CORRAL PETROLEUM HOLDINGS AB (PUBL) - Preem

RELATED PARTY TRANSACTIONSCapital Trust GroupCapital Trust Group, through its subsidiaries, provides international merchant and investment banking services.Preem paid Capital Trust Group a fee of $27 million in connection with the arrangement of the 2008 Credit Facility.In addition, Capital Trust Group, through its subsidiaries, provides certain technical and advisory services toPreem and its subsidiaries. The contract governing these services automatically renews on an annual basis unlessterminated by either party and provides for an annual fee of $2.5 million.The agreement has not been terminated. Mr. John P. Oswald, a former director of Preem and Corral PetroleumHoldings, is a principal shareholder of Capital Trust. Mr. Bassam Aburdene, a director of Preem and Corral PetroleumHoldings, is also a principal shareholder of Capital Trust. Preem believes that the foregoing transactions were enteredinto on terms no less favorable to it or to its subsidiaries than those that could have been obtained from an unrelated thirdparty.Midroc Europe ABMidroc Europe AB, a company in which Mr. Al-Amoudi has a majority interest, has provided and continues toprovide maintenance and construction services, through its subsidiaries, including Midroc Electro AB, MidrocEngineering AB and Metalock Sweden AB to Preem (of which Mr. Al-Amoudi is also Chairman and director). For theseservices, we paid SEK 175 million (€19 million) in 2010, SEK 156 million (€17 million) in 2009 and SEK 146 million(€14 million) in 2008. Many of these services are provided on an as-needed basis. Accordingly, the amounts paid forthese services may vary from year to year depending on the amount of services provided. Preem believes that theforegoing transactions were entered into on terms no less favorable to us than those that could have been obtained froman unrelated third party.Former Corral Petroleum Holdings AcquisitionCorral Finans (now renamed Corral Petroleum Holdings) purchased all of the issued and outstanding shares ofFormer Corral Petroleum Holdings from Moroncha Holdings on March 29, 2007, in exchange for SEK 6,500 million(€722 million) paid by delivery of the Moroncha Note to Moroncha Holdings in the amount of SEK 6,500 million (€722million). After paying costs related to the offering of the 2007 Notes and depositing approximately €20 million andapproximately $30 million of the net proceeds of the offering of the 2007 Notes in segregated accounts of CorralPetroleum Holdings to be reserved for paying cash interest on the 2007 Notes, Corral Petroleum Holdings used theremaining net proceeds of the offering of the 2007 Notes to repay a portion of the Moroncha Note (the remainder ofwhich (SEK 1,407 million (€156 million)) was set off entirely at the closing of the offering of the 2007 Notes against anunconditional shareholder’s contribution to Corral Petroleum Holdings by Moroncha Holdings).SAMIRPreem occasionally sells liquefied petroleum gas to SAMIR, a company in which CMH has a majority interestand is indirectly 100% owned by Mr. Al-Amoudi. We received SEK 0 million in 2010, SEK 0 million in 2009 andSEK 8 million (€1 million) in 2008 for such sales. The sales were made at market prices.Huda Trading ABPreem and Huda Trading AB agreed to conduct business involving the purchase, storage and sale of oil,specifically when the market is in “contango” meaning that forward prices of crude oil or refined products exceed currentspot market prices. Huda Trading AB is 100% owned by Huda Holdings Limited, which is 100% controlled by Mr. Al-Amoudi. The agreement also includes the provision of operational and administrative support from Preem. Sales totaledSEK 1,756 million (€195 million) in 2010, SEK 1,291 million (€143 million) in 2009 and SEK 1,456 million (€162million) in 2008, and purchases totaled SEK 2,051 million (€228 million) in 2010, SEK 1,311 million (€146 million) in2009 and SEK 1,032 million (€115 million) in 2008.Svenska Petroleum Exploration ABDuring 2008, Preem had an agreement with Svenska Petroleum Exploration AB, which is indirectly 100%owned by Mr. Al-Amoudi, for the sale of administrative services. Sales totaled SEK 0 million in 2010, SEK 0 million in2009 and SEK 1 million in 2008.Corral Morocco Gas & OilOn February 6, 2006, Corral Morocco Gas & Oil, which is indirectly 100% owned by Mr. Al-Amoudi, issuedand delivered a promissory note to Corral Petroleum Holdings for a principal amount of approximatelySEK 3,136 million (€348 million) with an interest rate of 5.0% per annum. As of the date hereof, the outstandingprincipal, including capitalized interest, is approximately SEK 3,340 million (€371 million). After seven years from the51