EXHIBIT 10.28
Confidential
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AGREEMENT FOR PURCHASE AND SALE
by and between
NUEVO ENERGY COMPANY
as Seller
and
SAMSON LONE STAR LIMITED PARTNERSHIP
as Buyer
October 16, 1998
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Confidential
TABLE OF CONTENTS
Page
1. Sale and Purchase of the Properties....................................... 1
1.1. The Properties.................................................... 1
1.2. Excluded Assets................................................... 3
2. Purchase Price............................................................ 5
2.1. Basic Amount...................................................... 5
2.2. Adjustments to Purchase Price..................................... 5
2.3. Deposit........................................................... 6
2.4. Closing Statement................................................. 7
3. Representations and Warranties of Seller.................................. 7
3.1. Organization...................................................... 7
3.2. Authority and Authorization....................................... 7
3.3. Enforceability.................................................... 7
3.4. Conflicts......................................................... 7
3.5. Contracts......................................................... 8
3.6. Litigation and Claims............................................. 8
3.7. Approvals and Preferential Rights................................. 8
3.8. Compliance with Law and Permits................................... 9
3.9. Environmental Compliance.......................................... 9
3.10. Status of Contracts............................................... 10
3.11. Production Burdens, Taxes, Expenses and Revenues.................. 10
3.12. Current Commitments............................................... 10
3.13. Reserve Report.................................................... 10
4. Representations and Warranties of Buyer................................... 10
4.1. Organization...................................................... 10
4.2. Authorization and Authority....................................... 11
4.3. Enforceability.................................................... 11
4.4. Conflicts......................................................... 11
4.5. Qualified Purchaser............................................... 11
4.6. Available Funds................................................... 12
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5. Covenants of Seller Pending Closing....................................... 12
5.1. Conduct of Business Pending Closing............................... 12
5.2. Access............................................................ 12
6. Covenants of Buyer Pending Closing........................................ 13
6.1. Notifications..................................................... 13
7. Conditions Precedent to the Obligations of Buyer.......................... 13
7.1. Representations and Warranties.................................... 13
7.2. Compliance........................................................ 13
7.3. Consents.......................................................... 13
7.4. No Pending Suits.................................................. 13
7.5. Purchase Price Adjustments........................................ 14
8. Conditions Precedent to the Obligations of Seller......................... 14
8.1. Representations and Warranties.................................... 14
8.2. Compliance........................................................ 14
8.3. Consents.......................................................... 14
8.4. No Pending Suits.................................................. 14
8.5. Purchase Price Adjustments........................................ 14
9. Closing................................................................... 15
9.1. The Closing....................................................... 15
9.2. Documents to be Delivered at Closing.............................. 15
9.3. Possession........................................................ 16
9.4. Payment of Purchase Price......................................... 16
10.Termination............................................................... 16
10.1. Events of Termination............................................. 16
10.2. Effect of Termination............................................. 17
11.Taxes, Prorations, Suspense Funds and Assumption of Obligations.......... 18
11.1. Tax Prorations.................................................... 18
11.2. Assumption of Obligations......................................... 18
11.3. Suspended Funds................................................... 19
▇▇.▇▇▇▇▇ Accounting.......................................................... 19
12.1. Settlement Statement.............................................. 19
12.2. Arbitration of Final Settlement................................... 19
12.3. Payment........................................................... 20
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13.Survival and Indemnification.............................................. 20
13.1. Survival.......................................................... 20
13.2. Liabilities....................................................... 20
13.3. Indemnification by Seller......................................... 20
13.4. Indemnification by Buyer.......................................... 21
13.5. Liability Limitations............................................. 21
13.6. Waiver of Representations......................................... 24
13.7. Year 2000 Compliance.............................................. 26
14.Further Assurances........................................................ 26
14.1. General........................................................... 26
14.2. Filings, Notices and Certain Governmental Approvals............... 26
14.3. Logos and Names................................................... 26
15. Access by Seller after Closing.................................... 26
16. Notices........................................................... 27
17. Assignment........................................................ 28
18. Governing Law..................................................... 28
19. Expenses and Fees................................................. 28
20. Integration....................................................... 28
21. Waiver or Modification............................................ 28
22. Headings.......................................................... 29
23. Invalid Provisions................................................ 29
24. Waiver of Jury Trial.............................................. 29
25. Multiple Counterparts............................................. 29
26. Public Announcements.............................................. 29
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27.Arbitration............................................................... 30
27.1. Binding Arbitration............................................... 30
27.2. Governing Rules................................................... 30
27.3. Arbitrators....................................................... 30
27.4. Conduct of Arbitration............................................ 30
27.5. Costs of Arbitration.............................................. 30
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TABLE OF DEFINED TERMS
Term Section
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AAA............................................................ 26.2
Adjusted Purchase Price........................................ 2.1
Agreement...................................................... Page 1
Allocated Value................................................ Annex I
Advisor........................................................ 1.2
Business Day................................................... 16
Buyer.......................................................... Page 1
Buyer Indemnified Parties...................................... 13.3
Closing........................................................ 9.1
Closing Date................................................... 9.1
Closing Period................................................. 2.2.1
Closing Statement.............................................. 2.4
Confidentiality Agreement...................................... 20
Contracts...................................................... 1.1.7
Cure Period.................................................... Annex I
Data........................................................... 1.1.6
Deposit........................................................ 2.3
Dispute........................................................ 26.1
Effective Date................................................. 1
Equipment...................................................... 1.1.5
Equitable Limitations.......................................... 3.3
Excluded Assets................................................ 1.2
Final Settlement Statement..................................... 12.1
Liabilities.................................................... 13.2
Liens.......................................................... Annex I
Marketable Title............................................... Annex I
Net Revenue Interest........................................... Annex I
Notice Date.................................................... Annex I
Oil and Gas Properties......................................... 1.1.1
Permitted Encumbrances......................................... Annex I
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Permits........................................................ 1.1.8
Properties..................................................... 1
Purchase Price................................................. 2.1
Report......................................................... 3.13
Reserves....................................................... 3.13
Seller......................................................... Page 1
Seller Indemnified Parties..................................... 13.4
Substances..................................................... 1.1.3
Surface Contracts.............................................. 1.1.4
Suspended Funds................................................ 11.3
Title Defect................................................... Annex I
Title Defect Amount............................................ Annex I
▇▇▇▇▇.......................................................... 1.1.2
Working Interest............................................... Annex I
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AGREEMENT FOR PURCHASE AND SALE
This Agreement for Purchase and Sale ("Agreement") is made and entered into
on this the 16th day of October, 1998, by and between Nuevo Energy Company
("Seller"), and Samson Lone Star Limited Partnership ("Buyer").
1. SALE AND PURCHASE OF THE PROPERTIES. Subject to the terms and conditions
and for the consideration herein set forth, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
Seller agrees to sell, assign, convey and deliver to Buyer, and Buyer agrees to
purchase and acquire from Seller at Closing, but effective as of 7:00 a.m. at
the location of each of the Oil and Gas Properties on July 1, 1998 (the
"Effective Date"), all of the interest of Seller in and to the following
properties, other than the Excluded Assets ("Properties"):
1.1. THE PROPERTIES.
1.1.1. OIL AND GAS PROPERTIES. All properties described on the
Exhibit whether the interest of Seller in such properties is fee interests;
leasehold interests; working interests; farmout rights; royalty interests,
overriding royalty interests, production payments or other non-working or
carried interests; or other mineral rights, and any rights that arise by
operation of law or otherwise in all properties and lands pooled, unitized,
communitized or consolidated with such properties (the "Oil and Gas
Properties").
1.1.2. ▇▇▇▇▇. All oil, condensate or natural gas ▇▇▇▇▇ located on
the Oil and Gas Properties, whether producing, operating, shut-in or temporarily
abandoned (the "▇▇▇▇▇").
1.1.3. SEVERED SUBSTANCES. All severed crude oil, natural gas,
casinghead gas, drip gasoline, natural gasoline, petroleum, natural gas liquids,
condensate, products, liquids and other hydrocarbons and other minerals or
materials of every kind and description either produced and sold from the Oil
and Gas Properties on or after the Effective Date or in pipelines on the
Effective Date (the "Substances").
1.1.4. SURFACE CONTRACTS. All right-of-way agreements or other
agreements relating to the use or ownership of surface properties that are used
or held for use in connection with the production of Substances from the Oil and
Gas Properties (the "Surface Contracts").
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1.1.5. EQUIPMENT. All processing plants, pipelines and other
equipment, fixtures and physical facilities of every type and description
located on the Oil and Gas Properties or the Surface Contracts (the
"Equipment").
1.1.6. INFORMATION AND DATA. All (a) title opinions, lease and land
files, filings with and reports to regulatory agencies, gas and sales contract
files, division order files and other books, files and records (including but
not limited to relevant accounting records, gas balancing records and suspense
account records) to the extent that they are directly related to Oil and Gas
Properties and the transfer thereof is not prohibited by existing contractual
obligations and (b) all geophysical, geological, engineering, exploration,
production, environmental and other technical data, magnetic field recordings,
digital processing tapes, field prints, summaries, reports and maps, whether
written or in electronically reproducible form, that are owned by Seller or may
be assigned by Seller without any payment by Seller to any other person and are
directly related to the Oil and Gas Properties (the "Data").
1.1.7. CONTRACTS. All contracts and arrangements that directly
relate to the Properties and the production, storage, treatment, transportation,
processing, purchase, sale, disposal or other disposition of Substances
therefrom and any and all amendments, ratifications or extensions of the
foregoing, to the extent that any of the foregoing relate to periods on or after
the Effective Date (the "Contracts"), and all rights to make claims and receive
proceeds under any insurance policy held by or on behalf of Seller in connection
with the Properties for any claim that arises from the Effective Date through
the Closing Date in connection with the Properties.
1.1.8. PERMITS. All franchises, licenses, permits, approvals,
consents, certificates and other authorizations and other rights granted by
governmental authorities and all certificates of convenience or necessity,
immunities, privileges, grants and other rights, that relate to the Properties
or the ownership or operation of any thereof (the "Permits").
1.1.9. IMBALANCES. All rights and benefits arising from or in
connection with any gas production, pipeline, storage, processing or other
imbalance attributable to Substances produced from Oil and Gas Properties
existing on the Effective Date.
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1.2. EXCLUDED ASSETS. As used herein, "Excluded Assets" means the
following:
(a) all trade credits and all accounts, instruments and general
intangibles (as such terms are defined in the Texas Uniform Commercial Code)
attributable to the Properties with respect to any period of time prior to the
Effective Date;
(b) all claims and causes of action of Seller (i) arising from acts,
omissions or events, or damage to or destruction of property, occurring prior to
the Effective Date, (ii) arising under or with respect to any of the Contracts
that are attributable to periods of time prior to the Effective Date (including
claims for adjustments or refunds), or (iii) with respect to any of the Excluded
Assets;
(c) all rights and interests of Seller (i) under any policy or
agreement of insurance or indemnity, (ii) under any bond, or (iii) to any
insurance or condemnation proceeds or awards arising, in each case, from acts,
omissions or events, or damage to or destruction of property, occurring prior to
the Effective Date;
(d) all Substances produced and sold from the Oil and Gas Properties
with respect to all periods prior to the Effective Date, together with all
proceeds from or of such Substances;
(e) claims of Seller for refunds of or loss carry forwards with
respect to (i) production or any other taxes attributable to any period prior to
the Effective Date, (ii) income or franchise taxes, or (iii) any taxes
attributable to the Excluded Assets;
(f) all amounts due or payable to Seller as adjustments to insurance
premiums related to the Properties with respect to any period prior to the
Effective Date;
(g) all proceeds, income or revenues (and any security or other
deposits made) attributable to (i) the Properties for any period prior to the
Effective Date, or (ii) any Excluded Assets;
(h) all personal computers and associated peripherals and all radio
and telephone equipment;
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(i) all of Seller's proprietary computer software, patents, trade
secrets, copyrights, names, trademarks, logos and other intellectual property;
(j) all of Seller's interpretations of geological and geophysical
data;
(k) all documents and instruments of Seller that may be protected by
an attorney-client privilege;
(l) data that cannot be disclosed or assigned to Buyer as a result of
confidentiality arrangements under agreements with persons unaffiliated with
Seller;
(m) all audit rights arising under any of the Contracts or otherwise
with respect to any period prior to the Effective Date or to any of the Excluded
Assets;
(n) all (i) agreements and correspondence between Seller and
NationsBanc ▇▇▇▇▇▇▇▇▇▇ Securities LLC (the "Advisor") relating to the
transactions contemplated in this Agreement, (ii) lists of prospective
purchasers for such transactions compiled by either Seller or the Advisor, (iii)
bids submitted by other prospective purchasers of the Properties, (iv) analyses
by Seller or the Advisor of any bids submitted by any prospective purchaser, (v)
correspondence between or among Seller or Advisor, or either of their respective
representatives, and any prospective purchaser other than Buyer, (vi)
correspondence between Seller or Advisor or any of their respective
representatives with respect to any of the bids, the prospective purchasers, the
engagement or activities of the Advisor or the transactions contemplated in this
Agreement and (vii) the Confidential Offering Memorandum dated July, 1998,
prepared by the Advisor and circulated to prospective purchasers; and
(o) the Escrow Agreement dated July 31, 1996, between Seller and
▇▇▇▇-▇▇▇▇▇ Corporation and the Agreement for Purchase and Sale dated July 26,
1996 between Seller and ▇▇▇▇-▇▇▇▇▇ Corporation.
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2. PURCHASE PRICE.
2.1. BASIC AMOUNT. The purchase price for the Properties, subject to
adjustment as provided in Section 2.2, shall be $190,600,000 (the "Purchase
Price"). The Purchase Price as adjusted pursuant to Section 2.2 is referred to
in this Agreement as the "Adjusted Purchase Price."
2.2. ADJUSTMENTS TO PURCHASE PRICE. The Purchase Price shall be adjusted as
provided in this Section 2.2.
2.2.1. The Purchase Price shall be increased by the following amounts
(without duplication):
(a) An amount equal to the costs and expenses that are (i)
attributable to the Properties for the period from the Effective Date to
the Closing Date (the "Closing Period"), whether paid before or after the
Effective Date, and (ii) paid by Seller, including, without limitation,
bond and insurance premiums paid by or on behalf of Seller attributable to
coverage during the Closing Period.
(b) If Seller is the operator under a joint operating agreement
covering any of the Oil and Gas Properties, an amount equal to the costs
and expenses paid by Seller on behalf of the other joint interest owners
that is attributable to periods after the Effective Date excluding any such
costs and expenses for which the Seller has invoiced the other joint
interest owners.
(c) An amount equal to the value (determined using $1.20/mcfe) of the
under position with respect to any gas production, pipeline, storage,
processing or other imbalance attributable to Substances produced from Oil
and Gas Properties as of the Effective Date under any agreement to the
extent the volume of such under position is greater than the amount set
forth on the Exhibit, or an amount equal to the value of the over position
with respect to any such imbalance as of the Effective Date under any such
agreement to the extent that the volume of the over position with respect
to any such imbalance is less than the volume set forth on the Exhibit.
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2.2.2. The Purchase Price shall be decreased by the following amounts
(without duplication):
(a) An amount equal to the proceeds received by Seller for the sale
during the Closing Period of Substances, net of all applicable taxes not
reimbursed to Seller by a purchaser of Substances.
(b) An amount equal to all proceeds received by Seller from whatever
source derived that relate to the Properties and are attributable to
periods on or after the Effective Date, other than operator's overhead
reimbursements received by Seller or Torch Operating Company ("Torch")
under joint operating agreements in which Seller or Torch is designated as
the operator.
(c) The amount of all adjustments determined in accordance with Annex
I for title adjustments for the Oil and Gas Properties to the extent that
the aggregate of all Title Defect Amounts exceeds $1,000,000.
(d) The amount of all taxes prorated to Buyer in accordance with
Section 11.1.
(e) An amount equal to the value (determined using $1.20/mcfe) of the
over position with respect to any gas production, pipeline, storage,
processing or other imbalance attributable to Substances produced from Oil
and Gas Properties as of the Effective Date under any agreement to the
extent the volume of such over position is greater than the amount set
forth on the Exhibit, or an amount equal to the value of the under position
with respect to any such imbalance as of the Effective Date under any such
agreement to the extent that the volume of the under position with respect
to any such imbalance is less than the volume set forth on the Exhibit.
(f) An amount equal to the aggregate net cash settlement amounts under
the two gas price swaps with Bankers Trust, each covering 5 mmbtu per day
with a price of $2.125 per mbtu and $2.210 per mmbtu, respectively, to the
extent they relate to the Closing Period.
2.3. DEPOSIT. On or before 12:00 noon Houston time on October 19,1998,
Buyer shall deposit with Seller an amount equal to five percent of the Purchase
Price (the "Deposit"). The Deposit shall be applied to the Adjusted Purchase
Price to be paid at Closing or may be returned to Buyer or retained by Seller in
accordance with the terms of this Agreement.
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2.4. CLOSING STATEMENT. Seller shall deliver to Buyer not less than two
Business Days before the Closing Date a statement (the "Closing Statement")
setting forth the adjustments to the Purchase Price provided in Section 2.2 and
using Title Defect Amounts that have been agreed by Seller and Buyer prior to
such date or determined by arbitration prior to such date. The Closing
Statement shall be prepared in accordance with customary accounting principles
used in the oil and gas industry.
3. REPRESENTATIONS AND WARRANTIES OF SELLER. Seller represents and warrants
to Buyer as follows:
3.1. ORGANIZATION. Seller is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware. Seller
is qualified to do business in and is in good standing under the laws of each
state in which the Properties are located.
3.2. AUTHORITY AND AUTHORIZATION. Seller has full corporate power and
authority to carry on its business as presently conducted, to enter into this
Agreement and to perform its obligations under this Agreement. The execution
and delivery of this Agreement by Seller have been, and the performance by
Seller of this Agreement and the transactions contemplated hereby shall be at
the time required to be performed hereunder, duly and validly authorized by all
requisite corporate action on the part of Seller.
3.3. ENFORCEABILITY. This Agreement has been duly executed and
delivered on behalf of Seller and constitutes the legal, valid and binding
obligation of Seller enforceable in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, reorganization or
moratorium statutes, or other similar laws affecting the rights of creditors
generally or equitable principles (collectively, "Equitable Limitations"). At
the Closing all documents and instruments required hereunder to be executed and
delivered by Seller shall be duly executed and delivered and shall constitute
legal, valid and binding obligations of Seller enforceable in accordance with
their terms, except as enforceability may be limited by Equitable Limitations.
3.4. CONFLICTS. The execution and delivery of this Agreement by Seller
does not, and the consummation of the transactions contemplated by this
Agreement shall not, (a) violate or be in conflict with, or require the consent
of any person or entity under, any provision of Seller's governing documents,
(b) violate any provision of or require any consent, authorization
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or approval under any judgment, decree, judicial or administrative order, award,
writ, injunction, statute, rule or regulation applicable to Seller, or (c)
result in the creation of any lien, charge or encumbrance on any of the
Properties.
3.5. CONTRACTS. The Exhibit sets forth a list of the following contracts,
agreements, and commitments to which any of the Properties are bound: (a) any
agreement with any affiliate of Seller; (b) any agreement or contract of Seller
for the sale, exchange or other disposition of Substances produced from the Oil
and Gas Properties that is not cancelable without penalty on not more than 60
days prior written notice; (c) any agreement of Seller to sell, lease, farmout
or otherwise dispose of any of its interests in any of the Properties other than
conventional rights of reassignment; (d) any tax partnership agreement of Seller
affecting any of the Properties; (e) any operating agreement to which Seller's
interests in any of the Oil and Gas Properties is subject; (f) any contract that
requires Seller to expend more than $50,000 in any year in connection with the
Properties; (g) any contract that contains an indemnity with respect to
environmental and health and safety matters; (h) any option to purchase or call
on the Substances produced from the Oil and Gas Properties; and (i) any lease,
title retention agreement, or security interest affecting any of the Equipment.
None of the agreements between Seller and Torch relating to the operation of the
Properties nor the agreements between Seller and Torch Energy Advisors
Incorporated or its affiliates are listed in the Exhibit and none of such
agreements will be binding on the Buyer or on the Properties after the Closing.
3.6. LITIGATION AND CLAIMS. Except as is set forth on the Exhibit, (a)
no claim, demand, filing, investigation, administrative proceeding, action, suit
or other legal proceeding is pending or, to the best of Seller's knowledge,
threatened, with respect to the Properties or the ownership or operation of any
thereof, other than proceedings relating to the oil and gas industry generally
and as to which Seller is not a named party; and (b) no written notice from any
governmental authority or any other person (including employees) has been
received by Seller claiming any violation or repudiation of the Oil and Gas
Properties or any violation of any law, rule, regulation, ordinance, order,
decision or decree of any governmental authority (including, without limitation,
any such law, rule, regulation, ordinance, order, decision or decree concerning
the conservation of natural resources).
3.7. APPROVALS AND PREFERENTIAL RIGHTS. The Exhibit contains a complete
and accurate list of (a) all approvals and consents required to be obtained by
Seller for the assignment or transfer of the Properties (other than the Data) to
Buyer, other than approvals
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and consents of governmental authorities that are customarily obtained in
similar transactions after the consummation of the transaction, and (b) all
preferential purchase rights that affect the transactions contemplated by this
Agreement.
3.8. COMPLIANCE WITH LAW AND PERMITS. The Properties have been and
currently are operated, and Seller and the Properties are, in compliance with
the provisions and requirements of all laws, rules, regulations, ordinances,
orders, decisions and decrees of all governmental authorities having
jurisdiction with respect to the Properties or the ownership or operation of any
thereof, except where noncompliance would not reasonably be expected to have a
material adverse effect on the ownership or operation of the Properties. All
necessary governmental permits, licenses and other authorizations with regard to
the ownership or operation of the Properties have been obtained and maintained
in effect, except where the failure to obtain or maintain such permits, licenses
and other authorizations would not reasonably be expected to have a material
adverse effect on the ownership or operation of the Properties. No violations
exist in respect of such permits, licenses or other authorizations, except for
violations that would not reasonably be expected to have a material adverse
effect on the ownership or operation of the Properties.
3.9. ENVIRONMENTAL COMPLIANCE. Except as is set forth on the Exhibit,
(a) Seller has obtained and maintained in effect all environmental and health
and safety permits, licenses, approvals, consents, certificates and other
authorizations necessary for the ownership or operation of the Properties
("Environmental Permits"); (b) Seller, the Properties and the ownership and
operation thereof are in compliance with all applicable environmental and health
and safety laws, rules, regulations, ordinances, orders, decisions and decrees
of all governmental authorities ("Environmental Laws") and with all terms and
conditions of all Environmental Permits, and all prior instances of non-
compliance have been fully and finally resolved to the satisfaction of all
governmental authorities with jurisdiction over such matters; (c) Seller has not
received any notice of any third party environmental or health and safety claim,
demand, filing, investigation, administrative proceeding, action, suit or other
legal proceeding ("Environmental Claim") or any violation or non-compliance with
any Environmental Law or the terms or conditions of any Environmental Permit,
arising from, based upon, associated with or related to the Properties or the
ownership or operation of any thereof; and (d) no pollutant, waste, contaminant,
or hazardous, extremely hazardous, or toxic material, substance, chemical or
waste identified, defined or regulated as such under any Environmental Law
("Environmental Contaminants") is present, or has been handled, managed,
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stored, transported, processed, treated, disposed of, released, migrated or has
escaped on, in, from, under or in connection with the Properties or the
ownership or operation of any thereof, such as to cause a condition or
circumstance that would reasonably be expected to result in an Environmental
Claim or a violation of any Environmental Law.
3.10. STATUS OF CONTRACTS. All of the contracts described in the Exhibit
are in full force and effect and Seller is not in breach of, or with the lapse
of time or the giving of notice, or both, would be in breach of, any of its
obligations thereunder.
3.11. PRODUCTION BURDENS, TAXES, EXPENSES AND REVENUES. All payments
due under or with respect to the Oil and Gas Properties have been properly and
timely paid. All ad valorem, property, production, severance and other taxes
based on or measured by the ownership of the Properties or the production of
Substances therefrom have been properly and timely paid. All expenses payable
under the terms of the Contracts have been properly and timely paid except for
such expenses as are being currently paid prior to delinquency in the ordinary
course of business. All of the proceeds from the sale of Substances are being
properly and timely paid to Seller by the purchasers of production without
suspension or indemnity other than standard division order indemnities.
3.12. CURRENT COMMITMENTS. The Exhibit contains a true and complete list as
of the date of this Agreement of all authorities for expenditures to drill or
rework ▇▇▇▇▇ or for capital expenditures pursuant to any of the Contracts for
which all of the activities anticipated in such AFEs or commitments have not
been completed by the date of this Agreement.
3.13. RESERVE REPORT. Seller has delivered to Buyer a copy of the reserve
report prepared by ▇▇▇▇▇ ▇▇▇▇▇ Company dated July 24, 1998 (the "Report")
relating to the oil and gas reserves attributable to the Oil and Gas Properties
(the "Reserves"). To the knowledge of Seller, the historical factual information
supplied by Seller to the independent engineering firm in connection with the
preparation of the Report was accurate and complete in all material respects.
4. REPRESENTATIONS AND WARRANTIES OF BUYER. Buyer represents and warrants to
Seller as follows:
4.1. ORGANIZATION. Buyer is a limited partnership duly formed, validly
existing and in good standing under the laws of the State of Texas. The sole
general partner of Buyer is Samson Resources Company.
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4.2. AUTHORIZATION AND AUTHORITY. The execution and delivery of this
Agreement have been and the performance of this Agreement and the transactions
contemplated hereby shall be at the time required to be performed hereunder,
duly and validly authorized by all requisite corporate action on the part of
Buyer. Buyer has full corporate power and authority to carry on its business as
presently conducted, to enter into this Agreement, to purchase the Properties on
the terms described in this Agreement and to perform its other obligations under
this Agreement.
4.3. ENFORCEABILITY. This Agreement has been duly executed and delivered on
behalf of Buyer, and constitutes a legal, valid and binding obligation of Buyer
enforceable in accordance with its terms, except as enforceability may be
limited by Equitable Limitations. At the Closing all documents required
hereunder to be executed and delivered by Buyer shall be duly executed and
delivered and shall constitute legal, valid and binding obligations of Buyer
enforceable in accordance with their terms, except as enforceability may be
limited by Equitable Limitations.
4.4. CONFLICTS. The execution and delivery of this Agreement by Buyer
does not, and the consummation of the transactions contemplated by this
Agreement shall not, (a) violate or be in conflict with, or require the consent
of any person or entity under, any provision of Buyer's Certificate of
Incorporation, bylaws or other governing documents, (b) conflict with, result in
a breach of, constitute a default (or an event that with the lapse of time or
notice, or both, would constitute a default) under any agreement or instrument
to which Buyer is a party or is bound, or (c) violate any provision of or
require any consent, authorization or approval under any judgment, decree,
judicial or administrative order, award, writ, injunction, statute, rule or
regulation applicable to Buyer.
4.5. QUALIFIED PURCHASER. Buyer is an experienced and knowledgeable
investor and operator in the oil and gas business. Buyer is acquiring the
Properties for its own account and not with a view to, or for offer of resale in
connection with, a distribution thereof, within the meaning of the Securities
Act of 1933, 15 U.S.C. (S) 77a et seq., and any other rules, regulations, and
laws pertaining to the distribution of securities.
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4.6. AVAILABLE FUNDS. Buyer has arranged to have available by the Closing
Date sufficient funds to enable the payment to Seller by wire transfer, the
Adjusted Purchase Price in accordance with Section 9.4, and to otherwise perform
Buyer's obligations under this Agreement.
5. COVENANTS OF SELLER PENDING CLOSING.
5.1. CONDUCT OF BUSINESS PENDING CLOSING. Seller covenants that from
the date hereof to the Closing Date, except (a) as provided herein, (b) as
required by any obligation, agreement, lease, contract, or instrument referred
to on the Exhibit, or (c) as otherwise consented to in writing by Buyer, Seller
will:
5.1.1. Not (i) operate or in any manner deal with, incur obligations
with respect to, or undertake any transactions relating to, the Properties other
than transactions (A) in the normal, usual and customary manner, (B) of a nature
and in an amount consistent with prior practice, and (C) in the ordinary and
regular course of business of owning and operating the Properties; (ii) dispose
of, encumber or relinquish any of the Properties (other than relinquishments
resulting from the expiration of leases that Seller has no right or option to
renew); or (iii) waive, compromise or settle any right or claim that would
materially and adversely affect the ownership, operation or value of any of the
Properties after the Effective Date.
5.1.2. Make or give all notifications, filings, consents or
approvals, from, to or with all governmental authorities, and take all other
actions reasonably requested by Buyer, necessary for, and cooperate with Buyer
in obtaining, the issuance, assignment or transfer, as the case may be, by each
such authority of such Permits as may be necessary for Buyer to own and operate
the Properties following the consummation of the transactions contemplated in
this Agreement.
5.1.3. Maintain in effect insurance providing the same type coverage,
in the same amounts with the same deductibles as the insurance maintained in
effect by Seller or its affiliates on the Effective Date.
5.2. ACCESS. Seller shall afford to Buyer and its authorized
representatives from the date hereof until the Closing Date, during normal
business hours, reasonable access to the
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Properties operated by Seller or Torch and to Seller's and Torch's title,
contract, and legal materials and operating data and information available as of
the date hereof and that becomes available to Seller or Torch at any time prior
to the Closing Date, other than any documents that are protected by an attorney-
client privilege.
6. COVENANTS OF BUYER PENDING CLOSING.
6.1. NOTIFICATIONS. Buyer will notify Seller promptly after the discovery
by Buyer of any facts or circumstances that causes or would cause any
representation or warranty of Seller contained in this Agreement to be untrue in
any material respect on the Closing Date. In addition, Buyer will notify Seller
of the discovery by Buyer of any facts or circumstances that causes or would
cause any representation or warranty of Buyer contained in this Agreement to be
untrue in any material respect on the Closing Date.
7. CONDITIONS PRECEDENT TO THE OBLIGATIONS OF BUYER. The obligations of
Buyer to be performed at Closing are subject to the fulfillment, before or at
Closing, of each of the following conditions:
7.1. REPRESENTATIONS AND WARRANTIES. The representations and warranties
by Seller set forth in this Agreement shall be true and correct in all respects
on the date of this Agreement and as of the Closing Date except for (i)
inaccuracies therein that would not reasonably be expected to have a negative
impact on the value of the Properties, taken as a whole, equal to 10% of the
Purchase Price or more, or (ii) changes therein specifically contemplated by
this Agreement or that would not reasonably be expected to have a negative
impact on the value of the Properties, taken as a whole, equal to 10% of the
Purchase Price or more.
7.2. COMPLIANCE. Seller shall have performed and complied in all material
respects with each of the covenants and conditions required by this Agreement of
which performance or compliance is required prior to or at the Closing.
7.3. CONSENTS. The consents specified in the Exhibit have been obtained
and any preferential rights specified in the Exhibit have been waived or have
expired.
7.4. NO PENDING SUITS. At the Closing Date, no suit, action or other
proceeding shall be pending or threatened before any court or governmental
agency in which it is sought to restrain or prohibit the performance of or to
obtain damages or other relief in connection with this Agreement or the
consummation of the transactions contemplated hereby.
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7.5. PURCHASE PRICE ADJUSTMENTS. The aggregate of all adjustments to the
Purchase Price pursuant to Annex I and all adjustments asserted by Buyer in good
faith pursuant to Annex I that have not been resolved prior to the Closing Date
shall not exceed 20% of the Purchase Price.
8. CONDITIONS PRECEDENT TO THE OBLIGATIONS OF SELLER. The obligations of
Seller to be performed at Closing are subject to the fulfillment, before or at
Closing, of each of the following conditions:
8.1. REPRESENTATIONS AND WARRANTIES. The representations and warranties
by Buyer set forth in this Agreement shall be true and correct in all material
respects as of the Closing Date except for changes therein specifically
contemplated by this Agreement.
8.2. COMPLIANCE. Buyer shall have performed and complied in all material
respects with each of the covenants and conditions required by this Agreement of
which performance or compliance is required prior to or at the Closing.
8.3. CONSENTS. The consents specified in the Exhibit have been obtained
and any preferential rights specified in the Exhibit have been waived or have
expired.
8.4. NO PENDING SUITS. At the Closing Date, no suit, action or other
proceeding shall be pending or threatened before any court or governmental
agency in which it is sought to restrain or prohibit the performance of or to
obtain damages or other relief in connection with this Agreement or the
consummation of the transactions contemplated hereby.
8.5. PURCHASE PRICE ADJUSTMENTS. The aggregate of all adjustments to the
purchase price pursuant to Annex I shall not exceed 20% of the Purchase Price.
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9. CLOSING.
9.1. THE CLOSING. The assignment and purchase of the Properties pursuant to
this Agreement (the "Closing"), shall be consummated in Houston, Texas, at the
offices of ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, L.L.P. before 11:00 p.m. on the later of (a)
the third Business Day after the day that conditions precedent set forth in
Sections 7 and 8 have been satisfied or waived or (b) the later of (i) December
8, 1998 or (ii) if Seller shall provide a written notice to Buyer on or before
December 8, 1998 that it has elected to extend the Closing, January 6, 1999 (the
"Closing Date").
9.2. DOCUMENTS TO BE DELIVERED AT CLOSING.
9.2.1. At the Closing, Seller shall deliver to Buyer the following
instruments, dated the Closing Date, properly executed by authorized officers
and, where appropriate, acknowledged:
(a) Counterparts of an Assignment of Leases and ▇▇▇▇ of Sale in the
form of Annex IV sufficient to convey to Buyer title in and to the
Properties;
(b) Such other instruments as are necessary to effectuate the
conveyance of the Properties to Buyer;
(c) Letters in lieu of division orders addressed to each purchaser of
the Substances;
(d) Evidence of the termination of the interests of ▇▇▇▇▇▇▇▇▇▇
Corporation in the Properties;
(e) With respect to any ▇▇▇▇▇ that Seller or Torch is designated as
the operator under the applicable joint operating agreement (other than the
▇.▇. ▇▇▇▇▇▇ Unit and the ▇▇▇▇▇▇▇ Unit), (i) letters to all working interest
owners in which Seller and Torch, as applicable, resign as the operator and
recommends Buyer as the successor operator and (ii) any forms promulgated
by the appropriate governmental authority and completed by Buyer
designating Buyer as the operator that Seller is required to execute by the
governmental authority; and respect to any ▇▇▇▇▇ for which Seller owns all
of the
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leasehold interests and either Seller or Torch is designated as the
operator with the appropriate governmental authority, any forms promulgated
by the appropriate governmental authority and completed by Buyer
designating Buyer as the operator that Seller or Torch is required to
execute by the governmental authority; and
(f) A certificate in the form of Annex II.
9.2.2. At the Closing, Buyer shall deliver to Seller a certificate in
the form of Annex III dated the Closing Date and properly executed by an
authorized officer.
9.3. POSSESSION. At the Closing, Seller shall deliver to Buyer
possession of the Properties other than the Data. Within five Business Days
after Closing, Seller shall deliver to Buyer at Seller's offices all of the
Data.
9.4. PAYMENT OF PURCHASE PRICE. At the Closing, against delivery of the
documents and materials described in Section 9.2, Buyer shall pay to Seller the
estimated Adjusted Purchase Price, less the amount of the Deposit, by wire
transfer of immediately available funds.
10. TERMINATION.
10.1. EVENTS OF TERMINATION. This Agreement may be terminated at any
time prior to the Closing:
10.1.1. By the mutual written consent of Buyer and Seller;
10.1.2. By Seller (i) if Buyer shall fail to perform in any material
respect its covenants contained herein required to be performed by it on or
prior to the Closing Date, or (ii) any of Buyer's representations contained
herein shall be incorrect in any material respect on the Closing Date, and such
failure or misrepresentation is not cured within ten days after Seller shall
have notified Buyer of its intent to terminate this Agreement pursuant to this
Section 10.1.2;
10.1.3. By Buyer if (i) Seller shall fail to perform in any material
respect its covenants contained herein required to be performed by it on or
prior to the Closing Date, or (ii) any of Seller's representations contained
herein shall be incorrect in any material respect
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on the Closing Date, and such failure or misrepresentation is not cured within
ten days after Buyer has notified Seller of its intent to terminate this
Agreement pursuant to this Section 10.1.3; and
10.1.4. By either Seller or Buyer if for any reason the Closing has
not occurred by January 11, 1999.
10.2. EFFECT OF TERMINATION.
10.2.1. If the purchase and sale of the Properties is not consummated
as contemplated in this Agreement and either (a) Buyer shall have failed to
perform in any material respect its covenants contained herein required to be
performed by it on or prior to the Closing Date, or (b) any of its
representations contained herein shall be incorrect in any material respect on
the Closing Date, and such failure or misrepresentation is not cured within the
time period provided in Section 10.1, then Seller may elect to retain the
Deposit as liquidated damages or return the Deposit to Buyer and seek such
damages as may be appropriate. Buyer acknowledges that the extent of damages to
Seller occasioned by any breach or misrepresentation by Buyer would be
impossible or extremely difficult to ascertain and that the amount of the
Deposit is a fair and reasonable estimate of such damages under the
circumstances.
10.2.2. If the purchase and sale of the Properties is not consummated
as contemplated in this Agreement and (a) Buyer shall have performed in all
material respects its covenants contained herein required to be performed by it
on or prior to the Closing Date and (b) all of its representations contained
herein shall be correct in all material respects on the Closing Date, then
Seller shall refund to Buyer the Deposit within three Business Days after the
date of termination of this Agreement.
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11. TAXES, PRORATIONS, SUSPENSE FUNDS AND ASSUMPTION OF OBLIGATIONS.
11.1. TAX PRORATIONS. Real and personal property taxes for the Properties
shall be prorated between Buyer and Seller as of the Effective Date. If the
actual taxes are not known on the Closing Date, Seller's share of such taxes
shall be determined by using (a) the rates and millage for the year prior to the
year in which the Closing occurs, with appropriate adjustments for any known and
verifiable changes thereto, and (b) the assessed values for the year in which
Closing occurs. When Buyer receives the actual tax statements for the Properties
from the appropriate taxing authorities, Buyer shall deliver to Seller a copy of
such statements, together with the amount, if any, by which Seller's proration
exceeds the proration that would have been made had actual tax statements been
used to calculate Seller's proration. If the proration for Seller that would
have been made using actual tax statements exceeds that made at Closing, Seller
shall pay to Buyer such difference within three Business Days of receipt of such
statement.
11.2. ASSUMPTION OF OBLIGATIONS. At Closing, Buyer shall assume (a) the
obligation to (i) plug and abandon or remove and dispose of all ▇▇▇▇▇,
platforms, structures, flow lines, pipelines, and the other equipment now or
hereafter located on the Oil and Gas Properties and Surface Contracts and (ii)
cap and bury all flow lines and other pipelines now or hereafter located on the
Oil and Gas Properties and Surface Contracts; (b) all obligations and
liabilities arising from or in connection with any gas production, pipeline,
storage, processing or other imbalance attributable to Substances produced from
Oil and Gas Properties, whether before, on or after the Effective Date; (c) all
matters disclosed on the Exhibit pursuant to Sections 3.8 or 3.9; (d) all costs,
obligations and liabilities of Seller arising on or after the Effective Date
under or relating to (i) the Acquisition Agreement dated as of April 9, 1993
between Seller, Maxwells Energy Company, Inc. and Torchmark Corporation, (ii)
the Assignment and ▇▇▇▇ of Sale dated effective as of January 1, 1993 (and
acknowledged on May 24, 1993 and May 25, 1993), from Nuevo to Torchmark
Corporation, (iii) the Conveyance of Production Payment dated effective as of
January 1, 1993 (and acknowledged on May 24, 1993 and May 25, 1993), from
Torchmark Corporation to Seller and (iv) the Production Payment Offset and
Reduction Agreement dated as of April 9, 1993, between Seller and ▇▇▇▇▇▇▇'▇
Energy Company, Inc.; and (e) all other costs, obligations and liabilities that
arise under the Oil and Gas Properties or Contracts or otherwise relate to the
Properties and, in each case, arise from or relate to events occurring or
conditions existing on or after the Effective Date or accrue after the Effective
Date. All such plugging, replugging, abandonment, removal, disposal, and
restoration operations shall be in compliance with applicable laws and
regulations and contracts.
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11.3. SUSPENDED FUNDS. As soon as practicable after the Closing, but no
later than ninety days thereafter, Seller shall provide to Buyer a listing
showing all proceeds from production attributable to the Properties which are
currently held in suspense by Seller and shall transfer to Buyer all those
suspended proceeds (the "Suspended Proceeds"). Thereafter, Buyer shall be
responsible for proper distribution of all the Suspended Proceeds to the parties
lawfully entitled to them.
12. FINAL ACCOUNTING.
12.1. SETTLEMENT STATEMENT. As soon as practical and, in any event, no
later than one hundred twenty calendar days after the Closing Date, Seller shall
prepare and deliver to Buyer a statement (the "Final Settlement Statement")
setting forth the adjustments to the Purchase Price in accordance with Section
2.2. The Final Settlement Statement shall be prepared in accordance with
customary accounting principles used in the oil and gas industry. The Final
Settlement Statement shall reflect all amounts shown on the Closing Statement
and shall deduct all such amounts from the amounts calculated under the Final
Settlement Statement. Within thirty calendar days after Buyer's receipt of the
Final Settlement Statement (but not earlier than ninety calendar days after the
Closing Date), Buyer and Seller shall endeavor to agree on the final accounting.
12.2. ARBITRATION OF FINAL SETTLEMENT. If Seller and Buyer cannot agree
upon the Final Settlement Statement, the Houston Office of the firm of ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ & Co. is designated to act as an arbitrator and to decide all points of
disagreement with respect to the Final Settlement Statement, such decision to be
binding on both parties. If such firm is unwilling or unable to serve in such
capacity, Seller and Buyer shall attempt to, in good faith, designate another
acceptable person as the sole arbitrator under this Section. If the parties are
unable to agree upon the designation of a person as substitute arbitrator, then
Seller or Buyer, or both of them, may in writing request the Judge of the United
States District Court for the Southern District of Texas senior in term of
service to appoint the substitute arbitrator. The arbitration shall be
conducted under the Texas General Arbitration Act and the rules of the American
Arbitration Association to the extent such rules do not conflict with the terms
of such Act and the terms hereof. The costs and expenses of the arbitrator,
whether the firm designated above, or a third party appointed pursuant to the
preceding sentence shall be shared equally by Seller and Buyer.
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12.3. PAYMENT. Within five Business Days after the agreement of Seller
and Buyer on the Final Settlement Statement or after the decision of the
arbitrator, Buyer or Seller, as the case may be, shall promptly make a cash
payment to the other equal to the sums as may be found to be due in the Final
Settlement Statement.
13. SURVIVAL AND INDEMNIFICATION.
13.1. SURVIVAL. The liability of Buyer and Seller under each of their
respective representations, warranties and covenants contained in this Agreement
shall survive the Closing and execution and delivery of the assignments
contemplated hereby.
13.2. LIABILITIES. The term "Liabilities" shall mean any and all claims,
causes of action, payments, charges, judgments, assessments, liabilities,
damages, penalties, fines or costs and expenses which are asserted, filed or
assessed against, paid or incurred by the person seeking indemnification,
including any legal or other expenses reasonably incurred in connection
therewith.
13.3. INDEMNIFICATION BY SELLER. After the Closing, Seller shall be
responsible for, shall pay on a current basis, and shall indemnify, save, hold
harmless, discharge and release Buyer, all of its affiliates, successors and,
permitted assignees, and all of its and their respective stockholders,
directors, officers, employees, agents and representatives (collectively, "Buyer
Indemnified Parties") from and against any and all Liabilities, arising from,
based upon, related to or associated with (a) any act or omission by Seller
involving or relating to the Properties occurring or existing before the
Effective Date, other than obligations and liabilities assumed by Buyer pursuant
to Section 11.2; (b) any act or omission by Seller involving or relating to the
Excluded Assets whether occurring before or after the Effective Date; (c) the
fees of the Advisor and any brokers' or finders' fees or commissions arising
with respect to brokers or finders retained or engaged by Seller and resulting
from or relating to the transactions contemplated in this Agreement; (d) the
inaccuracy of any representation or warranty of Seller set forth in this
Agreement or in any other agreement, instrument, document or certificate
executed or delivered in connection with this Agreement; (e) the breach of, or
failure to perform or satisfy, any of the covenants of Seller set forth in this
Agreement or in any other agreement, instrument, document or certificate
executed or delivered in connection with this Agreement; and (f) any interest
or penalties on the Suspended Proceeds to the extent such interest or penalties
are attributable to periods prior to the transfer of such Suspended Proceeds to
Buyer.
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13.4. INDEMNIFICATION BY BUYER. After the Closing, Buyer shall assume,
be responsible for, shall pay on a current basis, and shall indemnify, save,
hold harmless, discharge and release Seller, its affiliates, its and their
successors and permitted assigns, and all of their respective stockholders,
directors, officers, employees, agents and representatives (collectively,
"Seller Indemnified Parties") from and against any and all Liabilities arising
from, based upon, related to or associated with (a) any act, omission, event,
condition or circumstance involving or relating to the Properties occurring or
existing on or after the Effective Date; (b) liabilities and obligations assumed
by Buyer pursuant to Section 11.2; (c) any act, omission, event, condition or
circumstance involving or relating to the Properties occurring or existing
before the Effective Date that was not properly asserted by Buyer on or prior to
the date specified in Section 13.5.1; (d) any brokers' or finders' fees or
commissions arising with respect to brokers or finders retained or engaged by
Buyer and resulting from or relating to the transactions contemplated in this
Agreement; (e) the inaccuracy of any representation or warranty of Buyer set
forth in this Agreement or in any other agreement, instrument, document or
certificate executed or delivered in connection with this Agreement; (f) the
breach of, or failure to perform or satisfy any of the covenants of Buyer set
forth in this Agreement or in any other agreement, instrument, document or
certificate executed or delivered in connection with this Agreement; and (g) the
payment to the proper parties of the principal amount of the Suspended Proceeds
and any interest or penalties on the Suspended Proceeds attributable to periods
subsequent to the transfer of such Suspended Proceeds to Buyer.
13.5. LIABILITY LIMITATIONS.
13.5.1. After the Closing, any assertion by any Buyer Indemnified
Party that Seller is liable (a) for the inaccuracy of any representation or
warranty, (b) for the breach of any covenant, (c) for indemnity under the terms
of this Agreement or (d) otherwise in connection with the transactions
contemplated in this Agreement, must be made by Buyer in writing and must be
given to Seller on or prior to the Claims Notice Date. The notice shall state
the facts known to Buyer that give rise to such notice in sufficient detail to
allow Seller to evaluate the assertion. The "Claims Notice Date" for
Liabilities arising from, based upon, related to or associated with the non-
payment of royalties, overriding royalties, production payments, carried
interests, ad valorem taxes, severance taxes, production taxes or similar
burdens or taxes shall be the fourth anniversary of the Closing Date; the
"Claims Notice Date" for claims under Section 13.3(f) shall be December 31,
2018; and the "Claims Notice Date" for all other Liabilities shall be December
1, 1999.
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13.5.2. None of the Buyer Indemnified Parties shall be entitled to
assert any right to indemnification hereunder or to otherwise seek any damages
or other remedies for or in connection with (a) the inaccuracy of any
representations of Seller contained in this Agreement or in any other agreement,
instrument, document or certificate executed or delivered in connection with
this Agreement; (b) the breach of, or failure to perform or satisfy any of the
covenants of Seller set forth in this Agreement or in any other agreement,
instrument, document or certificate executed or delivered in connection with
this Agreement; or (c) any liabilities otherwise arising in connection with or
with respect to the transactions contemplated in this Agreement unless the
individual amount of each such Liability exceeds $10,000 and until the aggregate
amount of such Liabilities in excess of $10,000 for such misrepresentations and
breaches exceeds $2,000,000, and then only to the extent of such excess. The
limitations in this Section shall not apply, however, to the obligations of
Seller under Sections 9.4, 10.2, 11.1, 11.3, 12.1, 12.2, 12.3, 13.3(f) and 19.
13.5.3. The amount of any Liabilities for which any of the Buyer
Indemnified Parties or Seller Indemnified Parties is entitled to indemnification
or other compensation under this Agreement or in connection with or with respect
to the transactions contemplated in this Agreement shall be reduced by any
corresponding insurance proceeds realized or that could reasonably be expected
to be realized by such party if a claim were properly pursued under the relevant
insurance arrangements.
13.5.4. Seller shall not be required to indemnify any Buyer
Indemnified Parties or pay any other amount in connection with or with respect
to the transactions contemplated in this Agreement in any amount exceeding in
the aggregate $25,000,000.
13.5.5. None of the Buyer Indemnified Parties nor the Seller
Indemnified Parties shall be entitled to recover from Seller or Buyer,
respectively, for any losses, costs, expenses, or damages arising under this
Agreement or in connection with or with respect to the transactions contemplated
in this Agreement any amount in excess of the actual compensatory damages, court
costs and reasonable attorney fees, suffered by such party. Buyer on behalf of
each of the Buyer Indemnified Parties and Seller on behalf of each of the Seller
Indemnified Parties waives any right to recover punitive, special, exemplary and
consequential damages arising in connection with or with respect to the
transactions contemplated in this Agreement. This Section shall not limit
Seller's right to retain the Deposit as liquidated damages under Section 10.
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13.5.6. If the Closing occurs, the sole and exclusive remedy of each
of the Buyer Indemnified Parties and the Seller Indemnified Parties with respect
to the purchase and sale of the Properties, except for Title Defects handled in
accordance with the procedures set forth in Annex I, shall be pursuant to the
express indemnification provisions of this Section 13. Any and all (a) claims
relating to the representations, warranties, covenants and agreements contained
in this Agreement, (b) other claims pursuant to or in connection with this
Agreement or (c) other claims relating to the Properties and the purchase and
sale thereof shall be subject to the provisions set forth in this Section 13.
Except for claims made pursuant to the express indemnification provisions of
this Section 13, Buyer on behalf of each of the Buyer Indemnified Parties and
Seller on behalf of each of the Seller Indemnified Parties shall be deemed to
have waived, to the fullest extent permitted under applicable law, any right of
contribution against Seller or any of its affiliates and any and all rights,
claims and causes of action it may have against Seller or any of its affiliates
or Buyer or any of its affiliates, respectively, arising under or based on any
federal, state or local statute, law, ordinance, rule or regulation or common
law or otherwise.
13.5.7. No person entitled to indemnification hereunder or otherwise
to damages in connection with or with respect to the transactions contemplated
in this Agreement shall settle, compromise or take any other action with respect
to any claim, demand, assertion of liability or legal proceeding that could
prejudice or otherwise adversely impact the ability of the person providing such
indemnification or potentially liable for such damages to defend or otherwise
settle or compromise with respect to such claim, demand, assertion of liability
or legal proceeding.
13.5.8. Seller and Buyer acknowledge that the payment of money, as
limited by the terms of this Agreement, shall be adequate compensation for
breach of any representation, warranty, covenant or agreement contained herein
or for any other claim arising in connection with or with respect to the
transactions contemplated in this Agreement. As the payment of money shall be
adequate compensation, Buyer and Seller waive any right to rescind this
Agreement or any of the transactions contemplated hereby.
13.5.9. Each person entitled to indemnification hereunder or
otherwise to damages in connection with the transactions contemplated in this
Agreement shall take all
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reasonable steps to mitigate all losses, costs, expenses and damages after
becoming aware of any event or circumstance that could reasonably be expected to
give rise to any losses, costs, expenses and damages that are indemnifiable or
recoverable hereunder or in connection herewith.
13.5.10. THE INDEMNIFICATION, RELEASE AND ASSUMPTION PROVISIONS
PROVIDED FOR IN THIS AGREEMENT SHALL BE APPLICABLE WHETHER OR NOT THE LOSSES,
COSTS, EXPENSES AND DAMAGES IN QUESTION AROSE SOLELY OR IN PART FROM THE GROSS,
ACTIVE, PASSIVE OR CONCURRENT NEGLIGENCE, STRICT LIABILITY OR OTHER FAULT OF ANY
INDEMNIFIED PARTY. BUYER AND SELLER ACKNOWLEDGE THAT THIS STATEMENT COMPLIES
WITH THE EXPRESS NEGLIGENCE RULE AND IS CONSPICUOUS.
13.5.11. Neither Seller nor Buyer shall have any obligation or
liability under this Agreement or in connection with or with respect to the
transactions contemplated in this Agreement for any breach, misrepresentation or
noncompliance with respect to any representation, warranty, covenant, indemnity
or obligation (a) if such breach, misrepresentation or noncompliance shall have
been waived by the other party or (b) if such other party had knowledge of the
relevant facts at or before Closing; provided that Buyer shall not be deemed to
have waived any claim for any misrepresentation by Seller with respect to any
misrepresentations asserted by Buyer in writing at or before Closing.
13.6. WAIVER OF REPRESENTATIONS.
13.6.1. THE EXPRESS REPRESENTATIONS OF SELLER CONTAINED IN THIS
AGREEMENT AND IN THE CERTIFICATE TO BE DELIVERED PURSUANT TO SECTION 9.2.1 ARE
EXCLUSIVE AND ARE IN LIEU OF, ANY OTHER REPRESENTATION OR WARRANTY WITH RESPECT
TO THE ENVIRONMENTAL CONDITION, BOTH SURFACE AND SUBSURFACE, OR OTHER CONDITION
OF THE PROPERTIES; OR THE OWNERSHIP OR OPERATION OF THE PROPERTIES OR ANY PART
THEREOF.
13.6.2. EXCEPT TO THE EXTENT OF THE EXPRESS REPRESENTATIONS AND
WARRANTIES OF SELLER CONTAINED IN THIS
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AGREEMENT AND IN THE CERTIFICATE TO BE DELIVERED BY SELLER PURSUANT TO SECTION
9.2.1, SELLER EXPRESSLY DISCLAIMS AND NEGATES, AND BUYER HEREBY WAIVES, ANY
LIABILITY OR RESPONSIBILITY FOR, (I) ALL REPRESENTATIONS AND WARRANTIES,
EXPRESS, IMPLIED OR STATUTORY AND (II) ANY STATEMENT OR INFORMATION ORALLY OR IN
WRITING MADE OR COMMUNICATED TO BUYER, INCLUDING, BUT NOT LIMITED TO, ANY
OPINION, INFORMATION OR ADVICE THAT MAY HAVE BEEN PROVIDED TO BUYER BY ANY
OFFICER, DIRECTOR, EMPLOYEE, AGENT, CONSULTANT OR REPRESENTATIVE OF SELLER, ANY
ENGINEER OR ENGINEERING FIRM OR ANY OTHER AGENT, CONSULTANT OR REPRESENTATIVE.
13.6.3. SELLER EXPRESSLY DISCLAIMS AND NEGATES, AND BUYER HEREBY
WAIVES, ANY LIABILITY OR RESPONSIBILITY FOR, (I) ANY REPRESENTATION OR WARRANTY
WITH RESPECT TO THE QUALITY, QUANTITY OR VOLUME OF THE RESERVES, IF ANY, OF OIL,
GAS OR OTHER HYDROCARBONS IN OR UNDER THE OIL AND GAS PROPERTIES; AND (II) ANY
WARRANTY OR REPRESENTATION, EXPRESS OR IMPLIED, AS TO THE QUALITY,
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, CONFORMITY TO SAMPLES, OR
CONDITION OF ANY OF THE PROPERTIES OR ANY PART THERETO.
13.6.4. EXCEPT FOR THE EXPRESS REPRESENTATIONS CONTAINED IN THIS
AGREEMENT AND IN THE CERTIFICATE TO BE DELIVERED PURSUANT TO SECTION 9.2.1 THE
ITEMS OF PERSONAL PROPERTY, EQUIPMENT, IMPROVEMENTS, FIXTURES AND APPURTENANCES
CONVEYED AS PART OF THE PROPERTIES ARE SOLD, AND BUYER ACCEPTS SUCH ITEMS "AS
IS, WITH ALL FAULTS."
13.6.5. THERE ARE NO WARRANTIES THAT EXTEND BEYOND THE FACE OF THIS
AGREEMENT AND THE CERTIFICATE TO BE DELIVERED PURSUANT TO SECTION 9.2.1.
13.6.6. BUYER ACKNOWLEDGES THAT THE WAIVERS IN THIS SECTION 13.6 ARE
CONSPICUOUS.
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13.7. YEAR 2000 COMPLIANCE. Seller does not make, and expressly disclaims,
any representation or warranty regarding whether or not any software, hardware,
equipment, goods or systems utilized by Seller in connection with the ownership
or operation of any portion of the Properties (or any reporting with respect
thereto), any other owner or operator of any portion of the Properties or any
person who provides goods or services to Seller or any other person with respect
to the ownership or operation of the Properties will properly perform date
sensitive functions before, during or after the year 2000, and Buyer waives any
such representation or warranty.
14. FURTHER ASSURANCES.
14.1. GENERAL. After the Closing, Seller and Buyer shall execute,
acknowledge and deliver or cause to be executed, acknowledged and delivered such
instruments and take such other action as may be necessary or advisable to carry
out their obligations under this Agreement and under any exhibit, document,
certificate or other instrument delivered pursuant hereto.
14.2. FILINGS, NOTICES AND CERTAIN GOVERNMENTAL APPROVALS. Promptly after
Closing Buyer shall (a) record the assignments of the Properties executed at the
Closing in all applicable real property records, (b) send notices to vendors
supplying goods and services for the Properties of the assignment of the
Properties to Buyer and, if applicable, the designation of Buyer as the operator
thereof, (c) actively pursue the unconditional approval by all applicable
governmental authorities of the assignment of the Properties to Buyer and the
designation of Buyer as the operator thereof, and (d) actively pursue all other
consents and approvals that may be required in connection with the assignment of
the Properties to Buyer, and the assumption of the liabilities assumed by Buyer
hereunder, and that shall not have been obtained prior to Closing.
14.3. LOGOS AND NAMES. As soon as practicable after the Closing, Buyer
will remove or cause to be removed the names and marks used by Seller and all
variations and derivatives thereof and logos relating thereto from the
Properties.
15. ACCESS BY SELLER AFTER CLOSING. After the Closing Date, Seller and its
authorized representatives shall have reasonable access (at Seller's sole cost
and expense) during Buyer's normal business hours to (i) all books and records
of Buyer pertaining to the Properties for periods prior to the Closing Date and
(ii) the Properties for the purpose of prosecuting or
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defending claims, lawsuits or other proceedings, for audit purposes, or to
comply with legal process, rules, regulations or orders of any governmental
authority. Seller, at its sole expense, may copy such records that it deems
appropriate. Buyer agrees to maintain such books and records for a minimum of
six years after Closing. Seller may retain a copy, at its expense, of any of the
Data.
16. NOTICES. All notices required or permitted under this Agreement shall be
in writing and shall be deemed to have be given when actually received by the
following recipients:
To Seller: Nuevo Energy Company
Suite 1650, 1331 ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, President
Telecopier: 713.756.1744
With a copy to: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Torch Energy Advisors Incorporated
Suite 1600, 1221 ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Telecopier: 713.665.1711
To Buyer: Samson Lone Star Limited Partnership
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Telecopier: 918.591.1757
With a copy to: Samson Lone Star Limited Partnership
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ Canon
Telecopier: 918.591.1718
"Business Day" shall mean a day other than Saturday or Sunday or any legal
holiday for commercial banking institutions under the laws of the State of
Texas.
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17. ASSIGNMENT. Neither Seller nor Buyer may assign its rights or delegate
its duties or obligations arising under this Agreement, in whole or in part, by
operation of law or otherwise, before or after Closing, without the prior
written consent of the other party.
18. GOVERNING LAW. This Agreement shall be governed and construed in accordance
with the laws of the State of Texas without giving effect to any principles of
conflicts of laws.
19. EXPENSES AND FEES. Whether or not the transactions contemplated by this
Agreement are consummated, each of the parties hereto shall pay the fees and
expense of its counsel, accountants and other experts incident to the
negotiation and preparation of this Agreement and consummation of the
transactions contemplated hereby. Buyer shall be responsible for the cost of
all fees for the recording of transfer documents and any sales, transfer, stamp
or other excise taxes resulting from the transfer of the Properties to Buyer.
All other costs shall be borne by the party incurring such costs.
20. INTEGRATION. This Agreement, including the Exhibit, and the other agreements
to be entered into by the parties under the provisions of this Agreement and the
Confidentiality Agreement dated July 29, 1998, executed by Buyer and the Advisor
(the "Confidentiality Agreement") set forth the entire agreement and
understanding of the parties in respect of the transactions contemplated hereby
and supersede all prior agreements, prior arrangements and prior understandings
relating to the subject matter hereof.
21. WAIVER OR MODIFICATION. This Agreement may be amended, modified, superseded
or canceled, and any of the terms, covenants, representations, warranties or
conditions hereof may be waived, only by a written instrument executed by a duly
authorized officer of Buyer and Seller, or, in the case of a waiver or consent,
by or on behalf of the party or parties waiving compliance or giving such
consent. The failure of any party at any time or times to require performance of
any provision of this Agreement shall not affect its right at a later time to
enforce such provision. No waiver by any party of any condition, or of any
breach of any covenant, agreement, representation or warranty contained in this
Agreement, in any one or more instances, shall be deemed to be or construed as a
further or continuing waiver of any such condition or breach or waiver of any
other condition or of any breach of any other covenant, agreement,
representation or warranty.
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22. HEADINGS. The Section headings contained in this Agreement are for
convenient reference only and shall not in any way affect the meaning or
interpretation of this Agreement.
23. INVALID PROVISIONS. If any provision of this Agreement is held to be
illegal, invalid or unenforceable under present or future laws effective during
the term hereof, 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 hereof; and the remaining provisions of this
Agreement shall remain in full force and effect and shall not be affected by the
illegal, invalid or unenforceable provision or by its severance from this
Agreement.
24. WAIVER OF JURY TRIAL. SELLER AND BUYER HEREBY IRREVOCABLY WAIVE, TO THE
FULLEST EXTENT PERMITTED BY LAW, ANY AND ALL RIGHT TO A TRIAL BY JURY IN ANY
ACTION, SUIT OR OTHER LEGAL PROCEEDING BASED ON, ARISING OUT OF OR RELATING TO
THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREIN.
25. MULTIPLE COUNTERPARTS. This Agreement may be executed in a number of
identical counterparts, each of which for all purposes is to be deemed an
original, and all of which constitute, collectively, one agreement. In
addition, this Agreement may be executed in a number of counterparts, any one of
which may contain the execution of either Buyer or Seller, and all of such
counterparts taken together shall constitute one completely executed original
agreement.
26. PUBLIC ANNOUNCEMENTS. Buyer and Seller agree that prior to making any
public announcement or statement with respect to the transaction contemplated by
this Agreement, the party desiring to make such public announcement or statement
shall consult with the other party hereto and exercise its best efforts to (a)
agree upon the text of a joint public announcement or statement to be made by
both Buyer and Seller or (b) obtain approval of the other party hereto the text
of a public announcement or statement to be made solely by Seller or Buyer, as
the case may be. Nothing contained in this section shall be construed to
require either party to obtain approval of the other party hereto to disclose
information with respect to the transaction contemplated by this Agreement to
any state or federal governmental authority or agency to the extent required by
applicable law or by any applicable rules, regulations or orders of any
governmental authority or agency having jurisdiction or necessary to comply with
disclosure requirements of the New York Stock Exchange or any applicable
securities laws.
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27. ARBITRATION.
27.1. BINDING ARBITRATION. On the request of any party hereto, whether
made before or after the institution of any legal proceeding, any action,
dispute, claim or controversy of any kind now existing or hereafter arising
between any of the parties hereto in any way arising out of, pertaining to or in
connection with this Agreement (a "Dispute") shall be resolved by binding
arbitration in accordance with the terms hereof. Any party may, by summary
proceedings, bring an action in court to compel arbitration of any Dispute.
27.2. GOVERNING RULES. Any arbitration shall be administered by the
American Arbitration Association (the "AAA") in accordance with the terms of
this Section, the Commercial Arbitration Rules of the AAA, and, to the maximum
extent applicable, the Federal Arbitration Act. Judgment on any award rendered
by an arbitrator may be entered in any court having jurisdiction.
27.3. ARBITRATORS. Any arbitration shall be conducted before one
arbitrator. The arbitrator shall be a practicing or retired attorney licensed
to practice in the State of Texas who is knowledgeable in the subject matter of
the Dispute selected by agreement between the parties hereto. If the parties
cannot agree on an arbitrator within 30 days after the request for an
arbitration, then any party may request the AAA to select an arbitrator. The
arbitrator may engage engineers, accountants or other consultants that the
arbitrator deems necessary to render a conclusion in the arbitration proceeding.
27.4. CONDUCT OF ARBITRATION. To the maximum extent practicable, an
arbitration proceeding hereunder shall be concluded within 180 days of the
filing of the Dispute with the AAA. Arbitration proceedings shall be conducted
in Houston, Texas. Arbitrators shall be empowered to impose sanctions and to
take such other actions as the arbitrators deem necessary to the same extent a
judge could impose sanctions or take such other actions pursuant to the Federal
Rules of Civil Procedure and applicable law. At the conclusion of any
arbitration proceeding, the arbitrator shall make specific written findings of
fact and conclusions of law. The arbitrator shall have the power to award
recovery of all costs and fees to the prevailing party. Each party agrees to
keep all Disputes and arbitration proceedings strictly confidential except for
disclosure of information required by applicable law.
27.5. COSTS OF ARBITRATION. All fees of the arbitrator and any engineer,
accountant or other consultant engaged by the arbitrator, shall be paid by Buyer
and Seller equally unless otherwise awarded by the arbitrator.
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EXECUTED as of the date first set forth above.
SAMSON LONE STAR LIMITED PARTNERSHIP
by its sole general partner, Samson Resources Company
By:
------------------------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Attorney-in-Fact
NUEVO ENERGY COMPANY
By:
------------------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
President
Samson Investment Company, a Nevada corporation, unconditionally guarantees the
prompt payment and performance of each and every obligation of Buyer under this
Agreement and each and every agreement or instrument executed by Buyer in
connection with this Agreement.
SAMSON INVESTMENT COMPANY
By:
------------------------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Senior Vice President
Confidential
ANNEX I
TITLE TO THE PROPERTIES
1. DEFINITIONS. This Annex I incorporates the defined terms contained in the
Agreement and also includes the following definitions:
1.1. "Allocated Value" means the value allocated to each Oil and Gas
Property as set forth on the Exhibit, reflecting the portion of the Purchase
Price associated with each Oil and Gas Property.
1.2. "Liens" means any encumbrance, lien, security interest, claim or
burden.
1.3. "Marketable Title" means such title as (a) will enable Buyer, as
Seller's successor in title, to receive from a particular Oil and Gas Property
at least the "Net Revenue Interest" for the Oil and Gas Properties set forth on
the Exhibit as being associated with such Oil and Gas Property, without
reduction, suspension or termination throughout the productive life of ▇▇▇▇▇
located on the Oil and Gas Properties, except for any reduction, suspension or
termination caused by Buyer, that arises as a result of Permitted Encumbrances
or set forth in the Exhibit; (b) will obligate Buyer, as Seller's successor in
title, to bear no greater "Working Interest" than the Working Interest for each
of the Oil and Gas Properties identified on the Exhibit as being associated with
such Oil and Gas Property, without increase throughout the productive life of
such Well, except for any increase caused by Buyer, that arises as result of
Permitted Encumbrances or set forth in the Exhibit; and (c) is free and clear of
all Liens, except for Permitted Encumbrances.
1.4. "Notice Date" means November 25, 1998.
1.5. "Permitted Encumbrances" means (a) Liens securing payments to
mechanics and materialmen, payments of taxes or claims arising by statute to
secure or protect any other payment obligation that are, in each case, not yet
delinquent or, if delinquent, are being contested in good faith in the normal
course of business; (b) any matter specifically
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disclosed on the Exhibit; (c) Title Defects that Buyer fails to assert in
accordance with the provisions of this Annex prior to the Notice Date; (d)
consents to assignment by a governmental authority that are obtained by the
Closing Date or that are customarily obtained after the consummation of
transactions of the nature contemplated in this Agreement; (e) Liens held by
▇▇▇▇▇▇▇▇▇▇ Corporation to be released at Closing; and (f) other minor defects or
irregularities of title affecting any portion of any Oil and Gas Property that
individually or in the aggregate do not materially interfere with the operation,
value or use of any Oil and Gas Property.
1.6. "Title Defect" means any Lien or other matter, other than a
Permitted Encumbrance or matter specifically waived by Buyer in writing, that is
identified by Buyer on or before the Notice Date, and that renders title to a
Oil and Gas Property (or any portion thereof) less than Marketable Title;
provided that any such individual Lien or such other matter has a value of
$10,000 or less shall not be considered to be a Title Defect.
1.7. "Title Defect Amount" means, with respect to any reduction of the
Net Revenue Interest set forth in the Exhibit for any Oil and Gas Property, an
amount calculated by multiplying the reduction in Net Revenue Interest by the
Allocated Value of such Oil and Gas Property; with respect to any increase in
the Working Interest set forth in the Exhibit for any Oil and Gas Property, an
amount calculated by multiplying the increase in the Working Interest by the
lease operating and capital expense items as shown in the Report over the life
of such Oil and Gas Property; and with respect to any Title Defect that does not
cause the Net Revenue Interest set forth in the Exhibit for an Oil and Gas
Property to decrease or cause the Working Interest set for in the Exhibit for
any Oil and Gas Property to increase, an amount determined by evaluating the
portion of the Oil and Gas Property affected by such Title Defect, the legal
effect of the Title Defect, and the potential economic effect of the Title
Defect over the life of the Oil and Gas Property affected. The Title Defect
Amount as to any particular Oil and Gas Property, however, shall never exceed
the Allocated Value therefor.
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2. TITLE PROCEDURE.
2.1. NOTICE OF TITLE DEFECTS. On or before the Notice Date, Buyer
shall notify Seller of any Title Defect affecting an Oil and Gas Property
discovered by Buyer. The notice shall be in writing and shall describe the
alleged Title Defect, specify the Oil and Gas Property affected and set forth
Buyer's assessment of the Title Defect Amount.
2.2. SELLER'S ELECTION TO CURE. Seller may notify Buyer in writing on
or before the Closing Date that it elects to cure the alleged Title Defect. If
Seller has elected to cure the Title Defect, then Seller shall use commercially
reasonable efforts to cure such Title Defect during a period ending sixty days
after Closing (the "Cure Period").
2.3. UNCURED TITLE DEFECTS. If at the Closing Date, a Title Defect
identified by Buyer pursuant to Section 2.1 of this Annex I remains uncured and
Seller has not notified Buyer of its election to cure such Title Defect, then
the Purchase Price to be paid at the Closing shall be reduced by an amount equal
to the Title Defect Amount. There shall not be any reduction of the Purchase
Price at Closing for any Title Defects that Seller has elected to cure or has
disputed. If after the Cure Period, a Title Defect that Seller has elected to
cure remains uncured, then the Purchase Price shall be reduced in the Final
Settlement Statement by an amount equal to the Title Defect Amount.
3. DISPUTE RESOLUTION. If a Dispute exists as to whether a matter referred to
in any notice furnished by Buyer to Seller pursuant to Section 2.1 of this Annex
I constitutes a Title Defect, whether a Title Defect has been cured, or the
amount of any Title Defect Amount, either Buyer or Seller may request
arbitration of such dispute.
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ANNEX II
CERTIFICATE OF SELLER
Pursuant to the Agreement for Purchase and Sale ("Agreement") dated October 16,
1998, by and between Nuevo Energy Company ("Seller") and Samson Lone Star
Limited Partnership ("Buyer"), Seller hereby represents, warrants and affirms to
Buyer as follows:
1. Seller has performed and complied in all material respects with each
of the covenants and conditions required by the Agreement to be performed or
complied with by it before or at the time of execution of this Certificate; and
2. Each of the representations and warranties made by Seller under the
Agreement are true and correct as of the date hereof except for (a) changes
specifically contemplated by the Agreement, (b) inaccuracies in such
representations and warranties deemed to be waived by Buyer pursuant to the
terms of the Agreement and (c) inaccuracies set forth in the Schedule attached
to this Certificate.
This Certificate is executed this _____ day of _______________, 1998.
Nuevo Energy Company
By:_________________________________________________
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ANNEX III
CERTIFICATE OF BUYER
Pursuant to the Agreement for Purchase and Sale ("Agreement") dated October 16,
1998, by and between Nuevo Energy Company ("Seller") and Samson Lone Star
Limited Partnership ("Buyer"), Buyer hereby represents, warrants and affirms to
Seller as follows (capitalized terms used in this Certificate have the meanings
ascribed to such terms in the Agreement):
1. Buyer has performed and complied in all material respects with each
of the covenants and conditions required by the Agreement to be performed or
complied with by it before or at the time of execution of this Certificate.
2. Each of the representations and warranties made by Buyer under the
Agreement are true and correct as of the date hereof except for (a) changes
specifically contemplated by the Agreement, (b) inaccuracies in such
representations and warranties deemed to be waived by Seller pursuant to the
terms of the Agreement and (c) inaccuracies set forth in the Schedule attached
to this Certificate.
3. Buyer has been afforded an opportunity to (a) examine the Properties
and such materials as it has requested to be provided to it by Seller, (b)
discuss with representatives of Seller such materials and the nature and
operation of the Properties and (c) investigate the condition, including
subsurface condition, of the Oil and Gas Properties and Surface Contracts and
the condition of the Equipment. In entering into this Agreement, Buyer has
relied solely on the express representations and covenants of Seller in this
Agreement, its independent investigation of, and judgment with respect to, the
Equipment and the other Properties and the advice of its own legal, tax,
economic, environmental, engineering, geological and geophysical advisors and
not on any comments or statements of any representatives of, or consultants or
advisors engaged by, Seller or the Advisor.
This Certificate is executed this _____ day of __________, 1998.
SAMSON LONE STAR LIMITED PARTNERSHIP
by its sole general partner, Samson Resources Company
By:______________________________________________
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ANNEX IV
ASSIGNMENT AND ▇▇▇▇ OF SALE
THE STATE OF TEXAS
COUNTY OF ________
This Assignment and ▇▇▇▇ of Sale ("Assignment") is executed and delivered by
NUEVO ENERGY COMPANY, a Delaware corporation ("Assignor"), to SAMSON LONE STAR
LIMITED PARTNERSHIP, a Texas limited partnership ("Assignee").
Assignor, for valuable considerations, the receipt and sufficiency of which are
hereby acknowledged, does by these presents GRANT, BARGAIN, SELL, CONVEY,
ASSIGN, TRANSFER, SET OVER and DELIVER unto Assignee the undivided interest of
Assignor set forth in the Exhibit in and to the following properties, other than
the Excluded Assets (the "Properties"):
A. OIL AND GAS PROPERTIES. All properties described on the Exhibit
whether the interest of Seller in such properties is fee interests, leasehold
interests, working interests, farmout rights, royalty, overriding royalty or
other non-working or carried interests, or other mineral rights, and any rights
that arise by operation of law or otherwise in all properties and lands pooled,
unitized, communitized or consolidated with such properties (the "Oil and Gas
Properties").
▇. ▇▇▇▇▇. All oil, condensate or natural gas ▇▇▇▇▇ and water and other
types of injection ▇▇▇▇▇ located on the Oil and Gas Properties, whether
producing, operating, shut-in or temporarily abandoned.
C. SEVERED SUBSTANCES. All severed crude oil, natural gas, casinghead
gas, drip gasoline, natural gasoline, petroleum, natural gas liquids,
condensate, products, liquids and other hydrocarbons and other minerals or
materials of every kind and description produced
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from the Oil and Gas Properties and either (a) in storage tanks on the Effective
Date, (b) in pipelines on the Effective Date or (c) sold on or after the
Effective Date (the "Substances").
D. SURFACE CONTRACTS. All right-of-way agreements or other agreements
relating to the use or ownership of surface properties that are used or held for
use for flow lines in connection with the production of Substances from the Oil
and Gas Properties, including the rights-of-way agreements and other agreements
described in the Exhibit (the "Surface Contracts").
E. EQUIPMENT. All processing plants, pipelines and other equipment,
fixtures and physical facilities of every type and description located on the
Oil and Gas Properties or the Surface Contracts.
F. INFORMATION AND DATA. All (a) title opinions, lease and land files,
filings with and reports to regulatory agencies, gas and sales contract files,
division order files and other books, files and records to the extent that they
are directly related to Oil and Gas Properties and the transfer thereof is not
prohibited by existing contractual obligations and (b) all geophysical,
geological, engineering, exploration, production and other technical data,
magnetic field recordings, digital processing tapes, field prints, summaries,
reports and maps, whether written or in electronically reproducible form, that
are in the possession of Seller to the extent that they are directly related to
the Oil and Gas Properties.
G. CONTRACTS. All contracts and arrangements that directly relate to
the Properties and the production, storage, treatment, transportation,
processing, purchase, sale, disposal or other disposition of Substances
therefrom, and any and all amendments, ratifications or extensions of the
foregoing, and all rights to make claims and receive proceeds under any
insurance policy held by or on behalf of Assignor in connection with the
Properties for any claim that arises from the Effective Date through the Closing
Date in connection with the Properties, including the contracts described in the
Exhibit (the "Contracts").
H. PERMITS. All franchises, licenses, permits, approvals, consents,
certificates and other authorizations and other rights granted by governmental
authorities and all certificates of convenience or necessity, immunities,
privileges, grants and other rights, that relate to the Properties or the
ownership or operation of any thereof, including, without limitation, the
permits described in the Exhibit.
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I. IMBALANCES. All rights and benefits arising from or in connection
with any gas production, pipeline, storage, processing or other imbalance
attributable to Substances produced from Oil and Gas Properties existing on the
Effective Date.
As used herein, "Excluded Assets" means the following:
(1) all trade credits and all accounts, instruments and general
intangibles (as such terms are defined in the Code) attributable to the
Properties with respect to any period of time prior to the Effective Date;
(2) all claims and causes of action of Assignor (i) arising from acts,
omissions or events, or damage to or destruction of property, occurring prior to
the Effective Date, (ii) arising under or with respect to any of the Contracts
that is attributable to periods of time prior to the Effective Date (including
claims for adjustments or refunds), or (iii) with respect to any of the Excluded
Assets;
(3) all rights and interests of Assignor (i) under any policy or
agreement of insurance or indemnity, (ii) under any bond, or (iii) to any
insurance or condemnation proceeds or awards arising, in each case, from acts,
omissions or events, or damage to or destruction of property, occurring prior to
the Effective Date;
(4) all Substances produced and sold from the Oil and Gas Properties
with respect to all periods prior to the Effective Date, together with all
proceeds from or of such Substances;
(5) all claims of Assignor for refunds of or loss carry forwards with
respect to (i) production or any other taxes attributable to any period prior to
the Effective Date, (ii) income or franchise taxes, or (iii) any taxes
attributable to the Excluded Assets;
(6) all amounts due or payable to Assignor as adjustments to insurance
premiums related to the Properties with respect to any period prior to the
Effective Date;
(7) all proceeds, income or revenues (and any security or other
deposits made) attributable to (i) the Properties for any period prior to the
Effective Date, or (ii) any Excluded Assets;
(8) all personal computers and associated peripherals and all radio and
telephone equipment;
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(9) all of Assignor's proprietary computer software, patents, trade
secrets, copyrights, names, trademarks, logos and other intellectual property;
(10) all of Assignor's interpretations of geological and geophysical
data;
(11) all documents and instruments of Assignor that may be protected by
an attorney-client privilege;
(12) all audit rights arising under any of the Contracts or otherwise
with respect to any period prior to the Effective Date or to any of the Excluded
Assets;
(13) all (i) agreements and correspondence between Assignor and
NationsBanc ▇▇▇▇▇▇▇▇▇▇ Securities, Inc. (the "Advisor") relating to the
transactions contemplated in this Agreement, (ii) lists of prospective
purchasers for such transactions complied by either Assignor or the Advisor,
(iii) bids submitted by other prospective purchasers of the Properties, (iv)
analyses by Assignor or the Advisor of any bids submitted by any prospective
purchaser, (v) correspondence between or among Assignor or Advisor, or either of
their respective representatives, and any prospective purchaser other than
Buyer, (vi) correspondence between Assignor or Advisor or any of their
respective representatives with respect to any of the bids, the prospective
purchasers, the engagement or activities of the Advisor or the transactions
contemplated in this Agreement; and (vii) the Confidential Offering Memorandum
dated July, 1998, prepared by the Advisor and circulated to prospective
purchasers; and
(14) the Escrow Agreement dated July 31, 1996, between Seller and ▇▇▇▇-
▇▇▇▇▇ Corporation and the Agreement for Purchase and Sale dated July 26, 1996
between Seller and ▇▇▇▇-▇▇▇▇▇ Corporation.
TO HAVE AND TO HOLD all and singular the Properties, together with all rights,
titles, interests, estates, remedies, powers and privileges thereunto
appertaining unto Assignee and their respective successors, legal
representatives and assigns forever, subject to the Permitted Encumbrances (as
defined in the Agreement for Purchase and Sale dated October 16, 1998, between
Assignee and Assignor (the "Agreement")). Assignor hereby binds itself, its
successors, legal representatives and assigns, to warrant and forever defend the
Properties unto
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Assignee, their respective successors, legal representatives and assigns,
against every person whomsoever lawfully claiming or to claim the same or any
part thereof, by, through or under Assignor, but not otherwise.
In accordance with the terms of the Agreement, Assignee has assumed certain
obligations and liabilities. A complete description of the obligations of
Assignee are contained in the Agreement, and all such obligations are binding on
the successors and assigns of Assignee.
This Assignment may be executed in any number of counterparts and each of such
counterparts shall for all purposes be deemed to be an original, and all such
counterparts shall together constitute but one and the same Assignment.
IN WITNESS WHEREOF, the parties hereto have caused this Assignment to be duly
executed on this, the _____ day of _______, 199__. This Assignment shall be
effective at 7:00 a.m. at the location of the Properties on July 1, 1998 (the
"Effective Date").
NUEVO ENERGY COMPANY
By:
------------------------------------------
Name:
----------------------------------------
Title:
---------------------------------------
SAMSON LONE STAR LIMITED PARTNERSHIP
by its sole general partner, Samson Resources Company
By:
------------------------------------------
Name:
----------------------------------------
Title:
---------------------------------------
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ADDRESS OF ASSIGNOR: ADDRESS OF ASSIGNEE:
Suite 1650, 1331 ▇▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
-▇▇-
▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇ ▇▇▇▇▇ (S)
(S)
COUNTY OF ▇▇▇▇▇▇ (S)
This instrument was acknowledged before me on December __, 1998, by
_______________, ____________ of Samson Resources Company, a _____________
corporation, on behalf of said corporation, as the sole general partner of
Samson Resources Limited Partnership, a Texas limited partnership.
-----------------------------------------
Notary Public in and for
The State of Texas
Name:
------------------------------------
My Commission Expires:
-------------------
STATE OF TEXAS (S)
(S)
COUNTY OF ▇▇▇▇▇▇ (S)
This instrument was acknowledged before me on December __, 1998, by __________,
Vice President of Nuevo Energy Company, a Delaware corporation, on behalf of
said corporation.
-----------------------------------------
Notary Public in and for
The State of Texas
Name:
------------------------------------
My Commission Expires:
-------------------
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