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EXHIBIT 3.9
KUUKPIK/PAA
Joint Venture Agreement
Agreement made and entered into as of the 24th day of September, 1992 between
KUUKPIK Corporation ("KUUKPIK,") an Alaskan corporation and Pool Arctic Alaska
("PAA") an Alaskan general partnership of Pool Alaska, Inc. and Arctic Alaska
Drilling Company, Inc. hereinafter collectively referred to as the "Parties."
WITNESSETH:
The Parties desire to establish a joint venture for the purpose of entering into
contracts to provide land drilling and/or workover rig services for companies
seeking to drill and workover onshore ▇▇▇▇▇ situated on KUUKPIK lands and
elsewhere on the North Slope of Alaska. Therefore, in consideration of the
promises and mutual covenants herein contained the Parties agree as follows:
1. Formation of Joint Venture: The Parties hereby form a general partnership
(hereinafter called the "Joint Venture") limited exclusively to the
purpose of entering into contracts with oil and gas operators
("Customers") for the drilling and/or workover of ▇▇▇▇▇ on the North Slope
of Alaska ("Contracts"). The Joint Venture shall conduct no other
business, and KUUKPIK and PAA are not, and shall not be deemed to be,
partners for any other purpose.
During the term of this Agreement PAA rigs 4, 6, 7 and 102, as well as any
other rigs brought to or used on the North Slope by PAA or on its behalf
shall operate on the North Slope only pursuant to Subcontracts with the
Joint Venture substantially in the form of Exhibit "A" attached hereto
(the "Subcontractors") under which PAA shall undertake to perform all
services required of the Joint Venture under the Contracts. KUUKPIK shall
not participate in the providing of drilling and/or workover rig services
with respect to ▇▇▇▇▇ located on the North Slope of Alaska during the term
of this Agreement with, through or by means of any entity or vehicle other
than the Joint Venture.
2. Rig Use: Nothing in this agreement prohibits or limits PAA's right to
employ any drilling or workover rig to work outside the North Slope of
Alaska, independent of the Joint Venture.
3. Name and Location of Joint Venture: The name of the Joint Venture shall be
KUUKPIK/Pool Arctic Alaska and its principal place of business shall be at
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇.
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4. Term of Agreement: This Agreement shall continue for a Primary Term of 24
months following the date hereof, and shall thereafter be automatically
for an indefinite period subject to termination in accordance with
Paragraph 17 hereof.
5. Distribution of Profits: The interests of the Parties in and to any and
all profits of the Joint Venture shall be in accordance with the following
percentages:
KUUKPIK 51%
PAA 49%
---
Total 100%
Distribution of profits will occur within 15 days following receipt of
funds in payment for services provided under Contracts. KUUKPIK shall have
no liability for any losses incurred by the Joint Venture.
6. Capital Contributions: The Parties shall contribute cash in an aggregate
amount of $4,000 as capital to the Joint Venture, of which KUUKPIK shall
contribute $2,040 and PAA shall contribute $1,960. The Joint Venture will
not acquire any rigs, equipment or other property but will operate only
through the Subcontracts.
7. Performance of Services: The Joint Venture shall subcontract exclusively
with PAA to provide the rigs, equipment, expertise, personnel and capital
to perform the services called for in the Contracts. PAA will be
compensated for providing such services on the basis of specified
percentages of the day rates and other charges billed to and paid by
Customers pursuant to the Contracts. The percentages which PAA shall
receive as compensation for providing such services utilizing PAA Rigs 4,
6, 7 and 102 shall be as follows:
Operating Day Rate (or equivalent terminology) 90%
Standby with Crew Day Rate (or equivalent terminology) 90%
All other services and charges including but not limited to:
Mobilization
Demobilization
All Other Rig Moves
Extra Labor
Reimbursement of Third Party Charges
Auxiliary Equipment 100%
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Compensation payable to PAA for performing services pursuant to
Subcontracts utilizing any rigs other than Rigs 4, 6, 7 and 102 shall be
negotiated on a case by case basis but in no case will such rate be less
than the rates specified above.
PAA shall indemnify and defend the Joint Venture against any and all
claims or losses arising out of or in connection with PAA's management of
the Joint Venture and performance of the services pursuant to
Subcontracts, including but not limited to claims, losses or costs arising
from non-compliance with permits, statutes or regulations, negligence, and
breaches of contracts with third parties; provided however that PAA's
obligation to indemnify and defend the Joint Venture with respect to
matters arising out of PAA's management of the Joint Venture shall be
limited to third party claims against the Joint Venture or the Parties.
8. Management of the Joint Venture: Control and management of the Joint
Venture shall be vested in PAA and PAA shall have the sole and exclusive
right to contractually bind the Joint Venture. Pursuant to Subcontracts,
PAA shall have sole responsibility to carry out all obligations of the
Joint Venture in connection with or arising out of the performance of any
Contracts. PAA shall establish and operate Joint Venture bank accounts
into which shall be paid the capital contributions of the Parties and all
amounts received pursuant to Contracts and from which accounts shall be
paid the fees and profit distributions provided for in Paragraphs 5, 7 and
11 hereof and any other expenses of the Joint Venture.
9. PAA Retains Its Property: PAA shall retain all right, title and interest
(subject to any security interests granted to its creditors) in any and
all property and equipment used to perform Contracts, and this Agreement
shall not in any way extend or entitle KUUKPIK or the Joint Venture to any
ownership right or interest therein.
10. Grant of Security Interests: PAA shall have the right to assign its
rights under this Agreement and under Subcontracts to its lenders as
collateral for obligations of PAA. PAA shall further have the right, on
behalf of the Joint Venture, to assign the Joint Venture's rights under
Contracts to PAA's lenders, as collateral for separate obligations of PAA,
provided, however, that such lenders enter into an agreement in form
satisfactory to KUUKPIK providing for first priority payment by such
lenders to KUUKPIK, from revenues received pursuant to Contracts, of all
sums which KUUKPIK is entitled to receive pursuant to this Agreement.
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11. Shareholder Hire/Native Hire Program: It is agreed that employment of
KUUKPIK shareholders and other Native Alaskans is a priority of the Joint
Venture. KUUKPIK shall be entitled to receive fees as specified below as
compensation for its efforts in recruiting KUUKPIK shareholders and other
Native Alaskan personnel for employment by PAA (as Subcontractor to the
Joint Venture) in connection with Subcontracts. Such fees, however, will
reduce the amount of profits available for distribution pursuant to
Paragraph 5 hereof. Fees payable to KUUKPIK shall be as follows:
a. A fee of $500 for each KUUKPIK shareholder hired by PAA (as
Subcontractor to the Joint Venture) to perform work pursuant to
Subcontracts.
b. A fee of $200 for each non-KUUKPIK shareholder Alaska Native referred
by KUUKPIK and hired by PAA (as Subcontractor to the Joint Venture) to
perform work pursuant to Subcontracts.
c. A fee equal to 10% of the gross wages paid to KUUKPIK shareholders as
employees of PAA (as Subcontractor to the Joint Venture) in
performance of work pursuant to Subcontracts. It is understood by the
Parties that all such individuals recruited and referred by KUUKPIK
for employment by PAA must be qualified and are subject to all
standard employment requirements of PAA. PAA has discretion to not
hire or to fire any person referred by KUUKPIK for any reason.
12. Regular Meetings: The general manager of PAA and the president of
KUUKPIK, or his designee, shall meet monthly to discuss matters
affecting the Joint Venture. Time and place of the meetings will be
determined by the Parties. It is understood that monitoring and
oversight of the Shareholder Hire/Native Hire Program (Program) and
obtaining the satisfaction of both KUUKPIK and PAA with its results
shall be a primary concern of the Parties for discussion at such
meetings.
13. Monthly Status Report: PAA will provide KUUKPIK a status report
covering activities on contracts of the Joint Venture for each calendar
month by the 25th day of the succeeding month. Such status reports
will, at a minimum, show the daily status of each rig, Day Rate earned,
employment fees earned and the profit of the Joint Venture. The actual
format of the status report will be determined by mutual agreement of
the Parties.
14. Confidentiality; Each party to this Agreement will maintain in
confidence and will not use or disclose any
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confidential or proprietary information of either Party or of any
parties to Contracts entered into by the Joint Venture.
15. Accounting: Right to Audit: KUUKPIK shall be entitled to, at its
expense, audit PAA books and records as reasonably required to confirm
the accuracy of the accounting for the Joint Venture. The right to
audit shall cease twenty-four months following the dissolution of the
Joint Venture.
16. Assignment. Except as provided in Paragraph 10 hereof, neither Party
shall sell, assign or in any manner transfer its interest in the Joint
Venture or any rights or obligations under this Agreement without the
prior written consent of the other Party.
17. Dissolution: The Joint Venture shall be dissolved.
a. At the option of the non-defaulting Party, upon default by one of
the Parties with respect to any material obligations hereunder, but
only after failure to remedy the default within 30 days after
notice has been given of such default.
b. Upon bankruptcy or dissolution of either of the Parties,
c. Upon agreement between the Parties, or
d. At any time after the end of the Primary term, upon at least 90
days written notice given by either party to the other, provided,
however, that no dissolution pursuant to any such notice shall
occur until all work called for under existing Contracts shall have
been completed.
18. Governing Law: This Agreement shall be governed by and construed in
accordance with the laws of the State of Alaska.
19. Dispute Resolution: Jurisdiction with respect to any disputes arising
out of or relating to this Agreement or its performance or breach shall
be exclusively in the Superior Court, State of Alaska, Third Judicial
District, at Anchorage.
20. Entire Agreement: This Agreement contains the entire agreement between
the Parties hereto with respect to the subject matter hereof and may be
amended only by a written agreement signed by all Parties.
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21. Severability: If any provision of this Agreement is held to be
illegal, invalid, or unenforceable under applicable law, such provision
shall be fully severable, this Agreement, shall be construed and
enforced as if such illegal, invalid or unenforceable provision had
never comprised a part thereof, and the remaining provisions of the
Agreement shall remain in full force and effect and shall not be
affected by the illegal, invalid, or unenforceable provision or by its
severance herefrom.
22. Notice: Any notice required by or permitted under this Agreement shall
be in writing and shall be effective upon hand-delivery, facsimile
transmission and receipt or upon receipt by registered, certified, or
regular mail with charges prepaid at the address specified below, or to
such other address as either Party may from time to time furnish in
writing to the other Party:
KUUKPIK Corporation
▇.▇. ▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
FAX: (▇▇▇) ▇▇▇-▇▇▇▇
and
Pool Arctic Alaska
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
FAX: (▇▇▇) ▇▇▇-▇▇▇▇
23. Binding Effect: This Agreement shall be binding upon and inure to the
benefit of the Parties hereto and their respective successors and
permitted assigns and nothing contained herein, express or implied, is
intended to confer upon any person other than the Parties hereto, their
successors and permitted assigns, any rights or remedies under or by
reason of this Agreement.
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IN WITNESS WHEREOF, the Parties have each caused this Agreement to be executed
on their behalf by their officers thereunto duly authorized, as of the date
first above written.
KUUKPIK Corporation Pool Arctic Alaska
by /s/ ▇▇▇ ▇▇▇▇▇▇▇▇▇ by /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
its President its General Manager
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Partner Approval & Authorization
On behalf of our respective entities, we hereby authorize ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇,
General Manager, to act on behalf of Pool Arctic Alaska, an Alaska general
partnership of Pool Alaska, Inc. and Arctic Alaska Drilling Company, to execute
an agreement to form a joint venture with KUUKPIK Corporation of Nuiqsut,
Alaska.
Pool Alaska, Inc.
By: /s/ ▇.▇. ▇▇▇▇▇▇▇▇ Date: 9/18/92
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▇.▇. ▇▇▇▇▇▇▇▇
Arctic Alaska Drilling Company, Inc.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Date: 9/18/92
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▇▇▇▇▇▇ ▇▇▇▇▇▇▇
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EXHIBIT "A"
SUBCONTRACT
This Agreement is made and entered into as of the _______ day of ________, 1992
between KUUKPIK/Pool Arctic Alaska (the "Joint Venture"), an Alaskan general
partnership, and Pool Arctic Alaska ("PAA"), an Alaskan general partnership,
hereinafter collectively referred to as the "Parties".
WITNESSETH:
WHEREAS, the Joint Venture has been awarded a contract to provide
certain drilling and/or workover services on the North Slope of Alaska, which
contract (hereinafter referred to as the "Contract") is identified on Schedule
"A" attached hereto; and
WHEREAS, the Joint Venture desires to subcontract to PAA the
performance of all obligations of the Joint Venture under the Contract;
NOW THEREFORE, for valuable consideration, the Parties hereby agree as
follows:
1. Performance of Services: The Joint Venture hereby subcontracts to PAA
the performance of all obligations of the Joint Venture under the
Contract, as the same may be amended from time to time, and PAA hereby
undertakes to perform all of such obligations in accordance with the
terms of the Contract and to provide the rig and all the equipment,
expertise, personnel and capital to perform the services called for in
the Contract.
2. Compensation: PAA will be compensated for providing such services on
the basis of specified percentages of the day rates and other charges
billed to and paid by the customer pursuant to the Contract. The
percentages which PAA shall receive as compensation for providing such
services shall be as follows:
Operating Day Rate
(or equivalent terminology) 90%
Standby with Crew Day Rate
(or equivalent terminology) 90%
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All other services and charges including but not limited to:
Mobilization
Demobilization
All Other Rig Moves
Extra Labor
Reimbursement of Third Party Charges
Auxiliary Equipment 100%
3. Indemnification: PAA shall indemnify and defend the Joint Venture
against any and all claims or losses arising out of or in connection
with PAA's performance of services pursuant to this Subcontract,
including, but not limited to, claims, losses or costs arising from
non-compliance with permits, statutes or regulations, negligence, and
breaches of contracts with third parties.
4. Retention of PAA Property: PAA shall retain all right, title and
interest (subject to any security interests granted to its creditors)
in any and all property and equipment used to perform the Contract, and
the Agreement shall not in any way extend or entitle the Joint Venture
to any ownership right or interest therein.
5. Grant of Security Interest: PAA shall have, and there is hereby
granted to PAA, a security interest in all accounts, contract rights
and general intangible, arising under or in connection with the
performance of the Contracts in order to secure the obligation of the
Joint Venture to pay PAA the compensation provided for herein. PAA
shall have the right to assign its rights under this Agreement to its
lenders as collateral for obligations of PAA to such lenders.
6. Assignment: Except as provided in Paragraph 5 hereof, neither Party
shall sell, assign or in any manner transfer any rights or obligations
under this Agreement without the prior written consent of the other
Party.
7. Governing Law: This Agreement shall be governed by and construed in
accordance with the laws of the State of Alaska.
8. Dispute Resolution: Jurisdiction with respect to any disputes arising
out of or relating to this Agreement or its performance or breach shall
be exclusively in the Superior Court, State of Alaska, Third Judicial
District, at Anchorage.
9. Entire Agreement: This Agreement contains the entire agreement between
the Parties hereto with respect to the
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subject matter hereof and may be amended only by a written agreement
signed by all Parties.
IN WITNESS WHEREOF, the Parties have each caused this Agreement to be executed
on their behalf by their officers thereunto duly authorized, as of the date
first above written.
KUUKPIK/Pool Arctic Alaska
By: Pool Arctic Alaska
By:
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▇. ▇. ▇▇▇▇▇▇▇, General Manager
Pool Arctic Alaska
By:
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▇. ▇. ▇▇▇▇▇▇▇, General Manager
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