PURCHASE AND SALE AGREEMENT
AUGUST 16, 2001
TABLE OF CONTENTS
1. PURCHASE AND SALE 1
1.1 Purchase and Sale 1
1.2 Interests 1
1.3 Special Provisions Regarding Individual Fields 4
1.4 Excluded Interests 6
1.5 Overriding Royalty Interests 7
1.6 Effective Date 7
1.7 Interests Subject to Existing Agreements 7
2. Purchase Price 7
2.1 Purchase Price 7
2.2 Adjustments to Purchase Price 7
3. REPRESENTATIONS AND WARRANTIES 9
3.1 Representations and Warranties of Seller 9
3.2 Representations and Warranties of Buyer 11
4. COVENANTS AND AGREEMENTS 13
4.1 Covenants and Agreements of Seller 13
4.2 Covenants and Agreements of Buyer 14
5. TITLE MATTERS 15
5.1 Defensible Title 15
5.2 Special Warranty of Title 16
5.3 Consents to Assign 16
5.4 No Preferential Rights to ▇▇▇▇▇▇▇▇ ▇▇
▇. CONDITIONS TO CLOSING 17
6.1 Seller's Conditions 17
6.2 Buyer's Conditions 17
7. CLOSING 17
7.1 Date of Closing 17
7.2 Place of Closing 17
7.3 Closing Obligations 17
8. OBLIGATIONS AFTER CLOSING 19
8.1 Post-Closing Adjustment Procedure 19
8.1.1 Receipts and Credits 19
8.1.2 2001 Taxes 20
8.2 Files and Records 20
8.3 Further Assurances 20
8.4 NORM 20
8.5 Plugging and Abandonment of ▇▇▇▇▇, Removal of Facilities 21
8.6 Seller's Retention of Obligations and Indemnification 21
8.7 Buyer's Assumption of Obligations and Indemnification 22
8.8 Suspense Funds 23
9. MISCELLANEOUS 23
9.1 Exhibits and Schedules 23
9.2 Disclaimers 23
9.2.1 Disclaimer of Warranties 23
9.2.2 Disclaimer Regarding Information 26
9.3 Confidentiality 26
9.4 Waiver of Partition 27
9.5 Expenses 27
9.6 Notices 27
9.7 Amendments 28
9.8 Conditions 28
9.9 Counterparts 28
9.10 Governing Law 28
9.11 Entire Agreement 28
9.12 Parties in Interest 29
9.13 Liability and Jury Waivers 29
9.14 Press Release 29
9.15 Severability 29
9.16 Dispute Resolution 30
9.17 Certain Governmental Consents 30
9.18 No Admissions 30
9.19 Consents 30
9.20 Preferred Stock Representation 31
EXHIBITS AND SCHEDULES
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Exhibit A Seller's Interest in Oil and Gas Leases and ▇▇▇▇▇
Exhibit B-1 Assignment, ▇▇▇▇ of Sale and Conveyance-East ▇▇▇▇▇▇ Field
Exhibit B-2 Assignment, ▇▇▇▇ of Sale and Conveyance-Alwan Field
Exhibit B-3 Assignment, ▇▇▇▇ of Sale and Conveyance-North Francitas Field
Exhibit B-4 Assignment, ▇▇▇▇ of Sale and Conveyance-Grand Lake Field
Exhibit B-5 Assignment, ▇▇▇▇ of Sale and Conveyance-Lacassine Field
Schedule 1.3 Plat of North Fault Block and South Fault Block, Lacassine Field
Schedule 1.3(A)(v) Joint Operating Agreement-Lacassine Field
Schedule 1.3(B)(ii) Joint Operating Agreement-North Francitas Field
Schedule 1.3(D) Joint Operating Agreement-Grand Lake Field
Schedule 1.4 Excluded Interests-Employment, Consulting, Office and Accounting
Service Contracts
Schedule 1.5 Assignments of Overriding Royalty Interests
Schedule 2.1 Statement of Resolution Establishing and Designating a Series of
Shares of GulfWest Energy Inc., Series E Preferred Stock, par
value $.01 per share
Section 3.1(f) Production Sales Contracts which may not be terminated on notice
of 60 days or less
Section 3.1(p) Calls on Production
Schedule 7.3(b)Notice of Contractual Rights
Schedule 7.3(i)Act of Complete Release from Millennium Energy Fund, L.L.C. and
Notice of Termination and Reassignment of Net Profits Interest
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Note: Exhibits and Schedules listed above are omitted in this filing, however
the registrant agrees to furnish a copy of any omitted exhibit or
schedule to the Commission upon request.
PURCHASE AND SALE AGREEMENT
This Purchase and Sale Agreement, dated the 16th day of August 2001,
("Agreement") is between Grand Goldking, L.L.C., a Louisiana limited liability
company, herein referred to either as "Goldking" or as "Seller" and GulfWest
Energy Inc, a Texas corporation, hereinafter referred to as "GulfWest Energy"
and GulfWest Oil & Gas Company, a Texas Corporation ("GulfWest
O&G") and GulfWest Oil & Gas Company (Louisiana) LLC, a Louisiana
limited liability company ("GulfWest LLC"), all located at ▇▇▇ ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ (GulfWest Energy,
GulfWest O&G and GulfWest LLC, herein referred to collectively and in the
singular as "Buyer").
In consideration of the mutual promises contained herein, the benefits to be
derived by each party hereunder and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Buyer and Seller agree
as follows:
1. PURCHASE AND SALE.
1.1 Purchase and Sale.
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Seller agrees to sell and convey to Buyer, and Buyer agrees to purchase and
pay Seller for the Interests (as defined in Section 1.2), subject to the
terms and conditions of this Agreement.
1.2 Interests.
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Subject to the provisions and limitations of this Agreement, including but
not limited to Section 1.3 hereof and specifically excepting the Excluded
Interests and Reserved Overriding Royalty Interests (as hereinafter defined
in Section 1.4 and Section 1.5, respectively), the following shall be
called "Interests", to-wit:
(a) One hundred percent (100%) of Seller's working interest in the oil and
gas leases and other properties situated in the Lacassine Refuge Field
(sometimes referred to as "Lacassane Refuge Field") ("Lacassine
Field"), as more particularly described on Exhibit A hereto; SAVE
AND EXCEPT an undivided fifty percent (50%) of Seller's ownership
interest in the following: (i) the ▇-▇▇ ▇▇▇▇ (▇▇▇▇▇▇ ▇▇. ▇▇▇▇▇▇), (▇▇)
all ▇▇▇▇▇ drilled or caused to be drilled in the North Fault Block [as
defined in Section 1.3 (A)(i) hereof] by Buyer (or its designee) and
Seller (or its designee) subject to the terms and conditions of that
certain Joint Operating Agreement dated of even date herewith between
Seller, Buyer and Setex Oil & Gas Company ("Setex"),and (iii) all
oil, gas and other minerals produced from such ▇▇▇▇▇ described in
(i) and (ii) above located on the North Fault Block.
(b) One hundred percent (100%) of Seller's interest in oil and gas leases
and other properties located in the Grand Lake Field as more
particularly described on Exhibit A hereto, insofar and only insofar
as said leases cover rights situated from the surface down to 200'
below the base of the No. 24 sand as seen in the Superior Oil Company
State Lease 344 No. 25 well (API No. 17-023-20946) on the ISF/SONIC
log at 10,790' ("Shallow Depths";
(c) An undivided fifty percent (50%) of Seller's interest in oil and gas
leases located in the Grand Lake Field, insofar said leases cover the
zones below the Shallow Depths;
(d) One hundred percent (100%) of Seller's interest in oil and gas leases
situated in the North Francitas Field, as more particularly described
on Exhibit A hereto;
(e) One hundred percent (100%) of Seller's interest in the oil and gas
leases and other properties situated in the Alwan Field, as more
particularly described on Exhibit A hereto;
(f) One hundred percent (100%) of Seller's interest in the oil and gas
leases and other properties situated in East ▇▇▇▇▇▇ Field, as same are
more particularly described on Exhibit A hereto;
The properties, rights and Interests specified in the foregoing subsections
(a), (b), (c), (d), (e), and (f) are herein referred to collectively as the
"Oil & Gas Properties".
(g) Those interests in personal property, fixtures and improvements
appurtenant to the Interests or used or obtained in connection with
their operation or with the production, treatment, sale or disposal of
hydrocarbons or water produced therefrom or attributable thereto,
including without limitation, ▇▇▇▇▇, pipelines, gathering systems and
compression facilities appurtenant to or located upon the Interests,
less and except any and all boats, vehicles (the "Personal Property
and Fixtures");
(h) Those interests in property, rights, privileges, benefits and
appurtenances in any way belonging to, incidental to, or appertaining
to the Interests, including, to the extent transferable, all
agreements, purchase and sale agreements identified on Exhibit "A"
hereto and made a part hereof, product purchase and sale contracts,
surface leases, gas gathering contracts, salt water disposal leases
and ▇▇▇▇▇, processing agreements, compression agreements, equipment
leases, permits, gathering lines, rights-of-way, easements, licenses,
farm-outs and farm-ins, options, orders, pooling, spacing or
consolidation agreements, unit agreements, communitization agreements,
and operating agreements and all other agreements relating thereto
(the "Contracts");
(i) Originals or copies of all production records, accounts,
files, information, and data, in the custody, or control of Seller
that pertain in any material way to the Interests (in any medium,
including paper, film, microfilm, and computer magnetic tapes and
disks, and in any form, including numbers, text, tables, charts, maps,
financial accounts and graphic images) including without limitation:
(1) instruments and agreements that constitute, create, or
govern the Interests, the easements, equipment, and
agreements described above;
(2) title opinions, abstracts of title, together with all
curative materials and title files for the Interests;
(3) maps, drilling reports, engineering data, formation tests,
logs and maps for the Interests;
(4) to the extent transferable by Seller without restriction
under applicable law or third party agreements (without the
extraordinary payment of funds or other consideration),
seismic geophysical, geological, gravitational,
paleontological, and chemical data, information and analyses
for the Interests;
(5) information about hydrocarbon production, processing,
storage, transportation, and sales form the Interests,
including all such production and sales records; and
(6) relevant financial and tax information (excluding income tax
information) including authorities for expenditure,
operating budgets, cash call, billing statements, and
reconciliation statements..
Items (1) through (6) above are hereinafter referred to as the "Records."
However, excluded from the sale and transfer of the Interests shall be
the following materials that Seller shall not be required to deliver
or make available to Buyer:
(a) Seller's general tax records,
(b) All attorney-client communications or attorney work
product, records and documents, and other legally
recognized privileged communications in Seller's
possession, and/or
(c) records which are subject to third party contractual
restrictions on disclosure that cannot be removed
without extraordinary expense or effort.
The above items (a), (b) and (c) may be collectively referred to
herein as the "Excluded Records".
(j) All accounts receivables attributable to the Interests that are,
in accordance with generally accepted accounting principles,
attributable to the period from and after the Effective Date (the
"Accounts Receivable").
(k) All oil, gas and mineral production attributable to the Interests from
and after the Effective Date (the "Production").
The Oil & Gas Properties, the Personal Property and Fixtures, the Records,
the Accounts Receivable, the Production and all other property described in (a)
through (k) are hereinafter referred to as the "Interests".
1.3 Special Provisions Regarding Individual Fields.
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A. Lacassine Refuge Field, Cameron Parish, Louisiana.
(i) Description of North Fault Block and South Fault Block:
For the purposes of this Agreement, the Lacassine Field shall be
divided into two (2) fault blocks, the North Fault Block and the South
Fault Block.
(a) The North Fault Block is defined as that portion of the Interests
lying north of a line bisecting the LARF MARG HOWEI '2' SU, as
created by the Louisiana Office of Conservation Order No. 868, as
follows:
Commencing at a point located on the southwest quadrant
boundary line of the unit drawn for the LARF MARG HOWEI '2'
SU at the surface location of the Texas Pacific Oil Company
Inc. #B-3 well and continuing North 52 degrees East to a
point at the surface location of the Oryx Energy Co.
Lacassine #B-11 well and thence continuing North 76 degrees
East to a point located on the Northeast boundary line of
the designated unit for the LARF MARG HOWEI '2' SU. A plat
of the line separating the North and South Fault Block is
attached hereto as Schedule 1.3.
(b) The South Fault Block is that portion of the Interests that is
situated south of the above described line that bisects the LARF
MARG HOWEI '2' SU.
(ii) Within eighteen (18) months after Closing, Buyer will make a good
faith effort to clean out the B-1 well for the deepening or recompletion of
the well to the MH3 zone or other zones. Should Buyer either not timely
commence such deepening operation or fail to make a good faith attempt to
reach the MH3 zone, then Seller, at its election, may require Buyer to
reassign such wellbore to Seller. Upon such reassignment, Seller shall be
entitled to all production obtained from said well as it may be deepened
and Seller shall be responsible for plugging and abandoning the B-1
wellbore. The reassignment of the B-1 wellbore to Seller shall be subject
to Buyer's lender ("Lender") releasing such wellbore from all security
interests held by the Lender that pertain to such well. Buyer agrees to
make a good faith attempt to secure such releases.
(iii)Buyer agrees to transport natural gas to a sales meter and store oil
and condensate prior to sale as a result of (ii) above, and Buyer agrees to
provide Seller or its designee, at no cost, gathering and metering services
("Gathering and Metering Services") in this field so long and only to the
extent excess capacity exists in Buyer's existing gathering and sales
metering facilities. If additional facilities are required to handle
Seller's production, then Seller shall pay its proportionate share of the
costs incurred by Buyer in providing Gathering and Metering Services for
Seller's share of production.
(iv) Seller shall pay Buyer a fee of 5 cents per barrel for the disposal of
Seller's share of produced water from the Lacassine Field. This right is
not assignable by Seller to a third party not affiliated with or a
subsidiary of Seller or Goldking Energy Corporation.
(v) At Closing, Seller, Buyer and Setex shall enter into a separate Joint
Operating Agreement (JOA) covering the Lacassine Field, a copy of this JOA
is attached hereto as Schedule 1.3(A)(v).
(vi) Seller and Buyer agree that no new well will be spud to test
reservoirs in the North Fault Block in the Lacassine Field prior to
February 1, 2002, unless mutually agreed to by the parties.
B. North Francitas Field, ▇▇▇▇▇▇▇ County, Texas:
(i) At its sole cost and expense, Buyer shall attempt to reenter and
complete as a commercially productive well of oil and/or gas at least one
well located within the North Francitas Field AMI as defined in the JOA
attached hereto, within eighteen (18) months after Closing. If Buyer does
not timely satisfy this obligation, then Buyer shall, at Seller's sole
discretion and request, assign to Seller or its designee, for no additional
consideration, all rights acquired by Buyer from Seller in the North
Francitas Field and/or pursuant to the North Francitas Joint Operating
Agreement (JOA) to be executed by Seller, Buyer and Setex at Closing. This
reassignment shall be made free and clear of any liens, encumbrances or
transfers by or against Buyer and shall be effective as of the date of
Seller's request. Buyer shall retain all of its liability associated with
said prospect from the Closing Date through the date of re-conveyance to
Seller or its designee. Upon such transfer, the North Francitas JOA shall
no longer be effective. However, if Buyer is successful with its first well
reentry, then Buyer will carry Seller or its designee "through the tanks"
for its undivided thirty percent (30%) interest in the first and second
well reentries and the reentry of the salt water disposal well. Once this
obligation is satisfied, Seller shall then be responsible for its
proportionate share of facilities costs incurred subsequent to said
satisfaction. (ii) At Closing, Seller, or its designee, Buyer and Setex
shall enter into a Joint Operating Agreement (JOA) covering the North
Francitas Field, a copy of this JOA is attached hereto as Schedule
1.3(B)(ii).
▇. ▇▇▇▇▇ Field, ▇▇▇▇▇▇▇ County, Texas:
Seller has provided to ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ two performance bonds in
the amounts of Thirty-Two Thousand Dollars and Twenty-Five Thousand
Dollars, respectively, covering the obligation to plug and abandon the
▇▇▇▇▇▇▇▇▇▇ Nos. 1 and 3 ▇▇▇▇▇ and to perform surface restoration operations
on the well sites and facilities for said ▇▇▇▇▇ ("P&A" Bond). Buyer shall
provide ▇▇. ▇▇▇▇▇▇▇▇▇▇ with performance bonds sufficient to replace the
P&A Bonds ("Replacement Bonds") on or before the Closing Date.
D. Grand Lake Field, Cameron Parish, Louisiana:
At Closing, Seller, Buyer and Setex shall enter into a Joint Operating
Agreement (JOA) covering the Grand Lake Field, a copy of this JOA is
attached hereto as Schedule 1.3(D).
1.4 Excluded Interests.
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It is specifically agreed Seller is not selling and Buyer is not
purchasing the following ("Excluded Interests"):
(a) Materials and equipment leased or temporarily located on the
Interests, as more fully set forth in the attached Schedule 1.4,
and any materials, equipment, pipelines, or other facilities in
which Seller does not own an interest;
(b) all amounts due or payable to Seller as adjustments or refunds
under any contracts affecting the Interests for all periods of
time prior to the Effective Date, specifically including, without
limitation, amounts recoverable from audits under operating
agreements, provided such matters are identified, and Seller has
made timely claim thereon pursuant to the applicable contract and
such claim is made on or before two years from and after the
Effective Date;
(c) all proceeds, benefits, income or revenue accruing to the
Interests prior to the Effective Date, and any claims of Seller
for refunds of or losses carried forward with respect to taxes
attributable to the Interests for any period prior to the
Effective Date; and
(d) all employment, consulting, office lease and accounting service
contracts, and all other contracts described in Schedule 1.4.
1.5 Overriding Royalty Interests.
----------------------------
Buyer acknowledges the Interests are subject to those overriding
royalty interests more fully set forth in Schedule 1.5 attached
hereto.
1.6 Effective Date.
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The purchase and sale of the Interests shall be effective as of
July 1, 2001(the "Effective Date").
1.7 Interests Subject to Existing Agreements.
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Buyer and Seller agree that the sale of the Interests will be
made subject to any and all reservations of public record and that are
included on the attached Exhibit A.
2. PURCHASE PRICE.
2.1 Purchase Price
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(a) The purchase price for the Interests shall be Fourteen
Million Five Hundred Thousand Dollars ($14,500,000.00) (the
"Purchase Price"), subject to adjustment as set forth in
Section 2.2., and payable as follows:
(i) Ten Million Dollars (US) ($10,000,000.00) paid at Closing by
bank wire transfer of immediately available funds as
specified by Seller ("Cash"), and
(ii) Four Million Five Hundred Thousand Dollars ($4,500,000.00)
represented by nine thousand (9,000) shares of GulfWest Energy's
Series E preferred redeemable stock ("Preferred Stock") to be
issued as follows: 4,500 shares to ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇. and
4,500 shares to Millennium Energy Fund, L.L.C. (collectively, the
"Shareholders"). The rights and obligations of Shareholders and
GulfWest Energy with regard to the Preferred Stock shall be set
forth in a separate Statement of Resolution Establishing and
Designating a Series of Shares of GulfWest Energy, Inc. Series E
Preferred ("Statement") in the form set forth as Schedule 2.1
attached hereto.
2.2 Adjustments to Purchase Price.
-----------------------------
The Purchase Price shall be adjusted as follows:
(a) The Cash portion of the Purchase Price shall be adjusted upward
by the following:
(i) the value of all oil in storage above the pipeline connection as
of the Effective Date and not previously sold by Seller that is
attributable to the Interests, such value to be the market price
in effect as of the Effective Date less applicable taxes and
gravity adjustments;
(ii) the amount of expenditures paid by or on behalf of Seller in
connection with the operation of the Interests, in accordance
with generally accepted accounting principles, to the extent not
provided for in Section 2.2 (a)(iii), attributable to the period
after the Effective Date including but not limited to: (a) all ad
valorem, property, production, excise, severance and similar
taxes based upon or measured by the ownership of property or the
production of hydrocarbons or the receipt of proceeds therefrom
and (b) all expenditures, rentals, royalties and other charges
and expenses billed under applicable operating agreements,
excluding overhead charges;
(iii)an amount equal to all prepaid expenses attributable to the
Interests that are paid by or on behalf of Seller that are, in
accordance with generally accepted accounting principles,
attributable to the period ( or any portion thereof) after the
Effective Date, including without limitation prepaid utility
charges and prepaid ad valorem, property, production, severance
and similar taxes based upon or measured by the ownership of
property or the production of hydrocarbons or the receipt of
proceeds therefrom; and
(iv) any other amount if agreed upon in writing by Seller and Buyer.
(b) The Cash portion of the Purchase Price shall be adjusted downward by
the following:
(i) proceeds received by Seller attributable to the Interests that
are, in accordance with generally accepted accounting principles,
attributable to the period of time from and after the Effective
Date, excluding proceeds attributable to oil in storage above the
pipeline connection as of the Effective Date;
(ii) an amount equal to unpaid ad valorem, property, production,
excise, severance and similar taxes and assessments based upon or
measured by the ownership of the Interests that are attributable
to any period or periods of time (or any portion thereof) prior
to the Effective Date (collectively, "Taxes"), which amounts
shall, to the extent not actually assessed, be computed based on
such tax rates and assessments for the preceding tax year (such
amount to be prorated for (1) the period of Seller's and Buyer's
ownership before and after the Effective Date) and (2) based upon
Seller's and Buyer's post Closing ownership ("Tax Estimate"). For
purposes of this section, Seller's pro rata portion of year 2001
ad valorem taxes shall be estimated to be Fifty Thousand Dollars
($50,000.00);
(iii)the sum of $85,000 that will be used by Buyer for field repairs
as determined by Buyer; and (iv) any other amount if agreed upon
in writing by Seller and Buyer.
3. REPRESENTATIONS AND WARRANTIES.
3.1 Representations and Warranties of Seller.
----------------------------------------
Seller represents and warrants to Buyer as of the Closing Date,
the following:
(a) Grand Goldking L.L.C. is a limited liability company duly
organized, validly existing and in good standing under the laws of the
State of Louisiana, and is duly qualified to carry on its business in
the jurisdictions where the Interests are located.
(b) Seller has all requisite 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 consummation of the
transactions contemplated by this Agreement will not violate, or be in
conflict with, (i) any provision of its operating agreement; (ii) any
provision of any agreement or instrument to which it is a party or by
which it is bound, noncompliance with which would have a material
adverse effect upon Buyer's ownership or operation of the Interests or
upon any of the transactions contemplated by this Agreement, and (iii)
to Seller's knowledge, any judgment, decree, order, statute, law, rule
or regulation, applicable to Seller.
(c) This Agreement has been duly authorized, executed and delivered on
behalf of Seller and constitutes the legal, valid and binding
obligation of Seller, enforceable in accordance with its terms;
subject, however, to the effects of bankruptcy, insolvency,
reorganization and other laws for the protection of creditors.
(d) Seller has incurred no liability, contingent or otherwise, for
brokers' or finders' fees relating to the transactions contemplated by
this Agreement for which Buyer shall have any responsibility
whatsoever.
(e) There are no bankruptcy, reorganization or arrangement proceedings
pending, being contemplated by or, to the knowledge of Seller,
threatened against Seller.
(f) Except as shown on Schedule 3.1(f) Seller is not a party to, and
Seller's Interests are not otherwise bound by, any production sales
contracts that cannot be terminated on notice of 60 days or less.
(g) Seller is not a "holding company", "subsidiary company", "public
utility company," "gas utility company" or an "affiliate" of a "public
utility company" within the meaning of such terms in the Public
Utility Holding Company Act of 1935, as amended. Seller is not subject
to regulation as a natural gas distribution utility nor is Seller
subject to regulation as a public utility or public service company
(or similar designation) by any state in the United States or in any
foreign country. Seller is not subject to regulation by the Federal
Energy Regulatory Commission under the Federal Power Act or as a
"natural gas company" under the Natural Gas Act.
(h) To the best of Seller's knowledge, there are no pending threatened
claims, demands, or legal proceedings currently pending or threatened
by any third party against Seller in connection with Seller's
ownership or operation of the Interests described on Exhibit A.
(i) To the best of Seller's knowledge as of the Effective Date, Seller
has not violated any applicable laws or statutes, or any applicable
regulations, rules or orders promulgated by the Federal Energy
Regulatory Commission, or any other federal or state regulatory
agency, or any of their predecessor agencies, which would have a
material and adverse effect upon the value of the Interests or the
production of hydrocarbons from the Interests.
(j) To the best of Seller's knowledge, all of the ▇▇▇▇▇ drilled by
Seller have been drilled, completed and operated within the boundaries
of the Interests eases or within the limits otherwise permitted by
contract, pooling or unit agreement and by law and in substantial
compliance with all applicable rules, regulations, permits judgments,
orders and decrees of any court or the federal and state regulatory
authorities having jurisdiction thereof.
(k) To the best of Seller's knowledge, (i) all contracts or agreements
which affect the right of Seller to own and operate the Interests,
which have not previously expired or been terminated by mutual
agreement, are in full force and effect and are included on Exhibit
A, and (ii) except as set forth on Schedule 3.1(f) neither Seller
nor any other party to any such agreement has given, or threatened to
give, written notice of any action to cancel, rescind or procure a
judicial reformation of any such contract or agreement or any
provision thereof.
(l) To the best of Seller's knowledge, it has made available to Buyer
for inspection all governmental permits in the possession of Seller
affecting or relating to the Interests.
(m) To the best of Seller's knowledge, Seller's operation of the
Interests is not the subject of any pending regulatory compliance or
enforcement actions.
(n) To the best of Seller's knowledge, no fact or circumstance exists
which would preclude or inhibit approval of Seller's assignment of the
Interests to the Buyer by any state agency or other jurisdictional
body.
(o) Except for files and other information that would reasonably be
considered as confidential, subject to legally recognized privileged
communication or proprietary data standards, all files relating to the
Interests in the possession of Seller have been made available to
Buyer for Buyer's review prior to Closing.
(p) To the best of Seller's knowledge and except as reflected on
Schedule 3.1(p) and in the documents and agreements listed in Exhibit
A, (i) no amount of Seller's hydrocarbons produced from the
Interests and marketed by others is subject to a sale or processing
contract (except for contracts terminable without penalty by Seller on
notice or not more than thirty days after notice), and no person has
any call upon, option to purchase or similar rights under any
agreement with respect to the Interests or the production therefrom,
(ii) Seller has not in any respect collected, nor will Seller in any
respect collect, any proceeds from the sale of hydrocarbons produced
from the Interests that are subject to refund by Buyer, and (iii)
Seller has not been nor will Seller be obligated by virtue of any
prepayment made under any gas transportation, production sales
contract or any other contract containing a "take-or-pay" clause, or
under any gas balancing, deferred production or similar arrangement to
deliver oil, gas or other minerals produced from or allocated to any
of the Interests at some future time without receiving full payment
therefore at the time of delivery.
(q) To the best of Seller's knowledge, all production excise,
severance, windfall profit and similar taxes and assessments payable
with respect to the Interests and based on or measured by the
production or removal of hydrocarbons or the receipt of proceeds
therefrom have been and will be timely paid as of the Effective Date
in all respects.
(r) For twelve months following the Closing, Seller agrees to provide
Buyer with reasonable access to accounting data and other information
(less and except any Excluded Records) regarding the Interests
conveyed pursuant to this Agreement in order that Buyer can satisfy
its reporting requirements to the Securities and Exchange Agreement.
This information shall include information regarding Seller's books,
records, files and other pertinent data relating to the Interests.
3.2 Representations and Warranties of Buyer.
---------------------------------------
Buyer represents and warrants to Seller, as of the Closing Date, the following:
(a) GulfWest Energy, Inc. and GulfWest Oil & Gas Company are Texas
companies duly organized, validly existing and in good standing under
the laws of the State of Texas. GulfWest Oil & Gas Company
(Louisiana) LLC is a Louisiana company duly organized, validly
existing and in good standing under the laws of the State of
Louisiana. GulfWest Energy, GulfWest O&G and GulfWest LLC are, or
will be on the Closing Date, duly qualified to conduct business in
each state where the Interests are located.
(b) Buyer has all requisite 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 consummation of the
transactions contemplated by this Agreement will not violate, or be in
conflict with, (i) any provision of the articles of formation, bylaws
or regulations of Buyer; (ii) any provision of any agreement or
instrument to which either Buyer is a party or by which it is bound,
noncompliance with which would have a material adverse effect upon
Buyer's ownership or operation of the Interests, or upon any of the
transactions contemplated by this Agreement, and (iii) any judgment,
decree, order, and to its knowledge, any statute, law, rule or
regulation, applicable to Buyer.
(c) This Agreement has been duly authorized, executed and delivered on
behalf of Buyer and constitutes the legal, valid and binding
obligation of Buyer, enforceable in accordance with its terms;
subject, however, to the effects of bankruptcy, insolvency,
reorganization and other laws for the protection of creditors.
(d) Buyer has incurred no liability, contingent or otherwise, for
brokers' or finders' fees relating to the transactions contemplated by
this Agreement for which Seller shall have any responsibility
whatsoever.
(e) Buyer is an experienced oil and gas company and operator. It has
entered into this Agreement on the basis of its own independent
judgment and analysis. Buyer is in the business of purchasing and
owning oil and gas producing properties. The Interests to be acquired
by Buyer pursuant to this Agreement are being acquired by it for its
own account for investment purposes and not for distribution within
the meaning of any securities law. In acquiring the Interests, it is
acting in the conduct of its own business and not under any specific
contractual commitment to any third party, or any specific nominee
agreement with any third party, to transfer to, or to hold title on
behalf of such third party, with respect to all or any part of the
Interests.
(f) There are no bankruptcy, reorganization or arrangement proceedings
pending, being contemplated by or, to the knowledge of Buyer,
threatened against Buyer.
(g) Buyer will have at Closing, all funds and Preferred Stock
necessary to pay the Purchase Price. Buyer's ability to consummate the
transaction contemplated hereby is not contingent on its ability to
complete any public or private placement of securities prior to or
upon Closing other than the issuance of the Preferred Stock.
(h) The total authorized capital stock of GulfWest Energy is
40,000,000 shares of Class A common stock, par value $.001 per share
(the "Common Stock"), of which 18,462,541 shares are issued and
outstanding as of the Closing Date, and 10,000,000 shares of preferred
stock, par value $.01 per share, of which 8,000 shares of Series D
Preferred Stock has been previously issued and is outstanding and
9,000 shares of the Series E Preferred Stock which will be issued to
Seller at Closing. Upon delivery of the 9,000 shares of the Series E
Preferred Stock to Seller at the Closing, pursuant to the terms
hereof, Seller will have good, marketable and indefeasible title to
the Series E Preferred Stock, free and clear of all Liens whatsoever.
The 9,000 shares of Series E Preferred Stock have been duly authorized
and upon issuance at Closing will be fully paid, nonassessable and
validly issued in compliance with all applicable federal and state
laws and regulations, provided that a Form D is filed with the U.S.
Securities and Exchange Commission within 15 days of the issuance of
the 9,000 shares of Preferred Stock and all representations and
warranties of the Seller and the Shareholders in this Agreement or any
of certificate or instrument delivered in connection herewith are true
and correct.
The Series D Preferred Stock is convertible to Common Stock at anytime
following the third anniversary of the date of issuance, which was
December 31, 1999. As of the Closing Date, GulfWest Energy will have
issued and outstanding warrants to purchase 2,013,254 shares of Common
Stock at prices ranging from $.75 to $6.00 per share, and employee
stock options issued pursuant to the Company's 1994 Stock Option and
Compensation Plan (Amended and Restated as of April 1, 2001) to
purchase 1,177,000 shares of Common Stock at prices ranging from $.75
to $3.00 per share. Except for the securities of the Company described
in this Section 3.2(h), as of the Closing Date there are no other
outstanding warrants, options or other securities pursuant to which
the Company is or may become obligated to issue or sell any shares of
capital stock of the Company.
(i) To the best of Buyer's knowledge, no fact or circumstance exists
which would preclude or inhibit approval by any state agency or other
jurisdictional body of Seller's assignment of the Interests to the
Buyer..
4. COVENANTS AND AGREEMENTS.
4.1 Covenants and Agreements of Seller.
----------------------------------
Seller covenants and agrees with Buyer as follows:
(a) Seller has made available to Buyer for examination all of Seller's
title information, production information and other information
relating to the Interests, including without limitation, accounting
files, production files, land files, lease files, well files, division
order files, contract files and marketing files, and, subject to the
consent and cooperation of third parties, will cooperate with Buyer in
Buyer's efforts to obtain, at Buyer's expense, such additional
information relating to the Interests as Buyer may reasonably desire,
to the extent in each case that Seller may do so without violating
legal constraints or any confidentiality requirement or other
contractual commitment of Seller to a third party.
(b) Seller has permitted Buyer's authorized representative , at
Buyer's sole risk and expense, to conduct reasonable on-site
inspections of the Interests, including, without limitation,
environmental assessments.
(c) Except as otherwise consented to in writing by Buyer or provided
in this Agreement, from the Effective Date of this Agreement to the
Closing Date, to the extent Seller is the operator of any of the
Interests, Seller has continued to operate the Interests in a good and
workmanlike manner consistent with past practices. Seller will, in
accordance with its normal business practice, pay or cause to be paid
its proportionate share of all costs and expenses incurred in
connection with such operations, and Seller has notified Buyer of
ongoing activities and major capital expenditures in excess of $20,000
per activity, if any, conducted on the Interests
(d) Subject to Subsection (c) above, Seller has not: (i) abandoned any
part of the Interests (except in the ordinary course of business or
the abandonment of leases upon the expiration of their respective
primary terms or if not capable of production in paying quantities,
(ii) approved any operations on the Interests costing Buyer more than
$20,000 per activity; (iii) conveyed or disposed of any part of the
Interests (other than replacement of equipment or sale of hydrocarbons
produced from the Interests in the regular course of business); (iv)
entered into any "farm-out," "farm-in" or other similar contract
affecting the Interests; (v) let lapse any insurance now in force with
respect to the Interests; (vi) materially modified or terminated any
contract material to the operation of the Interests, or (vii)
authorized or proposed, or agreed in writing or otherwise to take, any
of the actions described in this Section 4.1(d).
4.2 Covenants and Agreements of Buyer.
---------------------------------
Buyer covenants and agrees with Seller that:
(a) Buyer has maintained its corporate status and is not under any
material corporate, legal or contractual restriction that would
prohibit or delay the timely consummation of the transactions
contemplated in this Agreement.
(b) Buyer shall take over operations as of 7:00 a.m. local time at the
well sites on the day after the Closing Date with respect to Seller
operated ▇▇▇▇▇ included in the Interests assigned to Buyer at Closing.
(c) Buyer has furnished to Seller reasonably acceptable documentation
that Buyer is qualified to do business and to own and operate the
Interests in the jurisdictions in which the Interests are located and
has posted all bonds.
5. TITLE MATTERS.
5.1 Defensible Title.
-----------------
(a) The term "Defensible Title" shall mean, as to the Interests, such
title of record held by Seller or a third party for the benefit of
Seller, except for and subject to Permitted Encumbrances [as defined
in Section 5.1(b)], that:
(i) entitles Seller to receive as to each of the Interests set
forth in Exhibit A, not less than the "Net Revenue Interest"
set forth in Exhibit A in the oil, gas and associated liquid
and gaseous hydrocarbons produced, saved and marketed therefrom
(except Permitted Encumbrances);
(ii) obligates Seller to bear costs and expenses relating to the
maintenance, development and operation of each of the Interests
set forth on Exhibit A in an amount not greater than the
"Working Interest" set forth in Exhibit A, without a
proportionate increase in the Net Revenue Interest (except
Permitted Encumbrances);
(iii) is free and clear of all liens and encumbrances (except
Permitted Encumbrances).
(b) The term "Permitted Encumbrances" as used herein, shall mean,
as follows:
(i) Lessor royalties, overriding royalties, net profits
interests, unitization and pooling designations and agreements,
reversionary interests and similar burdens and terms of the
Contracts, provided same do not either (a) reduce the Net Revenue
Interests below that set forth on Exhibit A, or (b) increase
the Working Interests above that set forth on Exhibit A,
without a proportionate increase in the Net Revenue Interest
(ii) all rights to consent by, required notices to, filings with,
or other actions by governmental entities in connection with the
sale or conveyance of oil and gas leases or interest therein if
the same are customarily obtained subsequent to such sale or
conveyance;
(iii) easements, rights-of-way, servitudes, permits, surface
leases and other rights with respect to surface operations,
including pipelines, grazing, logging, canals, ditches,
reservoirs or the like, easements for streets, alleys, highways,
pipelines, telephone lines, power lines, railways and other
easements and rights-of- way, on, over or in respect of the
surface of any of the Interests that do not operate to materially
interfere with the use, value or operation of the Interests in
the manner as they have been historically operated;
(iv) materialmen's, mechanics', repairmen's, employees',
contractors', operator tax and other similar liens or charges
arising in the ordinary course of business incidental to
construction, maintenance or operation of any of the Interests
(a) if they have not been filed pursuant to law, (b) if filed,
they have not yet become due and payable or payment is being
withheld as provided by law, or (c) if their validity is being
contested in good faith in the ordinary course of business by
appropriate action;
(v) any other liens, charges, encumbrances, contracts,
agreements, instruments, obligations, defects or irregularities
of any kind whatsoever affecting the Interests of the type usual
in the area and customarily waived by a reasonably prudent
operator or accepted by a reasonably prudent purchaser, and that
individually or in the aggregate are not reasonably expected to
materially adversely affect the title to or value of the
Interests, and do not prevent Seller from receiving the proceeds
of production and that do not operate to (a) reduce the Net
Revenue Interest of Seller below that set forth on Exhibit A,
(ii) increase the Working Interest of Seller above that set forth
on Exhibit A without a proportionate increase in the Net
Revenue Interest of Seller; or (iii) materially interfere with
the operation of the Interests;
(vi) liens that will be released at Closing.
5.2 Special Warranty of Title.
--------------------------
Except as herein provided, the Interests shall be conveyed by
Seller to Buyer at Closing without any warranties of title, implied,
express or statutory, Seller shall, however, warrant title to the
Interests against any person who lawfully claimed all or any portion
of the Interests, by, through or under Seller, but not otherwise
("Special Warranty"). Said assignment shall be made with full
subrogation to any rights Seller may have pertaining to the Interests
being conveyed. However, Seller represents that it has not previously
sold or in any way encumbered title to the Interests except for
Permitted Encumbrances.
5.3 Consents to Assign.
------------------
Some of the Leases may be subject to third party consents to
assignment and notices of sale. The consents to assign have been
executed by the necessary parties and an original or telecopy of each
document shall be furnished to Buyer at Closing.
5.4 No Preferential Rights to Purchase.
----------------------------------
Seller represents there are no preferential rights to purchase
held by third parties that are applicable to or otherwise affect the
Interests.
6. CONDITIONS TO CLOSING.
6.1 Seller's Conditions.
---------------------
The obligations of Seller to consummate the transactions
contemplated by this Agreement shall be subject to the satisfaction of
the following conditions at Closing:
(a) All representations and warranties of Buyer contained in this
Agreement shall be true in all material respects as of the
Closing Date, and as of the Closing Date, Buyer shall have
performed and satisfied, in all material respects, all covenants
and agreements required of it by this Agreement;
(b) No order shall have been entered by any court or governmental
agency having jurisdiction over the parties or the subject matter
of this Agreement that restrains or prohibits the purchase and
sale contemplated by this Agreement;
6.2 Buyer's Conditions.
------------------
The obligations of Buyer to consummate the transactions contemplated
by the Agreement shall be subject to the satisfaction of the following
conditions at Closing:
(a) All representations of Seller contained in this Agreement shall be
true in all material respects at and as of the Closing, Seller shall
have performed and satisfied all covenants and agreements, in all
material respects, required of it by this Agreement;
(b) No order shall have been entered by any court or governmental
agency having jurisdiction over the parties or the subject matter of
this Agreement that restrains or prohibits the purchase and sale
contemplated by this Agreement;
7. CLOSING.
7.1 Date of Closing.
---------------
Unless the parties agree otherwise in writing and subject to the
conditions stated in this Agreement, the consummation of the
transactions contemplated hereby (the "Closing") shall be held on or
before August 16, 2001 (the "Closing Date").
7.2 Place of Closing.
----------------
The Closing shall be held at the offices of ▇▇▇▇▇▇ and ▇▇▇▇▇▇, L.L.P.,
700 Louisiana, ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇-▇▇▇▇.
7.3 Closing Obligations.
-------------------
At Closing, the following events shall occur, each being a condition
precedent to the others and each being deemed to have occurred
simultaneously with the others:
(a) Seller and Buyer shall execute, acknowledge and deliver separate
documents titled "Assignment, ▇▇▇▇ of Sale and Conveyance" (the
"Assignments") (in sufficient counterparts to facilitate recording)
and a copy of each document shall be attached hereto as Exhibits B-1
(East ▇▇▇▇▇▇ Field), Exhibit B-2 (Alwan Field), Exhibit B-3 (North
Francitas Field), Exhibit B-4 (Grand Lake Field), and Exhibit B-5
(Lacassine Field) and such documents shall convey to Buyer the
Interests. Such documents shall recognize that the Interests bear the
proportionate share of the Overriding Royalty Interests;
(b) Seller and Buyer shall execute the document titled "Notice of
Contractual Interest" attached as Schedule 7.3(b).
(c) Seller and Buyer shall execute, at Closing, a settlement
statement, prepared by Seller in accordance with this Agreement and
generally accepted accounting principles (the "Preliminary Statement")
that shall set forth the Preliminary Purchase Price and each
adjustment and the calculation of such adjustments used to determine
such amount. The term "Preliminary Purchase Price" shall mean the
Purchase Price, adjusted as provided in Section 2.2, using for such
adjustments the best information then available.
(d) Buyer shall deliver to Seller the Preliminary Purchase Price by
direct bank or wire transfer in immediately available federal funds.
(e) GulfWest Energy shall deliver stock certificates to the
Shareholders for shares of the Preferred Stock.
(f) GulfWest Energy shall execute and deliver to Shareholders the
Statement of Resolution Establishing and Designating A Series of
Shares of GulfWest Energy Inc. Series E Preferred Stock.
(g) Seller and Buyer shall execute the other agreements referred to in
this Agreement.
(h) Seller and Buyer shall execute, acknowledge and deliver transfer
orders or letters in lieu thereof directing purchasers of production
to make payment to Buyer of proceeds attributable to production from
the Interests assigned to Buyer.
(i) Seller shall deliver or cause to be delivered full releases of the
liens created in favor of Millennium Energy Fund, L.L.C. or any other
lienholder against the Interests and the reassignment or termination
of the Net Profits Interest in the form attached hereto as Schedule
7.3(i).
(j) Seller shall prepare and furnish to Buyer such notices of change
in operator that may be required to designate Buyer as operator of all
transferred ▇▇▇▇▇.
(k) Buyer shall provide the Replacement Bonds as set for in Section
2.3(v).
(l) Buyer shall deliver to each of the Shareholders a properly
executed officer's certificate certifying the matters described in
Section 6.1(a).
(m) Buyer shall deliver to each Shareholder an opinion letter of
GulfWest Energy's counsel in form acceptable to each Shareholder's
counsel covering the matters described in Sections 3.2(a), (b), (c)
and (d).
(n) Seller shall deliver to Buyer the Resolution of the Board of
Managers of Goldking approving the sale under this Agreement,
certified by an authorized officer of Seller.
8. OBLIGATIONS AFTER CLOSING.
8.1 Post-Closing Adjustment Procedure.
---------------------------------
As soon as practicable after the Closing Date, but no later than 90
days after the Closing Date, Seller shall prepare and deliver to
Buyer, in accordance with this Agreement and generally accepted
accounting principles, a statement (the "Final Settlement Statement")
setting forth each adjustment or payment that was not finally
determined as of the Closing Date and showing the calculation of such
adjustments. Within fifteen (15) days after receipt of the Final
Settlement Statement, Buyer shall deliver to Seller a written report
containing any changes that Buyer proposes be made to the Final
Settlement Statement. The parties shall undertake to agree with
respect to the amounts due pursuant to such post-closing adjustment no
later than fifteen (15) days after Seller has received Buyer's
proposed changes. The date upon which such agreement is reached shall
be called the "Final Settlement Date." The amount agreed upon by Buyer
and Seller shall be referred to as the "Final Purchase Price." If (i)
the Final Purchase Price is more than the Preliminary Purchase Price,
Buyer shall pay in immediately available federal funds the amount of
such difference to Seller or to Seller's account (as designated by
Seller), or (ii) the Final Purchase Price is less than the Preliminary
Purchase Price, Seller shall pay in immediately available federal
funds the amount of such difference to Buyer or to Buyer's account (as
designated by Buyer). Payment by Buyer or Seller shall be made within
five (5) days after the Final Settlement Date.
8.1.1 Receipts and Credits.
--------------------
The Final Settlement Statement notwithstanding, all
monies, proceeds, receipts, credits, income and other things
of value attributable to the Interests for all periods of
time subsequent to the Effective Date except as otherwise
provided herein, shall be the sole property and entitlement
of Buyer, and to the extent received by Seller, Seller shall
account for and refund the same to Buyer in the Final
Settlement Statement after Closing. All monies, proceeds,
receipts, credits, income and other things of value
attributable to the Interests, except as otherwise provided
in this Agreement for all periods of time prior to the
Effective Date, shall be the sole property and entitlement
of Seller and, to the extent received by Buyer, Buyer shall
fully disclose, account for and transmit same to Seller
promptly. All costs, expenses and disbursements attributable
to the Interests for periods of time prior to the Effective
Date regardless of when due or payable, shall be the sole
obligation of Seller and Seller shall promptly pay, or if
paid by Buyer, promptly reimburse Buyer for and hold Buyer
harmless from and against same. All costs, expenses and
disbursements attributable to the Interests for periods of
time subsequent to the Effective Date regardless of when due
or payable, shall be the sole obligation of Buyer and Buyer
shall promptly pay, or if paid by Seller, promptly reimburse
Seller for and hold Seller harmless from and against same.
Seller shall be entitled to a credit for and reimbursement
in an amount equal to any amount received by Buyer after
Closing for any delivery or performance by Seller prior to
the Effective Date, and Buyer shall be entitled to a credit
for and reimbursement in an amount equal to any amount
received by Seller after closing for any delivery or
performance by Buyer after the Effective Date.
Notwithstanding any of the foregoing in this sub-Section,
Seller shall forward to Buyer on a regular basis all
proceeds and receipts of funds and all bills and assessments
for the Interests for production for periods after the
Effective Date, and Buyer shall forward to Seller on a
regular basis all proceeds and receipts of funds and all
bills and assessments for the Interests for production or
periods prior to the Effective Date.
8.1.2 2001 Taxes.
----------
Buyer and Seller agree that in the event that Seller's share
of the Taxes exceeds the Tax Estimate, then Buyer shall
reduce the first dividend payable under the Preferred Stock
by the amount necessary to satisfy such shortage.
8.2 Files and Records.
------------------
Immediately following Closing, Seller shall deliver to Buyer originals
of all of Seller's files and records relating to the Interests. Seller
may retain copies of any records or data. After Closing, Buyer shall
make available for Seller any files or records reasonably required by
Seller for a period of five (5) years.
8.3 Further Assurances.
------------------
After Closing, Seller and Buyer shall execute, acknowledge and deliver
or cause to be executed, acknowledged and delivered such instruments,
and shall take such other action as may be necessary or advisable to
carry out their obligations under this Agreement and under any
document, certificate or other instrument delivered pursuant hereto.
8.4 NORM:
----
Buyer acknowledges that some oilfield production equipment comprising
the Interests may contain asbestos and/or naturally occurring
radioactive material ("NORM"). In this regard, Buyer specifically
acknowledges that NORM may affix or attach itself to the inside
wellbores, materials and equipment as scale or in other forms, and
that ▇▇▇▇▇, materials and equipment comprising the Interests and being
located on a lease may contain NORM and that NORM containing material
may have been disposed of on a lease. Buyer expressly understands that
special procedures may be required for the removal and disposal of
asbestos and NORM from the Interests if and where they may be found,
and that Buyer assumes all of Seller's liability for or in connection
with the assessment, remediation, removal, transportation or disposal
of any such materials present on a lease at or after the Effective
Time in accordance with all requirements of governmental agencies.
8.5 Plugging and Abandonment of ▇▇▇▇▇, Removal of Facilities.
--------------------------------------------------------
Buyer recognizes and specifically assumes Seller's obligations with
respect to the Interests to:
(i) properly plug and abandon any and all oil, gas or condensate
wellbore(s) , water source, water injection and other injection and
disposal ▇▇▇▇▇ and systems located on each lease (or lands pooled with
a lease) but only to the extent Seller would otherwise be liable for
such well plugging and abandonment; and
(ii) properly remove and dispose of all structures, equipment and
facilities, including but not limited to, platforms, templates,
pipelines, and all flowlines; and
(iii) restore each lease and wellsite(s) associated with the Interests
and lands pooled therewith;
all in accordance with the rules, regulations, and requirements of any
governmental authority having jurisdiction thereof, and in accordance
with all obligations, express or implied, in any contract assumed by
Buyer, whether or not any such obligations arise prior to or after the
Effective Date. Buyer agrees to pay all costs and expenses associated
with any such plugging and abandoning, removal, or restoration.
8.6 Seller's Retention of Obligations and Indemnification.
-----------------------------------------------------
(a) Following Closing, except as otherwise set forth herein, Seller
expressly retains responsibility for and agrees to pay, perform,
fulfill and discharge all claims, costs, expenses, liabilities and
obligations accruing or relating to the following (collectively, the
"Retained Liabilities"):
(i) ad valorem, property, production, excise, severance or
other taxes on production which are attributable to the Interests
for any period or periods (or and portion thereof) occurring
prior to the Effective Date;
(ii) third party claims relating to the incorrect payment of
royalties on production from the Interests prior to the Effective
Date; and
(iii) such other claims, asserted by third parties, insofar
and only insofar as such claims relate to the ownership or
operation of the Interests prior to the Effective Date.
(b) Seller shall defend, release, indemnify and hold harmless Buyer,
its officers, directors, employees and agents ("Buyer Group"), against
all losses which arise from or in connection with: (i) the Retained
Liabilities; or (ii) any breach by Seller of this Agreement; provided,
however, that any claims relating to the breach of any of Seller's
representations or warranties hereunder must be asserted by Buyer to
Seller in writing within two (2) years after the Closing Date and any
such claims not asserted within such period shall be deemed waived,
except with regard to the Special Warranty which shall survive without
limitation. Any breach relating to any of Seller's covenants or
indemnities, including without limitation those relating to Seller's
Retained Liabilities, shall also survive without limitation.
8.7 Buyer's Assumption of Obligations and Indemnification.
-----------------------------------------------------
(a) From and after the Closing Date, Buyer shall assume and perform
all of the rights, duties, obligations and liabilities of ownership
and operation of the Interests, including, but not limited to the
following ("Buyer's Obligations"):
(i) The express and implied obligations, conditions and
covenants under the terms of each lease or the Contracts; and
(ii) Responsibility for compliance with all applicable laws,
regulations, ordinances, rules and orders and the procurement and
maintenance of all permits and bonds required by governmental
authorities relating to the Interests and which accrue after the
Effective Date; and
(iii) Responsibility for royalties, rentals, shut-in
payments (if any) to which the Interests are subject and which
are attributable to the period after the Effective Time; and
(iv) All other obligations assumed by Buyer under the terms
of this Agreement or otherwise as lessee and operator of the
lease(s).
(b) From and after the Closing Date, but as of the Effective Date,
Buyer shall defend, release, indemnify and hold harmless Seller, its
officers, directors, employees and agents ("Seller Group") against all
losses, which arise from or in connection with (i)Buyer's Obligations
and/or (ii) any breach by Buyer of this Agreement; provided that any
claims relating to the breach of any of Buyer's representations and
warranties hereunder must be asserted by Seller to Buyer in writing
within ninety (90) days after the Closing Date and any such claims not
asserted within such period shall be deemed waived.
8.8 Suspense Funds. .
---------------
Seller shall transfer to Buyer all funds it holds in suspense
attributable to the Interests ("Suspense Funds"). Buyer assumes all
liability for such funds and further agrees to indemnify and hold
Seller Group harmless from any and all losses, which arise from or in
connection with the Suspense Funds, but only to the extent of the
amount of such Suspense Funds.
9. MISCELLANEOUS.
9.1 Exhibits and Schedules.
----------------------
The Exhibits and Schedules referred to in this Agreement are hereby
incorporated in this Agreement by reference and constitute a part of
this Agreement.
9.2 Disclaimers
-----------
9.2.1 Disclaimer of Warranties.
------------------------
EXCEPT AS SET FORTH IN THIS AGREEMENT, SPECIFICALLY INCLUDING, WITHOUT
LIMITATION, SECTIONS 3.1, 5.2 AND 8.6 HEREOF:
(A) THE INTERESTS SHALL BE CONVEYED TO BUYER WITHOUT ANY
WARRANTIES AND BUYER SHALL WAIVE ALL WARRANTIES TO WHICH IT WOULD
OTHERWISE BE ENTITLED UNDER APPLICABLE LAW.
(B) BUYER AND SELLER AGREE THAT THE ASSIGNMENT OF THE
INTERESTS SHALL BE MADE SUBJECT TO THE FOLLOWING TERMS: SELLER
CONVEYS TO BUYER THE INTERESTS WITHOUT ANY WARRANTY, OR RECOURSE
WHATSOEVER, THE SOLE PERIL AND RISK OF EVICTION BEING ASSUMED BY
BUYER, BUT WITH FULL SUBSTITUTION AND SUBROGATION IN AND TO ALL
THE RIGHTS AND ACTIONS OF WARRANTY WHICH SELLER HAS OR MAY HAVE
AGAINST ALL PRECEDING OWNERS, LESSORS, LESSEES OR VENDORS; IT
BEING UNDERSTOOD THAT BUYER TAKES THE INTERESTS "AS IS" AND
"WHERE IS".
(C) BUYER HEREBY ACKNOWLEDGES RELIANCE SOLELY ON ITS OWN
TITLE EXAMINATION AND INSPECTION OF THE INTERESTS, AND NOT ON ANY
WARRANTIES OR REPRESENTATIONS FROM SELLER OR ANY PRIOR OWNERS OF
THE INTERESTS EXCEPT AS SET FORTH IN THIS AGREEMENT.
(D) EXCEPT AS SET FORTH IN THIS AGREEMENT, BUYER
ACKNOWLEDGES THAT SELLER HAS MADE NO REPRESENTATIONS OR
WARRANTIES WITH RESPECT TO THE INTERESTS AND THAT BUYER IS NOT
RELYING ON THE ACCURACY OF ANY INFORMATION OR DOCUMENTS
PREVIOUSLY FURNISHED TO BUYER BY SELLER OR ANY PRIOR OWNERS OF
THE INTERESTS.
(E) BUYER FURTHER ACKNOWLEDGES THAT ALTHOUGH SELLER MAY KNOW
OR HAVE REASON TO KNOW OF THE PARTICULAR USE BUYER INTENDS FOR
THE INTERESTS, OR BUYER'S PARTICULAR PURPOSE FOR BUYING THE
INTERESTS, BUYER IS NOT RELYING ON SELLER'S SKILL OR JUDGMENT IN
SELECTING THE INTERESTS.
(F) SELLER MAKES NO WARRANTY OR REPRESENTATION THAT THE
INTERESTS ARE FIT FOR BUYER'S INTENDED USE OR HIS PARTICULAR
PURPOSE AND BUYER WAIVES ANY SUCH WARRANTY TO WHICH IT MAY BE
ENTITLED UNDER ANY LAWS, INCLUDING BUT NOT LIMITED TO LOUISIANA
CIVIL CODE ARTICLE 2524 AND V.T.C.A. BUS. & C. SECTION 2.315.
(G) BUYER FURTHER WAIVES ANY WARRANTY TO WHICH IT MIGHT BE
ENTITLED UNDER ANY LAWS, INCLUDING BUT NOT LIMITED TO LOUISIANA
CIVIL CODE ARTICLE 2524 AND V.T.C.A. BUS. & C. SECTION 2.315,
AND BUYER FURTHER WAIVES ANY WARRANTY TO WHICH IT MIGHT BE
ENTITLED UNDER ANY LAWS INCLUDING LOUISIANA CIVIL CODE ARTICLE
2524 AND V.T.C.A. BUS. & C. SECTION 32.314 THAT THE INTERESTS
BE REASONABLY FIT FOR ITS ORDINARY USE.
(H) ALL OTHER IMPLIED WARRANTIES WITH RESPECT TO THE
INTERESTS, INCLUDING THOSE RELATED TO BUYER'S PEACEABLE
POSSESSION OF THE INTERESTS, THE MERCHANTABILITY THEREOF, HIDDEN
DEFECTS THEREIN OR THE FITNESS THEREOF FOR A PARTICULAR PURPOSE,
ARE HEREBY DISCLAIMED BY SELLER AND EXPRESSLY WAIVED BY BUYER.
(I) WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, SELLER
DOES NOT WARRANT THAT THE INTERESTS ARE FREE FROM HIDDEN,
REDHIBITORY OR LATENT DEFECTS OR VICES OR THAT THE INTERESTS ARE
FIT FOR THE USE INTENDED BY BUYER, AND BUYER HEREBY EXPRESSLY
WAIVES (I) ALL RIGHTS IN REDHIBITION PURSUANT TO LOUISIANA CIVIL
CODE ARTICLE 2520, ET SEQ., (II) THE WARRANTIES OF OWNERSHIP AND
PEACEABLE POSSESSION OF THE INTERESTS, (III) THE WARRANTIES
AGAINST HIDDEN OR REDHIBITORY DEFECTS IN THE INTERESTS, AND (IV)
THE WARRANTY THAT THE INTERESTS ARE FIT FOR THEIR INTENDED USE,
EACH OF WHICH WOULD OTHERWISE BE IMPOSED UPON SELLER BY LOUISIANA
CIVIL CODE ARTICLE 2475 OR ANY OTHER LAW, AND BUYER HEREBY
RELEASES SELLER FROM ANY LIABILITY FOR HIDDEN, REDHIBITORY OR
LATENT DEFECTS OR VICES UNDER LOUISIANA CIVIL CODE ARTICLE 2520
THROUGH 2549 OR ANY OTHER LAW.
(J) SELLER ALSO HEREBY DISCLAIMS AND BUYER HEREBY WAIVES THE
WARRANTY AGAINST EVICTION AND AGAINST NON-DECLARED ENCUMBRANCES,
BUYER AGAIN ACKNOWLEDGING THAT IT IS PURCHASING THE INTERESTS
BASED UPON ITS OWN TITLE EXAMINATION AND AT ITS OWN PERIL AND
RISK, BUYER WAIVES ANY RIGHT BUYER MAY HAVE TO A RETURN OF THE
PURCHASE PRICE FOR ANY REASON UNDER ANY LAWS, INCLUDING THE
LOUISIANA CIVIL CODE.
(K) BUYER REPRESENTS THAT IT HAS INSPECTED THEINTERESTS AND
ACCEPTED THE PHYSICAL ANDENVIRONMENTAL CONDITION OF SAME ON A "AS
IS-WHERE IS" BASIS SUBJECT TO THE TERMS OF THIS AGREEMENT.
(L) BUYER WAIVES ANY RIGHT TO RECOVER FROM SELLER AND
FOREVER RELEASES AND DISCHARGES SELLER AND SUBJECT TO, AND AS
PROVIDED IN, THIS AGREEMENT, AGREES TO RELEASE, INDEMNIFY, DEFEND
AND HOLD SELLER HARMLESS FROM ANY AND ALL DAMAGES, CLAIMS,
LOSSES, LIABILITIES, PENALTIES, FINES, LIENS, JUDGMENTS, COSTS
AND EXPENSES WHATSOEVER, (INCLUDING WITHOUT LIMITATION,
ATTORNEYS' FEES AND COSTS) (COLLECTIVELY, "DAMAGES"), WHETHER
DIRECT OR INDIRECT, KNOWN OR UNKNOWN, FORESEEN OR UNFORESEEN,
THAT MAY ARISE ON ACCOUNT OF OR IN ANY WAY BE CONNECTED WITH THE
PHYSICAL CONDITION OF THE INTERESTS FROM AND AFTER THE EFFECTIVE
DATE OF THIS AGREEMENT OR ANY LAW OR REGULATION APPLICABLE
THERETO, INCLUDING WITHOUT LIMITATION, THE COMPREHENSIVE
ENVIRONMENTAL RESPONSE, COMPENSATION AND LIABILITY ACT OF 1980,
AS AMENDED (42 U.S.C. § 9601 ET. SEQ.), THE RESOURCE
CONSERVATION ACT (33 U.S.C. §§ 466 ET. SEQ.), THE SAFE
DRINKING WATER ACT (14 U.S.C. §§ 1401-1450), THE
HAZARDOUS MATERIALS TRANSPORTATION ACT (49 U.S.C. § 7401 ET.
SEQ.) AS AMENDED, THE CLEAN AIR ACT AMENDMENTS OF 1990, AND ANY
OTHER APPLICABLE FEDERAL, STATE OR LOCAL LAW, BUT ONLY WITH
REGARD TO ACTS OR CONDITIONS OCCURRING SOLELY AFTER THE EFFECTIVE
DATE OF THIS AGREEMENT AND SELLER AGREES TO RELEASE, INDEMNIFY,
DEFEND AND HOLD BUYER HARMLESS FOR SUCH DAMAGES WITH REGARD TO
ACTS OR CONDITIONS OCCURING PRIOR TO THE EFFECTIVE DATE.
9.2.2 Disclaimer Regarding Information.
--------------------------------
EXCEPT AS OTHERWISE EXPRESSLY SET FORTH HEREIN, SELLER HEREBY
EXPRESSLY NEGATES AND DISCLAIMS, AND BUYER HEREBY WAIVES AND
ACKNOWLEDGES THAT SELLER HAS NOT MADE, ANY REPRESENTATION OR WARRANTY,
EXPRESS OR IMPLIED, RELATING TO (a) THE ACCURACY, COMPLETENESS OR
MATERIALITY OF ANY INFORMATION, DATA OR OTHER MATERIALS (WRITTEN OR
VERBAL) NOW, HERETOFORE, OR HEREAFTER FURNISHED TO BUYER BY OR ON
BEHALF OF SELLER OR (b) PRODUCTION RATES, RECOMPLETION OPPORTUNITIES,
DECLINE RATES, GEOLOGICAL OR GEOPHYSICAL DATA OR INTERPRETATIONS, THE
QUALITY, QUANTITY, RECOVERABILITY, COST OF RECOVERY OF ANY HYDROCARBON
RESERVES, ANY PRODUCT PRICING ASSUMPTIONS, OR THE ABILITY TO SELL OR
MARKET ANY HYDROCARBONS AFTER CLOSING.
9.3 Confidentiality.
---------------
Buyer shall keep confidential all aspects and terms of the
transactions contemplated by this Agreement and all information and
data concerning the Interests obtained through Seller in connection
with this Agreement and, without the prior written consent of Seller,
shall not disclose such information to anyone other than its lending
institution, gas transmission companies, partners, officers,
employees, agents and representatives, except (1) as otherwise
required by applicable law, administrative process or any standards or
rules of any stock exchange to which it or any of its Affiliates is
subject and (2) for information which is available to the public or
becomes available to the public other than as a result of a breach of
this Section. Upon Closing, this Section shall terminate but only as
to the Interests conveyed to Buyer.
9.4 Waiver of Partition.
-------------------
To the extent and for the maximum time permissible under the laws of
the States of Louisiana and Texas, Buyer and Seller hereby waive their
rights to seek or obtain voluntary or judicial partition of their
respective undivided Interests in all or any portion of the Interests.
Furthermore, Buyer and Seller agree that this provision shall be
binding on their successors and assigns. It being understood that,
each party shall be free to sell, transfer or encumber its respective
undivided interest in the Interests after the Closing in such manner
as it may elect.
9.5 Expenses.
--------
Except as otherwise specifically provided, all fees, costs and
expenses incurred by Buyer or Seller in negotiating this Agreement or
in consummating the transactions contemplated by this Agreement shall
be paid by the party incurring the same, including, without
limitation, legal and accounting fees, costs and expenses. Buyer shall
pay all recordation and filing fees and any applicable conveyance,
transfer fees or taxes or similar fees or charges.
9.6 Notices.
-------
All notices and communications required or permitted under this
Agreement shall be in writing and any communication or delivery
hereunder shall be deemed to have been duly made when personally
delivered to the individual indicated below, or if mailed or sent by
facsimile transmission, when received by the party charged with such
notice and addressed as follows:
Seller:
Grand Goldking, L.L.C.
c/o Goldking Energy Corporation
Two Shell Plaza
▇▇▇ ▇▇▇▇▇▇ ▇▇., ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇.
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Buyer:
GulfWest Energy Inc.
▇▇▇ ▇. ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Any party may, by written notice so delivered to the other parties,
change the address or individual to which delivery shall thereafter be
made.
9.7 Amendments.
----------
This Agreement may not be amended nor any rights hereunder waived
except by an instrument in writing signed by the party to be charged
with such amendment or waiver and delivered by such party to the party
claiming the benefit of such amendment or waiver.
9.8 Conditions.
----------
Seller and Buyer shall use all reasonable efforts to satisfy the
conditions to Closing.
9.9 Counterparts.
------------
This Agreement may be executed by Buyer and Seller in any number of
counterparts, each of which shall be deemed an original instrument,
but all of which together shall constitute but one and the same
instrument.
9. 10 Governing Law.
----------------
This Agreement and the transactions contemplated hereby shall be
construed and enforced in accordance with the laws of the State of
Texas, but without regard to laws or principles of conflicts of laws
that would cause application of the laws of another jurisdiction. The
parties hereby consent to the exclusive venue of the proper state or
federal court located in ▇▇▇▇▇▇ County, Texas, and hereby waive all
other venues.
9. 11 Entire Agreement.
----------------
This Agreement (including the Exhibits and Schedules hereto)
constitutes the entire understanding among the parties with respect to
the subject matter hereof, superseding all negotiations, prior
discussions and prior agreements and understandings relating to such
subject matter.
9.12 Parties in Interest.
-------------------
This Agreement shall be binding upon, and shall inure to the benefit
of the parties hereto, and except as otherwise prohibited, their
respective successors and assigns, and nothing contained in this
Agreement, express or implied, is intended to confer upon any other
person or entity any benefits, rights or remedies. The persons and/or
companies comprising Buyer shall be jointly and severally liable for
all of Buyer's liabilities and obligations under or pertaining to this
Agreement.
9.13 Liability and Jury Waivers.
--------------------------
(a) LIMITATION ON LIABILITY. NO PARTY SHALL BE REQUIRED TO PAY OR BE
LIABLE FOR INCIDENTAL, CONSEQUENTIAL, EXEMPLARY, PUNITIVE, OR INDIRECT
DAMAGES (WHETHER OR NOT ARISING FROM ITS NEGLIGENCE) TO ANY OTHER
PARTY REGARDING ANY DISPUTE ARISING OUT OF THIS AGREEMENT OR A CLAIM
OF BREACH HEREOF. THIS PROVISION SHALL NOT DIMINISH OR AFFECT IN ANY
WAY THE PARTIES' RIGHTS OR OBLIGATIONS UNDER ANY INDEMNITIES PROVIDED
FOR IN THIS AGREEMENT.
(b) WAIVER OF JURY TRIAL. EACH PARTY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY
IN RESPECT OF ANY SUIT, ACTION OR PROCEEDING RELATING TO THIS
AGREEMENT.
9.14 Press Release.
-------------
For a period of 30 days following Closing, neither party shall make
any press release or other announcement in connection with this
Agreement without first consulting with the other party. Following
such consultation and good faith attempt to make reasonable
accommodations, either party may make any announcement or press
release that it believes is either required by applicable law or the
rules of any stock exchange, or is advisable in connection with such
party's obligation to provide public disclosure regarding its
activities. This provision shall not apply to any filing with any
governmental body or stock exchange required by law, rule or
regulation.
9.15 Severability.
------------
If any term or other provision of this Agreement is invalid, illegal
or incapable of being enforced by any rule of law or public policy,
all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic
or legal substance of the transactions contemplated hereby is not
affected in any adverse manner to the detriment of any party. Upon
such determination that any term or other provision is invalid,
illegal or incapable of being enforced, the parties hereto shall
negotiate in good faith to modify this Agreement so as to effect the
original intent of the parties as closely as possible in an acceptable
manner to the end that the transactions contemplated hereby are
fulfilled to the extent possible.
9.16 Dispute Resolution.
------------------
The parties shall attempt in good faith promptly to resolve any
controversy or claim between the parties hereto arising out of or
relating to this Agreement. If any such controversy or claim should
arise, the parties shall meet and attempt to resolve the matter in
good faith by negotiation. Such negotiation shall, at a minimum, be
held between executives of both parties who have authority to settle
the dispute. If any such controversy or claim is not resolved by
negotiation, the dispute shall be settled by arbitration in Houston,
Texas and conducted in accordance with the rules of the Texas
Arbitration Act. Any award by the arbitrator(s) shall be final,
binding and non- appealable, and judgment may be entered thereon in
any court of competent jurisdiction.
9.17 Certain Governmental Consents.
-----------------------------
At the Closing, Seller shall execute and deliver to Buyer such
assignments of State Leases which require consent to assignment.
Seller and Buyer will use all reasonable efforts after Closing to
obtain approval of such assignments. Until such approvals are
obtained, Seller shall continue to hold record title to such leases,
to the extent Seller is currently record title holder, as nominee for
Buyer, during which time (i) Buyer shall indemnify and hold Seller
harmless from any and all Losses relating to such leases, except for
liabilities for which Seller is otherwise responsible hereunder and
(ii) Seller shall act as Buyer's nominee but shall be authorized to
act only upon and in accordance with Buyer's specific written
instructions and Seller shall have no authority, responsibility or
discretion to perform any tasks or functions with respect to such
leases other than those that are purely administrative or ministerial
in nature, unless otherwise specifically authorized by Buyer in
writing.
9.18 No Admissions.
-------------
Buyer and Seller agree that neither this Agreement, nor any part
thereof, nor any performance under this Agreement, nor any payment of
any amount pursuant to any provision of this Agreement shall
constitute or be construed as a finding, evidence of, or an admission
or acknowledgment of any liability, fault, or past or present
wrongdoing, or violation of any law, rule, regulation, or policy, by
either Seller or Buyer or by their respective officers, directors,
employees, or agents.
9.19 Consents.
--------
When a consent is required of either party hereto, such consent shall
not be unreasonably withheld.
9.20 Preferred Stock Representation
------------------------------
Notwithstanding anything to the contrary in this Agreement, Seller
acknowledges that the representations and warranties under Section
3.2(h) are made solely by GulfWest Energy, Inc. (the "Preferred Stock
Representations and Warranties"). GulfWest Energy, Inc. agrees and
acknowledges that the Shareholders, as defined in Section 2.1(a)(ii)
above, may rely on such Preferred Stock Representations and
Warranties; provided that such Preferred Stock Representations and
Warranties are subject to Section 8.7(b) above.
Executed as of the date first above mentioned.
Seller:
Grand Goldking, L.L.C.
By: Goldking Energy Corporation, its Manager
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇.
------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇.
President
Buyer:
GulfWest Energy Inc. GulfWest Oil & Gas Company
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------- ----------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
President President
GulfWest Oil & Gas Company (Louisiana) LLC
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Its Manager
