EXHIBIT 2.1
PURCHASE AGREEMENT AND RELEASE
This Purchase Agreement and Release (this "Agreement") is made and entered
into this 12th day of January, 2006, by and between Willbros Mt. West, Inc.,
formerly known as Mt. West Fabrication Plants and Stations, Inc., a Colorado
corporation ("Willbros"), and Xxxxxxxx Field Services Company, successor by
merger to Xxxxxxxx Gas Processing Company, a Delaware corporation ("Xxxxxxxx"),
pursuant to the recitations, terms and conditions set forth hereinbelow.
RECITALS
WHEREAS, Willbros is the owner of a gas processing plant known as the TXP-4
Plant, located in Section 27, Township 21 North, Range 114 West, in Lincoln
County, Wyoming;
WHEREAS, on or about February 24, 2003, Xxxxxxxx and Willbros entered into
that certain Opal 350 MMscfd Turbo-Expander Processing Plant (TXP-4) Process
Facility Supply and Installation Contract (the "Installation Agreement")
pursuant to which Willbros agreed to build the TXP-4 Plant on land owned by
Xxxxxxxx, as more particularly set forth therein;
WHEREAS, on or about February 24, 2003, Xxxxxxxx and Willbros entered into
that certain TXP-4 Plant Operating Agreement (the "Operating Agreement")
pursuant to which Xxxxxxxx agreed to operate the TXP-4 Plant for Willbros, as
more particularly set forth therein;
WHEREAS, on or about February 24, 2003, Xxxxxxxx and Willbros entered into
that certain TXP-4 Gas Processing Agreement (the "Processing Agreement")
pursuant to which Willbros agreed to process at the TXP-4 Plant natural gas
supplied by Xxxxxxxx, as more particularly set forth therein;
WHEREAS, on or about June 6, 2003, Xxxxxxxx and Willbros entered into that
certain Jonah Dehydration Facility Engineering Procurement and Construction
Contract (the "Dehydration Agreement") pursuant to which Willbros agreed to
construct a Jonah dehydration facility (the "Jonah Dehy") for Xxxxxxxx, as more
particularly set forth therein;
WHEREAS, disputes have arisen between Xxxxxxxx and Willbros relating to
and/or concerning the Installation Agreement, the Operating Agreement, the
Processing Agreement and the Dehydration Agreement (collectively, the "TXP-4
Agreements"); and
WHEREAS, the parties desire to address any and all issues relating to or in
any way concerning the above referenced agreements and to provide reimbursement
for expenditures made by Willbros on the TXP-4 Plant and the Jonah Dehy;
AGREEMENT
NOW, THEREFORE, for and in consideration of the above recitals and
definitions which are specifically incorporated herein, the mutual covenants and
agreements set forth in this Agreement, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties agree as follows:
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1. EFFECTIVE DATE. The effective date of the transactions, releases and
covenants set forth in this Agreement shall be 12:01 a.m. Central Standard Time
on January 1, 2006 (the "Effective Date").
2. CONVEYANCE OF THE WILLBROS INTERESTS. (a) Willbros owns all of the
membership interests in a newly-formed Delaware limited liability company by the
name of Opal TXP-4 Company, LLC (the "Willbros Company"). Willbros has
contributed to the capital of the Willbros Company all equipment, spare parts,
inventory and all other items owned by Willbros and located at the Opal Plant
site that are for the benefit of or use at the TXP-4 Plant, but specifically
excluding the Lease, as defined in paragraph 2(e) below (referred to
collectively as the "Property"), pursuant to a conveyance in the form of Exhibit
"1" hereto (the "Willbros Assignment").
(b) At Closing, Willbros shall convey to Xxxxxxxx all of Willbros' right,
title and interest in and to the membership interest of the Willbros Company
(the "Membership Interest") by duly executed assignment and conveyance document
(the "Conveyance Document").
(c) From December 29, 2005, through the Closing (as defined below), neither
Willbros nor the Willbros Company has removed from the Opal Plant site any
equipment, materials, spare parts, inventory or any other item. The term of each
of the Operating Agreement and the Processing Agreement shall terminate in all
respects at the Effective Date, and, as of the Effective Date, the Installation
Agreement and the Dehydration Agreement shall be considered terminated in all
respects, in each case such that no provisions thereof shall survive after the
Effective Date.
(d) Willbros promises and agrees to defend, indemnify and hold Xxxxxxxx
harmless from and against any and all third party claims, demands and liability
arising from or relating to the negligence of Willbros in connection with its
construction and ownership of the Property for a period of three (3) years after
the Effective Date, and promises and agrees to defend, indemnify and hold
Xxxxxxxx harmless from and against any and all third party claims, demands and
liability arising from or relating to title to the Property and the Membership
Interest indefinitely. Willbros further promises and agrees to defend, indemnify
and hold Xxxxxxxx harmless from and against any and all third party claims,
demands and liabilities arising from or relating to payment due or claimed due
for equipment, supplies, materials, services, labor and/or work provided to,
performed for or commissioned by Willbros at or upon the Property at any time
prior to the Effective Date.
(e) Willbros will remain solely responsible for all lease-related payments
which are or may become due to Caterpillar Financial Services Corporation
("Lessor") or its successor under that certain Long-Term Rental Agreement dated
as of December 29, 2003, between Lessor and Willbros USA, Inc., the parent
company of Willbros, relating to the lease by Lessor to Willbros USA, Inc. of
one Solar Taurus 70S/C451 gas turbine driven natural gas compression set and all
associated components, parts and additions thereto at the TXP-4 Plant (the
"Lease"), including all payments necessary for transfer of ownership of such
equipment from Lessor to Xxxxxxxx (i.e., the residual payment) and completing
all documentation necessary to effectuate the transfer of ownership on or before
the expiration of the Lease term. Willbros warrants and represents that it is
not a party to any other equipment leases affecting the Property.
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3. PAYMENT. At Closing, Xxxxxxxx will pay to Willbros (a) the sum of
$27,944,500 for and in consideration of the conveyance of the Membership
Interest; (b) the sum of $422,968 representing the remaining funds being held by
Xxxxxxxx as retainage under the Dehydration Agreement; and (c) the sum of
$4,044,000 for and in reimbursement of expenditures made by Willbros at the
TXP-4 Plant and the Jonah Dehy (collectively the "Cash Consideration"). Payment
of the Cash Consideration shall be by wire transfer to the following account:
Amegy Bank, 0000 Xxxx Xxx Xxxxxxx, Xxxxxxx Xxxxx 00000, ABA Number: 000000000,
Account Name: Willbros USA, Inc., Account Number: XXX736. All income or similar
taxes arising out of the transfer of the Property to the Willbros Company or
sale of the Membership Interest to Xxxxxxxx, the receipt by Willbros of the
retainage and the receipt by Willbros of the reimbursement proceeds paid in
connection herewith shall be borne solely by Willbros, as well as any personal
property, income or other taxes arising out of its or the Willbros Company's
ownership of the TXP-4 Plant prior to the Effective Date, and Willbros shall
indemnify and hold Xxxxxxxx harmless therefor. Xxxxxxxx shall be responsible for
any personal property, income or other taxes arising out of its ownership of the
Property and the Membership Interest after the Effective Date, and for any real
property taxes arising out of its ownership of the land underlying the TXP-4
Plant, and shall indemnify and hold Willbros harmless therefor. Any sales tax
arising out of the transactions contemplated in this Agreement shall be borne
and paid in equal shares by Willbros and Xxxxxxxx.
4. PAYMENT FROM THIRD-PARTY CLAIMS. In addition to the sums set forth in
paragraph 3 above, Xxxxxxxx will pay to Willbros a portion of any recovery that
Xxxxxxxx may obtain in the future from third parties, either through settlement
or through judgment, which is based on damages, loss or injury related to the
TXP-4 Plant or the Jonah Dehy, such payment to be calculated as follows:
(a) To the extent the recovery is for damages, loss or injury incurred
prior to the Effective Date, or for damages, loss or injury resulting from the
same cause(s) as existed on or before the Effective Date, Willbros will receive
50% of such recovery, up to a total amount of $3,400,000; and
(b) To the extent the recovery is for damages, loss or injury incurred from
new causes following the Effective Date, Willbros will not be entitled to any
portion of the recovery.
Once the amount paid to Willbros by Xxxxxxxx under the above scenario totals
$3,400,000, Xxxxxxxx shall have no further obligation to share the recovery from
third parties, and shall have the right to retain all recoveries in excess of
$3,400,000.
For purposes of this paragraph 4, the value of any recovery which is not a
lump-sum cash payment will be calculated as the absolute value of the recovery
at the time the recovery is obtained.
Xxxxxxxx shall pursue any claims against third parties at its own cost and
expense, and the prosecution and resolution of the claims shall be controlled
solely by Xxxxxxxx, and Xxxxxxxx shall have no obligation to consult with or
obtain approval from Willbros with respect to such claims and/or the resolution
thereof.
Willbros hereby assigns to Xxxxxxxx all of its right, title and interest in and
to any rights, claims, damages, injuries, and/or causes of action it has or may
have against any third party as
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contemplated in this paragraph 4. It is further agreed that all funds paid to
Willbros under this paragraph 4 will be used by Willbros to satisfy the Lease
obligations referred to in paragraph 2 above, and will not be used for any other
purpose unless and until all such Lease obligations have been paid in full.
5. WARRANTIES AND REPRESENTATIONS OF WILLBROS. Willbros makes the following
warranties and representations to Xxxxxxxx as of the Effective Date with regard
to itself and the Willbros Company.
(a) Willbros is a corporation duly organized, validly existing and in good
standing under the laws of the State of Colorado, and is qualified to do
business and in good standing in the State of Wyoming. The Willbros Company, a
wholly-owned subsidiary of Willbros, is a limited liability company duly
organized, validly existing, and in good standing under the laws of the State of
Delaware and qualified to do business and in good standing in the State of
Wyoming.
(b) Willbros possesses the corporate power necessary to enter into and
consummate the transactions contemplated under this Agreement, and this
Agreement and all instruments required hereunder to be executed and delivered by
Willbros at Closing have been and shall be duly authorized, executed and
delivered by Willbros.
(c) There are no bankruptcy, reorganization, or arrangement proceedings
pending, being contemplated by or, to the knowledge of Willbros, threatened
against Willbros or the Willbros Company.
(d) The Willbros Company owns title to the TXP-4 Plant as against the
claims of those claiming by, through or under Willbros or the Willbros Company,
and not otherwise, and the TXP-4 Plant is, or upon Closing will be, free and
clear of all mortgages, liens and security interests of every kind and nature
arising by, through or under Willbros or the Willbros Company.
(e) No consent, approval, order or authorization of, registration,
declaration or filing with, or permit from, any governmental authority or other
person is required by or with respect to Willbros or the TXP-4 Plant in
connection with the execution and delivery of this Agreement by Willbros or the
consummation by Willbros of the transactions contemplated hereby.
(f) The Willbros Company is classified as a disregarded entity for federal
income tax purposes under all applicable laws and regulations, and has never
filed for election to be treated as a corporation for federal income tax
purposes.
(g) The Willbros Company has conducted no business except with respect to
the ownership of the TXP-4 Plant and has not incurred any debt or other
liability.
6. WARRANTIES AND REPRESENTATIONS OF XXXXXXXX. Xxxxxxxx makes the following
warranties and representations to Willbros as of the Effective Date.
(a) Xxxxxxxx is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware and is qualified to do business
and in good standing in the State of Wyoming.
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(b) Xxxxxxxx possesses the corporate power necessary to enter into and
consummate the transactions contemplated under this Agreement, and this
Agreement and all instruments required hereunder to be executed and delivered by
Xxxxxxxx at Closing have been and shall be duly authorized, executed and
delivered by Xxxxxxxx.
(c) There are no bankruptcy, reorganization, or arrangement proceedings
pending, being contemplated by or, to the knowledge of Xxxxxxxx, threatened
against Xxxxxxxx.
(d) No consent, approval, order or authorization of, registration,
declaration or filing with, or permit from, any governmental authority or other
person is required by or with respect to Xxxxxxxx in connection with the
execution and delivery of this Agreement by Xxxxxxxx or the consummation by
Xxxxxxxx of the transactions contemplated hereby.
7. CLOSING. The following provisions shall be applicable with respect to
Closing:
(a) Closing Date. The Closing shall take place on or before January 12,
2006, at the offices of Xxxxxxxx in Tulsa, Oklahoma, or at such other time and
place as the Parties may mutually agree (the "Closing").
(b) Willbros' Obligations. At Closing, Willbros shall, with respect to the
Membership Interest, as a condition precedent to Xxxxxxxx' obligations
hereunder:
(i) Execute and deliver to Xxxxxxxx the Conveyance Document;
(ii) Provide to Xxxxxxxx a duly executed copy of the Willbros
Assignment;
(iii) Deliver to Xxxxxxxx all Willbros Company records;
(iv) Deliver to Xxxxxxxx possession of the TXP-4 Plant;
(v) Execute and deliver to Xxxxxxxx letters of resignation of the
officers and directors of the Willbros Company, if any;
(vi) Execute and deliver to Xxxxxxxx a certificate from an
officer of Willbros to the effect that all of the representations and
warranties herein made by it are true at and as of the Closing in the
same manner and with the same effect as if this Agreement had been
executed at that time and such representations and warranties had been
made at and as of that time; and
(vii) Execute and deliver to Xxxxxxxx the retraction letter
referred to in paragraph 14 below.
(c) Xxxxxxxx' Obligations. At Closing, and as a condition precedent to
Willbros' obligations hereunder, Xxxxxxxx shall:
(i) Deliver the Cash Consideration as set forth in paragraph 3
hereof; and
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(ii) Execute and deliver to Willbros a certificate from an
officer of Xxxxxxxx to the effect that all of the representations and
warranties herein made by it are true at and as of the Closing in the
same manner and with the same effect as if this Agreement had been
executed at that time and such representations and warranties had been
made at and as of that time.
8. OPERATIONS PENDING EFFECTIVE DATE. Xxxxxxxx and Willbros will retain
their existing contractual positions as to the TXP-4 Plant and the Jonah Dehy
through the Effective Date and will remain responsible for any costs or losses
incurred and benefits accrued by reason of such positions prior to the Effective
Date. Any payments due to or from Willbros relative to its ownership position in
the TXP-4 Plant prior to the Effective Date will be made according to the normal
timing for payments under the applicable agreements. For a period of three (3)
years after the Effective Date, Xxxxxxxx promises and agrees to defend,
indemnify and hold Willbros harmless from and against any and all third party
claims and demands arising from or relating to the negligence of Xxxxxxxx in
connection with its operation of the Property, supply of gas or marketing of the
product prior to the Effective Date. Neither party will delay or discontinue any
work currently being conducted on, or for the benefit of, the TXP-4 Plant or the
Jonah Dehy prior to the Effective Date. Following the Effective Date, the
parties will cooperate to the full extent necessary to ensure that the work
described on Exhibit "2" attached hereto is neither delayed nor discontinued
after the Effective Date. For any other work that may be required with respect
to the TXP-4 Plant after the Effective Date, Xxxxxxxx and Willbros may negotiate
and enter into a new service agreement.
9. RELEASE OF XXXXXXXX. Except as otherwise expressly stated in this
Agreement, effective on the later of the Effective Date and receipt by Willbros
of the payments under paragraph 3 above, Willbros hereby releases, acquits,
discharges and covenants not to xxx Xxxxxxxx and its predecessors, successors,
assigns, parents, subsidiaries, affiliates and related companies (including, but
not limited to, The Xxxxxxxx Companies, Inc.) and all their respective
shareholders, directors, officers, employees, representatives, agents,
attorneys, and controlling persons thereof, of and from any and all claims,
demands, debts, liabilities, injuries, damages, causes of action, suits and
actions of whatsoever kind or character, whether in contract or in tort, at law
or in equity, known or unknown, asserted or unasserted, developed or
undeveloped, which Willbros has or may have, arising from or in any way relating
to any of the TXP-4 Agreements.
10. RELEASE OF WILLBROS. Except as otherwise expressly stated in this
Agreement, effective on the Effective Date, Xxxxxxxx hereby releases, acquits,
discharges and covenants not to xxx Willbros and its predecessors, successors,
assigns, parents, subsidiaries, affiliates and related companies (including, but
not limited to, Willbros USA, Inc. and Willbros Group, Inc.) and all their
respective shareholders, directors, officers, employees, representatives,
agents, attorneys, and controlling persons thereof, of and from any and all
claims, demands, debts, liabilities, injuries, damages, causes of action, suits
and actions of whatsoever kind or character, whether in contract or in tort, at
law or in equity, known or unknown, asserted or unasserted, developed or
undeveloped, which Xxxxxxxx has or may have, arising from or in any way relating
to any of the TXP-4 Agreements.
11. FINAL COMPLETION. Effective on the Effective Date: (a) Xxxxxxxx hereby
(i) agrees that Willbros has no further obligation under the Installation
Agreement or the Dehydration Agreement, and (ii) agrees that Willbros is
released and discharged from any and all liability arising from or related to
the Installation Agreement and/or the Dehydration Agreement;
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(b) the parties hereto agree that all warranty periods under the Installation
Agreement and the Dehydration Agreement have expired and that the warranties and
indemnities under said Agreements shall have no further force or effect; (c)
each of the parties hereto hereby releases the other from any past or future
liability relating to the work under the Installation Agreement and the
Dehydration Agreement; (d) all insurance obligations under the Installation
Agreement and the Dehydration Agreement shall terminate; and (e) neither party
hereto shall have any liability to the other with respect to property damage
relating to the TXP-4 Plant arising under the Installation Agreement or the
Dehydration Agreement.
12. CONFIDENTIALITY. For a period of five years after the Effective Date,
the terms and conditions of this Agreement shall be held confidential by
Xxxxxxxx and Willbros and shall not be disclosed by either of them to any third
party (i.e., any person or entity other than Xxxxxxxx and Willbros) except: (a)
as necessary to effectuate the actions contemplated herein; (b) to any party's
employees, attorneys, accountants, advisors, auditors and regulators; (c) others
as may be required by law; (d) pursuant to a judicial order from a court of
competent jurisdiction; or (e) as otherwise agreed upon by the parties in
writing.
13. CONSEQUENTIAL DAMAGES. NOTWITHSTANDING ANY OTHER PROVISION OF THIS
AGREEMENT, NEITHER PARTY HERETO SHALL BE RESPONSIBLE TO THE OTHER PARTY FOR
CONSEQUENTIAL, INDIRECT, SPECIAL, EXEMPLARY OR PUNITIVE DAMAGES, INCLUDING
WITHOUT LIMITATION LOSS OF USE, LOSS OF BUSINESS OPPORTUNITY, LOSS OF PROFIT OR
REVENUE, WHETHER OR NOT FORESEEABLE, SUFFERED BY SUCH OTHER PARTY AS A RESULT OF
THE FIRST PARTY'S PERFORMANCE OR NON-PERFORMANCE OF ITS OBLIGATIONS UNDER THIS
AGREEMENT OR OTHERWISE.
14. RETRACTION. At Closing, Willbros shall deliver to Xxxxxxxx a written
retraction, in the form set forth as Exhibit "3" attached hereto, concerning
Willbros' previous allegation that Xxxxxxxx committed fraud in the negotiation
and/or performance of the TXP-4 Agreements. Further, effective on the Effective
Date, each of Willbros and Xxxxxxxx hereby retracts all of such party's previous
allegations with respect to the other party's having acted in bad faith or been
incompetent in connection with the negotiation and/or performance of any of the
TXP-4 Agreements.
15. REPRESENTATIONS AND WARRANTIES. Each of Willbros and Xxxxxxxx
represents and warrants that it is duly authorized to enter into this Agreement,
that each person signing this Agreement is duly authorized to execute this
Agreement on its behalf, that, before entering into this Agreement, it sought
and received the advice of its own legal counsel, and that it is entering into
this Agreement as its free and voluntary act.
16. NO ADMISSION. Nothing herein shall be deemed or construed as an
admission of liability by Xxxxxxxx or by Willbros. Rather, this Agreement
constitutes an agreed resolution of disputed claims.
17. MISCELLANEOUS.
A. Applicable Law. This Agreement shall, in all respects, be governed
by the laws of the State of Oklahoma. The parties hereto further agree that any
dispute arising out of
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this Agreement or the breach thereof shall be brought and heard in any court
having a situs in Tulsa County, Oklahoma.
B. Modifications and Amendments. No amendment, change or modification
of this Agreement shall be valid unless in writing and signed by Willbros and
Xxxxxxxx.
C. Successors and Assigns. All of the terms and provisions contained
herein shall inure to the benefit of, and shall be binding upon, Willbros and
Xxxxxxxx and their respective successors and assigns; provided, however, neither
Willbros nor Xxxxxxxx may assign any of its rights or obligations hereunder
without the prior written consent of the other.
D. Entire Agreement. This Agreement, including the Exhibits hereto,
together with the Transfer, Assignment, Conveyance and Contribution to Capital
and its Exhibits, constitute the entire understanding and agreement between the
parties hereto with respect to its subject matter, and no other agreements,
understandings or representations have been made with respect to such subject
matter. In the event of any conflict between this Agreement and the Transfer,
Assignment, Conveyance and Contribution to Capital, this Agreement shall govern
and control.
E. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
F. Captions. The captions appearing at the commencement of the
paragraphs and sections hereof are descriptive only and for convenience in
reference. Should there be any conflict between any such caption and the
specific language within the paragraph or section, at the head of which it
appears, the specific language of this Agreement and not such caption shall
govern in the construction of this Agreement.
[SIGNATURES ON FOLLOWING PAGE]
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In witness whereof, the parties hereto have caused this Agreement to be
executed by their duly authorized representatives on the date first above
written.
WILLBROS MT. WEST, INC.
By: /s/ Xxxxxx X. Xxxx
------------------------------------
Name: Xxxxxx X. Xxxx
Title: Attorney-in-Fact
STATE OF Texas )
) SS:
COUNTY OF Xxxxxx )
This instrument was acknowledged before me this 12th day of January, 2006,
by Xxxxxx X. Xxxx, as a duly authorized representative of Willbros Mt. West,
Inc.
/s/ Xxxxx X. Xxxxxxx
----------------------------------------
Notary Public
My Commission Expires:
Sep. 2, 2007
(SEAL)
XXXXXXXX FIELD SERVICES COMPANY
By: /s/ Xxxx X. Xxxxxxxxx
------------------------------------
Name: Xxxx X. Xxxxxxxxx
Title: Sr. Vice President
STATE OF OKLAHOMA )
) SS:
COUNTY OF TULSA )
This instrument was acknowledged before me this 12 day of January, 2006, by
Xxxx X. Xxxxxxxxx, as a duly authorized representative of Xxxxxxxx Field
Services Company.
/s/ Xxxxxx Xxxxx
----------------------------------------
Notary Public
My Commission Expires:
5-7-2009
(SEAL)
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The following exhibits to the Purchase Agreement and Release have been
omitted and the Registrant agrees to furnish supplementally a copy of any such
exhibits to the Securities and Exchange Commission upon its request:
Exhibit "1" Transfer, Assignment, Conveyance and Contribution to Capital
Exhibit "2" Work to be Performed After Closing
Exhibit "3" Retraction Letter
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