LOAN AGREEMENT
XXXXXX-XXXXXXX OIL COMPANY
(Lender)
and
DELTA PETROLEUM CORPORATION
(Borrower)
December 1, 1999
Loan Agreement
This loan agreement ("Agreement") is made this _______ day
of November 1999 (the "Agreement Date") among the following
parties (the "Parties"):
(i) Xxxxxx-Xxxxxxx Oil Company, a Delaware corporation ("Xxxxxx-
Xxxxxxx"); and,
(ii) Delta Petroleum Corporation, a Colorado corporation
("Delta").
In exchange for the mutual promises hereafter made and other
good and valuable consideration the receipt and adequacy of which
the Parties hereby acknowledge, and intending to be legally bound
hereby, Xxxxxx-Xxxxxxx and Delta hereby agree as follows:
(1) Background and Purpose of this Agreement. The background
and purpose of this Agreement is as follows:
(a) Delta is a party to the following agreements:
(i) Purchase and Sale Agreement dated June 8, 1999 between
Xxxxxxx Petroleum Corporation ("Xxxxxxx") and Delta respecting
certain oil and gas properties in the Point Xxxxxxxx Unit and the
Rocky Point Unit (the "Offshore Agreement"); and,
(ii) Purchase and Sale Agreement dated July 1, 1999 between
Xxxxxxx and Delta respecting certain oil and gas properties in
the East Carlsbad Field, Eddy County, New Mexico and the Xxxxxx
Xxxxxx SW Field, Matagorda County, Texas (the "New Mexico
Agreement").
(b) Delta and Xxxxxx-Xxxxxxx have heretofore entered into a
letter agreement dated November 5, 1999 respecting the Offshore
Agreement and the New Mexico Agreement (the "Letter Agreement").
(c) The Purpose of this Agreement is to implement and supersede
those provisions of the Letter Agreement respecting a loan from
Xxxxxx-Xxxxxxx to Delta (as set forth in the second, third, and
fourth bullet denominated paragraphs of the Letter Agreement).
(2) Xxxxxx-Xxxxxxx Commitment To Lend Monies to Delta. On the
terms and conditions set forth in this Agreement, Xxxxxx-Xxxxxxx
shall loan monies (the "Loan") to Delta:
(a) Maximum Amount of Loan. The maximum amount of principal of
the Loan shall be Eight Million United States Dollars
(US$8,000,000). The Loan shall be made contemporaneously with the
execution and delivery of the Note (as hereafter defined).
(b) Loan Evidenced by Negotiable Promissory Note. The Loan
shall be evidenced by the execution and delivery
contemporaneously herewith by Delta of a negotiable promissory
note in the form and content of either Exhibit A-1 (Floating
Rate) or Exhibit A-2 (Fixed Rate) in the discretion of Delta as
determined at the time of the execution and delivery of the Note
(the "Note").
(c) Security for Repayment of the Note. Delta shall
contemporaneously with the execution and delivery of this
Agreement execute and deliver to Xxxxxx-Xxxxxxx an oil and gas
mortgage in the form and content of Exhibits B-1 through B-3
(collectively, the "Mortgage") and a security agreement in the
form and content of Exhibit B-4 (the "Security Agreement").
(3) Prepayment Compensation. The Loan may be pre-paid as
provided in the Note. In the event of a prepayment of the Note by
Delta or a default in payment of the Note by Delta, Delta shall
compensate Xxxxxx-Xxxxxxx as follows:
(a) Prepayment On or Before September 1, 2000. In the event,
Delta prepays the Note on or before September 1, 2000 no
prepayment compensation shall be paid by Delta.
(b) Prepayment After September 1, 2000 and On or Before June 1,
2001. In the event Delta prepays the Note after September 1,
2000 and on or before June 1, 2001, Delta shall assign to Xxxxxx-
Xxxxxxx an oil and gas overriding royalty interest ("ORRI") equal
to two and one-half percent (2.5%) of the all of the oil and gas
properties acquired by Delta pursuant to the Offshore Agreement
(the "Offshore Properties") including those described in Exhibit
A to the Offshore Agreement.
(i) The ORRI shall be assigned by the execution and delivery of
an assignment of ORRI in the form and content of Exhibit C
("Assignment").
(ii) Delta shall execute and deliver the ORRI on June 1, 2001.
(iii) The effective date of the ORRI shall be December 1,
1999, notwithstanding the date it is executed and delivered.
(c) Prepayment After June 1, 2001 and On or Before June 1, 2002.
In the event Delta prepays the Note after June 1, 2001 and on or
before June 1, 2002, Delta shall assign to Xxxxxx-Xxxxxxx an ORRI
equal to two and one-half percent (2.5%) of all of the Offshore
Properties in addition to the ORRI assigned pursuant to the
preceding subparagraph (the "Additional ORRI").
(i) The Additional ORRI shall be assigned by the execution and
delivery of the Assignment.
(ii) Delta shall execute and deliver the Additional ORRI on June
1, 2001.
(iii) The effective date of the Additional ORRI shall be
December 1, 1999, notwithstanding the date it is executed and
delivered.
(d) Prepayment After June 1, 2002 and On or Before June 1, 2003.
In the event Delta prepays the Note after June 1, 2002 and on or
before June 1, 2003, Delta shall, in addition to the ORRI and the
Additional ORRI assigned to Xxxxxx-Xxxxxxx assigned to Xxxxxx-
Xxxxxxx in accordance with subparagraphs (b) and (c) above, pay
Xxxxxx-Xxxxxxx Xxx Xxxxxxx Xxxxx-Xxxxxxxx Xxxxxx Xxxxxx Dollars
($250,000). Delta shall pay the $250,000 on June 1, 2003 in
funds immediately available in Tulsa, Oklahoma
(e) Prepayment After June 1, 2003 and On or Before June 1, 2004.
In the event Delta prepays the Note after June 1, 2003 and on or
before June 1, 2004, Delta shall, in addition to the ORRI and the
Additional ORRI then previously assigned to Xxxxxx-Xxxxxxx and
the $250,000 paid in accordance with the preceding subparagraph,
pay Xxxxxx-Xxxxxxx an additional Two Hundred Fifty-Thousand
United States Dollars ($250,000). Delta shall pay the additional
$250,000 on June 1, 2004 in funds immediately available in Tulsa,
Oklahoma
(f) When Prepayment Is Deemed Made. Prepayment of the Note
shall be deemed made only when Xxxxxx-Xxxxxxx receives
full payment of all principal and interest due on the
Note in United States Dollars immediately available in
Tulsa, Oklahoma and the prepayment compensation set
forth in the preceding subparagraphs (b) through (e).
In the event Delta defaults in payment of the Note,
Delta shall be deemed to have prepaid the Note after
June 1, 2004 for the purposes of, but solely for the
purposes of, determining the compensation to be paid to
Xxxxxx-Xxxxxxx by Delta in accordance with
subparagraphs (b), (c), (d), and (e) above.
(g) Offshore Properties and New Mexico Properties Defined.
Offshore Properties means all those oil and gas
properties acquired by Delta pursuant to the Offshore
Agreement at any time without reduction for any
interests therein which Delta may, after receipt,
assign. New Mexico Properties means all those oil and
gas properties acquired by Delta pursuant to the New
Mexico Agreement at any time without reduction for any
interest therein which Delta may, after receipt assign.
Any Offshore Property or New Mexico Property assigned
by Delta shall remain subject to the lien of the
Mortgage.
(h) Proportionate Reduction of ORRI and Additional ORRI. In the
event Delta is required to assign in an arms length transaction
some fractional undivided interest in the Offshore Properties in
order to obtain access to Point Xxxxxxxx Unit offshore drilling
platform(s) for the drilling of xxxxx on the Offshore Properties,
the ORRI and the Additional ORRI shall be proportionately
reduced; provided, however, (i) such reduction shall subject to
the prior written approval of Xxxxxx-Xxxxxxx (which approval
shall not be unreasonably withheld, delayed or denied) and (ii)
any oil and gas interest or other thing of value of any nature,
whether similar or dissimilar, received by Delta in any such
transaction shall be subject to the ORRI and the Additional ORRI.
(i) Special Circumstances Respecting ORRI and Additional ORRI.
In the event any action of any governmental unit (whether federal
or state and whether legislative, executive or judicial)
precludes the orderly development of, and production of
hydrocarbons and other minerals from, the Offshore Properties and
Delta receives compensation therefor, Xxxxxx-Xxxxxxx shall
receive in respect of the ORRI (and the Additional ORRI, if
applicable) a proportionate part of such compensation which
proportion shall be in the same ratio as the value of the ORRI
(and Additional ORRI, if applicable) in the Offshore Properties
reasonably expected had orderly development and production not
been interrupted bears to the value of the expense interest in
the Offshore Properties giving consideration to the expenses
which would have been incurred by Delta in deriving the value
attributable to the expense interest had orderly development and
production not been interrupted. Xxxxxx-Xxxxxxx and Delta shall
negotiate in good faith to determine the share of Xxxxxx-Xxxxxxx
in such compensation for a period twenty business days after one
or both of Xxxxxx-Xxxxxxx first requests such negotiations (the
"negotiating period", as provided in paragraph 5(b)(i)). In the
event the Parties do not reach agreement, the determination of
the Xxxxxx-Xxxxxxx share of such compensation shall be made in
the same manner, mutatis mutandi, hereafter provided in paragraph
5(e).
(j) Further Assurances. If Delta has not received commercially
marketable title to any of the Offshore Properties or New Mexico
Properties, Delta shall from and after the Agreement Date use its
best efforts to obtain commercially marketable title and, upon
receipt of such title, shall execute and deliver such documents
as Xxxxxx-Xxxxxxx may reasonably require in order that the
Mortgage shall constitute a first lien of record thereon, subject
only to such encumbrances as are described in the Mortgage.
(k) Release of Mortgage. Subject to approval by Xxxxxx-Xxxxxxx
(which shall be unreasonably withheld, delayed or denied), Xxxxxx-
Xxxxxxx shall release the lien of the Mortgage to the extent of
any fractional undivided interest in any Offshore Property Delta
is required to assign in an arms length transaction in order to
obtain access to Point Arguella Unit offshore drilling
platform(s) for the drilling of xxxxx on the Offshore Properties.
(4) Option to Acquire Delta Common Stock and Registration Rights
Agreement. Contemporaneously herewith, Delta and Xxxxxx-Xxxxxxx
shall execute and deliver (i) an option agreement granting Xxxxxx-
Xxxxxxx the right to acquire 250,000 shares of common stock of
Delta (the "Stock Option") and (ii) a registration rights
agreement respecting any shares of common stock of Delta acquired
pursuant to the Stock Option ("Registration Rights Agreement").
The Stock Option shall be in the form and content of Exhibit D.
(5) Right of First Refusal. Delta hereby grants Xxxxxx-Xxxxxxx
the right to acquire any part and all parts of the Offshore
Properties and/or New Mexico Properties which Delta desires to
transfer to any person or entity other than Delta (including any
affiliate of Delta, as hereafter defined) on the following terms
and conditions:
(a) Delta shall by notice (the "disposition notice") advise
Xxxxxx-Xxxxxxx of its intention to make any disposition of the
Offshore Properties and/or New Mexico Properties or any part
thereof. Delta shall include in the disposition notice:
(i) a description of the interest proposed to be disposed;
(ii) the identity of party to whom the disposition is proposed;
(iii) a description of the consideration to be received by
Delta for the proposed disposition;
(iv) a description of the material terms of the proposed
disposition including, without limitation, and time requirements
for performance of any obligation which may be a term of the
proposed disposition;
(v) the proposed effective date and closing date of the proposed
disposition; and,
(vi) any other material information which Delta believes, in its
discretion reasonably exercised, would be material to a decision
whether a party would acquire the interest proposed to be
disposed.
(b) In the event the consideration or any part thereof described
in the disposition notice is of such a nature that Xxxxxx-Xxxxxxx
is unable to match such consideration in kind and the disposition
notice does not include Delta's good faith estimate of the value
in cash of such consideration, Xxxxxx-Xxxxxxx may within five
business days of receipt of the disposition notice request Delta
provide, and Delta shall provide within five business days of the
Xxxxxx-Xxxxxxx request, an estimate of the value in cash of such
consideration in Delta's discretion exercised in good faith.
(i) In the event of a disagreement, the Parties shall, during
the three (3) business days next following the receipt by Xxxxxx-
Xxxxxxx of Delta's good faith estimate of the cash value of such
consideration (the "negotiating period"), negotiate in good faith
to resolve the disagreement.
(ii) If, after such good faith negotiations, the Parties fail to
agree, the value in cash of such consideration shall be
determined as hereafter provided in this Agreement (the
"arbitration determination").
(c) Within the later of (i) thirty (30) calendar days from the
receipt of the disposition notice or (ii) the receipt by both
Delta and Xxxxxx-Xxxxxxx of the arbitration determination, Xxxxxx-
Xxxxxxx may give notice (the "notice of acceptance") to Delta
that Xxxxxx-Xxxxxxx elects to acquire the interest which Delta
proposes to dispose for the applicable price (which shall include
the value in cash of any in kind consideration which Xxxxxx-
Xxxxxxx cannot match). The notice of acceptance shall create
between Delta and Xxxxxx-Xxxxxxx a binding contractual obligation
upon Delta to dispose and Xxxxxx-Xxxxxxx to acquire the interests
proposed to be disposed in the notice for the applicable price
and on the other terms and conditions set forth in the
disposition notice.
(d) In the event that Xxxxxx-Xxxxxxx does not timely give the
notice of acceptance:
(i) Xxxxxx-Xxxxxxx shall be deemed to have rejected the
disposition notice; and,
(ii) the proposed disposition shall be subject to the prior
written approval of Xxxxxx-Xxxxxxx which Xxxxxx-Xxxxxxx may
withhold in the event, but only in the event, Xxxxxx-Xxxxxxx
determines in its discretion exercised in good faith that the
disposition would be likely to have a material adverse effect of
the value of the interest to be disposed as security for
repayment of the Loan.
(A) Without limiting the generality of the foregoing, in
exercising its discretion, Xxxxxx-Xxxxxxx may consider the
financial ability of the proposed assignee to meet any
obligations of the proposed assignee which may constitute
part of the terms and conditions of the proposed disposition.
(B) In the event Xxxxxx-Xxxxxxx does not give Delta notice that
Xxxxxx-Xxxxxxx does not approve the proposed disposition
within the same period of time within which Xxxxxx-Xxxxxxx
could give a notice of acceptance, Xxxxxx-Xxxxxxx shall be
deemed to have approved the proposed disposition.
(iii) In the event the proposed disposition is not
consummated within ninety (90) days of the notice of
disposition, any proposed disposition of the interests
proposed to be disposed
shall once again apply to any proposed disposition.
(e) In the event Xxxxxx-Xxxxxxx and Delta are unable to agree to
the value in cash of any in kind consideration (as discussed in
subparagraph (b) above), Xxxxxx-Xxxxxxx and Delta shall each
forthwith (forthwith and in no event later than the business day
next following the expiration of the negotiating period) engage
an individual with experience in the industry in evaluating
similar transactions, who shall select a third such individual,
and the three individuals (the "arbitrators") shall each
determine the value in cash of such consideration.
(i) The third arbitrator (that is, the arbitrator engaged) by
the two arbitrators engaged by Delta and Xxxxxx-Xxxxxxx) shall,
upon his engagement administer the proceedings of the three
arbitrators including giving notice to the Parties of the
determination of the cash value of the in kind consideration.
(ii) Each of the arbitrators shall be engaged to make their
determination within five (5) business days following the
expiration of the negotiating period.
(iii) The value in cash shall be the mean of the two values
thus established which are nearest to each other.
(iv) Delta and Xxxxxx-Xxxxxxx shall each pay one half of all
costs of the arbitration determination, including the
compensation to the three arbitrators.
(v) The times specified in this paragraph shall be suspended for
a period of time equal to the period of time from the date the
two individuals are designated until the three individuals
give notice of the determination of the cash value to both
of Xxxxxx-Xxxxxxx and Delta.
(6) Conditions Precedent to Obligation of Xxxxxx-Xxxxxxx To Make
the Loan. Each of the following shall be conditions precedent to
the obligation of Xxxxxx-Xxxxxxx to make the Loan or any advance
on the Loan:
(a) Delta shall have executed and delivered the Note to Xxxxxx-
Xxxxxxx.
(b) Delta shall have executed and delivered the Mortgage to
Xxxxxx-Xxxxxxx.
(c) Delta shall have executed and delivered to Xxxxxx Xxxxxxx
all documents, in addition to the Note and Mortgage, which Xxxxxx-
Xxxxxxx may reasonably request to give full effect to the
provisions of this Loan Agreement including, without limitation
the Note and the Mortgage.
(d) Xxxxxx-Xxxxxxx shall have received evidence, sufficient in
the opinion of counsel to Xxxxxx-Xxxxxxx, that:
(i) Delta has acquired commercially marketable title to the
Offshore Properties and New Mexico Properties, free and clear of
all liens and encumbrances except (a) those identified on Exhibit
A to the Offshore Agreement, (b) those identified on Exhibit A to
the New Mexico Agreement, (c) the overriding royalty interest
held by BWAB Limited Liability Company ("BWAB") pursuant to
agreement dated April 1, 1999 with Delta provided such BWAB
overriding royalty interest is the same in content as the ORRI
and does not exceed three percent (3%) proportionately reduced,
and (d) the overriding royalty interests held by Messrs. Xxxxxx &
Xxxxxx provided such Xxxxxx & Xxxxxx overriding royalty interests
shall be in the same content as the ORRI and do not in the
aggregate exceed two percent (2%); and,
(ii) The Mortgage constitutes a first and prior lien on the
Offshore Properties and the New Mexico Properties, subject to
only (a) those liens and encumbrances identified on Exhibit A to
the Offshore Agreement, (b) Exhibit A to the New Mexico
Agreement, and (c) the overriding royalty interest held by BWAB
Limited Liability Company ("BWAB") pursuant to agreement dated
April 1, 1999 with Delta provided such BWAB overriding royalty
interest is the same in content as the ORRI and does not exceed
three percent (3%) proportionately reduced, and (d) the
overriding royalty interests held by Messrs. Xxxxxx & Xxxxxx
provided such Xxxxxx & Xxxxxx overriding royalty interests shall
be in the same content as the ORRI and do not in the aggregate
exceed two percent (2%).
(e) Xxxxxx-Xxxxxxx shall have received evidence, sufficient in
the opinion of counsel to Xxxxxx-Xxxxxxx, that the execution,
delivery, consummation, and performance of the Loan Agreement and
all documents in connection therewith including the Note and the
Mortgage has been authorized by Delta in accordance with all
requirements of law, the Articles of Incorporation and By-laws of
Delta, and all other agreements by which Delta is bound.
(f) The representations and warranties set for the Paragraph (7)
of this Agreement shall be true and correct.
(7) Delta Representation and Warranties. Delta represents and
warrants to Xxxxxx-Xxxxxxx that:
(a) Delta is a duly organized, legally existing corporation in
good standing under the laws of the State of Colorado and is duly
qualified in all jurisdictions where it does business or owns or
leases property except to the extent that failure to so qualify
would not have a materially adverse affect thereon.
(b) The execution and delivery of this Agreement, the Note, the
Mortgage and all other agreements and instruments executed in
connection herewith by Delta and its performance of any
obligations hereunder and thereunder are: (a) within its
enumerated powers; (b) duly authorized; (c) not in contravention
of any law or of the terms of any provision, indenture, agreement
or undertaking to which Delta or its property is bound; (d) do
not require any consent or approval (including governmental)
which has not been given; (e) do not contravene any statute, rule
or regulation or any contractual or governmental restriction; (f)
not subject to prior approval by any state or federal agency or
regulatory authority having jurisdiction; and (g) will not result
in the imposition of liens, charges or encumbrances on any of
Delta's properties or assets other than those contemplated under
this Agreement.
(c) This Agreement, the Note, the Mortgage, and all other
documents executed and delivered by Delta to Xxxxxx-Xxxxxxx are
legal, valid and binding obligations of Delta as represented in
such documents and are enforceable in accordance with their
terms, except as may be limited by bankruptcy, insolvency or
similar laws affecting creditors' rights generally.
(d) Delta shall acquire contemporaneously with any advance being
made on the Loan, commercially marketable title to the Offshore
Properties and New Mexico Properties, free and clear of all liens
and encumbrances except those identified in subparagraph
(6)(d)(i);
(i) The Mortgage will constitute, prior to any advance being
made on the Loan, a first and prior lien on the Offshore
Properties and the New Mexico Properties, subject to only those
liens and encumbrances identified on Exhibit A to the Offshore
Agreement and in Exhibit A to the New Mexico Agreement subject to
only (a) those liens and encumbrances identified on Exhibit A to
the Offshore Agreement, (b) Exhibit A to the New Mexico
Agreement, and (c) the overriding royalty interest held by BWAB
Limited Liability Company ("BWAB") pursuant to agreement dated
April 1, 1999 with Delta provided such BWAB overriding royalty
interest is the same in content as the ORRI and does not exceed
three percent (3%) proportionately reduced, and (d) the
overriding royalty interests held by Messrs. Xxxxxx & Xxxxxx
provided such Xxxxxx & Xxxxxx overriding royalty interests shall
be in the same content as the ORRI and do not in the aggregate
exceed two percent (2%).
(e) Xxxxxx-Xxxxxxx shall have received evidence satisfactory to
it that Delta is fully bonded and qualified to own federal
leases, both offshore and onshore.
(8) Provisions Respecting Non-Consent Operations. The following
provisions shall govern operations on the Offshore Properties:
(a) In the event any operations are proposed by third parties on
any of the Offshore Properties (the "proposed operations"), Delta
shall forthwith give notice of such proposed operations to Xxxxxx-
Xxxxxxx (the "proposed operations notice").
(b) The proposed operations notice shall include all information
received by Delta from the third party with respect to the
proposed operations.
(c) Delta shall use its best efforts to make a determination
whether Delta will participate in the proposed operations as soon
as practicable and in not event later than six (6) business days
preceding any date by which Delta is required to give notice of
any election to participate in such operations.
(d) Delta shall give Xxxxxx-Xxxxxxx notice of any determination
that Delta will not participate in proposed operations at least
six (6) business days preceding any date by which Delta is
required to give notice of any election to participate in such
operations to any party.
(e) In the event Delta determines not to participate in any
proposed operation, Xxxxxx-Xxxxxxx shall have the right to
participate for its own account in the proposed operation on the
following terms and conditions:
(i) Delta shall upon request from Xxxxxx-Xxxxxxx forthwith
deliver or make available to Xxxxxx-Xxxxxxx at Xxxxxx-Xxxxxxx
cost all information reasonably pertinent to a determination
whether to participate in the proposed operations which is in the
possession or control of Delta.
(ii) Xxxxxx-Xxxxxxx may, but shall not be obligated to, give
Delta notice of its election to participate in the proposed
operation (the "election to participate").
(iii) The Xxxxxx-Xxxxxxx election to participate shall
constitute a binding contractual obligation between Delta and
Xxxxxx-Xxxxxxx, the terms and conditions of which shall be those
set forth in this paragraph.
(iv) Delta shall forthwith assign to Xxxxxx-Xxxxxxx all of
Delta's right, title and interest in the interest subject to the
proposed operations (the "subject interest") by an assignment
with special warranty of title against all claims made by
through, and under Delta. Delta shall execute and deliver such
further instruments, and take such further actions, as Xxxxxx-
Xxxxxxx may reasonably require to evidence, give effect and
implement the assignment and enable Xxxxxx-Xxxxxxx to participate
in the proposed operations.
(v) In the event, the subject interest cannot be assigned by
virtue of any provision of any agreement or instrument which is a
burden on the subject interest, Delta shall participate in the
proposed operation as nominee for the sole account of Xxxxxx-
Xxxxxxx.
(vi) Xxxxxx-Xxxxxxx shall, and does hereby agree to, defend,
indemnify, and hold harmless Delta against all loss, cost, and
expense arising out of the proposed operations, including
reimbursement, upon reasonable substantiation thereof, of the
reasonable costs of Delta (excluding general and administrative
expense) of complying with the obligations of Delta to (i)
participate in the proposed operation as nominee for the account
of Xxxxxx-Xxxxxxx and (ii) evidencing, giving effect to and
implementing the assignment as contemplated by the second
sentence of clause (iv) above.
(9) Miscellaneous Provisions. The following miscellaneous
provisions shall apply to this Agreement:
(a) All notices or advices required or permitted to be given by
or pursuant to this Agreement, shall be given in writing. All
such notices and advices shall be (i) delivered personally,
(ii) delivered by facsimile or delivered by U.S. Registered or
Certified Mail, Return Receipt Requested mail, or (iii) delivered
for overnight delivery by a nationally recognized overnight
courier service. Such notices and advices shall be deemed to
have been given (i) the first business day following the date of
delivery if delivered personally or by facsimile, (ii) on the
third business day following the date of mailing if mailed by
U.S. Registered or Certified Mail, Return Receipt Requested, or
(iii) on the date of receipt if delivered for overnight delivery
by a nationally recognized overnight courier service. All such
notices and advices and all other communications related to this
Agreement shall be given as follows:
If to Delta: Xx. Xxxxxx X. Xxxxxx, Xx.
Delta Petroleum Corporation
000 00xx Xxxxxx, Xxxxx 0000
Xxxxxx XX 00000
303-293-9133- Telephone
000-000-0000 - Facsimile
If to Xxxxxx-Xxxxxxx: Xx. Xxxxxx X. Xxxxxx
Xxxxxx-Xxxxxxx Oil Company
X.X. Xxx 00000
Xxxxx, XX 00000-0000
000-000-0000 - Telephone
918-491-4694- Facsimile
With Copy to: Xxxxxxxx Xxxxxxx
Old City Hall
000 Xxxx Xxxxxx Xxxxxx
Xxxxx, XX 00000-0000
(000) 000-0000 - Telephone
(000) 000-0000 - Facsimile
or to such other address as the party may have
furnished to the other parties in accordance
herewith, except that notice of change of
addresses shall be effective only upon receipt.
(b) This Agreement is made and executed in Tulsa County,
Oklahoma.
(c) This Agreement shall be subject to, and interpreted by and
in accordance with, the laws (excluding conflict of law
provisions) of the State of Oklahoma.
(d) This Agreement is the entire Agreement of the parties
respecting the subject matter hereof except those written
agreements described herein and executed and delivered as
provided herein. There are no other agreements, representations
or warranties, whether oral or written, respecting the subject
matter hereof except those written agreements described herein
and executed and delivered as provided herein.
(e) No course of prior dealings involving any of the parties
hereto and no usage of trade shall be relevant or advisable to
interpret, supplement, explain or vary any of the terms of this
Agreement, except as expressly provided herein.
(f) This Agreement, and all the provisions of this Agreement,
shall be deemed drafted by all of the parties hereto.
(g) This Agreement shall not be interpreted strictly for or
against any party, but solely in accordance with the fair meaning
of the provisions hereof to effectuate the purposes and intent of
this Agreement.
(h) Each party hereto has entered into this Agreement based
solely upon the agreements, representations and warranties
expressly set forth herein and upon his own knowledge and
investigation. Neither party has relied upon any representation
or warranty of any other party hereto except any such
representations or warranties as are expressly set forth herein.
(i) Each of the persons signing below on behalf of a party
hereto represents and warrants that he or she has full requisite
power and authority to execute and deliver this Agreement on
behalf of the parties for whom he or she is signing and to bind
such party to the terms and conditions of this Agreement.
(j) This Agreement may be executed in counterparts, each of
which shall be deemed an original. This Agreement shall become
effective only when all of the parties hereto shall have executed
the original or counterpart hereof. This agreement may be
executed and delivered by a facsimile transmission of a
counterpart signature page hereof.
(k) In any action brought by a party hereto to enforce the
obligations of any other party hereto, the prevailing party shall
be entitled to collect from the opposing party to such action
such party's reasonable litigation costs and attorneys fees and
expenses (including court costs, reasonable fees of accountants
and experts, and other expenses incidental to the litigation).
(l) This Agreement shall be binding upon and shall inure to the
benefit of the parties and their respective successors and
assigns.
(m) This is not a third party beneficiary contract. No person
or entity other than a party signing this Agreement shall have
any rights under this Agreement.
(n) This Agreement may be amended or modified only in a writing
which specifically references this Agreement.
(o) This Agreement may not be assigned (including performance by
subcontract) by any party hereto; provided, however, Xxxxxx-
Xxxxxxx may (i) assign all its rights and obligations to a wholly-
owned subsidiary, without recourse to Xxxxxx-Xxxxxxx provided the
Loan is fully advanced as provided in paragraph (2) by either
Xxxxxx-Xxxxxxx or such subsidiary and (ii) Xxxxxx-Xxxxxxx or such
subsidiary may assign a fractional undivided interest, not
exceeding fifty percent (50%), in its rights and obligations
arising under this Agreement.
(p) Nothing in this Agreement shall be construed to create a
partnership or joint venture, nor to authorize any party hereto
to act as agent for or representative of any other party hereto.
Each party hereto shall be deemed an independent contractor and
no party hereto shall act as, or hold itself out as acting as,
agent for any other party hereto.
(q) A party to this Agreement may decide or fail to require full
or timely performance of any obligation arising under this
Agreement. The decision or failure of a party hereto to require
full or timely performance of any obligation arising under this
Agreement (whether on a single occasion or on multiple occasions)
shall not be deemed a waiver of any such obligation. No such
decisions or failures shall give rise to any claim of estoppel,
laches, course of dealing, amendment of this Agreement by course
of dealing, or other defense of any nature to any obligation
arising hereunder.
(r) The repudiation, breach, or failure to perform any
obligation arising under this Agreement by a party after
reasonable notice thereof shall be deemed a repudiation, breach,
and failure to perform all of such party's obligations arising
under this Agreement.
(s) Time is of the essence with respect to each obligation
arising under this Agreement. The failure to timely perform an
obligation arising hereunder shall be deemed a failure to perform
the obligation.
(t) Any cause of action for a breach or enforcement of, or a
declaratory judgment respecting, this Agreement shall be
commenced and maintained only in the United States District Court
for the Northern District of Oklahoma or the applicable Oklahoma
state trial court sitting in Tulsa, Oklahoma and having subject
matter jurisdiction.
Dated and effective as of the Agreement Date.
DELTA PETROLEUM CORPORATION
By s/Xxxxxx X. Xxxxxx, Xx.
Signature
Xxxxxx X. Xxxxxx, Xx.
Printed Name
Chairman/CEO
Title
XXXXXX-XXXXXXX OIL COMPANY
By s/Xxxxx X. Xxxxxx
Signature
Xxxxx X. Xxxxxx
Printed Name
Executive Vice President
Title
