256 $2.74324 $3,002,267.89 25-Sep-86 0.75422 $2,264,368.02 $5,266,635.91
Sep-86 1,042,335.93 $6.74552 $5.72088 $1.02464 $1,068,019.67 27-Oct-86 0.74655 $797,327.90 $1,865,347.57
Oct-86 1,163,998.67 $6.88070 $5.82562 $1.05508 $1,228,111.72 25-Nov-86 0.73960 $908,306.38 $2,136,418.10
Nov-86 1,096,445.42 $7.67025 $5.90699 $1.76326 $1,933,318.35 26-Dec-86 0.73216 $1,415,506.83 $3,348,825.18
Dec-86 1,067,860.24 $9.82693 $7.32215 $2.50478 $2,674,754.97 26-Jan-87 0.72473 $1,938,482.86 $4,613,237.83
Jan-87 1,212,103.31 $11.01265 $8.98507 $2.02758 $2,457,636.44 25-Feb-87 0.71754 $1,763,455.14 $4,221,091.58
Feb-87 1,008,697.25 $10.77027 $10.10092 $0.66935 $675,170.98 25-Mar-87 0.71083 $479,930.95 $1,155,101.93
Mar-87 1,202,951.05 $11.24809 $10.08016 $1.16793 $1,404,962.63 27-Apr-87 0.70273 $987,313.44 $2,392,276.07
Apr-87 1,171,472.00 $11.47211 $11.04305 $0.42906 $502,631.78 26-May-87 0.69532 $349,490.89 $852,122.67
May-87 1,219,833.64 $12.03693 $11.15490 $0.88203 $1,075,929.87 25-Jun-87 0.68751 $739,716.53 $1,815,646.40
Jun-87 1,150,672.49 $12.69424 $11.64577 $1.04847 $1,206,445.59 27-Jul-87 0.67918 $819,399.66 $2,025,845.25
Jul-87 1,210,819.00 $13.35275 $12.30311 $1.04964 $1,270,919.44 25-Aug-87 0.67164 $853,596.51 $2,124,515.95
Aug-87 1,207,243.65 $12.49424 $12.84399 ($0.34975) ($422,231.37) 25-Sep-87 0.66327 ($280,052.19) ($702,283.56)
Sep-87 1,158,840.65 $11.99413 $12.15288 ($0.15875) ($183,961.11) 26-Oct-87 0.65447 ($120,396.25) ($304,357.36)
Oct-87 1,200,828.42 $11.69543 $11.75365 ($0.05822) ($69,912.23) 25-Nov-87 0.64618 ($45,176.23) ($115,088.46)
Nov-87 1,150,501.47 $10.38870 $11.27475 ($0.88605) ($1,019,399.59) 28-Dec-87 0.63714 ($649,504.16) ($1,668,903.75)
Dec-87 1,200,573.78 $9.10156 $9.67780 ($0.57624) ($691,817.36) 25-Jan-88 0.62949 ($435,493.02) ($1,127,310.38)
</TABLE>
Note 1: Interest at the Chemical Bank Prime plus 1.25% through August 31, 1994.
Page 4 of 14
<PAGE> 32
State of Alaska
Department of Natural Resources
Division of Oil & Gas
Royalty Accounting
ANS Royalty Litigation
MAPCo
Exhibit C to the State MAPCo Settlement Agreement
1/80 - 12/91
<TABLE>
<CAPTION>
- - - ----------------------------------------------------------------------------------------------------------------------------------
Sales Volume Value ANS Previous Delta Additional Due Date Cumulative Additional Total Royalty
Month Rebilling Value Royalty Interest Interest & Interest
Rate
(a) (b) (c) (d) (e) = (c-d) (f) = (b*e) (g) (h) (i) = (f*h) (j) = (f+i)
==================================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Jan-88 1,017,317.24 $9.49842 $9.63438 ($0.13596) ($138,314.54) 25-Feb-88 0.62119 ($85,918.96) ($224,233.50)
Feb-88 1,125,660.89 $9.32518 $9.37767 ($0.05249) ($59,085.94) 25-Mar-88 0.61346 ($36,246.85) ($95,332.79)
Mar-88 1,375,359.89 $9.59859 $9.22333 $0.37526 $516,117.56 25-Apr-88 0.60520 $312,355.23 $828,472.79
Apr-88 1,380,720.06 $10.49011 $10.12911 $0.36100 $498,439.95 25-May-88 0.59700 $297,571.13 $796,011.08
May-88 1,180,749.85 $9.97349 $10.06282 ($0.08933) ($105,476.38) 27-Jun-88 0.58776 ($61,995.13) ($167,471.51)
Jun-88 1,131,266.82 $9.44929 $9.66818 ($0.21889) ($247,623.00) 25-Jul-88 0.57976 ($143,561.34) ($391,184.34)
Jul-88 1,225,198.32 $9.21659 $8.90806 $0.30853 $378,005.41 25-Aug-88 0.57045 $215,632.28 $593,637.69
Aug-88 1,165,393.83 $8.82662 $8.58058 $0.24604 $286,733.49 26-Sep-88 0.56061 $160,746.10 $447,479.59
Sep-88 1,072,634.19 $7.63169 $8.02053 ($0.38884) ($417,083.08) 25-Oct-88 0.55170 ($230,103.73) ($647,186.81)
Oct-88 887,428.90 $6.70581 $7.13516 ($0.42935) ($381,017.60) 25-Nov-88 0.54217 ($206,575.90) ($587,593.50)
Nov-88 1,094,096.91 $7.34072 $7.20432 $0.13640 $149,240.18 27-Dec-88 0.53224 $79,432.20 $228,672.38
Dec-88 1,158,695.25 $9.45150 $8.34081 $1.11069 $1,286,951.24 25-Jan-89 0.52291 $672,962.18 $1,959,913.42
Jan-89 1,149,634.66 $11.11803 $10.00922 $1.10881 $1,274,726.41 27-Feb-89 0.51199 $652,643.72 $1,927,370.13
Feb-89 1,026,512.69 $11.79557 $11.16563 $0.62994 $646,646.16 25-Mar-89 0.50291 $325,201.65 $971,847.81
Mar-89 959,981.06 $13.73869 $12.73287 $1.00582 $965,567.73 25-Apr-89 0.49208 $475,133.03 $1,440,700.76
Apr-89 1,066,244.00 $14.32621 $13.49175 $0.83446 $889,738.00 25-May-89 0.48160 $428,495.05 $1,318,233.05
May-89 1,132,633.77 $12.94482 $13.37374 ($0.42892) ($485,809.26) 25-Jun-89 0.47106 ($228,843.26) ($714,652.52)
Jun-89 1,028,972.48 $12.58672 $12.62928 ($0.04256) ($43,793.08) 25-Jul-89 0.46099 ($20,188.05) ($63,981.13)
Jul-89 933,610.57 $12.32844 $12.03978 $0.28866 $269,496.02 25-Aug-89 0.45094 $121,526.36 $391,022.38
Aug-89 1,060,031.19 $11.97993 $11.89061 $0.08932 $94,681.97 25-Sep-89 0.44096 $41,750.95 $136,432.92
Sep-89 1,017,596.22 $12.56219 $12.26857 $0.29362 $298,786.62 25-Oct-89 0.43130 $128,867.37 $427,653.99
Oct-89 1,055,939.66 $13.11179 $12.65155 $0.46024 $485,985.67 25-Nov-89 0.42132 $204,756.90 $690,742.57
Nov-89 1,036,710.64 $13.84872 $13.26896 $0.57976 $601,043.38 26-Dec-89 0.41134 $247,235.26 $848,278.64
Dec-89 1,061,307.76 $15.23581 $14.30675 $0.92906 $986,018.60 25-Jan-90 0.40193 $396,312.92 $1,382,331.52
</TABLE>
Note 1: Interest at the Chemical Bank Prime plus 1.25% through August 31, 1994.
Page 5 of 14
<PAGE> 33
State of Alaska
Department of Natural Resources
Division of Oil & Gas
Royalty Accounting
ANS Royalty Litigation
MAPCo
Exhibit C to the State MAPCo Settlement Agreement
1/80 - 12/91
<TABLE>
<CAPTION>
- - - ----------------------------------------------------------------------------------------------------------------------------------
Sales Volume Value ANS Previous Delta Additional Due Date Cumulative Additional Total Royalty
Month Rebilling Value Royalty Interest Interest & Interest
Rate
(a) (b) (c) (d) (e) = (c-d) (f) = (b*e) (g) (h) (i) = (f*h) (j) = (f+i)
==================================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Jan-90 1,044,946.03 $14.66853 $14.35400 $0.31453 $328,666.89 25-Feb-90 0.39238 $128,961.56 $457,628.45
Feb-90 927,421.35 $13.68721 $13.72526 ($0.03805) ($35,288.38) 25-Mar-90 0.38375 ($13,541.83) ($48,830.21)
Mar-90 1,024,269.08 $12.71990 $12.23430 $0.48560 $497,385.05 25-Apr-90 0.37419 $186,117.89 $683,502.94
Apr-90 984,891.70 $9.89228 $10.56147 ($0.66919) ($659,079.71) 25-May-90 0.36495 ($240,528.64) ($899,608.35)
May-90 1,007,210.63 $9.41480 $8.99481 $0.41999 $423,018.37 25-Jun-90 0.35539 $150,337.09 $573,355.46
Jun-90 858,785.15 $8.23085 $8.93123 ($0.70038) ($601,475.95) 25-Jul-90 0.34614 ($208,197.78) ($809,673.73)
Jul-90 982,778.97 $10.38911 $12.13825 ($1.74914)($1,719,018.00) 25-Aug-90 0.33659 ($578,604.32) ($2,297,622.32)
Aug-90 1,274,435.45 $19.65426 $19.49002 $0.16424 $209,313.28 25-Sep-90 0.32704 $68,452.82 $277,766.10
Sep-90 1,153,606.56 $25.81297 $26.18902 ($0.37605) ($433,813.88) 25-Oct-90 0.31779 ($137,861.13) ($571,675.01)
Oct-90 1,377,964.08 $26.03821 $25.88071 $0.15750 $217,029.33 25-Nov-90 0.30823 $66,895.78 $283,925.11
Nov-90 1,065,498.11 $23.58203 $22.91765 $0.66438 $707,895.63 25-Dec-90 0.29899 $211,651.80 $919,547.43
Dec-90 1,033,604.93 $18.92872 $18.64391 $0.28481 $294,380.98 25-Jan-91 0.28976 $85,300.21 $379,681.19
Jan-91 1,106,676.09 $16.12616 $15.70643 $0.41973 $464,505.16 25-Feb-91 0.28093 $130,494.60 $594,999.76
Feb-91 1,049,587.09 $11.23145 $11.87646 ($0.64501) ($676,994.08) 25-Mar-91 0.27307 ($184,866.43) ($861,860.51)
Mar-91 1,116,443.92 $11.74171 $11.85362 ($0.11191) ($124,941.26) 25-Apr-91 0.26436 ($33,029.97) ($157,971.23)
Apr-91 969,057.23 $12.79680 $12.93212 ($0.13532) ($131,132.79) 25-May-91 0.25628 ($33,606.95) ($164,739.74)
May-91 1,023,155.30 $12.19831 $12.45158 ($0.25327) ($259,134.57) 25-Jun-91 0.24800 ($64,265.63) ($323,400.20)
Jun-91 940,294.01 $11.89457 $12.15454 ($0.25997) ($244,448.24) 25-Jul-91 0.23999 ($58,664.47) ($303,112.71)
Jul-91 886,993.54 $12.47906 $12.67938 ($0.20032) ($177,682.53) 25-Aug-91 0.23171 ($41,170.19) ($218,852.72)
Aug-91 965,578.62 $12.55227 $12.70573 ($0.15346) ($148,177.70) 25-Sep-91 0.22360 ($33,133.09) ($181,310.79)
Sep-91 716,326.14 $12.90734 $13.03887 ($0.13153) ($94,218.38) 25-Oct-91 0.21600 ($20,351.26) ($114,569.64)
Oct-91 1,001,310.46 $13.60173 $13.63693 ($0.03520) ($35,246.12) 25-Nov-91 0.20842 ($7,345.95) ($42,592.07)
Nov-91 751,238.90 $12.70193 $12.58124 $0.12069 $90,667.02 25-Dec-91 0.20131 $18,252.11 $108,919.13
Dec-91 656,798.01 $10.86345 $10.69994 $0.16351 $107,393.05 27-Jan-92 0.19474 $20,913.89 $128,306.94
</TABLE>
Note 1: Interest at the Chemical Bank Prime plus 1.25% through August 31, 1994.
Page 6 of 14
<PAGE> 34
State of Alaska
Department of Natural Resources
Division of Oil & Gas
Royalty Accounting
ANS Royalty Litigation
MAPCo
Exhibit C to the State MAPCo Settlement Agreement
1/80 - 12/91
<TABLE>
<CAPTION>
- - - ----------------------------------------------------------------------------------------------------------------------------------
Sales Volume Value ANS Previous Delta Additional Due Date Cumulative Additional Total Royalty
Month Rebilling Value Royalty Interest Interest & Interest
Rate
(a) (b) (c) (d) (e) = (c-d) (f) = (b*e) (g) (h) (i) = (f*h) (j) = (f+i)
==================================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Jan-92 652,400.90 $10.15669 $10.66959 ($0.51290) ($334,616.42) 25-Feb-92 0.18839 ($63,038.07) ($397,654.49)
Feb-92 580,804.85 $10.23391 $10.72691 ($0.49300) ($286,336.79) 25-Mar-92 0.18225 ($52,184.41) ($338,521.20)
Mar-92 420,370.46 $10.34449 $10.81933 ($0.47484) ($199,608.71) 27-Apr-92 0.17536 ($35,002.64) ($234,611.35)
Apr-92 554,982.43 $11.87018 $12.22131 ($0.35113) ($194,870.98) 25-May-92 0.16962 ($33,053.74) ($227,924.72)
May-92 618,314.76 $13.31881 $13.74374 ($0.42493) ($262,740.49) 25-Jun-92 0.16313 ($42,860.72) ($305,601.21)
Jun-92 574,778.90 $15.46252 $15.93357 ($0.47105) ($270,749.60) 27-Jul-92 0.15670 ($42,425.13) ($313,174.73)
Jul-92 546,684.11 $14.70404 $15.09595 ($0.39191) ($214,250.97) 25-Aug-92 0.15095 ($32,341.30) ($246,592.27)
Aug-92 519,070.97 $13.37151 $13.92560 ($0.55409) ($287,612.03) 25-Sep-92 0.14481 ($41,649.05) ($329,261.08)
Sep-92 549,240.25 $13.71791 $14.12597 ($0.40806) ($224,122.98) 26-Oct-92 0.13867 ($31,078.94) ($255,201.92)
Oct-92 385,623.68 $13.78069 $14.09238 ($0.31169) ($120,195.04) 25-Nov-92 0.13273 ($15,953.07) ($136,148.11)
Nov-92 513,954.65 $12.64459 $13.12579 ($0.48120) ($247,314.98) 28-Dec-92 0.12619 ($31,208.58) ($278,523.56)
Dec-92 368,779.25 $11.35770 $11.85582 ($0.49812) ($183,696.32) 25-Jan-93 0.12063 ($22,159.31) ($205,855.63)
Jan-93 615,021.88 $11.20193 $11.82324 ($0.62131) ($382,119.24) 25-Feb-93 0.11447 ($43,742.18) ($425,861.42)
Feb-93 648,237.51 $12.53089 $13.00282 ($0.47193) ($305,922.73) 25-Mar-93 0.10891 ($33,318.34) ($339,241.07)
Mar-93 868,106.47 $13.01733 $13.34499 ($0.32766) ($284,443.77) 26-Apr-93 0.10255 ($29,171.07) ($313,614.84)
Apr-93 704,035.03 $13.72726 $14.11084 ($0.38358) ($270,053.76) 25-May-93 0.09679 ($26,139.72) ($296,193.48)
May-93 862,411.87 $13.38032 $13.79467 ($0.41435) ($357,340.36) 25-Jun-93 0.09064 ($32,388.25) ($389,728.61)
Jun-93 753,907.30 $12.21665 $12.58971 ($0.37306) ($281,252.66) 26-Jul-93 0.08448 ($23,760.07) ($305,012.73)
Jul-93 626,284.40 $10.92899 $11.24129 ($0.31230) ($195,588.62) 25-Aug-93 0.07852 ($15,357.73) ($210,946.35)
Aug-93 744,717.78 $11.39965 $11.87282 ($0.47317) ($352,378.11) 27-Sep-93 0.07197 ($25,359.16) ($377,737.27)
Sep-93 735,288.93 $10.94670 $11.30277 ($0.35607) ($261,814.33) 25-Oct-93 0.06640 ($17,385.55) ($279,199.88)
Oct-93 941,058.20 $11.34170 $11.71419 ($0.37249) ($350,534.77) 25-Nov-93 0.06025 ($21,118.52) ($371,653.29)
Nov-93 762,443.65 $9.25414 $9.56783 ($0.31369) ($239,170.95) 27-Dec-93 0.05389 ($12,889.02) ($252,059.97)
Dec-93 824,766.75 $7.09563 $7.29313 ($0.19750) ($162,891.43) 25-Jan-94 0.04813 ($7,839.99) ($170,731.42)
</TABLE>
Note 1: Interest at the Chemical Bank Prime plus 1.25% through August 31, 1994.
Page 7 of 14
<PAGE> 35
State of Alaska
Department of Natural Resources
Division of Oil & Gas
Royalty Accounting
ANS Royalty Litigation
MAPCo
Exhibit C to the State MAPCo Settlement Agreement
1/80 - 12/91
<TABLE>
<CAPTION>
- - - ----------------------------------------------------------------------------------------------------------------------------------
Sales Volume Value ANS Previous Delta Additional Due Date Cumulative Additional Total Royalty
Month Rebilling Value Royalty Interest Interest & Interest
Rate
(a) (b) (c) (d) (e) = (c-d) (f) = (b*e) (g) (h) (i) = (f*h) (j) = (f+i)
==================================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Jan-94 727,101.26 $7.86785 $8.16781 ($0.29996) ($218,101.29) 25-Feb-94 0.04197 ($9,154.28) ($227,255.57)
Feb-94 713,296.52 $8.38097 $8.70059 ($0.31962) ($227,983.83) 25-Mar-94 0.03640 ($8,297.99) ($236,281.82)
Mar-94 822,285.35 $8.10192 $8.83336 ($0.73144) ($601,452.40) 25-Apr-94 0.02995 ($18,010.62) ($619,463.02)
Apr-94 896,631.81 $10.45208 $10.72974 ($0.27766) ($248,958.79) 25-May-94 0.02327 ($5,794.26) ($254,753.05)
May-94 1,150,121.29 $12.06675 $12.32461 ($0.25786) ($296,570.28) 27-Jun-94 0.01559 ($4,623.25) ($301,193.53)
Jun-94 1,159,001.04 $11.45596 $12.11988 ($0.66392) ($769,483.97) 25-Jul-94 0.00907 ($6,978.06) ($776,462.03)
Jul-94 1,147,379.63 $12.19620 $12.11988 $0.07632 $87,568.01 25-Aug-94 0.00173 $151.14 $87,719.15
-------------- -------------- -------------------------------
157,672,456.10 $42,680,234.19 $53,125,556.10 $95,805,790.29
============== ============== =============== ==============
</TABLE>
Note 1: Interest at the Chemical Bank Prime plus 1.25% through August 31, 1994.
Page 8 of 14
<PAGE> 36
State of Alaska
Department of Natural Resources
Division of Oil & Gas
Royalty Accounting
ANS Royalty Litigation
GVEA 1
Exhibit C to the State MAPCo Settlement Agreement
6/81 - 5/84
<TABLE>
<CAPTION>
==================================================================================================================================
Sales Volume GVEA's GVEA's Delta Additional Due Date Cumulative Additional Total Royalty
Month ANS Rebilling Previous Royalty Interest Interest & Interest
Value Value Rate
(a) (b) (c) (d) (e) = (c-d) (f) = (b*e) (g) (h) (i) = (f*h) (j) = (f+i)
- - - ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Jun-81 15,534.15 $23.68548 $23.9390982 ($0.25362) ($3,939.77) 25-Jul-81 1.8274693 ($7,199.81) ($11,139.58)
Jul-81 64,457.54 $23.47998 $23.3999400 $0.08004 $5,159.17 25-Aug-81 1.8153345 $9,365.62 $14,524.79
Aug-81 64,465.24 $23.12249 $23.0723100 $0.05018 $3,234.86 25-Sep-81 1.8031999 $5,833.10 $9,067.96
Sep-81 62,573.89 $22.75452 $22.2799900 $0.47453 $29,693.18 26-Oct-81 1.7910651 $53,182.42 $82,875.60
Oct-81 64,162.63 $23.54188 $22.1809400 $1.36094 $87,321.50 25-Nov-81 1.7793218 $155,373.05 $242,694.55
Nov-81 62,932.00 $23.91452 $22.1787300 $1.73579 $109,236.73 28-Dec-81 1.7664041 $192,956.21 $302,192.94
Dec-81 63,925.53 $23.56802 $21.9335500 $1.63447 $104,484.37 25-Jan-82 1.7554437 $183,416.43 $287,900.80
Jan-82 65,589.19 $20.57009 $21.4652500 ($0.89516) ($58,712.82) 25-Feb-82 1.7433090 ($102,354.58) ($161,067.40)
Feb-82 59,414.71 $19.60423 $20.1119200 ($0.50769) ($30,164.26) 25-Mar-82 1.7323486 ($52,255.01) ($82,419.27)
Mar-82 64,838.46 $19.69044 $18.8469600 $0.84348 $54,689.95 26-Apr-82 1.7198224 $94,057.00 $148,746.95
Apr-82 62,634.92 $20.89669 $19.0166900 $1.88000 $117,753.65 25-May-82 1.7084707 $201,178.66 $318,932.31
May-82 65,301.38 $21.82470 $19.0429500 $2.78175 $181,652.12 25-Jun-82 1.6963359 $308,143.01 $489,795.13
Jun-82 61,484.51 $22.16149 $20.9472200 $1.21427 $74,658.79 26-Jul-82 1.6842011 $125,740.42 $200,399.21
Jul-82 65,681.55 $21.93174 $20.9826288 $0.94911 $62,339.10 25-Aug-82 1.6724578 $104,259.52 $166,598.62
Aug-82 64,952.13 $22.26266 $21.0129715 $1.24969 $81,169.93 27-Sep-82 1.6595402 $134,704.76 $215,874.69
Sep-82 63,224.12 $22.74774 $20.8925672 $1.85517 $117,291.66 25-Oct-82 1.6485796 $193,364.64 $310,656.30
Oct-82 65,396.35 $21.19976 $20.7287762 $0.47098 $30,800.62 26-Nov-82 1.6360536 $50,391.46 $81,192.08
Nov-82 61,855.05 $20.59459 $20.0881669 $0.50642 $31,324.83 27-Dec-82 1.6239189 $50,868.98 $82,193.81
Dec-82 64,390.00 $20.03476 $19.4380216 $0.59674 $38,423.99 25-Jan-83 1.6125669 $61,961.25 $100,385.24
</TABLE>
Note 1: Interest calculated through August 31, 1994.
Page 9 of 14
<PAGE> 37
State of Alaska
Department of Natural Resources
Division of Oil & Gas
Royalty Accounting
ANS Royalty Litigation
GVEA 1
Exhibit C to the State MAPCo Settlement Agreement
6/81 - 5/84
<TABLE>
<CAPTION>
==================================================================================================================================
Sales Volume GVEA's GVEA's Delta Additional Due Date Cumulative Additional Total Royalty
Month ANS Rebilling Previous Royalty Interest Interest & Interest
Value Value Rate
(a) (b) (c) (d) (e) = (c-d) (f) = (b*e) (g) (h) (i) = (f*h) (j) = (f+i)
- - - ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Jan-83 65,929.43 $20.31249 $18.3217000 $1.99079 $131,251.65 25-Feb-83 1.6004321 $210,059.35 $341,311.00
Feb-83 58,982.68 $19.60251 $17.4430200 $2.15949 $127,372.51 25-Mar-83 1.5894718 $202,455.01 $329,827.52
Mar-83 66,276.06 $18.65719 $17.3384000 $1.31879 $87,404.20 25-Apr-83 1.5773371 $137,865.89 $225,270.09
Apr-83 63,606.88 $18.92481 $17.2705300 $1.65428 $105,223.59 25-May-83 1.5655938 $164,737.40 $269,960.99
May-83 62,794.21 $19.40777 $17.3361900 $2.07158 $130,083.25 27-Jun-83 1.5526761 $201,977.15 $332,060.40
Jun-83 62,007.16 $19.69008 $17.3538200 $2.33626 $144,864.85 25-Jul-83 1.5417158 $223,340.42 $368,205.27
Jul-83 64,968.30 $19.98298 $17.5094400 $2.47354 $160,701.67 25-Aug-83 1.5295810 $245,806.22 $406,507.89
Aug-83 137,327.38 $19.79360 $17.7493044 $2.04430 $280,737.77 26-Sep-83 1.5170548 $425,894.57 $706,632.34
Sep-83 155,468.50 $19.42785 $17.7871600 $1.64069 $255,075.62 25-Oct-83 1.5057029 $384,068.10 $639,143.72
Oct-83 161,001.51 $18.84870 $17.7409400 $1.10776 $178,351.04 25-Nov-83 1.4935682 $266,379.45 $444,730.49
Nov-83 152,883.91 $18.48090 $17.5910500 $0.88985 $136,043.76 27-Dec-83 1.4810420 $201,486.53 $337,530.29
Dec-83 157,159.68 $18.70924 $17.6709500 $1.03829 $163,177.33 25-Jan-84 1.4697169 $239,824.49 $403,001.82
Jan-84 161,083.63 $19.01753 $17.5362000 $1.48133 $238,618.02 25-Feb-84 1.4576154 $347,813.30 $586,431.32
Feb-84 150,097.24 $19.64110 $17.5789000 $2.06220 $309,530.52 26-Mar-84 1.4459041 $447,551.46 $757,081.98
Mar-84 142,765.92 $19.74881 $17.6145700 $2.13424 $304,696.74 25-Apr-84 1.4341930 $436,993.93 $741,690.67
Apr-84 159,076.60 $19.58553 $17.6976600 $1.88787 $300,315.95 25-May-84 1.4224816 $427,193.92 $727,509.87
May-84 163,909.65 $19.78100 $17.6878500 $2.09315 $343,087.48 25-Jun-84 1.4103802 $483,883.79 $826,971.27
------------ ------------- -----------------------------
3,148,152.09 $4,432,953.55 $6,810,318.11 $11,243,271.66
============ ============= =============================
</TABLE>
Note 1: Interest calculated through August 31, 1994.
Page 10 of 14
<PAGE> 38
State of Alaska
Department of Natural Resources
Division of Oil & Gas
Royalty Accounting
ANS Litigation Billing
GVEA 2
Exhibit C to the State MAPCo Settlement Agreement
6/84 - 9/85
<TABLE>
<CAPTION>
==================================================================================================================================
Sales Volume Value ANS Previous Price Additional Due Date Cumulative Additional Total Royalty
Month Rebilling Value Delta Royalty Interest Interest & Interest
Rate
(a) (b) (c) (d) (e) (f) = (b*e) (g) (h) (i) = (f*h) (j) = (f+i)
- - - ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Jun-84 148,569.91 $19.29653 $18.0169200 $1.2796100 $190,111.56 25-Jul-84 1.168317931 $222,110.74 $412,222.30
Jul-84 157,492.43 $19.50651 $18.4748500 $1.0316600 $162,478.62 17-Aug-84 1.159363011 $188,371.70 $350,850.32
Aug-84 161,090.43 $19.59200 $18.3154800 $1.2765200 $205,635.15 17-Sep-84 1.147293341 $235,923.84 $441,558.99
Sep-84 158,668.14 $19.55336 $18.5789400 $0.9744200 $154,609.40 15-Oct-84 1.136494161 $175,712.68 $330,322.08
Oct-84 159,282.16 $19.28730 $18.4755503 $0.8117497 $129,297.26 16-Nov-84 1.124602081 $145,407.97 $274,705.23
Nov-84 155,664.92 $18.49660 $18.5048800 ($0.0082800) ($1,288.91) 13-Dec-84 1.114390331 ($1,436.35) ($2,725.26)
Dec-84 152,804.30 $17.66470 $18.0764500 ($0.4117500) ($62,917.18) 14-Jan-85 1.102272101 ($69,351.85) ($132,269.03)
Jan-85 146,396.08 $18.53941 $17.9262900 $0.6131200 $89,758.37 15-Feb-85 1.090436481 $97,875.80 $187,634.17
Feb-85 150,693.08 $19.16657 $17.6808200 $1.4857500 $223,892.25 15-Mar-85 1.080080321 $241,821.61 $465,713.86
Mar-85 164,678.13 $19.16466 $17.8119800 $1.3526800 $222,756.81 15-Apr-85 1.068614571 $238,041.17 $460,797.98
Apr-85 151,299.87 $18.38728 $17.8888200 $0.4984600 $75,416.94 13-May-85 1.058258401 $79,810.61 $155,227.55
May-85 166,940.66 $17.85982 $17.8583200 $0.0015000 $250.42 17-Jun-08 1.045710461 $261.87 $512.29
Jun-85 161,495.55 $17.75807 $17.9734400 ($0.2153700) ($34,781.29) 15-Jul-85 1.036121411 ($36,037.64) ($70,818.93)
Jul-85 160,146.19 $17.95742 $17.9221300 $0.0352900 $5,651.56 16-Aug-85 1.025162511 $5,793.77 $11,445.33
Aug-85 157,159.51 $18.30424 $17.9080500 $0.3961900 $62,265.04 16-Sep-85 1.014546071 $63,170.76 $125,435.80
Sep-85 158,682.18 $18.63129 $18.0064500 $0.6248400 $99,150.95 14-Oct-85 1.004957031 $99,642.44 $198,793.39
------------ ------------- -----------------------------
2,511,063.54 $1,522,286.95 $1,687,119.12 $3,209,406.07
============ ============= =============================
</TABLE>
Note1: Interest at the Bank of America Prime Rate plus 3% through August 31,
1994.
Page 11 of 14
<PAGE> 39
State of Alaska
Department of Natural Resources
Division of Oil & Gas
Royalty Accounting
ANS Royalty Litigation Billing
GVEA 3
Exhibit C to the State MAPCo Settlement Agreement
10/85 - 12/91
<TABLE>
<CAPTION>
==================================================================================================================================
Sales Volume Value ANS Previous Price Additional Due Date Cumulative Additional Total Royalty
Month Rebilling Value Delta Royalty Interest Interest & Interest
Rate
(a) (b) (c) (d) (e) (f) = (b*e) (g) (h) (i) = (f*h) (j) = (f+i)
- - - ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Oct-85 162,288 $19.44611 $17.9229200 $1.5231900 $247,195.60 18-Nov-85 0.992970731 $245,458.00 $492,653.60
Nov-85 153,003 $18.61720 $17.9340600 $0.6831400 $104,522.33 16-Dec-85 0.983381691 $102,785.35 $207,307.68
Dec-85 161,632 $15.71598 $17.7806400 ($2.0646600) ($333,714.32) 17-Jan-86 0.972422781 ($324,511.41) ($658,225.73)
Jan-86 162,403 $9.96918 $15.6844000 ($5.7152200) ($928,169.66) 18-Feb-86 0.961463881 ($892,401.60) ($1,820,571.26)
Feb-86 148,283 $7.80356 $11.3403200 ($3.5367600) ($524,439.62) 17-Mar-86 0.952367991 ($499,459.51) ($1,023,899.13)
Mar-86 158,000 $5.38926 $7.5854510 ($2.1961910) ($346,997.59) 14-Apr-86 0.943162511 ($327,275.12) ($674,272.71)
Apr-86 148,854 $6.39401 $6.3935200 $0.0004900 $72.94 16-May-86 0.932998131 $68.05 $140.99
May-86 164,281 $5.79749 $5.1972669 $0.6002231 $98,605.06 16-Jun-86 0.923231001 $91,035.25 $189,640.31
Jun-86 155,285 $3.66392 $4.7630600 ($1.0991400) ($170,679.64) 17-Jul-86 0.913559771 ($155,926.05) ($326,605.69)
Jul-86 163,396 $5.34418 $3.3720600 $1.9721200 $322,235.59 18-Aug-86 0.904820041 $291,565.22 $613,800.81
Aug-86 156,348 $7.21580 $4.0050000 $3.2108000 $502,002.07 18-Sep-86 0.894902241 $449,242.78 $951,244.85
Sep-86 148,907 $7.04552 $5.8502400 $1.1952800 $177,985.21 16-Oct-86 0.886847441 $157,845.73 $335,830.94
Oct-86 166,287 $7.18070 $6.0228400 $1.1578600 $192,537.43 17-Nov-86 0.877641961 $168,978.93 $361,516.36
Nov-86 156,637 $7.97025 $6.0812900 $1.8889600 $295,880.54 14-Dec-86 0.869874841 $257,379.04 $553,259.58
Dec-86 152,553 $10.12693 $7.1766100 $2.9503200 $450,080.44 16-Jan-87 0.860381691 $387,240.97 $837,321.41
Jan-87 173,159 $11.31265 $9.1175600 $2.1950900 $380,100.62 15-Feb-87 0.851751551 $323,751.29 $703,851.91
Feb-87 144,101 $11.07027 $10.1223603 $0.9479097 $136,594.88 16-Mar-87 0.843409091 $115,205.36 $251,800.24
Mar-87 171,852 $11.54809 $10.2618200 $1.2862700 $221,048.05 16-Apr-87 0.834388541 $184,439.96 $405,488.01
Apr-87 167,355 $11.77211 $11.1223900 $0.6497200 $108,733.85 15-May-87 0.825737851 $89,785.66 $198,519.51
May-87 174,264 $12.33693 $11.3154500 $1.0214800 $178,007.01 14-Jun-87 0.816491281 $145,341.17 $323,348.18
Jun-87 164,384 $12.99424 $11.9075500 $1.0866900 $178,633.95 17-Jul-87 0.806320041 $144,036.13 $322,670.08
Jul-87 172,970 $13.65275 $12.4479840 $1.2047660 $208,388.23 17-Aug-87 0.796765251 $166,036.50 $374,424.73
Aug-87 172,463 $12.79424 $12.7563564 $0.0378836 $6,533.51 14-Sep-87 0.787984431 $5,148.30 $11,681.81
Sep-87 165,541 $12.29413 $12.1437311 $0.1503989 $24,897.15 16-Oct-87 0.777546071 $19,358.68 $44,255.83
Oct-87 171,549 $11.99543 $11.8183900 $0.1770400 $30,370.98 16-Nov-87 0.767402241 $23,306.76 $53,677.74
Nov-87 164,382 $10.68870 $11.2197715 ($0.5310715) ($87,298.84) 14-Dec-87 0.758388541 ($66,206.44) ($153,505.28)
Dec-87 171,519 $9.40156 $9.8365206 ($0.4349606) ($74,604.18) 17-Jan-88 0.747458291 ($55,763.51) ($130,367.69)
</TABLE>
Page 12 of 14
<PAGE> 40
State of Alaska
Department of Natural Resources
Division of Oil & Gas
Royalty Accounting
ANS Royalty Litigation Billing
GVEA 3
Exhibit C to the State MAPCo Settlement Agreement
10/85 - 12/91
<TABLE>
<CAPTION>
==================================================================================================================================
Sales Volume Value ANS Previous Price Additional Due Date Cumulative Additional Total Royalty
Month Rebilling Value Delta Royalty Interest Interest & Interest
Rate
(a) (b) (c) (d) (e) (f) = (b*e) (g) (h) (i) = (f*h) (j) = (f+i)
- - - ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Jan-88 145,331 $9.79842 $9.7945100 $0.0039100 $568.23 18-Feb-88 0.737301181 $418.96 $987.19
Feb-88 160,801 $9.62518 $9.5364100 $0.0887700 $14,274.25 14-Mar-88 0.729445991 $10,412.29 $24,686.54
Mar-88 196,473 $9.89859 $9.1793236 $0.7192664 $141,316.13 18-Apr-88 0.718448721 $101,528.39 $242,844.52
Apr-88 197,234 $10.79011 $10.1973900 $0.5927200 $116,904.57 16-May-88 0.709568941 $82,951.85 $199,856.42
May-88 168,691 $10.27349 $10.2300000 $0.0434900 $7,336.39 18-Jun-88 0.698749271 $5,126.30 $12,462.69
Jun-88 161,622 $9.74929 $9.8438405 ($0.0945505) ($15,281.43) 18-Jul-88 0.688844901 ($10,526.54) ($25,807.97)
Jul-88 175,037 $9.51659 $9.1061618 $0.4104282 $71,840.03 15-Aug-88 0.679213751 $48,794.74 $120,634.77
Aug-88 166,464 $9.12662 $8.7163608 $0.4102592 $68,293.29 16-Sep-88 0.667847631 $45,609.51 $113,902.80
Sep-88 154,098 $7.93169 $8.1220400 ($0.1903500) ($29,332.49) 16-Oct-88 0.657191891 ($19,277.07) ($48,609.56)
Oct-88 133,628 $7.00581 $7.3182400 ($0.3124300) ($41,749.42) 14-Nov-88 0.646891351 ($27,007.34) ($68,756.76)
Nov-88 156,730 $7.64072 $6.9405840 $0.7001360 $109,732.12 18-Dec-88 0.634527961 $69,628.10 $179,360.22
Dec-88 165,891 $9.75150 $8.0439900 $1.7075100 $283,259.76 16-Jan-89 0.623815071 $176,701.71 $459,961.47
Jan-89 158,949 $11.41803 $10.2595900 $1.1584400 $184,133.39 19-Feb-89 0.611102741 $112,524.42 $296,657.81
Feb-89 146,813 $12.09557 $11.2890760 $0.8064940 $118,403.53 16-Mar-89 0.601226031 $71,187.28 $189,590.81
Mar-89 137,142 $14.03869 $12.8182903 $1.2203997 $167,367.74 17-Apr-89 0.588513701 $98,498.21 $265,865.95
Apr-89 152,322 $14.62621 $13.7065700 $0.9196400 $140,081.72 15-May-89 0.577390411 $80,881.84 $220,963.56
May-89 161,807 $13.24482 $13.2770700 ($0.0322500) ($5,218.26) 16-Jun-89 0.564842461 ($2,947.49) ($8,165.75)
Jun-89 146,998 $12.88672 $12.6718800 $0.2148400 $31,580.96 17-Jul-89 0.553061641 $17,466.22 $49,047.18
Jul-89 133,374 $12.62844 $12.2072802 $0.4211598 $56,171.87 14-Aug-89 0.542705481 $30,484.78 $86,656.65
Aug-89 151,435 $12.27993 $11.9713600 $0.3085700 $46,728.19 17-Sep-89 0.530130141 $24,772.02 $71,500.21
Sep-89 145,372 $12.86219 $12.3424900 $0.5197000 $75,550.06 16-Oct-89 0.519404111 $39,241.01 $114,791.07
Oct-89 150,850 $13.41179 $12.8203800 $0.5914100 $89,214.26 13-Nov-89 0.509047941 $45,414.34 $134,628.60
Nov-89 148,103 $14.14872 $13.4490999 $0.6996201 $103,615.85 15-Dec-89 0.497212331 $51,519.08 $155,134.93
Dec-89 151,617 $15.53581 $14.3867200 $1.1490900 $174,221.62 15-Jan-90 0.485842461 $84,644.26 $258,865.88
</TABLE>
Page 13 of 14
<PAGE> 41
State of Alaska
Department of Natural Resources
Division of Oil & Gas
Royalty Accounting
ANS Royalty Litigation Billing
GVEA 3
Exhibit C to the State MAPCo Settlement Agreement
10/85 - 12/91
<TABLE>
<CAPTION>
===================================================================================================================================
Sales Volume Value ANS Previous Price Additional Due Date Cumulative Additional Total Royalty
Month Rebilling Value Delta Royalty Interest Interest & Interest
Rate
(a) (b) (c) (d) (e) (f) = (b*e) (g) (h) (i) = (f*h) (j) = (f+i)
- - - -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Jan-90 149,280 $14.96853 $14.4247200 $0.5438100 $81,179.71 16-Feb-90 0.474445201 $38,515.32 $119,695.03
Feb-90 132,490 $13.98721 $13.7939500 $0.1932600 $25,605.05 16-Mar-90 0.464472601 $11,892.84 $37,497.89
Mar-90 146,326 $13.01990 $12.2279000 $0.7920000 $115,889.85 15-Apr-90 0.453787671 $52,589.39 $168,479.24
Apr-90 140,701 $10.19228 $10.4317104 ($0.2394304) ($33,687.99) 17-May-90 0.442390411 ($14,903.24) ($48,591.23)
May-90 143,887 $9.71480 $9.1484300 $0.5663700 $81,493.39 18-Jun-90 0.432061641 $35,210.17 $116,703.56
Jun-90 122,685 $8.53085 $9.0748702 ($0.5440202) ($66,743.07) 16-Jul-90 0.421020551 ($28,100.20) ($94,843.27)
Jul-90 134,209 $10.68911 $11.6597600 ($0.9706500) ($130,270.21) 13-Aug-90 0.411047941 ($53,547.30) ($183,817.51)
Aug-90 140,353 $19.95426 $19.3814000 $0.5728600 $80,402.86 17-Sep-90 0.398582191 $32,047.15 $112,450.01
Sep-90 127,037 $26.11297 $25.6262398 $0.4867302 $61,832.99 14-Oct-90 0.388965751 $24,050.92 $85,883.91
Oct-90 150,838 $26.33821 $25.7426000 $0.5956100 $89,840.61 12-Nov-90 0.378636981 $34,016.98 $123,857.59
Nov-90 135,029 $23.88203 $22.2977600 $1.5842700 $213,922.62 14-Dec-90 0.367239721 $78,560.88 $292,483.50
Dec-90 147,659 $19.22872 $18.0683203 $1.1603997 $171,343.97 14-Jan-91 0.356390411 $61,065.35 $232,409.32
Jan-91 150,237 $16.42616 $14.9979200 $1.4282400 $214,574.66 15-Feb-91 0.345636981 $74,164.94 $288,739.60
Feb-91 142,604 $11.53145 $11.8510706 ($0.3196206) ($45,579.21) 15-Mar-91 0.336589041 ($15,341.46) ($60,920.67)
Mar-91 151,811 $12.04171 $11.8272000 $0.2145100 $32,564.94 13-Apr-91 0.327253421 $10,656.99 $43,221.93
Apr-91 138,513 $13.09680 $12.8993600 $0.1974400 $27,348.01 13-May-91 0.317623291 $8,686.36 $36,034.37
May-91 138,714 $12.49831 $12.4997600 ($0.0014500) ($201.14) 15-Jun-91 0.307226031 ($61.80) ($262.94)
Jun-91 134,325 $12.19457 $12.1478400 $0.0467300 $6,277.01 13-Jul-91 0.298404111 $1,873.08 $8,150.09
Jul-91 140,593 $12.77906 $12.6412293 $0.1378307 $19,377.99 12-Aug-91 0.288952051 $5,599.31 $24,977.30
Aug-91 124,009 $12.85227 $12.7200700 $0.1322000 $16,393.97 15-Sep-91 0.278280821 $4,562.13 $20,956.10
Sep-91 134,837 $13.20734 $13.0002700 $0.2070700 $27,920.73 13-Oct-91 0.269842461 $7,534.20 $35,454.93
Oct-91 145,870 $13.90173 $13.3059300 $0.5958000 $86,909.55 14-Nov-91 0.260321921 $22,624.46 $109,534.01
Nov-91 134,440 $13.00193 $12.0165200 $0.9854100 $132,478.58 13-Dec-91 0.251979451 $33,381.88 $165,860.46
Dec-91 134,746 $11.16345 $10.6090200 $0.5544300 $74,706.95 13-Jan-92 0.243673631 $18,204.11 $92,911.06
---------- ------------- ------------- -------------
11,479,667 $4,591,115.77 $2,627,794.82 $7,218,910.59
========== ============= ============= =============
</TABLE>
Page 14 of 14
<PAGE> 1
EXHIBIT 11
MAPCO INC. AND CONSOLIDATED SUBSIDIARIES
STATEMENT RE: COMPUTATION OF PER SHARE EARNINGS
(Dollars and Shares in Millions
except per share amounts)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
------------------ ------------------
1994 1993 1994 1993
-------- -------- -------- --------
<S> <C> <C> <C> <C>
PRIMARY EARNINGS PER COMMON SHARE
Computation for Consolidated Statements of Income
- - - -------------------------------------------------
Net income (a) $ 24.7 $ 26.9 $ 41.5 $ 92.1
======== ======== ======== ========
Weighted average common shares outstanding 29.9 30.0 30.0 30.0
Common stock equivalents (stock options) - - - -
-------- -------- -------- --------
Average common shares outstanding (a) 29.9 30.0 30.0 30.0
======== ======== ======== ========
Primary earnings per common share (a) (c) $ .83 $ .90 $ 1.39 $ 3.07
======== ======== ======== ========
Additional Primary Computations
- - - -------------------------------
Net income (a) $ 24.7 $ 26.9 $ 41.5 $ 92.1
======== ======== ======== ========
Average common shares outstanding (a) 29.9 30.0 30.0 30.0
Dilutive effect of outstanding options .2 .3 .1 .2
-------- -------- -------- --------
Average common shares outstanding, as adjusted 30.1 30.3 30.1 30.2
======== ======== ======== ========
Primary earnings per common share as adjusted (b) $ .82 $ .89 $ 1.38 $ 3.05
======== ======== ======== ========
FULLY DILUTED EARNINGS PER COMMON SHARE
Additional Fully Diluted Computation
- - - ------------------------------------
Net income (a) $ 24.7 $ 26.9 $ 41.5 $ 92.1
======== ======== ======== ========
Average common shares outstanding (a) 29.9 30.0 30.0 30.0
Dilutive effect of outstanding options .2 .3 .2 .2
-------- -------- -------- --------
Assumed common shares outstanding 30.1 30.3 30.2 30.2
======== ======== ======== ========
Fully diluted earnings per common share (b) $ .82 $ .89 $ 1.38 $ 3.05
======== ======== ======== ========
</TABLE>
24 of 27
<PAGE> 2
EXHIBIT 11
a) These figures agree with the related amounts in the Consolidated
Statements of Income.
b) This calculation is submitted in accordance with Securities Exchange Act
of 1934 Release No. 9083, although not required by footnote 2 to paragraph
14 of APB Opinion No. 15 because it results in dilution of less than 3%.
c) In 1994 and 1993, stock options are not included in the earnings per share
computation included in MAPCO's Condensed Consolidated Statements of
Income because the dilutive effect is less than 3%.
25 of 27
<PAGE> 1
EXHIBIT 12
MAPCO INC. AND CONSOLIDATED SUBSIDIARIES
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(Dollars in Millions)
<TABLE>
<CAPTION>
Nine Months Ended
September 30, 1994 1993 1992 1991 1990 1989
------------------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
Earnings as defined:
Income before provision for income taxes ........ $ 64.5 $202.9 $144.6 $182.6 $185.7 $172.2
Fixed charges.................................... 42.6 55.3 60.1 63.9 67.3 45.7
Capitalized interest included in fixed charges... (2.8) (2.0) (1.2) (1.1) (.8)
Amortization of capitalized interest............. 2.7 3.5 3.5 3.3 3.6 3.1
Minority interest in earnings of subsidiary...... (1.2) (2.2)
Distributed income of affiliate accounted for by
the equity method.............................. 4.5 2.1
------ ------ ------ ------ ------ ------
Total................................. $108.6 $256.7 $206.2 $248.6 $260.0 $222.3
====== ====== ====== ====== ====== ======
Fixed charges as defined:
Interest and debt expense (includes amortization
of debt expense and discount).................. $ 38.2 $ 46.9 $ 51.7 $ 55.5 $ 59.3 $ 37.5
Capitalized interest............................. 2.8 2.0 1.2 1.1 .8
Interest expense on guaranteed debt of affiliate
accounted for by the equity method............. .6 2.1
Portion of rentals representative of the interest
factor......................................... 4.4 5.6 6.4 7.2 6.3 5.3
------ ------ ------ ------ ------ ------
Total................................. $ 42.6 $ 55.3 $ 60.1 $ 63.9 $ 67.3 $ 45.7
====== ====== ====== ====== ====== ======
Ratio of earnings to fixed charges................. 2.5 4.6 3.4 3.9 3.9 4.9
====== ====== ====== ====== ====== ======
</TABLE>
26 of 27
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM MAPCO INC.'S
CONDENSED CONSOLIDATED BALANCE SHEET AS OF SEPTEMBER 30, 1994, AND MAPCO INC.'S
CONDENSED CONSOLIDATED STATEMENT OF INCOME FOR THE NINE MONTHS ENDED SEPTEMBER
30, 1994, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-END> SEP-30-1994
<CASH> 27,200
<SECURITIES> 0
<RECEIVABLES> 251,000
<ALLOWANCES> 0
<INVENTORY> 119,400
<CURRENT-ASSETS> 479,600
<PP&E> 2,479,600
<DEPRECIATION> 1,008,100
<TOTAL-ASSETS> 2,158,900
<CURRENT-LIABILITIES> 421,300
<BONDS> 758,500
<COMMON> 62,800
0
0
<OTHER-SE> 526,300
<TOTAL-LIABILITY-AND-EQUITY> 2,158,900
<SALES> 2,235,500
<TOTAL-REVENUES> 2,235,500
<CGS> 0
<TOTAL-COSTS> 2,008,000
<OTHER-EXPENSES> 125,200
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 37,800
<INCOME-PRETAX> 64,500
<INCOME-TAX> 21,800
<INCOME-CONTINUING> 41,500
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 41,500
<EPS-PRIMARY> 1.39
<EPS-DILUTED> 1.38
</TABLE>
