EXHIBIT 4.12
SHAREHOLDER AGREEMENT
THIS SHAREHOLDER AGREEMENT (together with all appendices attached
hereto, this "Agreement") effective as of the Effective Date (as hereinafter
defined) by and among Belco Oil & Gas Corp., a Nevada corporation ("Belco"),
Coda Energy, Inc., a Delaware corporation ("Coda"), and _______________________
________________________ (the "Shareholder").
A. Belco and Coda contemplate entering into an Agreement and Plan of
Merger dated as of October 30, 1997 (the "Acquisition Agreement") providing for
the acquisition of Coda by Belco through a merger of a subsidiary of Belco with
and into Coda, with Coda as the surviving corporation (the "Merger").
B. The Shareholder is a holder of stock of Coda ("Coda Stock"), a
holder of options to acquire Coda Stock or both.
C. This Agreement is intended to be executed and delivered
simultaneously with the execution and delivery of the Acquisition Agreement.
NOW, THEREFORE, in consideration of the foregoing premises and the
representations, warranties, covenants and agreements contained herein, the
parties have agreed as follows:
1. The Shareholder hereby represents and warrants to Belco that the
Shareholder (a) is a holder of Coda Stock, holding record and beneficial title
to the outstanding shares of the Coda Stock set forth opposite the Shareholder's
name on Appendix F-1 attached hereto, and/or (b) is the holder of options to
acquire shares of Coda Stock holding record and beneficial title to options to
acquire shares of Coda Stock (the "Coda Option") set forth opposite the
Shareholder's name on Appendix F-1.
2. The Shareholder hereby (i) covenants and agrees to vote all
shares of Coda Stock held by the Shareholder for the Merger at any meeting of
stockholders of Coda held for purposes of acting upon the Merger and (ii) grants
Belco an irrevocable proxy, coupled with an interest, to vote all shares of Coda
Stock held by the Shareholder in favor of the Merger at any meeting of
stockholders of Coda held for purposes of acting upon the Merger; provided that
nothing in this Section 2 shall invalidate any action taken by written consent
of stockholders pursuant to the Stockholders Allocation Agreement attached
hereto as Appendix F-2 (the "Stockholders Allocation Agreement").
3. The Shareholder hereby relinquishes, waives and releases forever,
effective as of the Closing (as defined in the Acquisition Agreement), any and
all rights under Delaware law or otherwise to dissent to the Merger, including
without limitation any and all rights to seek appraisal of the shares of Coda
Stock or to seek consideration for shares of Coda Stock in the
1
Merger other than as provided in the Acquisition Agreement and the Stockholders
Allocation Agreement; provided, however, nothing contained in this Agreement
shall prevent the Shareholder from asserting any and all rights the Shareholder
may have under the Acquisition Agreement and the Stockholders Allocation
Agreement.
4. If the Shareholder holds a Coda Option, the Shareholder hereby
(i) agrees not to exercise any option to acquire Coda Stock pursuant to any Coda
Option the Shareholder may hold, (ii) relinquishes, waives and releases forever,
effective as of the Closing, any and all rights, titles and interests to acquire
shares of Coda Stock, including without limitation any and all rights under any
agreement between Coda and the Shareholder evidencing such option and any and
all rights under the Stockholders Agreement (as hereinafter defined) to acquire
shares of Coda Stock and (iii) agrees to accept the Option Consideration (as
defined and provided for in the Acquisition Agreement) in exchange for the
Shareholder's agreements in clauses (i) and (ii) above in this Paragraph 4;
provided, however, nothing contained in this Agreement shall prevent the
Shareholder from (x) receiving the Option Consideration in exchange for such
options or (y) asserting any and all rights the Shareholder may have under the
Stockholders Allocation Agreement.
5. Coda and the Shareholder, severally and not jointly, represent
and warrant to Belco that each entered into a Stockholders Agreement dated
October 30, 1995, as amended January 10, 1996, among Coda and the shareholders
and optionholders of Coda Stock (as amended, the "Stockholders Agreement").
Coda and the Shareholder hereby covenant and agree that the Stockholders
Agreement shall terminate in accordance with terms of the Stockholders
Allocation Agreement; provided, however, nothing contained in this Agreement
shall prevent the Shareholder from asserting rights under the Stockholders
Allocation Agreement.
6. The Shareholder hereby relinquishes, waives and releases forever,
effective as of the Closing, any and all claims of any kind whatsoever that the
Shareholder may have against Coda or against any Affiliate (as defined in the
Acquisition Agreement) of Coda, except as specifically provided in the
Acquisition Agreement, the Stockholders Allocation Agreement and any
Indemnification Agreement between Coda and the Shareholder, and except for any
written employment agreement between the Shareholder and Coda and written
employee benefit plans of Coda.
7. The Shareholder hereby represents and warrants to Belco that the
Shareholder understands and agrees that (i) Belco would not enter into the
Acquisition Agreement unless this Agreement was fully executed and delivered,
(ii) the actions to be taken by Belco pursuant to the Acquisition Agreement
materially benefit the Shareholder and (iii) no additional consideration shall
be payable to the Shareholder other than Belco executing, delivering and
performing the Acquisition Agreement.
8. The representations, warranties, covenants and agreements made by
the parties hereto shall survive the Closing.
9. The Effective Date shall be the date Belco and Coda execute and
deliver the Acquisition Agreement. This Agreement shall terminate (i) upon the
termination of the
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Acquisition Agreement in accordance with its terms or (ii) upon written
agreement of all parties to this Agreement.
10. Arbitration. Any and all claims, demands, causes of action,
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disputes, controversies and other matters in question arising out of or relating
to this Agreement, the alleged breach thereof, or in any way relating to the
subject matter of this Agreement ("Claims"), even though some or all of such
Claims allegedly are extra contractual in nature, whether such Claims sound in
contract, tort or otherwise, at law or in equity, under state or federal law,
whether provided by statute or the common law, for damages or any other relief,
shall be resolved and decided exclusively by binding arbitration pursuant to the
Federal Arbitration Act in accordance with the Commercial Arbitration Rules then
in effect with the American Arbitration Association. The arbitration proceeding
shall be conducted in Dallas, Texas. The arbitration shall be before a panel of
three arbitrators. The party or parties asserting any claim shall select one
arbitrator, the party or parties against whom such claim is asserted shall
select one arbitrator, and the two arbitrators selected by the parties shall
select the third arbitrator. The arbitrators are authorized to issue subpoenas
for depositions and other discovery mechanisms, as well as trial subpoenas, in
accordance with the Federal Rules of Civil Procedure. Either party may initiate
a proceeding in the appropriate United States District Court to enforce this
provision. This agreement to arbitrate shall be enforceable in either federal or
state court. Judgment upon any award rendered in any such arbitration proceeding
may be entered by any federal or state court having jurisdiction. The
enforcement of this agreement to arbitrate and all procedural aspects of this
agreement to arbitrate, including the construction and interpretation of this
agreement to arbitrate, the scope of the arbitrable issues, allegations of
waiver, delay or defenses to arbitrability, and the rules of governing the
conduct of the arbitration, shall be governed by and construed pursuant to the
Federal Arbitration Act. The arbitrators shall have no authority to award
punitive (including, without limitation, any exemplary damages, treble damages
or any other penalty or punitive type of damages), consequential, incidental or
indirect damages (in tort, contract or otherwise) under any circumstances, the
parties hereto hereby waiving their right, if any, to recover such damages in
connection with any Claims. The arbitrators shall be entitled to award costs of
the arbitration and attorney's fees as they deem appropriate. Prior to any party
instituting a Claim under this Agreement, such party shall provide to the other
parties hereto a written notice specifying the nature and basis of the Claim.
The party that is the subject of any Claim shall be given 30 days to cure any
breach before any Claim is filed. It is further agreed that prior to such Claims
being submitted to the arbitrators on such Claims, the parties to the Claims
shall attempt to resolve such Claims through non-binding mediation of such
Claims for a period not in excess of 30 days commencing after assertion of a
Claim.
11. This Agreement (i) constitutes the entire agreement and
supersedes all other prior agreements and understandings, both written and oral,
among the parties, or any of them, with respect to the subject matter hereof,
(ii) is not intended to confer upon any other person any rights or remedies
hereunder and shall be binding upon and inure to the benefit solely of each
party hereto, and their respective heirs, beneficiaries, personal
representatives, successors and assigns, and (iii) shall be governed in all
respects, including validity, interpretation and effect, by the laws of the
State of Texas (without giving effect to the provisions thereof relating to
conflicts of law).
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This Agreement may be executed in any number of counterparts which together
shall constitute a single agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
effective as of the Effective Date.
BELCO OIL & GAS CORP.
By:
-------------------------------
Name:
Title:
CODA ENERGY, INC.
By:
-------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice Chairman of the Board and
Chief Operating Officer
SHAREHOLDER:
----------------------------------
[Name of Shareholder]
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STOCKHOLDERS ALLOCATION AGREEMENT
DATED OCTOBER 31, 1997
TABLE OF CONTENTS
ARTICLE I CERTAIN TERMS; REPRESENTATIONS AND WARRANTIES................. 1
1.1 Certain Terms................................................. 1
1.2 Representation and Warranties................................. 2
ARTICLE II Allocations, Settlements, Waivers and Terminations............ 3
2.1 Employee Benefit Plan Settlement.............................. 3
2.2 Waiver of Stock Purchase Rights............................... 3
2.3 Waiver of Preferential Purchase Rights........................ 4
2.4 Settlement of Special Management Rights....................... 4
2.5 Termination of Agreements..................................... 4
2.6 Mutual Releases............................................... 4
2.7 Tax Withholding on Option Consideration....................... 4
2.9 Repayment of Indebtedness..................................... 4
2.10 Payments Potentially Subject to Parachute Rules............... 4
2.11 Written Consent of the Stockholder............................ 5
2.12 Attorneys Fees................................................ 5
2.13 JEDI Waiver................................................... 6
ARTICLE III MISCELLANEOUS................................................. 6
3.1 Amendment; Waivers............................................ 6
3.2 Assignment.................................................... 6
3.3 Notices....................................................... 6
3.4 Counterparts.................................................. 7
3.5 Headings...................................................... 7
3.6 Choice of Law................................................. 7
3.7 Entire Agreement.............................................. 7
3.8 Cumulative Rights............................................. 7
3.9 No Partnership................................................ 7
3.10 Number; Gender; Without Limitation; Interpretation
of Certain Defined Terms..................................... 7
3.11 Severability.................................................. 7
3.12 Third Person.................................................. 7
3.13 U.S. Currency................................................. 7
3.14 Indemnification............................................... 8
3.15 Arbitration................................................... 8
3.16 Termination................................................... 8
(i)
STOCKHOLDERS ALLOCATION AGREEMENT
THIS STOCKHOLDERS ALLOCATION AGREEMENT (this "AGREEMENT") is entered into
as of October 31, 1997, among Coda Energy, Inc., a Delaware corporation (the
"CORPORATION"), and the Investors (as defined herein) listed on Schedule 1.1
------------
hereto.
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, concurrently with the execution and delivery of this Agreement,
the Corporation, Belco Oil & Gas Corp., a Nevada corporation ("BELCO"), and
Belco Acquisition Sub, Inc., a Delaware corporation ("SUB"), are entering into
an Agreement and Plan of Merger (the "MERGER AGREEMENT") providing for the
merger of Sub with and into the Corporation (the "MERGER");
WHEREAS, the Corporation and the Investors have previously entered into
that certain Stockholders Agreement, originally entered into as of October 30,
1995, and amended by that certain Amendment No. 1 to Stockholders Agreement,
entered into as of January 10, 1996 (as amended, the "STOCKHOLDERS AGREEMENT");
WHEREAS, in conjunction with the Merger, the parties to this Agreement
desire to agree upon various amounts to be paid or allocated pursuant to the
Stockholders Agreement, waive certain rights afforded under the Stockholders
Agreement and release claims they may have against one another.
NOW, THEREFORE, in consideration of the mutual covenants, payments,
releases and obligations hereinafter set forth, the parties hereto, intending to
be legally bound, hereby agree as follows:
ARTICLE I
CERTAIN TERMS;
REPRESENTATIONS AND WARRANTIES
------------------------------
1.1 CERTAIN TERMS. When used herein the following terms shall have the
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meanings indicated:
"AFFILIATE" of a Person means any Person controlling, controlled by, or
under common control with such Person. For purposes of this Agreement only,
Enron Corp., a Delaware corporation, and each of its subsidiaries shall be
deemed to be Affiliates of JEDI.
"AGREEMENT" shall have the meaning set forth in the opening paragraph.
"CAPITAL STOCK" means any and all shares, interests, participations, or
other equivalents (however designated) of capital stock of a corporation, any
and all similar ownership interests in a Person (other than a corporation), and
any and all warrants, options, or other rights to purchase or acquire any of the
foregoing.
"CLAIMS" shall have the meaning set forth in Section 3.16.
"COMMON STOCK" means shares of the common stock, par value $.01 per share,
of the Corporation.
"COMMON STOCK EQUIVALENTS" means any and all rights, warrants, options,
convertible securities, or exchangeable securities or indebtedness, or other
rights, exercisable for or convertible into or exchangeable for, directly or
indirectly, Common Stock, whether at the time of issuance or upon the passage of
time or the occurrence of some future event, but does not include Common Stock
or the Special Management Rights.
1
"CORPORATION" shall have the meaning set forth in the opening paragraph.
"EMPLOYEE BENEFIT PLAN" shall have the meaning set forth in Section 2.1.
"INDEMNITEES" shall have the meaning set forth in Section 3.14.
"INDEMNITOR" shall have the meaning set forth in Section 3.14.
"INVESTORS" means JEDI and the Management Investors listed on Schedule 1.1.
------------
"JEDI" shall mean Joint Energy Development Investments Limited Partnership,
a Delaware limited partnership.
"MANAGEMENT GROUP" means all of the Management Investors.
"MANAGEMENT INVESTOR" means each of the Persons identified as a Management
Investor on Schedule 1.1 hereto, but excluding any such Person who ceases to be
------------
a Party.
"MERGER" shall have the meaning set forth in the recitals.
"MERGER AGREEMENT" shall have the meaning set forth in the recitals.
"NOTICE" shall have the meaning set forth in Section 3.3.
"PARTY" means each Investor and the Corporation.
"PERSON" means any natural person, corporation, limited partnership,
limited liability company, general partnership, joint stock company, joint
venture, association, company, trust, bank, trust company, land trust, business
trust, or other organization, whether or not a legal entity, and any government
or agency of political subdivision thereof.
"PREFERRED STOCK" means shares of 15% Cumulative Preferred Stock, par value
$0.01 per share, of the Corporation.
"SPECIAL MANAGEMENT RIGHTS" shall have the meaning set forth in Section
2.4.
"SUB" shall have the meaning set forth in the recitals.
1.2 REPRESENTATION AND WARRANTIES. (a) Each of the Investors (as to itself
-----------------------------
or himself only) represents and warrants to the Corporation and other Investors
that as of the date hereof and at the Effective Time (as defined in the Merger
Agreement):
(i) such Investor has full power and authority to execute and deliver
this Agreement and the execution and delivery by such Investor of this
Agreement have been duly authorized by all necessary action;
(ii) this Agreement has been duly and validly executed and delivered
by such Investor and constitutes the binding obligation of such Investor,
enforceable against such Investor in accordance with its terms;
2
(iii) such Investor owns of record and beneficially as of the date of
this Agreement the number of shares of Preferred Stock, Common Stock and
such Common Stock Equivalents as are set forth on Schedule 1.1, and such
------------
Preferred Stock, Common Stock and Common Stock Equivalents are owned by
such Investor free and clear of all liens and other encumbrances arising
by, through or under such Investor except for this Agreement, the
Stockholders Agreement, a Security Agreement, if any, executed by such
Investor in favor of the Corporation (as to each Investor, a "SECURITY
AGREEMENT") and the agreements creating such Common Stock Equivalents; and
(iv) The amounts set forth in this Agreement (including the
attachments hereto) and in Article II of the Merger Agreement with respect
to the Investor represent the total consideration of any kind to be
received by such Investor or any Affiliate thereof pursuant to or in
respect of the Merger.
(b) The Corporation hereby represents and warrants to each Investor that:
(i) it is a corporation duly organized, validly existing, and in good
standing under the laws of the State of Delaware, it has full corporate
power and authority to execute, deliver, and perform this Agreement and to
consummate the transactions contemplated hereby, and the execution,
delivery, and performance by it of this Agreement and the consummation of
the transactions contemplated hereby have been duly authorized by all
necessary action; and
(ii) this Agreement has been duly and validly executed and delivered
by the Corporation and constitutes the binding obligation thereof,
enforceable against the Corporation in accordance with its terms.
ARTICLE II
ALLOCATIONS, SETTLEMENTS, WAIVERS AND TERMINATIONS
--------------------------------------------------
2.1 EMPLOYEE BENEFIT PLAN SETTLEMENT. Sections 2.4 and 6.6 of the
--------------------------------
Stockholders Agreement provide that there shall be contributed to the EMPLOYEE
BENEFIT PLAN (as defined in the Stockholders Agreement) shares of Common Stock,
SPECIAL MANAGEMENT SHARES (as defined in the Stockholders Agreement) or cash
paid in lieu thereof. In lieu of the implementation of the Employee Benefit
Plan, the Corporation and the Investors hereby agree that there shall be paid by
JEDI to the Corporation, as a capital contribution immediately prior to the
Merger, $1,070,942.01 to be distributed as a performance bonus by the
Corporation (less applicable tax withholding) to those persons to be determined
by the Management Group prior to the Merger and identified in writing to the
Corporation. This payment will be made by wire transfer of immediately available
funds on the Effective Date. The Corporation shall immediately distribute such
funds to those persons and in the amounts set forth in the notice from the
Management Group referenced in the immediately preceding sentence. The cash
payment provided for in this Section 2.1 shall constitute a complete settlement
of the obligations set forth in Sections 2.4 and 6.6 of the Stockholders
Agreement.
2.2 WAIVER OF STOCK PURCHASE RIGHTS. Section 3.1 of the Stockholders
-------------------------------
Agreement provides for certain share purchase rights in the event of an issuance
of Capital Stock by the Corporation. The Investors hereby waive any and all
rights they may have under said Section 3.1 to acquire any Capital Stock issued
or issuable in connection with the Merger.
2.3 WAIVER OF PREFERENTIAL PURCHASE RIGHTS. Section 4.3 of the
--------------------------------------
Stockholders Agreement provides for certain preferential rights on the part of
the Investors. The Investors hereby waive any and all rights they may have under
said Section 4.3 in connection with the Merger.
3
2.4 SETTLEMENT OF SPECIAL MANAGEMENT RIGHTS. The Investors acknowledge
---------------------------------------
that the Merger constitutes a Trigger Event (as defined in the Stockholders
Agreement) under Article VI of the Stockholders Agreement. Accordingly, each
Management Investor would be entitled to a cash payout on his Special Management
Rights (as defined in the Stockholders Agreement) as set forth in Article VI of
the Stockholders Agreement. In full and complete payment of any amounts owed to
the Management Investors under Article VI of the Stockholders Agreement, and
notwithstanding any term or calculation set forth in said Article VI to the
contrary, each Management Investor agrees to accept, and JEDI promises to pay to
the Corporation (for the benefit of and distribution to each Management
Investor), as a capital contribution immediately prior to the Merger, the cash
payout on his Special Management Rights set forth opposite his name on Schedule
--------
1.1 hereto under the column headed "Special Management Rights Payment" found
---
under either the heading "Assuming Taurus is Sold for $45 Million" or the
heading "Assuming Taurus is Not Sold," as applicable; provided, however, that if
Taurus is sold prior to the Effective Time for less than $45.0 million, the
Special Management Rights Payment to be made by JEDI hereunder shall equal
$25,702,607, in the aggregate, less the aggregate Common Stock Consideration and
aggregate Option Consideration (as such terms are defined in the Merger
Agreement) received by the Management Group pursuant to the Merger Agreement to
be allocated among the Management Group proportionately in the same manner as
reflected on Schedule 1.1. This payment shall be made by wire transfer of
------------
immediately available funds on the Effective Time. The Corporation shall
immediately distribute such funds by wire transfer of immediately available
funds to those persons and in the amounts described on Schedule 1.1 hereto as it
------------
may be adjusted by the Corporation prior to the Effective Time to reflect the
sale of Taurus for less than $45 million. The Investors further agree that,
conditioned upon consummation of the Merger, the daily accrual provided in
Section 6.4 of the Stockholders Agreement shall end on the earlier of the date
of the Effective Time or November 30, 1997. Upon receipt of the Special
Management Rights, each Management Investor shall pay to the Corporation all
applicable tax withholding in accordance with the Corporation's written
notification delivered prior to the Effective Time.
2.5 TERMINATION OF AGREEMENTS. Effective as of the Effective Time, the
-------------------------
Stockholders Agreement and the Business Opportunity Agreement, entered into as
of October 30, 1995, among the Investors and certain other parties thereto shall
be terminated without any further effect.
2.6 MUTUAL RELEASES. Each party hereto shall execute and deliver at the
---------------
Merger closing a release in the form of Exhibit A attached to this Agreement.
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2.7 TAX WITHHOLDING ON OPTION CONSIDERATION. Upon receipt of the Option
---------------------------------------
Consideration (as defined in the Merger Agreement) each Management Investor
shall pay to the Corporation all applicable tax withholding thereon in
accordance with the Corporation's written notification delivered prior to the
Effective Time.
2.8. NO AMENDMENT, MODIFICATION OR WAIVER. Other than as expressly set
------------------------------------
forth in this Agreement, this Agreement does not in any way modify, amend or
waive any provision of the Stockholders Agreement, and all other provisions of
the Stockholders Agreement shall remain in full force and effect until
terminated in accordance with Section 2.5 hereof.
-----------
2.9 REPAYMENT OF INDEBTEDNESS. All indebtedness of an Investor owed to
-------------------------
the Corporation (as set forth on Schedule 2.9 hereto) shall be repaid in full at
------------
the Effective Time.
2.10 PAYMENTS POTENTIALLY SUBJECT TO PARACHUTE RULES. Simultaneously with
-----------------------------------------------
this Agreement, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ("▇▇▇▇▇▇") and the Corporation are executing
and entering into that certain Amendment to Executive Employment Agreement, to
be effective as of the Effective Time. Pursuant to such Amendment, the
Corporation will make payment to ▇▇▇▇▇▇ at the Effective Time in the amount of
$1,123,875.57. All or a portion of the payments described in Sections 2.1, 2.4,
2.7 and 2.10 and the schedules attached hereto, when
4
combined with other payments occurring in connection with the change in the
ownership or control of the Corporation, could be considered an "EXCESS
PARACHUTE PAYMENT" under Internal Revenue Code ("IRC") section 280G. If any of
these payments are considered to be excess parachute payments, then the
Corporation will lose the corporate tax deduction related to any payments in
excess of the "BASE AMOUNT" under the IRC. In addition, any individual receiving
payments considered to be an excess parachute payment, must pay a 20% excise tax
under IRS section 4999(a) on any amounts deemed excess parachute payments.
Payments will not constitute parachute payments, if the payments are approved by
the stockholders of the Corporation who before the change in ownership or
control owned 75% or more of the Corporation's stock, and this Agreement is
intended, among other things, to evidence such approval.
2.11 WRITTEN CONSENT OF THE STOCKHOLDER. The undersigned, if a holder of
----------------------------------
the issued and outstanding shares of Common Stock or Preferred Stock, does
hereby, pursuant to the authority contained in Section 228 of the Delaware
General Corporation Law and the Corporation's Bylaws, consent to, authorize and
adopt the following actions with the same force and effect as if taken at a
meeting of the stockholders of the Corporation, duly convened and held on this
date pursuant to valid notice (notice being waived hereby):
(i) the execution and delivery by any authorized officer of the
Corporation for and on behalf of the Corporation of the Merger Agreement is
hereby ratified, confirmed and approved as the valid, binding and
enforceable action of the Corporation and all terms, provisions and
conditions of the Merger Agreement are hereby approved and adopted;
(ii) the merger of the Corporation with Belco Acquisition Sub, Inc.,
upon and subject to the terms and conditions of the Merger Agreement, all
as more fully set forth therein, is hereby approved and adopted;
(iii) the Merger Agreement constitutes an agreement of merger as
contemplated by Section 251 of the Delaware General Corporation Law;
(iv) the Corporation shall carry out the terms and provisions of the
Merger Agreement and to enter into, execute, perform and carry out all
other agreements, instruments, documents and certificates to be executed
and delivered by the Corporation pursuant to or required or contemplated by
the Merger Agreement; and
(v) the payments described in Sections 2.1, 2.4, 2.7 and 2.10 and the
schedules attached hereto are hereby ratified, confirmed and approved in
all respects, including, but not limited to, those approvals contemplated
under the IRC section 280G.
The undersigned acknowledges and agrees that by virtue of his or its
execution of this Agreement in connection with the merger of the Corporation
authorized above, the undersigned's rights to an appraisal by a court of the
fair value of his or its stock in the Corporation pursuant to Section 262 of the
Delaware General Corporation Law are hereby irrevocably waived.
2.12 ATTORNEYS FEES. JEDI shall pay at Closing of the Merger Agreement
--------------
the fees and expenses of ▇▇▇▇▇▇ and ▇▇▇▇▇, LLP (billed or incurred in its
capacity as counsel to the Corporation in respect of the Merger Agreement) in
excess of the amount to be reimbursed by Belco pursuant to Section 11.3 of the
Merger Agreement.
2.13 JEDI WAIVER. Conditioned upon consummation of the Merger, JEDI and
-----------
the Corporation hereby waive compliance with the redemption obligations set
forth in Article IV, Section 2(a)(3) of the Corporation's Restated Certificate
of Incorporation.
5
ARTICLE III
MISCELLANEOUS
-------------
3.1 AMENDMENT; WAIVERS. This Agreement may only be altered, supplemented,
------------------
amended or waived by the written consent of each party to this Agreement;
provided, however, (i) any Party may (without the consent of any other Person)
waive, in writing, any obligation owed to it hereunder by any other Party or the
Corporation, and (ii) any Party may (without the consent of any other Person)
waive, in writing, any right it has hereunder. Any waiver permitted hereunder
may be made prospectively or retroactively.
3.2 ASSIGNMENT. This Agreement is not assignable.
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3.3 NOTICES. Any and all notices, designations, consents, offers,
-------
acceptances, or other communications provided for herein (each a "NOTICE") shall
be given in writing by personal delivery, overnight courier, or telecopy which
shall be addressed, or sent, to the respective addresses or telecopy numbers as
follows (or such other address or telecopy number as the Corporation or any
Party may specify for itself to the Corporation and all other Parties by
Notice):
The Corporation: Coda Energy, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
Telecopy No. ▇▇▇-▇▇▇-▇▇▇▇
Telephone No. ▇▇▇-▇▇▇-▇▇▇▇
With a copy to: Enron Corp.
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Telecopy No. ▇▇▇-▇▇▇-▇▇▇▇
Telephone No. ▇▇▇-▇▇▇-▇▇▇▇
and:
▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Telecopy No. ▇▇▇-▇▇▇-▇▇▇▇ (▇▇▇▇▇▇▇▇▇)
▇▇▇-▇▇▇-▇▇▇▇ (▇▇▇▇▇▇▇)
Each Party: To such address or telecopy number of such Party as is set
forth on Schedule 1.1 hereto.
------------
All Notices shall be deemed effective, delivered and received (a) if given by
personal delivery, when such Notice is personally delivered at the address
specified above; (b) if given by telecopy, when such telecopy is transmitted to
the telecopy number specified above and receipt thereof is confirmed; or (c) if
given by overnight courier, on the business day immediately following the day on
which such Notice is delivered to a reputable overnight courier service.
6
3.4 COUNTERPARTS. This Agreement may be executed in two or more
------------
counterparts and each counterpart shall be deemed to be an original and which
counterparts together shall constitute one and the same agreement of the parties
hereto.
3.5 HEADINGS. Headings contained in this Agreement are inserted only as a
--------
matter of convenience and in no way define, limit, or extend the scope or intent
of this Agreement or any provisions hereof.
3.6 CHOICE OF LAW. This Agreement shall be governed by the internal laws
-------------
of the State of Texas without regard to the principles of conflicts of laws
thereof.
3.7 ENTIRE AGREEMENT. This Agreement contains the entire understanding of
----------------
the parties hereto respecting the subject matter hereof and supersedes all prior
agreements, discussions and understandings with respect thereto.
3.8 CUMULATIVE RIGHTS. The rights of the Parties and the Corporation
-----------------
under this Agreement are cumulative and in addition to all similar and other
rights of the Parties and the Corporation under other agreements.
3.9 NO PARTNERSHIP. No term of provision of this Agreement shall be
--------------
construed to establish any relationship of partnership, agency or joint venture
between the Parties hereto.
3.10 NUMBER; GENDER; WITHOUT LIMITATION; INTERPRETATION OF CERTAIN
-------------------------------------------------------------
DEFINED TERMS. Pronouns, wherever used in this Agreement, and of whatever
-------------
gender, shall include Persons of every kind and character, and the singular
shall include the plural whenever and as often as may be appropriate. Any
reference herein to "including" and words of similar import refer to "including
without limitation." When reference is made herein to specified Parties or
Persons, the determination as to which Persons are thereby referenced shall be
made as of the time in question. Unless the context otherwise requires, any
reference herein to "or" shall also include "and," so that "A or B" shall
include the possibilities of A, B, and A and B.
3.11 SEVERABILITY. In the event any one or more of the provisions
------------
contained in this Agreement should be held invalid, illegal or unenforceable in
any respect, the validity, legality and enforceability of the remaining
provisions contained herein shall not in any way be affected or impaired
thereby. The parties hereto shall endeavor in good-faith negotiations to
replace the invalid, illegal or unenforceable provisions with valid provisions,
the economic effect of which approximates as nearly as possible that of the
invalid, illegal or unenforceable provisions.
3.12 THIRD PERSON. Nothing herein expressed or implied is intended or
------------
shall be construed to confer upon or to give any Person not a party hereto any
rights or remedies under or by reason of this Agreement.
3.13 U.S. CURRENCY. All payments required or permitted hereunder shall
-------------
be paid in U.S. dollars or other lawful currency constituting legal tender of
the United States of America.
3.14 INDEMNIFICATION. Each Party and the Corporation (the "INDEMNITOR")
---------------
hereby agrees to protect, defend, indemnify and hold harmless all other Parties
and their respective successors, heirs and assigns (the "INDEMNITEES") against
any and all claims, lawsuits, damages and other liabilities and expenses
(including reasonable attorneys' fees) suffered or incurred by any of the
Indemnitees and which arise out of any breach by the Indemnitor of its
representations, warranties, covenants or other obligations hereunder.
7
3.15 ARBITRATION. Any and all claims, demands, causes of action,
-----------
disputes, controversies and other matters in question arising out of or relating
to this Agreement, the alleged breach thereof, or in any way relating to the
subject matter of this Agreement ("CLAIMS"), even though some or all of such
Claims allegedly are extracontractual in nature, whether such Claims sound in
contract, tort or otherwise, at law or in equity, under state or federal law,
whether provided by statute or the common law, for damages or any other relief,
shall be resolved and decided exclusively by binding arbitration pursuant to the
Federal Arbitration Act in accordance with the Commercial Arbitration Rules then
in effect with the American Arbitration Association. The arbitration proceeding
shall be conducted in Dallas, Texas. The arbitration shall be before a panel of
three arbitrators. Each party to such dispute shall select one arbitrator (with
all Management Investors parties to the dispute considered to be one party) and
the two arbitrators selected by the parties shall select the third arbitrator.
The arbitrators are authorized to issue subpoenas for depositions and other
discovery mechanisms, as well as trial subpoenas, in accordance with the Federal
Rules of Civil Procedure. Either party may initiate a proceeding in the
appropriate United States District Court to enforce this provision. This
agreement to arbitrate shall be enforceable in either federal or state court.
Judgment upon any award rendered in any such arbitration proceeding may be
entered by any federal or state court having jurisdiction. The enforcement of
this agreement to arbitrate and all procedural aspects of this agreement to
arbitrate, including the construction and interpretation of this agreement to
arbitrate, the scope of the arbitrable issues, allegations of waiver, delay or
defenses to arbitrability, and the rules governing the conduct of the
arbitration, shall be governed by and construed pursuant to the Federal
Arbitration Act. The arbitrators shall have no authority to award punitive
(including without limitation any exemplary damages, treble damages, or any
other penalty or punitive type of damages), consequential, incidental or
indirect damages (in tort, contract or otherwise) under any circumstances. The
parties hereto hereby waive their right, if any, to recover such damages in
connection with any Claims. The arbitrators shall be entitled to award costs of
the arbitration and attorney's fees as they deem appropriate. Prior to the
institution of a Claim under this Agreement by any Person, such Person shall
provide to the Corporation and all other Parties to this Agreement a written
notice specifying the nature and basis of the Claim. The Persons who are the
subject of any Claim shall be given thirty (30) days to cure any breach before
any Claim is filed. It is further agreed that prior to such Claims being
submitted to the arbitrators on such Claims, the parties to the Claims shall
attempt to resolve such Claims through non-binding mediation of such Claims
provided that such mediation period shall not exceed 30 days from the date such
Claim is asserted.
3.16 TERMINATION. This Agreement shall terminate (i) upon termination of
-----------
the Merger Agreement in accordance with its terms or (ii) upon written agreement
of all the Parties to this Agreement.
* * * * *
8
IN WITNESS WHEREOF, the parties hereby have executed this Agreement as of
the date first above written.
CODA ENERGY, INC.
By:
--------------------------------------
Name:
------------------------------------
Title:
-----------------------------------
JOINT ENERGY DEVELOPMENT
INVESTMENTS LIMITED PARTNERSHIP
By: Enron Capital Management Limited
Partnership, its general partner
By: Enron Capital Corp., its general
partner
By:
--------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Agent and Attorney-in-Fact
MANAGEMENT INVESTORS:
-----------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
-----------------------------------------
▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------------------------
J. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-----------------------------------------
▇.▇. ▇▇▇▇▇▇▇
-----------------------------------------
▇▇▇ ▇. ▇▇▇▇▇▇
9
-----------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-----------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------------
▇. ▇. ▇▇▇▇▇▇▇, III
-----------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
10
Exhibit A
RELEASE
--------
In consideration of the actions to be taken pursuant to that certain
Agreement and Plan of Merger dated as of October 31, 1997 (the "AGREEMENT") by
and among Belco Oil & Gas Corp., Belco Acquisition Sub, Inc. and Coda Energy,
Inc. (the "COMPANY"), and the Stockholders Allocation Agreement, dated as of
October 31, 1997, among the parties referenced therein, each of the individuals
and entities listed on the signature pages of this Release (each such individual
and entity, the "RELEASOR"), on behalf of the Releasor and the heirs,
beneficiaries, personal representatives, successors and assigns of the Releasor
(collectively, the "RELEASOR PARTIES"), for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, hereby releases and
discharges (i) the Company and the parents, subsidiaries and affiliated
corporations, past and present, of the Company (the "COMPANY AFFILIATES") with
respect to periods prior to the Closing (as defined in the Agreement), (ii) the
directors, officers, partners, agents and employees, past and present, of the
Company and the Company Affiliates in their capacities as directors, officers,
partners, agents and employees, and (iii) each other Releasor and the heirs,
beneficiaries, personal representatives, successors and assigns of each such
other Releasor, including with respect to Joint Energy Development Investments
Limited Partnership ("JEDI"), the parents, subsidiaries and affiliated
corporations, past and present, of JEDI (the "JEDI AFFILIATES") with respect to
periods prior to the Closing, and the directors, officers, partners, agents and
employees of JEDI and the JEDI Affiliates (all such released individuals and
entities referenced in clauses (i), (ii) and (iii), the "RELEASED PARTIES") from
any and all actions, causes of actions, suits, debts, dues, sums of money,
accounts, reckonings, bonds, bills, specialties, covenants, contracts,
controversies, agreements, promises, variances, trespasses, damages, judgments,
extents, executions, claims, and demands whatsoever, whether known or unknown,
in law, admiralty, equity or otherwise, that any one or more of the Releasor
Parties ever had, now has or hereafter can, shall or may have against any one
Exhibit A
or more of the Released Parties, for, upon or by reason of any matter, cause or
thing whatsoever occurring on or prior to the date of this Release relating to
the Company or any of the Company Affiliates (such actions, causes of actions,
suits, etc. collectively, "CLAIMS"), except for Claims arising out of
obligations expressly granted or continued pursuant to the terms of (i) the
Agreement and (ii) the documents listed on Exhibit A.
---------
Each Releasor represents and warrants that it has made no assignment or
other transfer of any interest in any of the Claims released hereby to any other
party or person and that it shall file no legal action or other proceeding nor
shall it take any other action that causes any other party or person to assert
said released Claims against any other party to this Release.
Each Releasor hereby acknowledges that (i) such Releasor (other than the
Company) has not been represented by ▇▇▇▇▇▇ and ▇▇▇▇▇, LLP or any other counsel
or advisors engaged by the Company in connection with this Release or any other
agreements or issues related to the transactions contemplated in the Agreement,
(ii) such Releasor has had sufficient time and opportunity to review this
Release and all other agreements related to the transactions contemplated in the
Agreement and (iii) such Releasor has had the opportunity to engage and consult
with separate counsel and advisors in connection with this Release and all other
agreements or issues related to the transactions contemplated in the Agreement.
Whenever the text hereof requires, the use of singular number shall include
the appropriate plural number.
This RELEASE may not be changed orally.
This RELEASE may be executed in several counterparts, each of which when
fully executed shall constitute but one and the same instrument.
* * * * *
-2-
Exhibit A
IN WITNESS WHEREOF, each Releasor has caused this Release to be executed
and delivered on this, the ____________ day of ______________, 1997.
RELEASORS:
Joint Energy Development Investments
Limited Partnership
By: Enron Capital Management Limited
Partnership, its general partner
By: Enron Capital Corp.,
its general partner
By:
-----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Agent and Attorney-in-Fact
Coda Energy, Inc.
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
--------------------------------------
▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-3-
Exhibit A
--------------------------------------
J. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
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▇. ▇. ▇▇▇▇▇▇▇
--------------------------------------
▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
--------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-4-
Exhibit A
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇. ▇. ▇▇▇▇▇▇▇, III
--------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-5-
Exhibit A
EXHIBIT A TO RELEASE
1. Stockholders Allocation Agreement, dated October 31, 1997
2. Shareholders Agreement, dated October 31, 1997
3. Each individual Releasor's Employment Agreement, if any, with the Company,
as it may have been amended
4. Director or Officer Indemnity Agreements between Coda Energy, Inc. and
certain Officers and Directors of Coda Energy, Inc.
5. Written employment plans of Coda Energy, Inc.
6. JEDI Agreement, dated October 31, 1997.
7. Such definitive agreements as may be entered into pursuant to Section 2 of
the JEDI Agreement.
-6-
