Common use of Preferential Right to Purchase Clause in Contracts

Preferential Right to Purchase. Should any Non-Operator desire to sell, transfer, pledge, or encumber all or any part of its interests under this Agreement (a “Selling Party”), or its rights and interests in the Contract Area, it shall promptly give written notice to the Operator (a “Sale Notice”), which Sale Notice shall include all material terms of the proposed transfer, including the price at which the Selling Party will be willing to sell its interest to the Operator (“Seller’s Offer Price”).The Operator shall then have an optional prior right, for a period of ten (10) days after receipt of the Sale Notice, to (i) notify the Seller in writing that it will purchase the Selling Party’s interest at the Seller’s Offer Price, or (ii) notify the Seller in writing that it will not purchase the Selling Party’s interest at the Seller’s Offer Price, in which case the written notice shall also state the price, if any, that the Operator would be willing to pay for the interest being offered by the Selling Party, (the “Purchaser’s Best Offer”). If the Operator agrees to purchase the Selling Party’s interest, then said sale shall close within ninety (90) days of the date of the Sale Notice. If the Operator declines to purchase the Selling Party’s interest, then, for a period of six (6) months following the date of the Sale Notice (the “Free Sale Period”), the Selling Party may sell its interest to any third party, provided, however, that if the purchase price to be paid by any third party in connection with the sale (the “Third Party Offer Price”) is equal to or less than the amount equal to Purchase’s Best Offer plus ten percent (10%), then Operator shall have the optional prior right to purchase the Selling Party’s interest at the Third Party Offer Price. In the event that the Selling Party fails to close any transaction within the Free Sale Period, then the Selling Party shall not be permitted to sell, transfer, pledge or encumber its interest without first issuing a new Sale Notice and further fully complying with the provision of this Article VIII(E). Notwithstanding the foregoing, there shall be no preferential right to purchase where (i) the proposed transfer occurs within thirty (30) days of the Closing Date of the Purchase and Sale Agreement; or (ii) a Non-Operator proposes to transfer less than one-half of its total interest in the Contract Area.

Preferential Right to Purchase. Should any Non-Operator desire If Participant desires to transfer, sell, transferfarm out, pledgeassign, or encumber otherwise dispose of all or any part of its interests under this Agreement (interest in a “Selling Party”), or its rights and interests in the Contract Area, Lease that has been assigned to it by El Paso pursuant to Section 3.3. Participant shall promptly give written notice to El Paso with full information about the Operator proposed transaction, including, but not limited to, the name and address of the prospective transferee (a “Sale Notice”who must be ready, willing, and able to acquire the interest and deliver the stated consideration therefor), which Sale Notice shall include the consideration and all material terms related to the transfer. In the case of a package sale of oil and gas interests that includes all or part of Participant's interest in such Leases, or if the proposed transaction is structured as a non-simultaneous, like-kind exchange under Section 1031 of the proposed transferInternal Revenue Code of 1986, including as amended ("Code"), the price at which interest that is subject to this preferential right shall be separately valued and the Selling Party will be willing to sell its interest notice shall state the value attributed to the Operator (“Seller’s Offer Price”).The Operator interest by the prospective transferee. El Paso shall then have an optional prior right, for a period of ten thirty (1030) days after receipt of the Sale Noticenotice, to (i) notify elect to purchase or acquire on the Seller in writing that it will purchase the Selling Party’s interest at the Seller’s Offer Pricesame terms and conditions, or (ii) notify the Seller in writing that it will not purchase the Selling Party’s interest at the Seller’s Offer Priceon equivalent terms for a non-cash transaction, in which case the written notice shall also state the price, if any, all of such interests that the Operator would Participant is proposing to transfer. This preferential right shall apply separately to each Lease or part thereof covered by this Agreement, regardless of whether it is included in the proposed transaction along with other oil and gas interests, whether as a sale, farm out, or non-simultaneous, like-kind exchange, and no provision in this Agreement shall be willing interpreted to pay for the interest being offered by the Selling Partydefeat this preferential right. Upon exercise of this preferential right, (the “Purchaser’s Best Offer”). If the Operator agrees El Paso shall agree to purchase the Selling Party’s interest, then said sale shall close within ninety (90) days perform all obligations of the date of prospective transferee under the Sale Noticeproposed transaction only for such interest subject to the proposed transaction. If the Operator declines to purchase the Selling Party’s interest, then, for a period of six (6) months following the date of the Sale Notice (the “Free Sale Period”), the Selling Party may sell its interest to any third party, providedThis preferential right, however, that if the purchase price to be paid by any third party in connection with the sale (the “Third Party Offer Price”) is equal to or less than the amount equal to Purchase’s Best Offer plus ten percent (10%), then Operator shall have the optional prior right to purchase the Selling Party’s interest at the Third Party Offer Price. In the event that the Selling Party fails to close any transaction within the Free Sale Period, then the Selling Party shall not be permitted exist or apply when Participant proposes (a) to sell, transfer, pledge or encumber its interest without first issuing a new Sale Notice and further fully complying with the provision of this Article VIII(E). Notwithstanding the foregoing, there shall be no preferential right to purchase where (i) the proposed transfer occurs within thirty (30) days of the Closing Date of the Purchase and Sale Agreement; or (ii) a Non-Operator proposes to transfer less than one-half of its total interest in the Contract Area.mortgage

Preferential Right to Purchase. Should any Non-Operator desire If Participant desires to transfer, sell, transferfarm out, pledgeassign, or encumber otherwise dispose of all or any part of its interests under this Agreement (interest in a “Selling Party”), or its rights and interests in the Contract Area, Lease that has been assigned to it by El Paso pursuant to Section 3.3. Participant shall promptly give written notice to El Paso with full information about the Operator proposed transaction, including, but not limited to, the name and address of the prospective transferee (a “Sale Notice”who must be ready, willing, and able to acquire the interest and deliver the stated consideration therefor), which Sale Notice shall include the consideration and all material terms related to the transfer. In the case of a package sale of oil and gas interests that includes all or part of Participant's interest in such Leases, or if the proposed transaction is structured as a non-simultaneous, like-kind exchange under Section 1031 of the proposed transferInternal Revenue Code of 1986, including as amended ("Code"), the price at which interest that is subject to this preferential right shall be separately valued and the Selling Party will be willing to sell its interest notice shall state the value attributed to the Operator (“Seller’s Offer Price”).The Operator interest by the prospective transferee. El Paso shall then have an optional prior right, for a period of ten thirty (1030) days after receipt of the Sale Noticenotice, to elect to purchase or acquire on the same terms and conditions, or on equivalent terms for a non-cash transaction, all of such interests that the Participant is proposing to transfer. This preferential right shall apply separately to each Lease or part thereof covered by this Agreement, regardless of whether it is included in the proposed transaction along with other oil and gas interests, whether as a sale, farm out, or non-simultaneous, like-kind exchange, and no provision in this Agreement shall be interpreted to defeat this preferential right. Upon exercise of this preferential right, El Paso shall agree to perform all obligations of the prospective transferee under the proposed transaction only for such interest subject to the proposed transaction. This preferential right, however, shall not exist or apply when Participant proposes (a) to mortgage its interest; (b) to dispose of or transfer its interest to an Affiliate by (i) notify the Seller in writing that it will purchase the Selling Party’s interest at the Seller’s Offer Pricemerger, (ii) reorganization, or (iiiii) notify consolidation; (c) to sell all, or substantially all, of its exploration and production properties located in the Seller in writing that it will not purchase the Selling Party’s interest at the Seller’s Offer Price, in which case the written notice shall also state the price, if any, that the Operator would be willing United States of America; or (d) to pay for transfer the interest being offered by under a property exchange transaction other than a non-simultaneous, like-kind exchange under Section 1031 of the Selling Party, (the “Purchaser’s Best Offer”)Code. If the Operator agrees to purchase the Selling Party’s interest, then said sale shall close proposed transaction is not consummated within ninety (90) days of the date of the Sale Notice. If the Operator declines to purchase the Selling Party’s interest, then, for a period of six (6) months following the date after receipt of the Sale Notice (the “Free Sale Period”)notice by El Paso, the Selling Party may sell its interest to any third party, provided, however, that if shall again be governed by this subsection and the purchase price to be paid by any third party in connection with the sale (the “Third Party Offer Price”) is equal to or less than the amount equal to Purchase’s Best Offer plus ten percent (10%), then Operator shall have the optional prior right to purchase the Selling Party’s interest at the Third Party Offer Price. In the event that the Selling Party fails to close any transaction within the Free Sale Period, then the Selling Party shall not be permitted to sell, transfer, pledge or encumber its interest without first issuing a new Sale Notice and further fully complying with the provision of this Article VIII(E). Notwithstanding the foregoing, there shall be no preferential right to purchase where (i) shall again arise for the proposed transfer occurs within thirty (30) days of the Closing Date of the Purchase and Sale Agreement; or (ii) a Non-Operator proposes to transfer less than one-half of its total offered interest in the Contract Areaas herein described.

Preferential Right to Purchase. Should Check one: x Applicable. o Not Applicable. If the Preferential Right to Purchase provision is marked “Applicable,” should any Non-Operator Party desire to sell, transfer, pledge, or encumber sell all or any part of its interests under this Agreement (a “Selling Party”)Agreement, or its rights and interests in the Contract Area, it shall promptly give written notice to the Operator other Parties, with full information concerning its proposed disposition, which shall include the name and address of the prospective transferee (a “Sale Notice”who must be ready, willing and able to purchase), which Sale Notice shall include the purchase price, a legal description sufficient to identify the property, and all material other terms of the proposed transfer, including the price at which the Selling Party will be willing to sell its interest to the Operator (“Seller’s Offer Price”).The Operator offer. The other Parties shall then have an optional prior right, for a period of ten (10) days after receipt of the Sale Noticenotice is delivered, to (i) notify purchase for the Seller in writing that it will purchase stated consideration, on the Selling Party’s same terms and conditions, the interest at which the Seller’s Offer Price, or (ii) notify the Seller in writing that it will not purchase the Selling Party’s interest at the Seller’s Offer Price, in which case the written notice shall also state the priceother Party proposes to sell; and, if anythis optional right is exercised, the purchasing Parties shall share the purchased interest in the proportions that the Operator would be willing interest of each bears to pay for the total interest being offered by the Selling Party, (the “Purchaser’s Best Offer”)of all purchasing Parties. If the Operator agrees to purchase the Selling Party’s interest, then said sale shall close within ninety (90) days of the date of the Sale Notice. If the Operator declines to purchase the Selling Party’s interest, then, for a period of six (6) months following the date of the Sale Notice (the “Free Sale Period”), the Selling Party may sell its interest to any third party, provided, however, that if the purchase price to be paid by any third party in connection with the sale (the “Third Party Offer Price”) is equal to or less than the amount equal to Purchase’s Best Offer plus ten percent (10%), then Operator shall have the optional prior right to purchase the Selling Party’s interest at the Third Party Offer Price. In the event that the Selling Party fails to close any transaction within the Free Sale Period, then the Selling Party shall not be permitted to sell, transfer, pledge or encumber its interest without first issuing a new Sale Notice and further fully complying with the provision of this Article VIII(E). Notwithstanding the foregoingHowever, there shall be no preferential right to purchase in those cases where (i) any Party wishes to mortgage its interests, to transfer title to its interests to its mortgagee in lieu of or pursuant to foreclosure of a mortgage of its interests, sell the proposed properties included in a “large transaction,” as defined below, to dispose of its interests by merger, reorganization, consolidation, or by sale of all or substantially all of its Oil and Gas assets to any Party, or by transfer occurs within thirty (30) days of its interests to a subsidiary or parent company or to a subsidiary of a parent company, or to any company in which the Party owns a majority of the Closing Date stock. For the purposes of the Purchase this provision, a “large transaction” shall mean a sale of an interest in more than _____ well(s), wherever located, and Sale Agreement; or (ii) if a Non-Operator proposes to transfer less than one-half of its total Party’s interest in the Contract AreaArea is included in a “large transaction,” the preferential purchase right provided for in this provision shall not be applicable.

Preferential Right to Purchase. Should any Non-Operator a Party desire to sell, transfer, pledge, assign or encumber convey all or any part of its interests interest under this Agreement (a “Selling Party”)Agreement, or its rights and interests in the Contract Project Area, it shall promptly give written notice to the Operator other Party of the decision to sell, transfer, assign or convey such interest. The written notice shall contain all relevant information regarding the proposed sale, transfer, assignment or conveyance, including the name and address of any prospective transferee (a “Sale Notice”who must be ready, willing and able to purchase), which Sale Notice shall include the purchase price, a legal description sufficient to identify the property, and all material other terms of the proposed transfer, including transfer or sale with an attached copy of the price at which the Selling acquisition document. The other Party will be willing to sell its interest to the Operator (“Seller’s Offer Price”).The Operator shall then have an optional prior right, for a period of ten thirty (1030) days after receipt of the Sale Noticenotice, to (i) notify the Seller in writing that it will purchase the Selling Party’s interest at the Seller’s Offer Price, or (ii) notify the Seller in writing that it will not purchase the Selling Party’s interest at the Seller’s Offer Price, in which case the written notice shall also state the price, if any, that the Operator would be willing to pay for the interest being offered by the Selling Party, (the “Purchaser’s Best Offer”). If the Operator agrees to purchase the Selling Party’s interestinterest to be transferred or sold on the same terms and conditions as those being offered to the third party. If a Party does not exercise its optional preferential right to purchase by providing written notice within such 30-day period, then said sale shall close within the other Party may effect the transfer described in the notice at any time not later than ninety (90) days after the end of the date of thirty (30)-day option period, at a price not less than and on terms no more favorable to the Sale Noticetransferee than the price and terms stated in the notice provided pursuant to this Article 8. If such a transfer is made, the preferential right to purchase shall continue as to the interest acquired by said transferee. If the Operator declines to purchase the Selling Party’s interest, then, for a period of six interest is not transferred within such ninety (690) months following the date of the Sale Notice (the “Free Sale Period”), the Selling Party may sell its interest to any third party, provided, however, that if the purchase price to be paid by any third party in connection with the sale (the “Third Party Offer Price”) is equal to or less than the amount equal to Purchase’s Best Offer plus ten percent (10%)day period, then Operator any subsequent proposal to transfer such interest shall have be subject to the optional prior right provisions of this Article 8, as though such interest had never been offered for transfer. All sales, transfers, assignments, mortgages, or other conveyances of any interest of any Party to purchase this Agreement in the Selling Party’s interest at the Third Party Offer Price. In the event that the Selling Party fails Project Area shall be made expressly subject to close any transaction within the Free Sale Period, then the Selling Party this Agreement and shall not be permitted binding on either Party to sellthis agreement, transferunless and until an executed copy of the instrument evidencing such change in ownership has been delivered to AEPC, pledge or encumber its interest without first issuing together with a new Sale Notice copy of an instrument ratifying and further fully complying with adopting this Agreement properly executed and acknowledged by the provision of this Article VIII(E)acquiring party. Notwithstanding the foregoingHowever, there shall be no preferential right to purchase in those cases where (i) the proposed transfer occurs within thirty (30) days of the Closing Date of the Purchase and Sale Agreement; any Party wishes to mortgage all or (ii) a Non-Operator proposes to transfer less than one-half part of its total interest in the Contract Areaor to dispose of all or a part of its interest by merger, re-organization, consolidation, sale of all or substantially all of its oil and gas assets to a third party, or transfer of all or a part of its interest to an Affiliate.