EXHIBIT 7.6
STOCK EXCHANGE AGREEMENT
This Stock Exchange Agreement ("Agreement") dated this 23rd day of
November, 1998 is by and among all of the undersigned shareholders
("Shareholders") who own 100% of the shares of Saba Acquisub, Inc., a Colorado
corporation ("SAI"), SAI whose principal offices are located at 0000 Xxxxxxx
Xxxxx, Xxxxx 000, Xxxxx Xxxxx, Xxxxxxxxxx, 00000, and Horizontal Ventures,
Inc., a Colorado corporation ("HVNV") whose address is 000 Xxxxx Xxxxxx, Xxxxx
0000, Xxx Xxxx, Xxx Xxxx, 00000:
W I T N E S S E T H :
WHEREAS, the Shareholders own 100% of the issued and outstanding common
stock of SAI; and
WHEREAS, SAI is the owner of 3,000,000 shares of the issued and
outstanding common stock of Saba Petroleum Company ("Saba") which is its sole
asset; and
WHEREAS, HVNV is interested in acquiring SAI by exchanging its shares for
the Shareholders' shares of SAI to be followed by the merger of SAI with and
into HVNV.
NOW THEREFOR, the parties hereto enter into this Stock Exchange
Agreement on the terms, conditions and based on the consideration hereinafter
set forth:
1. The Share Exchange. At closing as hereinafter defined (the
"Closing"), the Shareholders shall exchange all of the issued and outstanding
shares of SAI free and clear of any liens, encumbrances or rights of any third
persons of any type or kind whatsoever for 1,300,000 shares of newly issued
HVNV no par value common stock. The shares of HVNV shall be issued to the
Shareholders on a pro rata basis as hereinafter set forth on Exhibit A. The
transaction is intended as a tax free exchange pursuant to Section
368(a)(1)(A) of the Internal Revenue Code of 1986 as amended, however HVNV is
not representing that the exchange will be treated as such by the Internal
Revenue Service and no request has been made to the U.S. Department of
Treasury for a ruling accordingly.
The Shareholders acknowledge and understand that the HVNV securities
being issued to it have not been registered and are being issued pursuant to
an exemption from registration available pursuant to Section 4.2 of the
Securities Act of 1933 as amended, that SAI is acquiring these securities for
an investment and not with a view to further distribution and that SAI may not
transfer or resell the securities except for as an in-kind distribution to its
shareholders on a pro rata basis in accordance with the Colorado Business
Corporation Act, without the prior written permission of the company except or
in accordance with Rule 144 or upon the effective date of a registration
statement registering the resale of these restricted securities.
3. Effective Date. This transaction shall deemed to have been closed
effective on the 23rd of November, 1998.
4. Merger. At Closing SAI and HVNV shall execute a merger agreement in
the form attached hereto as Exhibit B whereby SAI will be merged with and into
HVNV and the separate corporate existence of SAI shall be extinguished. The
certificate of merger shall not be filed except subject to Section 7 hereof.
5. Registration Rights. Within 60 days of Closing HVNV shall file a
registration statement on Form S-3 or such other form which may be available
to it if Form S-3 is not available for any reason to register the resale up to
1,000,000 shares of the 1,300,000 shares being issued in the exchange. HVNV
shall use its best efforts to have said registration statement declared
effective at the earliest practicable date after filing and to maintain the
effectiveness of the registration statement until a period of two years has
passed from the date of the actual Closing. The names of the selling
Shareholders in the S-3 registration statement shall be as designated by said
Shareholders at Closing including the number of shares of each selling
Shareholder to be registered. HVNV shall pay all of the expenses of said
registration statement except for any selling expenses or commissions of the
Shareholders.
6. The Closing. The Closing of the exchange of the shares shall occur
at the offices of Xxxxx Xxxxx & Xxxxx Professional Corporation, 0000 Xxxxxxx
Xxxxxx, Xxxxx 0000, Xxxxxx, Xxxxxxxx 00000 on or before 10:00 a.m. on or
before December 3, 1998. At such place and time the parties to this Agreement
shall exchange certificates and any other documents required for assignment
thereof and execute the Merger Agreement. Should the Shareholders, pending
Closing, elect to pay down the margin debt as defined in Section 11(a) of this
Agreement, the Shareholders shall be entitled to a prorata increase of the
number of shares of HVNV received, up to a maximum of 40,000 additional HVNV
shares if the entire debt of SAI is paid off prior to Closing. If additional
shares are to be issued, Exhibit A shall be adjusted and initialed at Closing.
7. Termination Clause. At the option of the Shareholders upon a
unanimous election thereby or HVNV, either the Shareholders or HVNV may
terminate this Agreement and the Merger Agreement on or before December 31,
1998 if and only if HVNV fails to close the Common Stock Purchase Agreement
dated October 8, 1998 by and between HVNV and Saba Petroleum Company or the
Preferred Stock Purchase Agreement by and between HVNV and RGC dated October
6, 1998 in accordance with the terms of those Agreements as they may be
extended or amended by the parties thereto. In furtherance of the rights
granted pursuant to this clause, Xxxxx Xxxxx & Xxxxx Professional Corporation,
counsel to HVNV, shall, at Closing, upon receipt of all the closing documents
including the certificates and any required stock powers, maintain possession
of all of the documents and stock certificates and not distribute same to the
rightful owners or file the certificate of merger with the Secretary of State
of the State of Colorado until such time as the Parties hereto have waived
their rights pursuant to this clause or on or after December 31, 1998,
whichever shall first occur. Should HVNV or the Shareholders unanimously
elect to terminate this Agreement and the Merger Agreement in accordance with
the terms of this clause, Xxxxx Xxxxx & Xxxxx Professional Corporation shall
return the documents and certificates in its possession to the Parties to this
Agreement in accordance with their jointly executed instructions. Should the
termination clause be waived or should Xxxxx Xxxxx & Xxxxx Professional
Corporation not receive properly executed instructions on or before December
31, 1998, it shall automatically deliver the documents executed at Closing and
the certificates to the appropriate party and file the certificate of merger
with the Colorado Secretary of State's Office as per the terms of this
Agreement.
8. Indemnification. HVNV and when and if HVNV is entitled to control
Saba, Saba do and shall agree to indemnify the Shareholders, individually,
jointly and severally to the fullest extent permitted by the Articles of
Incorporation, Bylaws and the state statutory law relating thereto with
respect to any claim or action arising as a result of the terms and conditions
of this Stock Exchange Agreement. Any rights to indemnification are subject
to the Shareholders notifying HVNV and/or Saba of any threatened claim or
claim in a timely fashion thereby permitting HVNV and/or Saba to defend the
threatened claim or claim effectively in accordance with the terms of this
indemnification.
9. Voting Agreement. From Closing and until December 31, 1999 or such
shorter period as the Shareholders own the shares of HVNV received in this
exchange transaction, the Shareholders agree that they will execute upon the
reasonable request of HVNV proxies in the form set forth as Exhibit C attached
hereto. The Shareholders acknowledge that they will be required to execute
more than one proxy during the term of this voting agreement and they shall
cooperate in delivering said proxies to HVNV immediately upon receipt of the
request for a new proxy. The parties hereto acknowledge that this voting
agreement was separately bargained for and is a material term to and forms a
substantial part of the basis for the consideration being paid by HVNV for the
acquisition of SAI. The parties further acknowledge that a revocation or
attempted revocation of the proxy being granted hereby would cause
substantial, immediate and irreparable damage to HVNV. The parties further
acknowledge that it would be difficult in light of the anticipated or actual
harm caused by a breach of this voting agreement to determine and/or prove the
losses suffered by HVNV and impossible for HVNV to obtain an adequate, timely
remedy. Therefore, in addition to the right of HVNV to immediate equitable
relief in the form of temporary, preliminary and permanent injunctive relief
HVNV shall be entitled to liquidated damages. The parties have agreed that
upon breach of this voting agreement by the Shareholders or any one thereof,
the breaching Shareholder(s) shall forfeit up to one million shares in the
aggregate of the HVNV Common Stock issued as consideration herein. If one or
more but not all of the Shareholders breach the voting agreement, then only
that Shareholder shall be required to pay liquidated damages. The number of
shares to be forfeited by the breaching Shareholder shall be calculated based
on a formula whereby the numerator is the number of shares received by the
breaching Shareholder in the exchange transaction as set forth in Exhibit A
and the denominator shall be 1.3 million with the resulting fraction being
multiplied times one million or such lessor number of HVNV shares then owned
by the breaching Shareholder.
The parties hereto acknowledge that they have negotiated the amount and
reasonableness of the liquidated damages at arms length and with the
assistance of independent counsel and agree that the liquidated damage clause
established herein is fair and reasonable is not be construed as a penalty and
that their individual signatures on this Agreement shall be construed as
conclusive evidence thereof.
10. Matters Pending Closing. neither party will make any public
announcement with respect to the matters contained herein without the prior
written consent of the other except as may be required upon the advise of
counsel to comply with reporting requirements of the Securities and Exchange
Commission, AMEX or the Nasdaq stock market. Pending Closing HVNV shall
conduct its business in its ordinary course except that the parties
acknowledge that HVNV is attempting to obtain control through acquisition or
otherwise a controlling interest in Saba which is outside its ordinary course.
Relative to any matter that requires a vote of shareholders of Saba between
the date of this Agreement and Closing, SAI agrees to vote in accordance with
the direction of the Board of Directors of HVNV. The parties to this
Agreement will obtain any and all necessary authority to conclude the terms of
this Agreement at or before Closing and/or any regulatory or self-regulatory
organizational approvals. Further pending Closing, the parties to this
Agreement will use good faith in commercial dealings related to the Stock
Exchange Agreement, acknowledge that each party will spend a substantial
effort and expense based on the commitments made herein.
11. Representations and Warranties.
a. Representations and Warranties of SAI and the Shareholders.
SAI and the Shareholders represent and warrant that with the exception of
margin account loan balances of an amount not to exceed a total of $300,000 at
the Global Xxxxx Trading ($211,436.00) and Xxxxxx Xxxxx ($89,727.00) brokerage
firms which margin loans are secured by 660,000 and 305,200 shares of the Saba
Petroleum Company common stock respectively owned by SAI, the Saba shares
being exchanged pursuant to the terms of this agreement are owned by them free
and clear of any liens, encumbrances and free from any rights of any third
party whatsoever including spousal rights. Additionally, SAI and the
Shareholders represent and warrant that the margin loan balance not to exceed
$300,000 with the brokerage firms above set forth are not presently subject to
a margin call, is current in principal and interest payments and in no other
way in default, and that all documentation relative to said account shall be
delivered to HVNV and there are no undisclosed material issues related to that
account. SAI and the Shareholders further represent and warrant that all
corporate authority required of them has been obtained and that they may close
this Agreement without any further authority or consent of any third party.
SAI and the Shareholders further represent and warrant that they are obtaining
the HVNV securities for an investment and not with a view towards further
distribution and acknowledges that the securities of HVNV acquired as a result
of this Agreement will have a restrictive legend placed on the certificates
representing the shares acquired.
b. Representations and Warranties of HVNV. HVNV acknowledges that
it is a corporation in good standing with full power and authority to enter
into this transaction and that at or before Closing it shall have received any
and all necessary approvals for entering into and Closing this transaction in
accordance with its terms. HVNV represents and warrants that it is a publicly
traded company listed on the Nasdaq Small Cap Market, that its securities
trade under the symbol HVNV and that it is current in all of its reports with
the Securities and Exchange Commission. HVNV further represents that the
information and financial statements contained in its reports including the
recently filed 10-QSB for the period ended September 30, 1998 are true and
accurate in all material respects. HVNV further represents and warrants that
it is acquiring the shares of Saba for investment and not with a view to
further distribution but with a view of obtaining control of Saba in
accordance with documents filed with the Securities and Exchange Commission
and further documents to be filed.
12. First Right of Refusal. For a period of three years from the date
of Closing the Shareholders agree that should they desire to dispose of the
shares of HVNV received pursuant to the terms of this Agreement, they must
first offer to HVNV the right to repurchase these shares on the same terms and
conditions as they are to be offered to any third party. At such time as a
Shareholder desires to dispose of its HVNV shares, it must notify HVNV in
writing of its intent and the terms of the proposed sale. HVNV shall have a
period of seven days from the date of the receipt of notice to accept the
terms of the sale on the terms and conditions set forth in the notice or, in
the alternative to elect not to participate. If HVNV elects not to
participate, the Shareholder may complete the sale as proposed in the notice
on the same terms and conditions as proposed or in its sole discretion not
complete the sale. Should the Shareholder not complete the sale, it may not
complete any further sales during the term of HVNV's first right of refusal
without subsequent notices being issued to HVNV relative to those subsequent
proposed transactions.
[BALANCE OF THIS PAGE INTENTIONALLY LEFT BLANK]
Dated the year and date first above set forth.
Shareholders:
CAPCO RESOURCES LTD. HORIZONTAL VENTURES, INC.
By:_______________________________ By:_______________________________
Xxxxxxx Xxxxxx, Chairman and CEO
CAPCO ACQUISUB, INC. SABA ACQUISUB, INC.
By: ______________________________ By: _____________________________
SEDCO, INC.
By: ______________________________
PARKFIELD MANAGEMENT LIMITED
By: ________________________________
________________________________
Authority
EXHIBIT A
Name of Exchange No. of SAI Shares No. of HVNV Shares to be
Shareholder Exchanged Received
Capco Resources Ltd. 2,667 346,667
Capco Acquisub, Inc. 6,362 827,094
Sedco, Inc. 554 72,072
Parkfield Management Limited 417 54,167
EXHIBIT B
AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER (hereinafter called the "Merger
Agreement") is made effective as of _______________, 1998, by and between Saba
Acquisub, Inc., a Colorado corporation ("SAI"), and Horizontal Ventures, Inc.,
a Colorado corporation ("HVNV"). SAI and HVNV are sometimes referred to as
the "Constituent Corporations," with reference to the following facts:
A. The authorized capital stock of HVNV consists of fifty million
(50,000,000) shares of no par value common stock and fifty million
(50,000,000) shares of preferred stock. The authorized capital stock of SAI
consists of _____________ (___________) shares of common stock, $____ par
value.
B. There are currently _________ shares of stock of HVNV outstanding.
C. SAI has no subsidiaries, and has a total of _________ shares of $___
par value common stock issued and outstanding, and there are no options or
other rights to acquire any newly issued shares available to any person.
D. The directors of the Constituent Corporations deem it advisable and
to the advantage of such corporations that SAI merge into HVNV upon the terms
and conditions herein provided.
NOW, THEREFORE, the parties do hereby adopt the plan of merger
encompassed by this Merger Agreement and do hereby agree that SAI shall merge
with and into HVNV on the following terms, conditions, and other provisions:
1. TERMS AND CONDITIONS
1.1 Merger. SAI shall be merged with and into HVNV(the "Merger"), and
HVNV shall be the surviving corporation (the "Surviving Corporation")
effective upon the date when this Merger Agreement or a Certificate of Merger
is filed with the Secretary of State of Colorado (the "Effective Date").
1.2 Succession. On the Effective Date, HVNV shall continue its
corporate existence under the laws of the State of Colorado, and the separate
existence and corporate organization of SAI, except insofar as it may be
continued by operation of law, shall be terminated and cease.
1.3 Transfer of Assets and Liabilities. On the Effective Date, the
rights, privileges, powers and franchises, both of a public as well as of a
private nature, of each of the Constituent Corporations shall be vested in and
possessed by the Surviving Corporation, subject to all of the disabilities,
duties and restrictions of or upon each of the Constituent Corporations; and
all singular rights, privileges, powers and franchises of each of the
Constituent Corporations, and all property, real, personal and mixed, of each
of the Constituent Corporations, and all debts due to each of the Constituent
Corporations on whatever account, and all things in action or belonging to
each of the Constituent Corporations shall be transferred to and vested in the
Surviving Corporation; and all property, rights, privileges, powers and
franchises, and all and every other interest, shall be thereafter the property
of the Surviving Corporation as they were of the Constituent Corporations, and
the title to any real estate vested by deed or otherwise in either of the
Constituent Corporations shall not revert or be in any way impaired by reason
of the Merger; provided, however, that the liabilities of the Constituent
Corporations and of their stockholders, directors and officers shall not be
affected and all rights of creditors and all liens upon any property of either
of the Constituent Corporations shall be preserved unimpaired, and any claim
existing or action or proceeding pending by or against either of the
Constituent Corporations may be prosecuted to judgments as if the Merger had
not taken place except as they may be modified with the consent of such
creditors and all debts, liabilities and duties of or upon each of the
Constituent Corporations shall attach to the Surviving Corporation, and may be
enforced against it to the same extent as if such debts, liabilities and
duties had been incurred or contracted by it.
1.4 Manner of Accomplishing Merger. The Merger shall be accomplished by
way of the exchange of 100% (____________ shares) of the issued and
outstanding shares of SAI for 1,300,000 shares of the common stock of HVNV.
The transfer agent will automatically be instructed to issue new certificates
of HVNV to each of the shareholders of SAI in accordance with Exhibit A
attached hereto, at the address listed in the register of SAI shareholders.
No fractional shares will be issued, but each fractional share will be rounded
up to the next share and a certificate for HVNV will be issued to each record
holder of SAI accordingly. The exchange will be accomplished pursuant to an
exemption from registration provided by Section 4(2) of the Securities Act of
1933.
1.5 Rights of Appraisal. This Merger shall be subject to the unanimous
approval by the stockholders and there shall be no outstanding appraisal
rights.
1.6 Obligations of SAI Not to Issue its Securities. As of the date of
this Merger Agreement and until the date of closing, SAI shall not issue any
additional shares of its common stock to any person or entity whatsoever,
including as a result of having previously issued any warrants to acquire
common stock, any options to acquire its securities as a result of any
employee stock option plan or otherwise, or pursuant to any employee benefit
plan. SAI further represents that the capitalization, as set forth in
paragraph C of the preamble to this Agreement, is true and accurate in all
respects.
2. CHARTER DOCUMENTS, DIRECTORS AND OFFICERS
2.1 Certificate of Incorporation and Bylaws. The Articles of
Incorporation of HVNV in effect on the Effective Date shall continue to be the
Articles of Incorporation of the Surviving Corporation. The Bylaws of HVNV
shall be the Bylaws of the Surviving Corporation, as they may be amended from
time to time.
2.2 Directors. The directors of HVNV immediately preceding the
Effective Date shall become the directors of the Surviving Corporation on and
after the Effective Date to serve until the expiration of their terms and
until their successors are elected and qualified.
2.3 Officers. The officers of HVNV immediately preceding the Effective
Date shall become the officers of the Surviving Corporation on and after the
Effective Date to serve at the pleasure of its Board of Directors.
3. MISCELLANEOUS
3.1 Further Assurances. From time to time, and when required by the
Surviving Corporation or by its successors and assigns, there shall be
executed and delivered on behalf of SAI such deeds and other instruments, and
there shall be taken or caused to be taken by it such further and other action
as shall be appropriate or necessary in order to vest or perfect in or to
conform of record or otherwise, in the Surviving Corporation the title to and
possession of all the property, interests, assets, rights, privileges,
immunities, powers, franchises and authority of SAI and otherwise to carry out
the purposes of this Merger Agreement, and the officers and directors of the
Surviving Corporation are fully authorized in the name and on behalf of SAI or
otherwise to take any and all such action and to execute and deliver any and
all such deeds and other instruments.
3.2 Amendment. At any time before or after approval by the stockholders
of SAI, this Merger Agreement may be amended in any manner (except that, after
the approval of the Merger Agreement by the stockholders of SAI, the principal
terms may not be amended without the further approval of the stockholders of
SAI) as may be determined in the judgment of the respective Board of Directors
of Phone and SAI to be necessary, desirable, or expedient in order to clarify
the intention of the parties hereto or to effect or facilitate the purpose and
intent of this Merger Agreement.
3.3 Conditions to Merger. The obligation of the Constituent
Corporations to effect the transactions contemplated hereby is subject to
satisfaction of the following conditions (any or all of which may be waived by
either of the Constituent Corporations in its sole discretion to the extent
permitted by law):
(a) the Merger shall have been approved by all of the stockholders
of SAI in accordance with applicable provisions of the Colorado Revised
Statutes; and
(b) any and all consents, permits, authorizations, approvals, and
orders deemed in the sole discretion of SAI to be material to consummation of
the Merger shall have been obtained; and
(c) the securities issued by HVNV shall be issued pursuant to an
exemption from registration pursuant to the Securities Act of 1933 (as
amended); and
(d) any other requirements under applicable Colorado law shall have
been satisfied in connection with the Merger.
3.4 Abandonment or Deferral. At any time before the Effective Date,
this Merger Agreement may be terminated and the Merger may be abandoned by the
Board of Directors of HVNV, notwithstanding the approval of the Merger by the
stockholders of SAI or HVNV, or the consummation of the Merger may be deferred
for a reasonable period of time if, in the opinion of the Boards of Directors
of HVNV, such action would be in the best interest of such corporations. In
the event of termination of this Merger Agreement, this Merger Agreement shall
become void and of no effect and there shall be no liability on the part of
either Constituent Corporation or its Board of Directors or stockholders with
respect thereto.
3.5 Counterparts. In order to facilitate the filing and recording of
this Merger Agreement, the same may be executed in any number of counterparts,
each of which shall be deemed to be an original.
IN WITNESS WHEREOF, this Merger Agreement, having first been duly
approved by the Board of Directors of SAI and HVNV, is hereby executed on
behalf of each said corporation and attested by their respective officers
thereunto duly authorized.
SABA ACQUISUB, INC.
a Colorado corporation
By:______________________________
ATTEST:
______________________________
______________________________
Secretary
HORIZONTAL VENTURES, INC.
a Colorado corporation
By:______________________________
Xxxxxxx X. Xxxxxx, President
ATTEST:
______________________________
______________________________
Secretary
EXHIBIT C
PROXY
SHAREHOLDERS MEETINGS OF HORIZONTAL VENTURES, INC.
The undersigned shareholder of Horizontal Ventures, Inc., a Colorado
corporation, hereby appoints Xxxxxxx X. Xxxxxx my proxy to attend and
represent me at any annual or special meeting of the shareholders of
Horizontal Ventures, Inc. or at any adjournment of that meeting called in the
normal course and to vote my shares on any matter or resolution which may come
before the meeting and to take any other action which I could personally take
if present at the meeting. Xxxxxxx X. Xxxxxx has my full authority to vote
this proxy in his sole discretion. This proxy gives authority to Xx. Xxxxxx
to vote for me on any matters as may properly come before any meeting during
the term of my proxy which under no circumstances shall exceed the later of
eleven months from the date of the execution of my proxy or December 31, 1999.
Number of shares owned: ___________________
Dated: __________________________________
_______________________________________
Signature
(Signed exactly as name appears on certificate)
_______________________________________
Print name of shareholder
AMENDMENT NO. 1
TO
STOCK EXCHANGE AGREEMENT
This Amendment No. 1 To Stock Exchange Agreement (the "Amendment") is
entered into as of the 15th day of December 1998 between the shareholder (the
"Shareholder") who owns 100% of Saba Acquisub, Inc. ("SAI"), a Colorado
corporation, and Horizontal Ventures Inc. ("HVNV").
WITNESSETH:
WHEREAS, HVNV, SAI, Shareholder and the then-shareholders of SAI are
parties to the Stock Exchange Agreement dated November 23, 1998 (the "Exchange
Agreement"); and
WHEREAS, Shareholder has acquired all the interests of the other
shareholder in SAI so that Shareholder now owns 100% of SAI; and
WHEREAS, HVNV, SAI and Shareholder desire to amend the Exchange Agreement
in the manner set forth in this Agreement;
NOW THEREFOR the parties hereto enter into this Amendment on the terms,
conditions and based on the consideration hereinafter set forth and as set
forth in the Exchange Agreement and amended by this Amendment:
1. The second paragraph of the Exchange Agreement following the work
"WITNESSETH" shall be amended by replacing the number 3,000,000 with the
number 2,971766.
2. Section 5 of the Exchange Agreement shall be amended by replacing
the number "1,300,000" with the number "1,340,000".
3. Section 6 of the Exchange Agreement shall be amended by replacing
the date "December 3, 1998" with the date "December 18, 1998".
4. Section 9 of the Exchange Agreement shall be amended by replacing
the number "1.3 million" with the number "1,340,000".
5. Section 11a of the Exchange Agreement shall be amended by replacing
the number "$300,000" with the number "$3006,578.73" in two places, by
replacing the number "($211,436.00)" with the number "($214,615.16)", and by
replacing the number "($89,727.00)" with the number "($91,963.57)".
6. Section 12 of the Exchange Agreement shall be amended by adding the
following sentence at the end of Section 12; "Notwithstanding the foregoing
HVI agrees that Shareholder may transfer up to 75,000 shares without complying
with the notice provisions of this Section 12 and that HVI shall not have a
right to purchase those shares prior to the transfer by shareholder; provided
however, that the recipient of those shares shall agree to take those shares
subject to HVI's right of first refusal pursuant to this Section 12 and the
recipient shall agree to be bound by the provisions of Section 9 concerning
the voting of the transferred shares."
7. Exhibit A to the Exchange Agreement is amended to read in its
entirety as Exhibit A attached to and made a party of this Amendment.
8. Except as specifically amended in this Amendment, the terms of the
Exchange Agreement shall remain in full force and effect.
Dated the year and date first above set forth.
Shareholder:
CAPCO RESOURCES LTD.
/s/ Xxxxx Xxxx
By:
Kanti, Shah, President
HORIZONTAL VENTURES, INC.
/s/ Xxxxxxx X. Xxxxxx
By:
Xxxxxxx X. Xxxxxx, Chairman
And CEO
SABA ACQUISUB, INC.
/s/
By:
Signature
Printed Name and Title
Exhibit A
Name of Exchange No. of SAI Shares No. of HVNV Shares to be
Shareholder Exchanged Received
Capco Resources Ltd. 10,000 1,340,000
