Exhibit 10(a)
AGREEMENT
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Agreement dated December 23, 1984 among the, persons and entities
listed on Schedule A hereto (the "Mesa Entities") and Xxxxxxxx Petroleum
Company (the "Company"),
1. The Company will propose a recapitalization (the
"Recapitalization") of its Common Stock, $1.25 par value (the "Shares"),
under which
(a) 38% of the presently outstanding Shares will be exchanged for
debt securities of the Company ("Debt Securities") on the basis of $60
aggregate principal amount of Debt Securities for each Share;
(b) the certificate of incorporation of the Company will be
amended to provide for a classified board of directors and such other
customary provisions as the Company may determine;
(c) the Company will create an Employee Stock Ownership Plan and
sell to such Plan not more than 32 million Shares at the market price
thereof; and
(d) within the twelve-month period following the exchange
referred to in paragraph l(a), the Company will spend not less than
$1 billion to purchase Shares in the open market, provided that no
such purchases need be made when the market price of the Shares is
more than $50 per Share; so long as the market price of the Shares
is less than $50 per Share, the Company will purchase Shares pursuant
to this paragraph l(d) as rapidly as practical under then market
conditions.
2. The Company will use its best efforts (i) to submit the
Recapitalization to its stockholders and obtain their approval an soon an
practical, (ii) to register under the Securities Act of 1933 the securities
to be issued in the Recapitalization, and (iii) to consummate the Recapi-
talization.
3. (a) The Company will fix the terms of the Debt Securities,
based on the advice of Xxxxxx Xxxxxxx & Co. Incorporated and The First
Boston Corporation (the "Investment Bankers"), immediately prior to the
time the Proxy Statement relating to the meeting of the Company's
stockholders called to approve the Recapitalization (the "Proxy Statement")
is mailed so that the Debt Securities, in the opinion of the Investment
Bankers, would on such date have an aggregate market value equal to their
aggregate principal amount on the
assumptions that the Recapitalization was completed and the Debt Securities
were fully and widely distributed among investors, were freely transferable
and were subject to only a normal trading market.
(b) While the actual trading prices of the Debt Securities and
Shares in the period immediately following the Recapitalization cannot be
predicted (because, among other factors, the prices at which Shares will be
purchased and the timing of such purchases pursuant to paragraph l(d)
cannot now be determined and future market conditions cannot now be known),
the Company believes, after consultation with the Investment Bankers, that,
assuming (i) the Recapitalization is effected as described in paragraph 1,
(ii) the Debt Securities have an aggregate market value equal to their
aggregate principal amount, and (iii) current market and business
conditions on the date of this Agreement, the Debt Securities and Shares
should be worth approximately $53 per presently outstanding Share.
4. In the event that (a) the Recapitalization is not approved by
the stockholders of the Company or (b) the Exchange Date (as defined in
paragraph 6) shall not have occurred on or before April 1, 1985, the Mesa
Entities will have the right, for a period of 30 days following (x) the
date of the Company's stockholder meeting with respect to the
Recapitalization, if clause (a) applies or (y) April 1, 1985, if clause (b)
applies, to sell all, but not less than all, of their Shares to the Company
for $53 per Share in cash.
5. The Mesa Entities may elect to exercise their right, pursuant
to paragraph 4 hereof, to sell their Shares to the Company upon five days
written notice to the Company. At the closing of such sale, the Mesa
Entities shall deliver to the Company certificates representing all of
their Shares, in proper form for transfer, duly endorsed in blank, and the
Company shall transfer to an account at a New York City bank specified by
the Mesa Entities immediately available funds in an amount equal to $53
times the number of Shares to be transferred.
6. On the date of the exchange of Shares for the Debt Securities
as provided in paragraph l(a) (the "Exchange Date"), the Mesa Entities
shall agree to sell to the Investment Bankers for public distribution or
private placement pursuant to an agreement in substantially the form
attached as Exhibit A hereto, and the Company shall cause the Investment
Bankers to agree to purchase for public distribution or private placement,
all of the Debt Securities and Voting Securities (as hereinafter defined)
then held by the Mesa
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Entities for an aggregate amount equal to the then market price thereof,
but not less than the product of $53 times the number of Shares held by the
Mesa Entities immediately prior to the Exchange Date; provided, however,
that, if in the opinion of the Investment Bankers, the public distribution
or private placement of any of such securities would result in the
disruption of the trading markets for any of such securities or otherwise
adversely affect the Company, then the Investment Bankers may request the
Company to purchase (or request the Company to cause another person or
persons to purchase) from them, and the Company shall purchase (or cause
such other person or persons to purchase) from the Investment Bankers such
securities. At the closing of such sale, the Mesa Entities shall deliver
to the Investment Bankers the certificates representing such securities, in
proper form for transfer, duly endorsed in blank, and the Investment
Bankers shall transfer to an account at a New York City bank specified
by the Mesa Entities immediately available funds in an amount equal to the
purchase price therefor. The Company agrees to issue and deliver to the
Mesa Entities certificates for all such Debt Securities prior to the
closing contemplated by the agreement referred to in the first sentence of
this paragraph 6.
7. Each of the Mesa Entities represents and warrants to the
Company that: such Mesa Entity is duly authorized to execute, deliver and
perform this Agreement; this Agreement has been duly executed by such Mesa
Entity, is a valid and binding agreement of such Mesa Entity and is en-
forceable against such Mesa Entity in accordance with its terms; at the
closing effected pursuant to paragraph 5 or 6, such Mesa Entity will convey
good title to the securities being sold, free and clear of all liens,
encumbrances, security interests and claims other than any created by the
Company; Annex I hereto accurately sets forth all the voting securities and
direct or indirect rights or options to acquire voting securities of the
Company (together, the "Voting Securities") owned "beneficially (as that
term is defined in Rule 13d-3 under the Securities Exchange Act of 1934),
directly or indirectly, by such Mesa Entity or any of its "affiliates" or
"associates" (as those terms are defined in Rule 12b-2 under the Securities
Exchange Act of 1934) on the date hereof.
8. The Company represents and warrants that: it is duly
authorized to execute, deliver and perform this Agreement; and this
Agreement has been duly executed by the Company, is a valid and binding
agreement of the Company and is enforceable against the Company in
accordance with its terms. As of the date hereof approximately 154 million
Shares are issued and outstanding.
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9. Each of the Mesa Entities agrees that, for a period of fifteen
years after the data hereof, without the Company's prior written consent,
he or it will not and he or it will cause each of his or its affiliates,
associates and immediate family members to not, directly or indirectly,
alone or in concert with others, (a) acquire, offer to acquire, or agree to
acquire, by purchase, gift or otherwise, any Voting Securities of the
Company or make any proposal for or offer of any extraordinary transaction
involving the Company (other than as specifically contemplated by this
Agreement), (b) make, or in any way participate in, any "solicitation" of
"proxies" (as such terms are used in the proxy rules of the Securities and
Exchange Commission), or seek to advise or influence any person or entity
with respect to the voting of, or giving of consents with respect to, any
Voting Securities of the Company, or (c) otherwise act to seek to control
or influence the management, board of directors, policies or affairs of the
Company. The Company agrees that, for a period of fifteen years after the
date hereof, without the prior written consent of Mesa Petroleum Co.
("MPC"), it will not and will cause each of its affiliates and associates
to not, directly or indirectly, alone or in concert with others, take any
of the actions specified in clause (a), (b) or (c) of the preceding
sentence with respect to MPC. The restrictions contained in this paragraph
9 shall not inure to the benefit of (i) any corporation or other entity
(other than the Company or the Mesa Entities) that beneficially owns any
Voting Securities of the Company or MPC, as the case may be, or (ii) the
surviving corporation or other entity following any merger, consolidation
or similar reorganization of the Company or MPC, as the case may be, except
that such restrictions shall inure to the benefit of any such surviving
corporation or other entity, if immediately following the consummation of
such merger, consolidation or similar reorganization, the persons who
immediately prior thereto were stockholders of the Company or MPC, an the
case may be, own securities representing at least 5O% of the aggregate
voting power and 50% of the common equity of such surviving corporation or
other entity.
10. Each party hereto will (to the extent he or it is a party
thereto) dismiss without prejudice the lawsuits listed in Annex II hereto.
Each Mesa Entity will (to the extent he or it is a party thereto) dismiss
without prejudice all lawsuits in which he or it is a party which relate to
state takeover statutes or similar matters. Each party hereto will use his
or its best efforts to seek to cause the dismissal without prejudice of the
lawsuits listed in Annex III hereto and to prevent the institution of any
lawsuit or proceeding by any other person or entity in which any party
here-
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to or any advisor thereof may be or become a party which relates to or
arises from (i) the acquisition or proposed acquisition of Voting
Securities of the Company by the Mesa Entities, (ii) the proposal of Mesa
Partners to make a tender offer for Shares (the Tender Offer") and to
solicit consents (the "Consent Solicitation") from the holders of Shares,
(iii) any proposal by the Mesa Entities to acquire control of the Company
(the matters referred to in clauses (i), (ii) and (iii) being hereinafter
referred to as the "Transaction") or any action taken by the Company in
response or otherwise relating thereto, and to cause the dismissal without
prejudice of any such lawsuit or proceeding which is instituted after
the date hereof. The Company, on the one hand, and each other party
hereto, on the other hand, hereby releases and discharges the other (and
such other's present and former directors, officers, employees, agents,
attorneys, parents, predecessors, successors, assigns, subsidiaries and
affiliates) from all manner of claims, actions, causes of action or suits,
at law or in equity, which each now has or hereafter can, shall, or may
have by reason of any matter, cause or thing whatsoever from the beginning
of the world to the date of this Agreement, arising out of, in connection
with, or in any way related to, the Transaction and any and all actions
taken by the Company in response or otherwise relating thereto, excepting
only any action, cause of action or suit arising by virtue of this
Agreement. The Mesa Entities, on the one hand, and the Company, on the
other hand, agree not to pursue with any federal or state governmental or
regulatory authority any claim or complaint against the other relating to
or arising out of the Transaction or any and all actions taken by the
Company in response or otherwise relating thereto.
11. The Company agrees to pay the actual expenses (certified as
provided below), including, without limitation, legal fees and expenses,
bank fees and expenses, printing expenses, advisory fees and expenses,
travel expenses and the net cost of carrying the Shares referred to in
Annex I, paid by the Mesa Entities to third parties in connection with the
Transaction, including any litigation relating thereto (the "Expenses"), up
until the earlier of the Exchange Date or the closing pursuant to paragraph
5; provided that the Company shall not be obligated by this paragraph to
pay more than $25 million. The Company shall pay $12.5 million of the
Expenses on January 4, 1985 promptly after receipt of a certificate of
the principal financial officer of MPC ("Certificate") certifying the
amount of the Expenses incurred to that date and the balance of the
Expenses on the earlier of the Exchange Date or the closing pursuant to
paragraph 5 promptly after receipt of a Certificate certifying the
remaining amount of the Expenses.
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12. Each Mesa Entity agrees to vote all the Shares which he or it
beneficially owns in favor of the Recapitalization. The parties shall
issue the press release annexed hereto and no party shall make any
statement that is not supportive of the Recapitalization.
13. Each of the Mesa Entities, on the one hand, and the Company,
on the other hand, acknowledges that the other would not have an adequate
remedy at law for money damages in the event that any or all of the
covenants of any or all of the Mesa Entities, on the one hand, or of the
Company, on the other hand, in this Agreement were not performed in
accordance with its terms and therefore agrees that such other party shall
be entitled to specific enforcement of such covenants in addition to any
other remedy to which it may be entitled, at law or in equity.
14. This Agreement shall be governed and construed in accordance
with the laws of the State of Delaware. Each party hereto hereby agrees
that any action, cause of action or suit which it may hereafter commence by
virtue of this Agreement may only be brought in a federal or state court
located in the State of Delaware, and each party hereto agrees to submit to
the jurisdiction of any such court in any such action, cause of action or
suit which may be commenced by any other party hereto.
15. This Agreement may be executed in two or more counterparts
which together shall constitute a single agreement.
XXXXXXXX PETROLEUM COMPANY
By /s/ X.X. Xxxxx
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MESA PARTNERS:
By: Mesa Asset Co., General Partner
By /s/ Xxxxx X. Xxxxxxxxxx
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By: Cy-7, Inc., General Partner
By /s/ Xxxx X. Xxxx
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and
By: Xxxx-7, Inc., General Partner
By /s/ Xxxx X. Xxxx
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MESA PETROLEUM CO.
By /s/ Xxxxx X. Xxxxxxxxxx
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MESA ASSET CO.
By /s/ Xxxxx X. Xxxxxxxxxx
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XXXXXX & XXXXX
XXXXXX & XXXXX II
and
XXXXX & XXXXXX
By: Xxxxx Xxxxxx, Xx.,
General Partner
By: Xxxx X. Xxxxx, General Partner
By /s/ Xxxx X. Xxxx
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Xxxx X. Xxxx, Attorney-in fact
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XXXX-7, INC.
By /s/ Xxxx X. Xxxx
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CY-7, INC.
By /s/ Xxxx X. Xxxx
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Xxxx X. Xxxxx,
in his individual capacity
Xxxxx Xxxxxx, Xx.,
in his individual capacity
By /s/ Xxxx X. Xxxx
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Xxxx X. Xxxx, Attorney-in-fact
/s/ X. Xxxxx Xxxxxxx, Jr.
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X. Xxxxx Xxxxxxx, Jr.,
in his individual capacity
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SCHEDULE A
MESA ENTITIES
Mesa Partners
Mesa Petroleum Co.
Mesa Asset Co.
Xxxxxx & Xxxxx
Xxxxxx & Xxxxx II
Xxxxx & Xxxxxx
Xxxx-7, Inc.
Cy-7, Inc.
Xxxx X. Xxxxx
Xxxxx Xxxxxx, Xx.
X. Xxxxx Xxxxxxx, Jr.
ANNEX I
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Mesa Partners owns 8,898,800 Shares. No other
Mesa Entity owns any Voting Securities of the Company.
ANNEX II
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Mesa Partners x. Xxxxxxxx Petroleum Company, Civil Action
No. 7872 (Del. Ch.)
Mesa Partners x. Xxxxxxxx Petroleum Company and Xxxxxxx X.
Xxxxxx, III, Civil Action Xx. 00-000 (XXX) (X. Del.)
Xxxxxxxx Petroleum Company x. X. Xxxxx Xxxxxxx, Jr., Mesa
Petroleum Co., Mesa Partners, Mesa Asset Co., CY-7, Inc.,
Xxxx-7, Inc., Xxxxxx & Xxxxx, Xxxxx Xxxxxx, Xx., Xxxx X. Xxxxx
and Xxxxxx X. Xxxxxxxxx, Civil Action Xx. 00-000 (XXX) (X.
Del.)
Mesa Partners x. Xxxxxxxx Petroleum Company, C. Xxxxxxx Xxxxxx
Xx., Xxxx Xxxxx, Xxxxx Xxxxxxxx, Xxxxx Xxxxxxxx and Xxxxxxx X.
Xxxxxx, No. CIV-84-3217-T (W.D. Okla)
X. Xxxxx Xxxxxxx, Jr., and Mesa Petroleum Co. x. Xxxxxxxx
Petroleum Company, Xxxxxxx X. Xxxxx and Xxxx Xxxx, No. 65,386-A
(47th Dist. Ct., Potter Co., Tex.)
Xxxxxxxx Petroleum Company v. Mesa Petroleum Co., Mesa Partners,
Mesa Asset Co., Cy-7, Inc. and Xxxx-7, Inc., No. C84-775
(Dist. Ct., Washington Co., Okla.)
Mesa Partners x. Xxxxxxxx Petroleum Company, Civil Action No.
7883 (Del.
ANNEX III
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Mesa Partners v. State of Louisiana through Department of
Natural Resources by B. Xxx Xxxxxx and The Xxxxxxxxx Xxxx
Xxxxxx, District Judge, 19th Judicial District court, Civil
Action No. 84-1194 (M.D. La.)
State of Louisiana, through Department of Natural Resources
by B. Xxx Xxxxxx x. Xxxx Partners, through Mesa Petroleum
Company and Xxxxxx and Xxxxx, Docket No. 283825 (19th Jud.
Dist. Ct., E. Baton Rouge, La.)
Mesa Partners x. Xxxxxxx Propane & Oil, Inc., Xxxxxx Oil Company
and Judge X.X. Xxxxxx, Civil Action No. 84-C-1006E (N.D. Okla.)
Xxxxxxx Propane & Oil, Inc. and Xxxxxx Oil Co., individually and
on behalf of a class of persons similarly situated v. Mesa
Petroleum Co., Mesa Partners, Mesa Asset Co., CY-7, Inc. and
Xxxx-7, Inc., No. C-84-584 (Dist. Ct., Xxxxx Co., Okla.)
Exhibit A
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Form of Agreement with Investment Bankers
Agreement dated , 1985
among Mesa Partners, a Texas general
partnership (the "Partnership"),
Xxxxxx Xxxxxxx & Co Incorporated,
a Delaware corporation ("Xxxxxx
Xxxxxxx"), and The First Boston
Corporation, a Massachusetts corp-
oration ("First Boston" and together
with Xxxxxx Xxxxxxx, the
"Purchasers").
WHEREAS, immediately prior to the Recapitalization
referred to below, the Partnership owned not more than
8,898,800 shares of Common Stock, $1.25 par value ("Shares"),
of Xxxxxxxx Petroleum Corporation ("Xxxxxxxx");
WHEREAS, Xxxxxxxx has implemented a recapitali-
zation plan (the "Recapitalization") as contemplated by an
Agreement dated December 23, 1984, among the Company and
certain other parties including the Partnership (the "Recap-
italization Agreement") pursuant to which a portion of the
previously outstanding Shares were exchanged for debt
securities of Xxxxxxxx ("Debt Securities");
NOW THEREFORE, in consideration of the promises
contained in this Agreement and other good and valuable
consideration receipt of which is acknowledged, the parties
to this Agreement agree as follows:
1. The Partnership agrees to sell to the Pur-
chasers, and each of the Purchasers severally agrees to
purchase from the Partnership, one-half of:(a) all Debt
Securities the Partnership received in exchange for Shares
pursuant to the Recapitalization and (b) all shares owned
by the Partnership which were not exchanged for Debt Securi-
ties in the Recapitalization, for an aggregate cash price
equal to the higher of (i) the aggregate market price of
such Debt Securities and Shares at the close of trading on the
New York Stock Exchange, Inc. on the day (the "Issue Date")
the Debt Securities were originally issued pursuant
to paragraph 1(a) of the Recapitalization Agreement and (ii)
the product of $53 times the number of Shares held by the
Partnership immediately prior to the effectiveness of the
Recapitalization.
2. The closing of the sale and purchase of Debt
Securities and Shares pursuant to Paragraph 1 (the "Resale
Closing") shall occur on the first business day after the
Issue Date. At the Resale Closing, the Partnership shall
deliver (or cause to be delivered) to the Purchasers certifi-
xxxxx representing the Debt Securities and Shares to be
purchased, in proper form for transfer, duly endorsed in
blank; and the Purchasers shall transfer, to an account at a
New York City bank specified by the Partnership, immediately
available funds in an amount equal to the full purchase
price for such Debt Securities and Shares pursuant to
Paragraph 1.
3. The Purchasers shall acquire the Debt Securi-
ties and Shares covered by this Agreement for public distri-
bution or private placement; provided however, that, if in
the opinion of the Purchasers, the public distribution or
private placement of any of such securities would result in
the disruption of the trading markets for any of such
securities or otherwise adversely affect Xxxxxxxx, then the
Purchasers may request Xxxxxxxx to purchase (or request
Xxxxxxxx to cause another person or persons to purchase)
such securities from them.
4. The Partnership represents and warrants to the
Purchasers that it is duly authorized to execute, deliver
and perform this Agreement; this Agreement has been duly
executed by the Partnership, is a valid and binding agreement
of the Partnership and is enforceable against the Partnership
in accordance with its terms; at the Resale Closing the
Partnership will convey to the Purchasers good title to the
Debt Securities and Shares being sold, free and clear of all
liens, encumbrances, security interests and claims other
than any created by Xxxxxxxx; and none of the other Mesa
Entities (as defined in the Recapitalization Agreement) owns
any Shares.
5. Each of the Purchasers severally represents and
warrants to the Partnership that it is duly authorized to
execute, deliver and perform this Agreement; and this Agree-
ment is a valid and binding agreement of it, enforceable
against it in accordance with its terms.
6. This Agreement shall be governed by and con-
strued in accordance with the internal laws of the State
of New York.
7. This Agreement nay be executed in two or
more counterparts which together shall constitute a single
agreement.
MESA PARTNERS
By: Mesa Asset Co.
General Partner
By:
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By: CY-7, Inc.
General Partner
By:
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By: Xxxx-7, Inc.
General Partner
By:
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XXXXXX XXXXXXX & CO. INCORPORATED
By:
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Managing Director
THE FIRST BOSTON CORPORATION
By:
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Managing Director
