EX-10.1






Exhibit 10.1




[* * *] CONFIDENTIAL TREATMENT




Modification and Extension of Pipeline Capacity Lease Agreement




     This Modification and Extension of Pipeline Capacity Lease Agreement (“Agreement”),
effective the 1st day of May, 2009 (“Effective Date”), is entered into by and between Delek Crude
Logistics, LLC, whose address is 7102 Commerce Way, Brentwood, TN 37027(hereinafter referred to
as “Delek”) and Plains Marketing, L.P., a Texas limited partnership, acting through its general
partner, Plains Marketing GP Inc, whose address is 333 Clay Street, Suite 1600, Houston, Texas
77002 (hereinafter referred to as “Plains”) Plains or Delek may individually be referred to as a
“Party”, or collectively as the “Parties”.



     WHEREAS, LaGloria Oil & Gas Company (“LaGloria”) and Plains, as successor to Scurlock
Permian LLC executed that certain “Pipeline Capacity Lease Agreement” (“Lease”) dated April 12,
1999, for an initial term of five (5) years commencing January 1, 2000 through December 31, 2004,
a copy of which is attached hereto and incorporated herein in its entirety;



     WHEREAS, Delek, as successor in interest to LaGloria and Plains executed that certain
“One-Year Renewal of Pipeline Capacity Lease Agreement” renewing the Lease for one (1) additional
lease year commencing on January 1, 2005 through December 31, 2005;



     WHEREAS, Plains and Delek executed an “Amendment to the One-Year Renewal of Pipeline
Capacity Lease Agreement” changing the Monthly Rental payable by Delek to Plains under Section 4
of the Lease effective from September 1, 2005 through December 31, 2005;



     WHEREAS, the One (1) year renewal of the Pipeline Capacity Lease Agreement was subsequently
extended through April 30, 2006 by an “Extension of Pipeline Capacity Lease Agreement”;



     WHEREAS, effective May 1, 2006, Plains and Delek executed an “Modification and Extension of
Pipeline Capacity Lease Agreement” extending the term of the Lease through April 30, 2009 and
revising the rental payable by Delek to Plains under Section 4 of the Lease; and



     WHEREAS, the Parties intend to again amend the rental provisions of Section 4 of the Lease
and extend the term of the Lease for twenty-four (24) months and as herein amended to ratify,
adopt and confirm the Lease.



     NOW, THEREFORE, in consideration of the mutual benefits of the Parties hereto, by execution
below, Plains and Delek hereby modify the Lease as follows:



     The term of the Lease is hereby extended for an additional twenty-four (24) month term
beginning May 1, 2009, and ending April 30, 2011, then continuing ‘Quarterly’ as three (3) month
extensions thereafter until either Party issues a one-hundred and eighty (180 day advance written
notice of cancellation to the other Party. During the term of this Agreement,



 









 





[* * *] CONFIDENTIAL TREATMENT



the Parties agree
to negotiate in good faith, subject to the provisions in this Agreement, an extension of the term
of the Lease of at least five (5) years.




     For the first fourteen months of this extension of the Agreement commencing May 1, 2009, the
rental payable by Delek to Plains under Section 4 of the Lease shall be as follows:



     MONTHLY RENTAL:



     Volumes up to and including Daily Average of [* * *] barrels per day:




     Days in the month x the Daily Average volume delivered up to and including [* * *]
barrels per day x [* * *] per barrel.



     Volumes in excess of the Daily Average of [* * *] barrels per day:




     Days in the month x the Daily Average volume delivered in excess of [* * *] barrels
per day x [* * *] x the current rate per barrel.


For the annual period commencing July 1, 2010, and annually thereafter, the rental shall escalate
based on the FERC Oil Pipeline Index using the calculation formula as described in the above
paragraphs.



The above rental schedule includes normal operation, inspection and maintenance performed by
Plains, including routine leak repair, cleanup, right of way issues and elective pipe replacement.
However, if, as a result of conducting a smart pig inspection of the pipeline and major repairs are
required that Plains estimates will cost in excess of [* * *], or if any pipeline integrity upgrade
is required due to regulatory compliance or significant pipe integrity loss during the term of this
Agreement, Plains and Delek shall negotiate in good faith to compensate Plains for all of the cost
in excess of [* * *] of such repairs or added costs. It is the intent of the Parties that any such
form of compensation shall be amortized over a period of not less than five (5) years, and that the
pipeline lease term shall be extended to cover such amortization. It is the intent of the Parties
that Plains shall not have an obligation to continue to operate the pipeline at a financial loss
due to unanticipated pipeline integrity issues beyond its control. If during the twenty-four (24)
month term extension, a pipeline integrity upgrade is required in the sole discretion of Plains due
to regulatory compliance or a significant pipeline integrity loss, Plains shall have the right to
immediately terminate this Agreement notwithstanding any other provision to the contrary in this
Agreement. In such event, neither Party shall have any other rights or obligations to each other
subsequent to such termination except that Delek shall pay Plains for all crude oil delivered prior
to termination of this Agreement.



  



     Any unaffiliated third party entity which acquires substantially all of the assets of either
Party to this Agreement shall be entitled to the rights and shall be subject to the obligations of
its predecessor in title under this agreement. Each of the Parties may, without relieving itself
of its obligations under this Agreements, assign any of its rights here under to a company or
companies with which it is
affiliated, but otherwise no assignment of this Agreement or any of the rights or obligations
hereunder shall be made unless there first shall have been obtained the consent thereto in writing
of the other Party, which consent shall not be unreasonably withheld.



 









 





[* * *] CONFIDENTIAL TREATMENT




     As herein modified and extended, all the terms, provisions and conditions of the Lease shall
remain in full force and effect unless further modified by an agreement executed by authorized
representatives of each Party.



     The above recitals are incorporated into this Agreement and made apart of for all purposes.


IN WITNESS WHEREOF, the Parties hereto acting through their duly authorized representatives have
executed this Agreement as the Effective Date set forth above.




	 	 	 	 	 	 	 	 	 	 	 
	DELEK CRUDE LOGISTICS, LLC	 	 	 	PLAINS MARKETING,	 	 
	 	 	 	 	 	 	By Plains Marketing GP Inc.	 	 
	 	 	 	 	 	 	Its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By: 

Name:

	 	/s/ Frederec Green 3/31/09
 

Frederec Green
	 	 	 	By:

Name
	 	/s/ Glenn R. Willey
 

Glenn R. Willey – Managing Director -
	 	 
	Title:

	 	Vice President
	 	 	 	Title:
	 	Pipeline Business Development	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ Pete Daily	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	Name:

	 	H. Pete Daily	 	 	 	 	 	 	 	 
	Title:

	 	VP