ASSIGNMENT AGREEMENT
THIS AGREEMENT made as of the 30th day of July, 2009.
BETWEEN:
DORAL ENERGY CORP., a Nevada corporation with its head office located at 000 X. Xxxx Xxxxxx, Xxxxx 000, Xxxxxxx, XX 00000
(hereinafter called the “Assignor”)
OF THE FIRST PART
AND:
LEGACY RESERVES LP., a Delaware limited partnership with its head office located at 000 Xxxx Xxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, XX 00000
(hereinafter called the “Assignee”)
OF THE SECOND PART
WHEREAS:
A. By an agreement dated January 15, 2009 and as amended on February 23, 2009, March 31, 2009 and April 21, 2009, copies of which are attached as Schedule A hereto (collectively, the “Purchase Agreement”) between Miltex Oil Company (the “Vendor”) and the Assignor, the Assignor has the right to purchase all of the Vendor’s right, title and interest in and to certain oil and gas leases located in Xxxxxxx County, Texas and as more particularly described in the Purchase Agreement (collectively, the “Miltex Properties”); and
B. The Assignee wishes to acquire all of the Assignor’s rights under, and interest in, the Purchase Agreement,
NOW THEREFORE THIS AGREEMENT WITNESSES THAT for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:
ASSIGNMENT
1. At Closing, the Assignor will assign to the Assignee, all of the Assignor’s rights, title and interest in and under the Purchase Agreement.
CONSIDERATION
2. In consideration for the Assignor assigning to the Assignee the Assignor’s rights, title and interest in and under the Purchase Agreement, the Assignee will, at Closing, pay to the Assignor the aggregate amount of $633,249.51 (the “Closing Price”).
3. The Assignee shall be obligated to pay to the Assignor the consideration set out in Section 2 regardless of whether or not the Assignee completes the purchase of the Miltex Properties.
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ASSUMPTION OF OBLIGATIONS
4. Upon Closing, the Assignee agrees to be bound by the provisions of the Purchase Agreement and to assume all of the Assignor’s obligations thereunder as if the Assignee had originally executed the same. The Assignee agrees to indemnify and hold the Assignor harmless as to any claims or causes of action (including attorneys fees and court costs) arising from the Purchase Agreement.
ASSIGNOR’S REPRESENTATIONS AND WARRANTIES
5. The Assignor represents and warrants to and covenants with the Assignee that:
| (a) |
the Assignor has full corporate power and capacity to enter into this Agreement and this Agreement has been validly authorized, executed and delivered by the Assignor; | |
| (b) |
the entering into and the performance of this Agreement and the transactions contemplated herein will not result in the violation of any of the terms and provisions of the constating documents of the Assignor, any shareholders’ or directors’ resolutions, or of any indenture, other agreement, written or oral, to which the Assignor may be bound or to which it may be subject, or any judgment, decree, order, rule or regulation of any court or administrative body by which the Assignor is bound, or any statute or regulation applicable to the Assignor; | |
| (c) |
the Assignor is the lawful owner of, has good legal and beneficial title to, and has the right to assign its rights, title and interest in and under the Purchase Agreement; | |
| (d) |
the Purchase Agreement is a valid and subsisting agreement; | |
| (e) |
the Assignor has complied with all of the terms and conditions of the Purchase Agreement to date; | |
| (f) |
there have been no defaults or acts by the Assignor under the Purchase Agreement which have or would permit the Vendor to terminate the Purchase Agreement; | |
| (g) |
there are no liens or encumbrances against the Assignor that would materially affect the purchase by the Assignee of the Miltex Properties under the Purchase Agreement; and | |
| (h) |
there is no litigation, proceeding or investigation pending or threatened against the Assignor or, to the best of the knowledge of the Assignor, the Vendor, nor does the Assignor know, or have any reasonable grounds to know, of any basis for any litigation, proceeding or investigation, which would materially affect the Purchase Agreement or the purchase and sale of the Miltex Properties |
ASSIGNEE’S REPRESENTATIONS AND WARRANTIES
6. The Assignee represents and warrants to and covenants with the Assignor that:
| (a) |
the Assignee has full organizational power and capacity to enter into this Agreement and this Agreement has been validly authorized, executed and delivered by the Assignee; |
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| (b) |
the entering into and the performance of this Agreement and the transactions contemplated herein will not result in the violation of any of the terms and provisions of the constating documents of the Assignee, any unitholders’, partners, managers or directors’ resolutions, or of any indenture, other agreement, written or oral, to which the Assignee may be bound or to which it may be subject, or any judgment, decree, order, rule or regulation of any court or administrative body by which the Assignee is bound, or any statute or regulation applicable to the Assignee. |
NO REPRESENTATIONS AND WARRANTIES REGARDING MILTEX PROPERTIES
7. The Assignee agrees that the purchase by it of the Miltex Properties under the Purchase Agreement shall be made on an “as is, where is” condition and state of repair, and with all faults and defects, and that the Assignor makes no representations, warranties or covenants of any kind or nature, express, implied or statutory, including, but not limited to warranties of merchantability, quality, condition, environmental condition or fitness for a particular purpose, all of which are expressly disclaimed. The Assignor makes no representation, covenant or warranty, express, implied or statutory, concerning the quality or quantity of hydrocarbons or the ability of the Miltex Properties to produce hydrocarbons or the prices which the Assignee will be entitled to receive for any such hydrocarbons. For purposes of this Agreement, hydrocarbons shall include, but not be limited to, all crude oil, condensate, natural gas, natural gas liquids, casinghead gas, drip gasoline, products and other hydrocarbons, water or other minerals produced from or attributable to the Miltex Properties.
8. The Assignor agrees to make available to the Assignee all title reports, reserve reports or other information, reports or records in its possession relating to the title or condition of the Miltex Properties (collectively, the “Due Diligence Information”). The Assignee agrees not to use the Due Diligence Information for any purpose other than the assignment contemplated in this Agreement and the purchase by the Assignee of the Miltex Properties under the Purchase Agreement, and the Assignee agrees not to disclose the Due Diligence Information to any third party without the prior written consent of the Assignor.
REPRESENTATIONS AND WARRANTIES SURVIVE
9. The representations and warranties of the parties shall survive the completion of the assignment of the Purchase Agreement. Each party agrees to indemnify the other against any loss or damage sustained by such other party, directly or indirectly, by reason of a breach of any of the particular party’s warranties or representations. The parties acknowledge that the they have entered into this Agreement relying on the warranties and representations provided by each to the other, and no information which is now known or which may hereafter become known to the parties or their particular officers, directors or professional advisors, will limit or extinguish the right to indemnity hereunder.
CLOSING
10. Closing (the “Closing”) will take place on July 31, 2009.
11. Closing will be conditional on the representations and warranties set out in Sections 5 and 6 continuing to be true on Closing.
12. At the Closing the Assignor shall deliver to the Assignee a document executed by the Vendor acknowledging the Assignment and confirming that the Purchase Agreement is in good standing.
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13. At the Closing, the Assignee will wire transfer the full amount of the Closing Price to the Assignor’s bank account in accordance with wire transfer instructions to be provided by the Assignor to the Assignee at Closing.
MISCELLANEOUS
14. The parties shall do such further and other acts and execute such further and other documents as may be necessary to carry out the true intent and purposes of this Agreement fully and effectively.
15. Any notice required to be given under this Agreement shall be in writing and addressed to the parties as hereinbefore set out and may be delivered or faxed to the address set out on the front of this Agreement. Any notice given as aforesaid shall be deemed to have been received, if delivered, when delivered or, if faxed, on the business day after the date of faxing.
16. This Agreement shall enure to the benefit of and be binding upon the parties, their respective successors and assigns.
17. Time shall be of the essence hereof.
18. The invalidity, illegality or unenforceability of any provision of this Agreement shall not affect the validity, legality or enforceability of any other provision hereof.
19. The headings used in this Agreement have been inserted for convenience of reference only and shall not affect the meaning or interpretation of this Agreement or any provision hereof.
20. Notwithstanding the place where this Agreement may be executed by any of the parties hereto, the parties expressly agree that all the terms and provisions hereof shall be construed in accordance with and governed by the laws of the State of Nevada.
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21. This Agreement may be executed in one or more counterparts, all of which will be considered one and the same agreement and will become effective when one or more counterparts have been signed by each party and delivered to the other party, it being understood that all parties need not sign the same counterpart.
IN WITNESS WHEREOF the parties hereto have executed this Agreement as of the day and year first above written.
ASSIGNOR:
| Per: | /s Xxxxxxx X. Xxxx XX | |
| Name: Xxxxxxx Xxxxxxx Xxxx XX | ||
| Title: C.E.O. |
ASSIGNEE:
LEGACY RESERVES OPERATING LP, a Delaware limited partnership
By: Legacy Reserves Operating GP LLC, its general partner
By: Legacy Reserves LP, its sole member
By: Legacy Reserves GP, LLC, its general partner
| /s/ Xxxx X. XxXxxx | |
| Xxxx X. XxXxxx, Executive Vice President | |
| Business Development and Land |
SCHEDULE ‘A’
| 1. |
Letter Agreement dated January 15, 2009 between Doral Energy Corp. and Miltex Oil Company (the “Original Agreement”). | |
| 2. |
Letter Agreement dated February 23, 2009 between Doral Energy Corp. and Miltex Oil Company amending the Original Agreement. | |
| 3. |
Letter Agreement dated March 31, 2009 between Doral Energy Corp. and Miltex Oil Company amending the Original Agreement. | |
| 4. |
Letter Agreement dated April 21, 2009 between Doral Energy Corp. and Miltex Oil Company amending the Original Agreement. |
See attached.
