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EXHIBIT 1.16
STOCKHOLDERS' AGREEMENT
This Stockholders' Agreement ("Agreement") dated as of May 6, 1997 is
by and among ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇ (each, a "Management Stockholder" and collectively, the "Management
Stockholders"), EIBOC Investments Ltd., a corporation organized under the laws
of Barbados ("EIBOC"), Queen Sand Resources, Inc., a Delaware corporation (the
"Company"), and Joint Energy Development Investments Limited Partnership, a
Delaware limited partnership ("JEDI"). Initially capitalized terms used but
not otherwise defined herein have the meanings ascribed to such terms in the
Securities Purchase Agreement dated as of March 27, 1997 between the Company
and JEDI (the "Purchase Agreement").
WHEREAS, JEDI and the Company have entered into the Purchase Agreement
pursuant to which JEDI will purchase certain securities of the Company; and
WHEREAS, EIBOC is the legal owner of 6,600,000 shares of Common Stock
which are represented by certificate no. 3949 (the "Shares"); and
WHEREAS, the execution and delivery of this Agreement by the parties
hereto is a condition to the obligations of JEDI and the Company to consummate
the transactions contemplated by the Purchase Agreement.
NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
1. RESTRICTIONS ON TRANSFERS OF SHARES.
(a) No Stockholder shall, without the prior
written consent of JEDI, Transfer any of the Shares or
any interest therein except as specifically permitted
by Section 1(b) or (c) of this Agreement. For
purposes of this Agreement, the term "Stockholder"
means EIBOC, the Management Stockholder and any Person
who is required by the terms of this Agreement to
execute an Adoption Agreement, as described in the
following sentence and the term "Transfer" means any
direct or indirect sale, assignment, donation,
transfer, devise, pledge, hypothecation, encumbrance
or other disposition of any shares or any interest
therein. Any Person who is required by the terms of
this Agreement to become a party to this Agreement
shall do so by executing an Adoption Agreement in the
form attached as Exhibit A or in any other form
satisfactory to the Company and JEDI, whereupon such
person or entity shall be deemed a "Stockholder" and
shall have all of the rights and obligations of a
Stockholder under this Agreement and the Shares or any
interest therein held by any such Person shall be
subject to the provisions hereof.
(b) Notwithstanding the restrictions contained in
paragraph (a) of this Section 1, after October 1, 1997
(i) any Stockholder may Transfer Shares, provided that
the number of Shares to be Transferred together with
the number of all Shares Transferred by all
Stockholders during
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the preceding twelve months does not exceed the lesser
of (x) four percent of the shares of Common Stock
outstanding as shown by the most recent report or
statement published by the Company and filed with the
Commission, (y) four times the average weekly reported
volume of trading, excluding any trades made by
Stockholders, in Common Stock on all national
securities exchanges and/or reported through the
automated quotation system of a registered securities
association during the four calendar weeks preceding
the date of Transfer and (z) four times the average
weekly volume of trading, excluding any trades made by
Stockholders, in Common Stock reported through the
consolidated transaction reporting system,
contemplated by Rule 11Aa3-1 under the Exchange Act
during the four-week period specified in clause (y) of
this paragraph (b); and (ii) Stockholders may Transfer
Shares in a registered underwritten public offering of
Common Stock; provided, however, that no Stockholder
may transfer Shares pursuant to this paragraph (b) if
after such transfer the Management Stockholders would
beneficially own less than 4,950,000 Shares in the
aggregate, subject (1) to a proportionate adjustment
in the event of a stock split, reverse stock split,
combination of shares, stock dividend or distribution
or other similar change in the outstanding shares of
Common Stock and (2) reduction by the number of Shares
Transferred in accordance with paragraph (d) of this
Section 1 to the estate of a deceased Management
Stockholder or to a Disabled Management Stockholder.
As used herein, the term "beneficial owner" shall have
the meaning set forth in paragraph (a)(2) of Rule
16a-1 under the Exchange Act.
(c) Nothing in this Section 1: (i) shall prevent
any Stockholder from (x) voting their Shares or other
Voting Securities in any vote of stockholders of the
Company on a merger or consolidation of the Company
with or into any other Person, (y) Transferring their
Shares in exchange for consideration payable in
respect of such Shares in connection with a merger or
consolidation of the Company with or into any other
Person or (z) Transferring their Shares pursuant to a
tender or exchange offer that the Board of Directors
of the Company endorses or does not oppose, (ii) shall
prevent EIBOC from Transferring Shares to the
Management Stockholders in proportion to their
percentage beneficial interests in the EIBOC Shares,
(iii) shall prevent a Management Stockholder from
Transferring Shares to his Family Group; provided,
that no Transfer may be made to a Management
Stockholder's Family Group until the transferee has
executed an Adoption Agreement agreeing in be bound by
the terms of this Agreement. "Family Group" means,
with respect to a Management Stockholder, (x) the
spouse of the Management Stockholder, (y) any entity
of which the Management Stockholder or his spouse
legally and beneficially owns 100% of the equity
interests, provided such interests are not
transferrable and provided further that concurrently
with such Transfer, such entity agrees in writing with
JEDI that it will not issue any equity interest to any
Person other than the Management Stockholder and his
spouse, or (z) any trust solely for the benefit of the
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Management Stockholder, the Management Stockholder's
spouse, and/or their respective ancestors and/or
descendants, including any descendants by adoption;
provided, however, that the trustee or trustees
(including any substitute or replacement trustee or
trustees) shall have been approved by JEDI, which
approval may not be unreasonably withheld, or (iv)
shall prevent EIBOC from transferring or otherwise
allocating any Shares to ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇.
(d) Notwithstanding the restrictions contained in
paragraph (a) or (b) of this Section 1, upon the death
or Disability of a Management Stockholder, EIBOC may
Transfer Shares to the estate of the Management
Stockholder or a Disabled Management Stockholder, or
the Disabled Management Stockholder's personal
representative, in proportion to his percentage
beneficial interest in the Shares owned by EIBOC.
"Disability" shall exist, and a Management Stockholder
shall be "Disabled," if such Management Stockholder
becomes incapacitated by accident, sickness or other
circumstance which renders him mentally or physically
incapable of, or would have been incapable of, had he
been an employee of the Company at the time he became
disabled, performing the duties and services required
of the Management Stockholder under the Employment
Agreement between the Company and such Management
Stockholder for a period of 120 consecutive days, or
if, in any 12-month period, for a period of 180 days,
regardless of whether or not such days are
consecutive, as determined in good faith by the
Company's Board of Directors.
2. RESTRICTIONS ON TRANSFER BY JEDI.
(a) JEDI agrees that until the second anniversary
of the date of this Agreement and except pursuant to
its registration rights contained in the Registration
Rights Agreement, it will not Transfer any shares of
Common Stock or other securities that are convertible
into or exchangeable or exercisable for Common Stock
("Common Stock Equivalents") to any Person that is not
an Affiliate of JEDI except in blocks of at least
600,000 shares of Common Stock or blocks of Common
Stock Equivalents that are convertible into or
exchangeable or exercisable for at least 600,000
shares of Common Stock.
(b) JEDI agrees that, until the second
anniversary of the date of this Agreement and except
pursuant to its registration rights contained in the
Registration Rights Agreement, it will not Transfer
any shares of Common Stock or Common Stock Equivalents
to any Person that is not an Affiliate of JEDI without
first providing the Company and the Management
Stockholders the right to purchase the shares to be
Transferred in accordance with the following
provisions:
(i) If JEDI desires to Transfer shares of Common
Stock or Common Stock Equivalents to a Person that is not an
Affiliate of JEDI, JEDI shall deliver to the Company and,
provided the Management Stockholders beneficially own more than
10% of the voting power of all the voting power of all the
outstanding Voting
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Securities of the Company, to each of the Management
Stockholders a written notice (a "Transfer Notice"), which
shall specify the proposed transferee, the number of shares of
Common Stock or Common Stock Equivalents to be Transferred
(the "Subject Shares"), the proposed consideration to be paid
therefor (the "Proposed Sale Price"), and other material terms
of the proposed Transfer, and which notice shall include a
copy of any agreement with respect to the proposed Transfer.
(i) The Company shall have the
right, for a period of thirty days following its receipt of a
Transfer Notice to elect to acquire all, but not less than
all, of the Shares specified in the Transfer Notice at a cash
price equal to the Proposed Sale Price or, at the Company's
election if the Proposed Sale Price consists of noncash
consideration, for substantially identical consideration The
Company may exercise the foregoing right by delivering to
JEDI, within thirty days after receipt of the Transfer Notice,
written notice (an "Acceptance Notice") of its intention to
purchase the Subject Shares. The closing of any acquisition
of Subject Shares by the Company shall be consummated within
five Business Days following delivery of the Acceptance
Notice, at the principal offices of JEDI (unless otherwise
mutually agreed), at which time the purchase price (in the
form of a wire transfer to an account designated by JEDI or,
if other than cash, in a form reasonably acceptable to JEDI)
shall be delivered to JEDI or its representative and JEDI
shall deliver to the Company certificates representing the
Subject Shares, duly endorsed for transfer or accompanied by
duly executed stock powers.
(ii) If the Company elects not to
acquire the Subject Shares, so long as the Management
Stockholders beneficially own, in the aggregate, Capital Stock
of the Company representing more than 10% of the voting power
of all the outstanding Voting Securities of the Company, the
Management Stockholders shall have the right to acquire all,
but not less than all, of the Subject Shares on the same terms
as the Company could acquire the Subject Shares, as provided
in paragraph (b), by delivering an Acceptance Notice, signed
by each Management Stockholder and specifying the number of
Subject Shares to be purchased by each Management Stockholder,
to JEDI within thirty days following receipt by the Company of
a Transfer Notice. The right to purchase Subject Shares shall
be allocated among the Management Stockholders in a manner
determined by the Management Stockholders.
(iii) If neither the Company nor
the Management Stockholders deliver an Acceptance Notice
within thirty days after delivery of the Transfer Notice or
complete the purchase of the Subject Shares within five
Business Days of delivery of the Acceptance Notice, JEDI shall
be free to consummate the proposed Transfer on the terms set
forth in the Transfer Notice, provided the proposed Transfer
of the Subject Shares on the terms set forth in the Transfer
Notice is consummated within 90 days after the date of receipt
of the Transfer Notice.
3. REPRESENTATIONS OF MANAGEMENT STOCKHOLDERS. ▇▇▇▇▇▇
▇. ▇▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇ and ▇▇▇▇▇▇ ▇. ▇▇▇▇ jointly and severally represent to
JEDI that EIBOC is the sole legal owner of the Shares.
4. REPRESENTATIONS, WARRANTIES AND COVENANTS OF EIBOC.
EIBOC hereby represents, warrants and agrees with JEDI as follows:
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(a) EIBOC is a corporation duly organized, validly
existing and in good standing under the laws of
Barbados. EIBOC (i) has conducted no business since
its formation other than ownership of the Shares, (ii)
owns the Shares free and clear of all Liens, and (iii)
has all requisite corporate power and authority to
execute, deliver and perform its obligations under this
Agreement.
(b) This Agreement has been duly executed on behalf of
EIBOC and constitutes the legal, valid and binding
obligation of EIBOC, enforceable against it in
accordance with its terms.
(c) ATC is the sole holder of Capital Stock of EIBOC and
managing director of EIBOC, with sole power and
authority to act on its behalf.
(d) The authorized Capital Stock of EIBOC consists of an
unlimited number of shares, 120 of which are
outstanding and represented by certificate no. 1,
registered in the name of ATC. There are no
outstanding securities convertible into or exchangeable
for any shares of Capital Stock of EIBOC or any
contract, commitment, agreement, understanding or
arrangement of any kind to which EIBOC is a party
relating to the issuance of any Capital Stock of EIBOC.
EIBOC owns the Shares, free and clear of all Liens.
(e) EIBOC will not (i) issue any Capital Stock or permit any
of its Capital Stock to be Transferred, (ii) enter into
any contract, agreement, commitment, understanding or
arrangement of any kind relating to any issuance of
Capital Stock of EIBOC or (iii) engage in any trade or
business or engage in any other activity other than
ownership of the Shares, provided, however, that this
subsection 4(e) shall not prohibit any Transfer to any
successor trustee of the Capital Stock of EIBOC;
provided, that written consent is obtained from JEDI,
which consent shall not be unreasonably withheld.
5. LEGEND ON CERTIFICATES; STOP TRANSFER ORDERS. The parties
hereto agree to the placement on certificates representing securities covered
by Section 1 or Section 2 of a legend, in the form of Exhibit B attached
hereto, indicating that such securities may not be transferred except in
accordance with this Agreement and to the entry of a stop transfer order with
the transfer agent for such securities against the transfer of such securities
except in accordance with this Agreement.
6. ESCROW OF THE SHARES. On the date of this Agreement, the Shares
shall be deposited in escrow with an escrow agent pursuant to an escrow
agreement mutually acceptable to EIBOC, the Management Stockholders and JEDI,
and the Shares shall be held in such escrow until the earlier of (i) the
Transfer of all the Shares in accordance with this Agreement to a Person other
than a Management Stockholder or his Family Group, or (ii) the termination of
this Agreement pursuant to Section 11(a). Upon termination of this Agreement
or if EIBOC, the Management Stockholders and JEDI determine that a proposed
Transfer of Shares may be effected in compliance with this Agreement, then
EIBOC, the Management Stockholders and JEDI shall promptly send a notice to
such escrow agent to
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release the Shares to EIBOC or the Management Stockholders at the place
requested by EIBOC and the Management Stockholders.
7. ESCROW OF THE EIBOC SHARES. On the date of this Agreement,
all of the shares of issued and outstanding Capital Stock of EIBOC (the "EIBOC
Shares") shall be deposited in escrow with an escrow agent pursuant to an
escrow agreement mutually acceptable to EIBOC, the Management Stockholders and
JEDI, and the EIBOC Shares shall be held in such escrow until the earlier of
(i) the Transfer of all of the Shares in accordance with this Agreement to a
Person other than a Management Stockholder or his Family Group, or (ii) the
termination of this Agreement pursuant to Section 11(a). Upon termination of
this Agreement or if EIBOC, the Management Stockholders and JEDI agree that the
EIBOC Shares may be Transferred, then EIBOC, the Management Stockholders and
JEDI shall promptly send a notice to such escrow agent to release the EIBOC
Shares to the Management Stockholders at the place requested by the Management
Stockholders.
8. PROXY. EIBOC hereby irrevocably appoints ▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇▇▇▇▇
▇. ▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, collectively, as its
attorney-in-fact and proxy, with full power and substitution, to vote and
otherwise act (by written consent or otherwise) with respect to the Shares
which EIBOC is entitled to vote at any meeting of stockholders (whether annual
or special and whether or not an adjourned or postponed meeting) or consent in
lieu of any such meeting or otherwise, on all matters. EIBOC ACKNOWLEDGES THAT
THIS PROXY IS COUPLED WITH AN INTEREST AND IS IRREVOCABLE AND SHALL NOT BE
TERMINATED BY OPERATION OF LAW UPON THE OCCURRENCE OF ANY EVENT.
9. TRANSFERS IN VIOLATION OF AGREEMENT DEEMED FRAUDULENT. Any
Transfer of EIBOC Shares or any Shares contrary to the provisions of this
Agreement and any Transfer of any interest of any Stockholder intended to
circumvent the restrictions set forth herein or in violation of this Agreement
shall be deemed fraudulent and such Transfer shall be void ab initio and of no
force and effect.
10. MISCELLANEOUS.
(a) Except as to provisions that, by their terms,
terminate earlier, this Agreement shall terminate at
the earlier of (i) the fifth anniversary of the date of
this Agreement or (ii) such time as JEDI and its
Affiliates beneficially own, in the aggregate, Capital
Stock of the Company representing less than 10% of the
voting power of all then outstanding Voting Securities
of the Company.
(b) This Agreement shall inure to the benefit of and be
binding upon the successors and assigns of the parties
hereto. Notwithstanding the foregoing, the rights and
obligations of the parties hereunder shall not be
assignable, except that JEDI's rights and obligations
hereunder shall be assigned to an Affiliate of JEDI if
and to the extent that such Affiliate becomes the owner
of shares of Common Stock or Common Stock Equivalents.
(c) This Agreement may be executed in any number of
counterparts and by different parties hereto in
separate counterparts, each of which
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counterparts, when so executed and delivered, shall be
deemed to be an original and all of which
counterparts, taken together, shall constitute but one
and the same Agreement.
(d) The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect
the meaning hereof.
(e) The laws of the State of Texas shall govern this
Agreement without regard to principles of
conflict of laws.
(f) Any provision of this Agreement that is prohibited or
unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such
prohibition or unenforceability without invalidating
the remaining provisions hereof or affecting or
impairing the validity or enforceability of such
provision in any other jurisdiction.
(g) This Agreement, together with the Purchase Agreement,
and the other Basic Documents, is intended by the
parties as a final expression of their agreement and
intended to be a complete and exclusive statement of
the agreement and understanding of the parties hereto
in respect of the subject matter contained herein
This Agreement, the Purchase Agreement and the other
Basic Documents supersede all prior agreements and
understandings between the parties with respect to
such subject matter.
(h) This Agreement may be amended only by means of a
written amendment signed by all of the parties hereto.
(i) All notices provided for hereunder shall be given by
telecopy (confirmed by overnight delivery), air
courier guaranteeing overnight delivery or personal
delivery at the following addresses:
If to a Management Stockholder, to such Management
Stockholder at:
Queen Sand Resources, Inc.
▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇.▇. #▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
and
Queen Sand Resources, Inc.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
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If to JEDI:
Joint Energy Development Investments Limited Partnership
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇, Director - 28th Floor
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
If to EIBOC:
EIBOC Investments Ltd.
c/o Company Directors Ltd.
▇.▇. ▇▇▇ ▇▇▇▇▇
S.M.B. Cayside, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ VW1
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
or to such other address as any such party may designate by notice in the
manner provided above. All such notices shall be deemed to have been
delivered and received at the time delivered by hand, if personally delivered,
when receipt acknowledged, if telecopied, and on the next Business Day, if
timely delivered to an air courier guaranteeing overnight delivery.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the date first written above.
THE MANAGEMENT STOCKHOLDERS
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
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/s/ ▇▇▇▇▇ ▇. ▇▇▇▇
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/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
EIBOC INVESTMENTS LTD.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Director
QUEEN SAND RESOURCES, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President and Chief Executive Officer
and
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Chief Operating Officer
JOINT ENERGY DEVELOPMENT
INVESTMENTS LIMITED PARTNERSHIP
By: Enron Capital Management Limited
Partnership, its general partner
By: Enron Capital Corp., its general partner
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Attorney-in-Fact
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QUEEN SAND RESOURCES, INC.
SPOUSAL CONSENT
The undersigned spouse of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ executes this Consent and
Agreement to acknowledge her joining the Stockholders Agreement (a ▇▇▇ of which
is annexed hereto) with respect to her community property interest in the
Shares, such term is defined in the Stockholders Agreement.
WITNESS: SPOUSE:
/s/ Witness /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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QUEEN SAND RESOURCES, INC.
SPOUSAL CONSENT
The undersigned spouse of ▇▇▇▇▇ ▇. ▇▇▇▇ executes this Consent and
Agreement to acknowledge her joining the Stockholders Agreement (a ▇▇▇ of which
is annexed hereto) with respect to her community property interest in the
Shares, such term is defined in the Stockholders Agreement.
WITNESS: SPOUSE:
/s/ Witness /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
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QUEEN SAND RESOURCES, INC.
SPOUSAL CONSENT
The undersigned spouse of ▇▇▇▇▇▇ ▇ ▇▇▇▇ executes this Consent and
Agreement to acknowledge her joining the Stockholders Agreement (a ▇▇▇ of which
is annexed hereto) with respect to her community property interest in the
Shares, such term is defined in the Stockholders Agreement.
WITNESS: SPOUSE:
/s/ Witness /s/ ▇▇▇▇ ▇. ▇▇▇▇
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QUEEN SAND RESOURCES, INC.
SPOUSAL CONSENT
The undersigned spouse of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ executes this Consent
and Agreement to acknowledge her joining the Stockholders Agreement (a ▇▇▇ of
which is annexed hereto) with respect to her community property interest in the
Shares, such term is defined in the Stockholders Agreement.
WITNESS: SPOUSE:
/s/ Witness /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
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EXHIBIT A
ADOPTION AGREEMENT
This Adoption Agreement ("Agreement") is executed by the person or
entity named as "Transferee" below pursuant to the terms of the Stockholders'
Agreement dated as of March __, 1997 ("Stockholders' Agreement"), relating to
Shares of Common Stock, $.0015 per share, of Queen Sand Resources, Inc., a
Delaware corporation. Initially capitalized terms used but not otherwise
defined herein, shall have the meanings ascribed to them in the Stockholders'
Agreement.
1. Acknowledgment. Transferee acknowledges that Transferee is
acquiring certain Shares, or interest therein subject to the terms and
conditions of the Stockholders' Agreement.
2. Agreement. Transferee (a) agrees that Transferee and the
Shares acquired by Transferee shall be bound by and subject to the terms of the
Stockholders' Agreement and (b) adopts the Stockholders' Agreement with the
same force and effect as if Transferee were a "Stockholder" thereunder.
3. Notice. Any notice required or permitted by the Stockholders'
Agreement shall be given to Transferee at the address listed below Transferee's
signature.
4. Joinder. The spouse of Transferee, if applicable, executes
this Agreement to acknowledge that it is fair and in such spouse's best
interests and to bind such spouse's community interest, if any, in the Shares
to the terms of the Stockholders' Agreement.
This Agreement is executed by Transferee on ______________________________.
TRANSFEREE: SPOUSE (if applicable):
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Signature Signature
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Print Name Print Name
--------------------------
--------------------------
Address
QUEEN SAND RESOURCES, INC.
By:
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President
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EXHIBIT B
Legend for Stock Certificates:
"THE SECURITIES REPRESENTED HEREBY ARE SUBJECT TO THE PROVISIONS OF
A STOCKHOLDERS' AGREEMENT DATED APRIL _____, 1997 BY AND AMONG
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇,
EIBOC INVESTMENTS LTD., QUEEN SAND RESOURCES, INC. AND JOINT ENERGY
DEVELOPMENT INVESTMENTS LIMITED PARTNERSHIP AND MAY NOT BE SOLD,
TRANSFERRED PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF EXCEPT IN
ACCORDANCE THEREWITH."
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