THE SECURITIES BEING OFFERED AND SOLD HEREBY HAVE NOT BEEN
REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS
AMENDED, OR ANY OTHER DOMESTIC OR FOREIGN SECURITIES LAWS AND
THEIR OFFER AND SALE ARE SUBJECT TO CERTAIN RESTRICTIONS
HEREINAFTER SET FORTH.
PURCHASE AGREEMENT
Purchase of Common Stock
THIS PURCHASE AGREEMENT is made as of the 1st day of
October, 1997, by and between ▇▇▇▇▇▇▇ ▇▇▇▇ (the "Purchaser") and
XCL LTD., a Delaware corporation, with its principal offices at
▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ of
America (the "Company").
WHEREAS, the Company has duly authorized the issuance, sale
and delivery of 800,000 shares (the "Shares") of its common
stock, par value $.01 per share (the "Common Stock"), in
compromise of certain claims and as compensation for services
performed outside of North America, in accordance with the terms
of a compensation agreement dated effective October 1, 1997 (the
"Compensation Agreement");
WHEREAS, the Shares are being offered and sold by the
Company to Purchaser in a transaction intended to qualify for the
exemption from the registration requirements of the United States
Securities Act of 1933, as amended (the "Securities Act")
afforded by Regulation S promulgated under the Securities Act
("Regulation S");
WHEREAS, the Company has made available to Purchaser, copies
of its recent filings with the Securities and Exchange
Commission, including the Company's most recent Annual Report on
Form 10-K for the fiscal year ended December 31, 1996, as
amended, and Forms 10-Q and 8-K filed thereafter (the "SEC
Filings"); and
WHEREAS, the Company wishes to sell to Purchaser, and
Purchaser wishes to buy from the Company, the Shares for delivery
in accordance with this Purchase Agreement and the Compensation
Agreement.
NOW, THEREFORE, in consideration of the premises and the
mutual covenants contained in this Purchase Agreement, the
undersigned agree as follows:
Section 1. Agreement to Sell and Purchase the Common
Stock.
(a) On the basis of the representations, warranties and
agreements contained in this Purchase Agreement but subject to
the terms and conditions set forth in this Purchase Agreement and
the Compensation Agreement the Company agrees to issue and sell
to Purchaser, and Purchaser agrees to buy from the Company,
effective October 1, 1997, or on such other date as shall be
mutually agreed upon by the Company and Purchaser (the "Closing
Date"), 800,000 Shares. The Company has agreed to issue the
Shares to the Purchaser as compensation for services under the
Compensation Agreement.
(b) The completion of the sale and purchase of the
Common Stock (the "Closing") shall take place at the offices of
the Company on the Closing Date. At the Closing, the Company
shall deliver to the Purchaser, or his designees, one or more
stock certificates representing the Shares each registered in the
name of Purchaser or its nominee, against payment of the Purchase
Price therefor to the Company as set forth in Section 1(a) of
this Purchase Agreement.
(c) In the event of any change in the issued and
outstanding Common Stock of the Company by reason of stock
dividends, split-up or combination of the Common Stock,
reclassification of the capital stock of the Company or
recapitalization of the Company which occurs on or before the
Closing, the number of shares of Common Stock to be delivered to
Purchaser at the Closing and the Purchase Price therefor shall be
appropriately adjusted. In addition, in the event that any cash
dividends on the Common Stock of the Company shall be payable to
shareholders of record as of a record date that falls on any date
within the period on and from the time of execution of this
Purchase Agreement to and including the Closing Date, the price
per share of Common Stock payable by Purchaser shall be reduced
by the amount of such cash dividend per share of Common Stock.
(d) The obligation of the Purchaser to purchase the
Shares at the Closing shall be conditional upon the delivery by
the Company, on behalf of all the Purchasers, to the extent that
the Closing Date shall be a date other than the date of this
Purchase Agreement, a certificate of an officer of the Company as
to the correctness in all material respects of the
representations and warranties of the Company contained in
Section 2 of this Purchase Agreement as of the Closing Date, in
the form attached hereto as Schedule 2 dated the Closing Date.
(e) The obligation of the Company to issue and sell the
Shares at the Closing shall be conditional upon:
(i) The receipt and acceptance by the Company of
this Purchase Agreement for all of the Shares which shall be
evidenced by execution of this Purchase Agreement by the
President or any Vice President or any Director of the
Company. Purchaser understands that this Purchase Agreement
is irrevocable and the Company reserves the right in its
complete discretion to reject all or any portion of the
subscription for the Shares represented by this Purchase
Agreement, without regard to the order in which it was
received. All or any portion of the Purchase Price
represented by a rejected subscription for all or any
portion of the Shares subscribed for hereby shall be
promptly returned to the Purchaser without interest.
(ii) Delivery into the closing depository
identified in Section 1(a) hereby by Purchaser of
immediately available funds in United States dollars, in the
full amount of the Purchase Price, as payment in full for
the purchase of the Shares.
(iii) To the extent that the Closing Date shall be
a date other than the date of this Purchase Agreement the
receipt by the Company of a certificate of the Purchaser as
to the correctness in all material respects of the
representations and warranties of the Purchase contained in
Section 4 of this Purchase Agreement as of the closing Date,
in the form attached hereto as Schedule 3, dated the Closing
Date.
Section 2. Representations and Warranties of the
Company. The Company hereby represents and warrants to Purchaser
as follows:
2.1 Organization and Qualification. The Company is a
corporation duly organized, validly existing and in good standing
under the laws of the State of Delaware and has all requisite
corporate power and authority to own and lease its properties and
to conduct its business as presently conducted and as described
in the SEC Filings. The Company is duly qualified to do business
as a foreign corporation and is in good standing in every
jurisdiction where such qualification is required by controlling
law and where the failure so to qualify would have a material
adverse effect on the Company and its subsidiaries, taken as a
whole.
2.2. Authorized Capital Stock. The authorized and
outstanding capital stock of the Company is as set out in the SEC
Filings, and all of the issued shares of capital stock of the
Company have been duly and validly authorized and issued and are
fully paid and nonassessable. All of the outstanding shares of
capital stock of the Principal Subsidiaries have been duly and
validly authorized and issued and are fully paid and
nonassessable.
2.3 Due Execution, Delivery and Performance of the
Purchase Agreement. The execution, delivery and performance of
the Purchase Agreement by the Company (a) have been duly
authorized by all requisite corporate action of the Company, and
(b) will not violate (i) the Certificate of Incorporation or By-
laws of the Company or (ii) any law applicable to the Company or
any of its subsidiaries or any rule, regulation or order of any
court or governmental agency or body having jurisdiction over the
Company or any of its subsidiaries or (iii) any provision of any
material indenture, mortgage, agreement, contract or other
instrument to which the Company is subject. Upon execution and
delivery by the Company, the Purchase Agreement will constitute
the legal, valid and binding obligations of the Company,
enforceable against the Company in accordance its respective
terms, except as the enforceability thereof may be limited by an
applicable bankruptcy, insolvency, reorganization or other
similar laws, relating to or affecting the enforcement of
creditors rights generally and by general equitable principles,
regardless of whether such enforceability is considered in a
proceeding in equity or at law.
2.4 Issuance and Delivery of the Shares. the offer,
issuance, sale and delivery of the Shares in accordance with the
Purchase Agreement, have been duly authorized by all requisite
corporate action of the Company. The Shares as and when issued
and sold to the Purchaser pursuant to this Purchase Agreement,
and upon receipt by the Company of the Purchase Price therefor,
will be duly and validly issued and outstanding, fully paid and
nonassessable, will not be subject to any pre-emptive or similar
right, and Purchaser will receive good and valid record title to
the Shares, free and clear of any claim, lien, security interest,
mortgage, pledge, charge or other encumbrance of any nature
whatsoever, except such as may have been created by Purchaser.
2.5 Compliance with Regulation. The Company is a
"reporting issuer" (as defined in Regulation S). The Company,
its affiliates and any person acting on behalf of, or as agent
of, any of the foregoing, whether as principal or agent, (a) has
offered and sold the Shares only in an "offshore transaction" (as
defined in Regulation S), (b) has not engaged with respect to the
Shares in any "directed selling efforts" (as defined in
Regulation S) in respect of the Shares, (d) has not made any
offers or sales of any of the Shares or any interest therein in
the United States or to, or for the account of, any "U.S. person"
(as defined in Regulation S), and (e) has not made any sales of
any of the Shares or any interest therein to any person other
than the Purchasers; provided, however, that insofar as this
representation and warranty involves any broker-dealer
participating in the offering, any affiliate of such broker-
dealer or any officer, director, employee or agent of such broker-
dealer, to the extent such broker-dealer or other person is
acting as placement agent for the offering of the Shares, such
representation and warranty is made by the Company solely on the
basis of and in reliance upon the representations and warranties
of such broker-dealer or other person.
2.6 Representations and Warranties at the Closing. Each
of the representations and warranties contained in Section 2 is
true and correct in all material respects as of the date of this
Purchase Agreement. The Company will make the same
representations and warranties at the Closing and such
representations and warranties when so made will be true and
correct in all material respects as of the Closing Date.
Section 3. Certain Agreements of the Company. The
Company hereby covenants and agrees with Purchaser as follows:
(a) Prior to or contemporaneously with the delivery of
execution copies of this Purchase Agreement, the Company will
make available to Purchaser the SEC Filings.
(b) The Company will make available to Purchaser prior
to the Closing Date the opportunity to ask questions and receive
answers concerning the terms and conditions of the purchase of
the Shares and the business and financial conditions of the
Company and to obtain any additional information that the Company
may possess or can acquire without unreasonable effort or expense
that is necessary to verify the accuracy of the information
furnished in accordance herewith.
(c) At any time after the expiration of the Restricted
Period (as hereinafter defined) the Company will deliver to
Purchaser or its nominee who is acting as custodian therefor or
any subsequent holder who has received a stock certificate
representing the Shares which bears the legend described in
Section 4.4 of this Purchase Agreement (the "Legended Stock
Certificate") , without cost to such Purchaser or subsequent
holder, upon written request therefor, a substitute stock
certificate without the restrictive legend described in Section
4.4 of this Purchase Agreement. The Company shall be required to
deliver such substitute stock certificate only upon surrender of
the Legended Stock Certificate which, in the case of any holder
subsequent to Purchaser, must be duly endorsed for transfer or
surrender and accompanied by certificates signed by the Purchaser
and such holder as provided in Section 4.3(c) hereof.
Section 4. Representations, Warranties and Covenants of
Purchaser. Purchaser hereby represents, warrants and covenants
to the Company as follows:
4.1 Compliance with United States Securities Laws.
Purchaser understands and acknowledges that (a) the Shares have
not been and will not be registered under the Securities Act, and
may not be offered or sold in the United States or to, or for the
account or benefit of, any "U.S. person" (as defined in
Regulation S, which definition is set out in Schedule 4 hereto),
unless such Shares are registered under the Securities Act and
any applicable state securities or blue sky laws or such offer or
sale is made pursuant to exemptions from the registration
requirements of such laws, (b) the Shares are being offered and
sold pursuant to the terms of Regulation S under the Securities
Act, which permits securities to be sold to non-"U.S. persons" in
"offshore transactions" (as defined in Regulation S), subject to
certain terms and conditions, (c) the Company is relying upon the
truth and accuracy of the representations, warranties,
agreements, acknowledgments and understandings of the Purchaser
set forth herein in order to determine the availability of the
exemptions from registration under the Securities Act relied upon
by the Company and the suitability of the Purchaser to acquire
the Shares; (d) the Shares have been offered and sold to the
Purchaser in an "offshore transaction" and Purchaser has not
engaged in any "directed selling efforts", as each such term is
defined in Regulation S, and (e) in the view of the Commission,
the statutory basis for the exemption from registration claimed
for this offering would not be present if the offering of the
Shares, although in technical compliance with Regulation S, is
part of a plan or scheme to evade the registration provisions of
the Securities Act and, accordingly, the Purchaser is making the
representations and warranties in this Section 4 to evidence its
compliance with the applicable requirements of the Securities Act
and that its participation in such offering is not a part of any
such plan or scheme.
4.2 Status of Purchaser.
(a) Purchaser is purchasing the Shares for its own
account or for persons or accounts as to which it exercises
investment discretion. Neither Purchaser nor such person or
account is a "U.S. person" (as defined in Regulation S) and
neither Purchaser nor such other person or account has any
present intention to sell any of the Shares in the United States
or to a U.S. person or for the account or benefit of a U.S.
person either now or promptly after expiration of the Restricted
Period.
(b) Purchaser (and any person or account on whose behalf
Purchaser is purchasing) is knowledgeable, sophisticated and
experienced in making, and is qualified to make decisions with
respect to investments in restricted securities (such as this
Purchase Agreement and the Shares) and has requested, received,
reviewed and considered all information it deems relevant in
making a decision to execute this Purchase Agreement and purchase
the Shares. Purchaser acknowledges that it is capable of
evaluating the merits and risks of an investment in the Shares
and to make an informed decision relating thereto. In evaluating
its investment, Purchaser has consulted its own investment and/or
legal or tax advisors.
(c) Purchaser acknowledges that the Company had made
available to Purchaser the opportunity to ask questions and
receive answers concerning the terms and conditions of the
offering of the Shares and the business and financial condition
of the Company and to obtain any additional information that the
Company may possess or can acquire without unreasonable effort or
expense that is necessary to verify the accuracy of the
information furnished in accordance herewith. Purchaser and its
advisors, if any, have received complete and satisfactory answers
to all such inquiries. Purchase acknowledges that in making the
decision to purchase the Shares, it has relied solely upon the
representations and warranties of the Company contained herein
and the information contained in the SEC Filings, and other
publicly available documents, copies of which have been furnished
or made available to Purchaser, and upon the independent
investigations made by it and its representatives, if any.
(d) Purchaser has agreed to purchase the Shares for
investment purposes and not with a view to a distribution.
Purchaser is not an underwriter of, or dealer in, the Shares and
is not participating, pursuant to a contractual arrangement, in
the distribution of the Shares. To the extent that the Shares
are registered in the name of Purchaser's nominee, Purchaser
confirms that such nominee is acting merely as custodian for the
Purchaser of such securities.
(e) Purchaser understands that no U.S. Federal or state
or any foreign governmental authority or agency has made or will
make any finding or determination relating to the fairness for
public investment in the Shares, or has passed upon or made, or
will pass upon or make, any recommendation or endorsement of the
Shares.
4.3 Restrictions on Re-Sale.
(a) For a period of forty (40 days) following the
Closing Date ( the "Restricted Period"), Purchaser shall not
engage in any activity for the purpose of, or which may
reasonable be expected to have the effect of, conditioning the
market in the United States for the Shares, or directly or
indirectly offer, sell, transfer, pledge or otherwise dispose of
the Shares, or any interest therein, in the United States or to,
or for the account or benefit of, a "U.S. person" (as defined in
Regulation S). Purchaser hereby also agrees that it shall not,
either directly or indirectly, sell short the Company's shares of
Common Stock on the American Stock Exchange or on any other
exchange or in the over-the-counter market or otherwise in the
United States during the Restricted Period and it has not made
any such sale in anticipation of participating in the offering
and purchasing of the Shares.
(b) Purchaser understands that the Shares or any
interest therein are only transferable on the books and records
of the Transfer Agents and Registrar of the Common Stock of the
Company. Purchaser further understands that the Transfer Agents
and Registrar will not register any transfer of the Shares or any
interest therein which the Company in good faith believes
violates the restrictions set forth herein.
(c) Unless registered under the Securities Act, any
proposed offer, sale, transfer, pledge or other disposition
during the Restricted Period of any of the Shares or any interest
therein, shall be subject to the condition that Purchasers must
deliver to the Company (i) a written certification that neither
record nor beneficial ownership of the Shares or any interest
therein, has been offered or sold in the United States or to, or
for the account or benefit of, any "U.S. person" (as defined in
Regulation S), (ii) a written certification of the proposed
transferee that such transferee (or any account for which such
transferee is acquiring such Shares or any interest therein) is
not a "U.S. person" (as defined in Regulation S), that such
transferee is acquiring such Shares or such interest therein, for
such transferee's own account (or an account over which it has
investment discretion) and for investment and not with a view to
a distribution, and that such transferee is knowledgeable of and
agrees to be bound by the restrictions on re-sale set forth in
this section and Regulation S during the Restricted Period, and
(iii) if requested by the Company, a written opinion of United
States counsel, in form and substance satisfactory to the
Company, the effect that the offer, sale, transfer, pledge or
other disposition of the Shares, or any interest therein, are
exempt from registration under the Securities Act and any
applicable state securities or blue sky laws.
(d) Purchaser will not, directly or indirectly,
voluntarily offer, sell, pledge, transfer or otherwise dispose of
(or solicit any offerings to buy, purchase or otherwise acquire
or take a pledge of ) its rights under this Purchase Agreement,
the Shares, any interest therein, or otherwise than in compliance
with the Securities Act, any applicable state securities or blue
sky laws and any applicable securities laws or jurisdictions
outside the United States, and the rules and regulations
promulgated thereunder.
4.4 Legend. Purchaser agrees that, unless and until
removed as contemplated by Section 3(c) hereof, the stock
certificates representing the Shares shall bear the legend set
forth below:
"The shares of Common Stock represented by this
certificate have not been registered under the United
States Securities Act of 1933, as amended (the "Act"),
or any other securities laws, and have been issued in
reliance upon the exemption from registration under the
Act contained in Regulation S under the Act. Prior to
the later of _______________, 199__, no offer, sale,
transfer, pledge or other disposition (collectively, a
"Disposal") of the shares of Common Stock represented
by this certificate may be made: (a) in the United
States or to, or for the account or benefit of, any
"U.S. person" (as defined in Regulation S) unless (i)
registered under the Act and any applicable state
securities or blue sky laws or (ii) exemptions from the
registration requirements of such laws are available
and XCL Ltd. (the "Company") receives a written opinion
of United States legal counsel in form and substance
satisfactory to it to the effect that such Disposal is
exempt from such registration requirements; and (b)
outside of the United States or to, of for the account
or benefit of a person who is not a "U.S. person" (as
defined in Regulation S) unless (i) the beneficial
owner of such shares and the proposed transferee submit
certain certifications to the Company and (ii) the
Company receives a written opinion of United States
legal counsel in form and substance satisfactory to it
to the effect that such Disposal is exempt from the
registration requirements of the Act."
4.5 Re-Offers by Purchaser in the United States. If
Purchaser publicly re-offers all or any part of the Shares in the
United States, Purchaser (and/or certain persons who participate
in any such re-offer) may be deemed, under certain circumstances,
to be an "underwriter" as defined in section 2(11) of the
Securities Act. If Purchaser plans to make any such re-offer, it
will consult with United States legal counsel prior to any such
re-offer in order to determine its liabilities and obligations
under this Purchase Agreement, the Securities Act and any
applicable state securities or blue sky laws.
4.6 Due Execution, Delivery and Performance of the
Purchase Agreement and Other Obligations. Purchaser has full
right, power, authority and capacity to enter into this Purchase
Agreement and to consummate the transactions contemplated hereby.
Upon the execution and delivery of this Purchase Agreement by
Purchaser, this Purchase Agreement shall constitute the legal,
valid and binding obligation of Purchaser, except as the
enforceability thereof may be limited by any applicable
bankruptcy, insolvency, reorganization or other similar laws
relating to or affecting the enforcement of creditors rights
generally and by general equitable principles, regardless of
whether such enforceability is considered in a proceeding of
equity or at law.
4.7 Representations and Warranties at the Closing. Each
of the representations and warranties contained in this Section 4
is true and correct as of the date of this Purchase Agreement.
Purchaser will make the same representations and warranties on
the Closing Date and the Delivery Date and such representations
and warranties when so made will be true and correct as of the
Closing Date, and the Delivery Date, respectively.
Section 5. Survival of Representations, Warranties and
Agreements. Notwithstanding any investigation made by either
party to this Purchase Agreement, all covenants, agreements,
representations and warranties made by the Company and Purchaser
herein shall survive the execution of this Purchase Agreement,
the delivery to Purchaser of the Shares and the receipt by the
Company of payment for the Shares.
Section 6. Notices. All notices, demands, consents or
other communications under this Purchase Agreement shall be given
or made in writing and shall be delivered personally, or sent by
registered or international recorded airmail, postage prepaid, or
sent by facsimile transmission with a confirmation copy sent by
mail as aforesaid, and shall be deemed given when so personally
delivered, or if mailed as aforesaid, ten (10) business days
after the same shall have been posted or if sent by facsimile
transmission, at the earlier of (i) as soon as written or
telephonic communication is received from the party to whom it
was sent that the message has been received or (ii) ten (10) days
after the confirmation is posted:
(a) if to the Company, at its address as set out at the
head of this Purchase Agreement, or at such address or addresses
as may have been furnished to Purchaser in writing by the
Company;
(b) if to, Purchaser, at its address as set out
following Purchaser's signature on the signature page to his
Purchase Agreement, or at such other address or addresses as may
have been furnished to the Company in writing by Purchaser; or
(c) if to any transferee or transferees of Purchaser, at
such address or addresses as shall have been furnished to the
Company at the time of the transfer or transfers or at such other
address or addresses as may have been furnished by such
transferee or transferees to the Company in writing.
Section 7. Amendments. No amendment, interpretation or
waiver of the provisions of this Purchase Agreement shall be
effective unless made in writing and signed by the parties to
this Purchase Agreement.
Section 8. Headings. The headings of the sections and
sub-sections of this Purchase Agreement are used for convenience
only and shall not affect the meaning or interpretation of the
contents of this Purchase Agreement.
Section 9. Enforcement. The failure to enforce or to
require the performance at any time of any of the provisions of
this Purchase Agreement shall in no way be construed to be a
waiver of such provisions, and shall not affect either the
validity of this Purchase Agreement or any part hereof or the
right of any party thereafter to enforce each and every provision
in accordance with the terms of this Purchase Agreement.
Section 10. Governing Law; Submission to Jurisdiction.
This Purchase Agreement and the relationships of the parties in
connection with the subject matter of this Purchase Agreement
shall be governed by and determined in accordance with the
substantive laws of the State of Delaware, in the United States
of America, applicable to agreements made and to be performed
entirely therein. Purchaser hereby irrevocable and
unconditionally:
(a) submits for itself and its property in any legal
action or proceeding relating to this Purchase Agreement to which
it is a party, or for recognition and enforcement of any judgment
in respect thereof, to the non-exclusive general jurisdiction of
the courts of the State of New York, the Courts of the United
States of America for the Southern District of New York, and
appellate courts from any thereof;
(b) consents that any such action or proceeding may be
brought in such courts and waives any objection that it may now
or hereafter have to the venue of any such action or proceedings
as brought in an inconvenient forum and agrees not to plead or
claim the same;
(c) agrees that service of process in any such action or
proceeding may be effected by respectively delivering or mailing
a copy thereof by personal delivery or by registered or certified
mail (or any substantially similar form of mail), postage
prepaid, to the Purchaser at the address set forth on the
signature page hereof as at such other address of which the
Company shall have been notified in accordance with the
provisions of Section 6 hereof; and
(d) agrees that nothing herein shall affect the right to
effect service of process in any other manner permitted by law or
shall limit the right to ▇▇▇ in any other jurisdiction.
Section 11. Severability. If any provision of this
Purchase Agreement is held to be invalid or unenforceable by any
judgment of a tribunal of competent jurisdiction, the remainder
of this Purchase Agreement shall not be affected by such
judgment, and the Purchase Agreement shall be carried out as
nearly as possible according to its original terms and intent.
Section 12. Counterparts. This Purchase Agreement may
be executed in counterparts, all of which shall constitute one
agreement, and each such counterpart shall be deemed to have been
made, executed and delivered on the date set out at the head of
this Purchase Agreement without regard to the dates or times when
such counterparts may actually have been made, executed or
delivered.
IN WITNESS WHEREOF, the parties hereto have caused this
Purchase Agreement to be executed by their duly authorized
representatives as of the day and year first above written.
XCL LTD. PURCHASER'S NAME:
By:__________________________ _________________________________
Name:________________________ _________________________________
Title:_______________________ _________________________________
Duly executed by:
_________________________________
Title:
Aggregate number of Shares: PURCHASER'S ADDRESS:
_____________________________ ______________________________
______________________________
Total purchase price: ______________________________
______________________________
$____________________________
Stock certificate registration instructions:
Name of Holder:__________________________________________________
Address of Holder for delivery:__________________________________
_________________________________________________________________
_________________________________________________________________
Contact name and telephone number:_______________________________
_________________________________________________________________