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EXHIBIT 99.1
XXXXXX/MGPX OIL & GAS LEASE ACQUISITION AGREEMENT
THIS AGREEMENT, by and between Xxxxxx Exploration, Inc., a Texas
Corporation (hereinafter referred to as "Xxxxxx"); Xxxxxx-Texas Properties,
Inc., a Texas Corporation (hereinafter referred to as "Nominee") and MGPX
Ventures, Inc. (hereinafter referred to as MGPX), a Nevada Corporation. Xxxxxx
and MGPX are sometimes hereinafter referred to individually as a "Party" and
collectively as the "Parties".
RECITALS
WHEREAS, Xxxxxx is engaged in the business of exploring for oil and gas;
producing oil and gas; assembling prospects for the exploration of oil and gas,
developing oil and gas properties and purchasing producing oil and gas
properties in the State of Texas; and
WHEREAS, Xxxxxx and MGPX desire to participate in a joint effort to acquire
Leasehold Interest in the name of Nominee for the benefit of Xxxxxx and MGPX
within an Area of Interest as hereinafter set forth; and
WHEREAS, it is expected that initial exploration of such Leasehold Interest will
be conducted by third parties and primarily with capital provided by such third
parties pursuant to exploration agreements entered into by and between Nominee
and third parties. The exploration agreements will attempt to retain or acquire
an interest in the results of such exploration efforts; and
WHEREAS, in accordance with the terms and conditions herein, the parties may
elect to participate in the exploration drilling; and
WHEREAS, Xxxxxx and Nominee are willing to act on behalf of the parties hereto
in furtherance of the purposes and intent of this Agreement and to use their
best efforts to acquire Leasehold Interest in promising Prospects in accordance
with the terms and conditions of this Agreement for the benefit of the Parties;
and
WHEREAS, MGPX is willing to have Xxxxxx and Nominee act on behalf of the Parties
and is willing to provide capital to be expended for the acquisition of
Leasehold Interest, related geophysical costs and other costs as stated
hereinafter, in furtherance of the purposes and intent of this Agreement;
provided MGPX shall be entitled to a return of its invested capital as provided
for under the terms of this Agreement; and
WHEREAS, the business of this Agreement shall be carried out in the name of
Nominee and legal title to all Leasehold Interest acquired and held for the
benefit of Xxxxxx and MGPX shall be in the name of Nominee.
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NOW, THEREFORE, in consideration of the premises, mutual covenants and
agreements herein contained, the Parties agree as follows:
ARTICLE I
DEFINITIONS
1.1 As used in this agreement, the following terms have the
meanings ascribed:
(a) "Agreement" means this Xxxxxx/MGPX Oil & Gas Lease
Acquisition Agreement between Xxxxxx and MGPX.
(b) "Leasehold Interests" means any seismic option; oil,
gas or mineral lease or interest therein; fee
interest; unleased mineral interest or other oil, gas
or mineral right acquired by the Parties hereto
pursuant to this Agreement, including any such lease,
right or interest acquired or subject to acquisition
by the Parties under the terms of any farmout
agreement, lease purchase agreement, assignment from
third parties, option or any other type of agreement.
(c) "Acquisition Account" means the bank account or
accounts maintained by Xxxxxx pursuant to this
Agreement.
(d) "Prospect Acquisition Costs" means (i) costs of
acquiring Leasehold Interest, including but not
limited to lease bonuses, bank draft charges,
consultants and/or independent contractors, brokerage
fees, professional services, title examination, title
curative, petroleum data services and other expenses;
(ii) Leasehold Interest maintenance costs, including
but not limited to records maintenance, annual delay
rentals and bank charges; (iii) costs of attorney's
fees in connection with the acquisition and/or sale
of Leasehold Interest; (iv) geophysical costs and
expenses, including but not limited to the
acquisition of data, fees and expenses of consultants
or independent contractors performing geophysical
services and all brokerage fees; (v) cost of
geological fees and expenses paid by Xxxxxx to
geological consultants and (vi) marketing costs
related to the sale of a Leasehold Interest,
including but not limited to reproduction, drafting,
travel and all out of pocket expenses.
(e) "Acquisition Commitment" means the maximum amount
committed by MGPX for Acquisition Costs shall not
exceed $3,000,000.00 without the express written
consent of MGPX.
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(f) "Xxxxxx Overhead Cost" means $25,000.00 monthly
general and administrative expenses. The Xxxxxx
Overhead Cost will be allocated per diem on a
Prospect by Prospect basis with the allocation for
each Prospect beginning on the date a Prospect is
funded per the terms of this Agreement with the
allocation ceasing on the date a subsequent Prospect
is funded per the terms of this Agreement.
(g) "Area of Interest" means the Railroad Commission of
Texas Onshore Districts 1, 2, 3 and 4.
(h) "MGPX Acquisition Contributions" means payment made
by MGPX into the Acquisition Account upon the request
of Xxxxxx with MGPX's approval.
(i) "Prospect Sales Proceeds" means the cash
consideration paid by a third party for the
acquisition of a Prospect that was acquired with
funds from the Acquisition Account.
(j) "Prospect Payout" means when Prospect Sales Proceeds
equals the total of Prospect Acquisition Cost and
Xxxxxx Overhead Cost allocated per this Agreement to
the Prospect.
(k) "Prospect" means a specific geographic area within
the Area of Interest believed by Xxxxxx to have the
potential to produce oil and gas.
(l) "Payout Deficit" means when Prospect Sales Proceeds
are less than the total of Prospect Acquisition Cost
and Xxxxxx Overhead Cost allocated per this Agreement
to the Prospect plus any unrecovered Prospect
Acquisition Cost and Xxxxxx Overhead Cost from
Prospects approved and funded prior to the date of
approval and funding of the Prospect being sold.
(m) "Effective Date" means September 1, 1999.
(n) "Xxxxxx Incentive" means the difference between
Prospect Sales Proceeds and the sum of Prospect
Payout plus any unrecovered Prospect Acquisition Cost
and Xxxxxx Overhead Cost from Prospects approved and
funded prior to the date of approval and funding of
the Prospect being sold.
(o) "Promotional Interest" means any overriding royalty
interest, casing point
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carried working interest, back in after payout
working interest, production payment or any other
form of Leasehold Interest retained by Xxxxxx in the
sale of a Prospect to a third party.
(p) "Payback Point" means the point when Xxxxxx has sold
a Prospect to any party and the Prospect Sales
Proceeds are equal to Prospect Payout plus any
unrecovered Prospect Acquisition Cost and Xxxxxx
Overhead Cost from Prospects approved and funded
prior to the date of approval and
funding of the Prospect being sold.
ARTICLE II
PURPOSE
2.1 This Agreement is entered into for the purpose of generating
Prospects within the Area of Interest; evaluating and
acquiring Leasehold Interest within the Prospects, achieving
Payback Point and causing the initial exploration of the
Leasehold Interest acquired within Prospects to be conducted
by third parties with third party capital; however, both MGPX
and Xxxxxx shall have the right to purchase Prospects
generated, approved and funded under this Agreement. The
Parties will retain a Leasehold Interest in the results of
such initial exploration and any additional development of the
Prospects. Xxxxxx will for the benefit of the Parties use its
best efforts to locate and designate Prospects, acquire
Leasehold Interest within the Prospect area, achieve Payback
Point and arrange for the initial exploration of the Leasehold
Interests within a Prospect by third parties.
ARTICLE III
TERM
3.1 This Agreement shall remain in force and effect from the
Effective Date through August 31, 2002. It is agreed and
understood that either Party to this Agreement may terminate
this Agreement by giving one hundred and eighty (180) days
written notice to the other Party. In such event, this
Agreement shall expire one hundred eighty (180) days from
receipt of said notice by the other Party.
ARTICLE IV
ACQUISITION ACCOUNT
4.1 MGPX will contribute such amounts as Xxxxxx may request to be
used by Xxxxxx to cover Prospect Acquisition Costs; provided,
however MGPX shall have no
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obligation to make such contribution over and above the
$3,000,000.00 Acquisition Commitment.
4.2 Upon the execution of this Agreement, Xxxxxx shall establish
an Acquisition Account with a bank that is a member of the
Federal Deposit Insurance Corporation for purposes of
receiving payments or making disbursements in accordance with
this Agreement. MGPX shall have the authority to withdraw
funds from such account in accordance with Section 4.5. All
Prospect Acquisition Costs shall be paid with funds from the
Acquisition Account.
4.3 At any time after presentation of a Prospect to MGPX pursuant
to Section 6.4, Xxxxxx may request MGPX deposit funds into the
Acquisition Account in order for Xxxxxx to utilize those funds
for Prospect Acquisition Costs related to such Prospect.
Xxxxxx shall make such request in writing and MGPX shall,
within five (5) days of receipt of such notice, approve or
reject the request. If MGPX rejects the request the Prospect
will no longer be subject to this Agreement. If Xxxxxx does
not receive a reply within five (5) days it shall be deemed
MGPX rejected the request and the Prospect will no longer be
subject to this Agreement. If MGPX approves such request, MGPX
shall deposit or transfer the requested funds into the
Acquisition Account within three (3) banking days of such
approval. If the funds are not deposited or transferred within
three (3) banking days of approval it shall be deemed MGPX
rejected the request and the Prospect will no longer be
subject to this Agreement.
4.4 In consideration for Xxxxxx generating and submitting
Prospects to MGPX, MGPX agrees to fund the Acquisition Account
with Xxxxxx Overhead Cost on a monthly basis during the term
of this Agreement. MGPX will fund the Xxxxxx Overhead Cost on
the Effective Date of this Agreement and monthly thereafter on
or before the first of each month. In the event MGPX fails to
fund the Xxxxxx Overhead Cost this Agreement shall terminate
within thirty (30) days from receipt of written notice by MGPX
of such failure to fund the Xxxxxx Overhead Cost; unless, MGPX
remedies the default in payment of Xxxxxx Overhead Cost within
the thirty (30) days written notice period.
4.5 All funds in the Acquisition Account shall be held by Xxxxxx
in trust for MGPX; save and except, Xxxxxx Overhead Cost and
Xxxxxx Incentive. The funds in the Acquisition Account shall
only be disbursed to satisfy Prospect Acquisition Cost in
accordance with the terms of this Agreement, to return funds
to MGPX, to pay Xxxxxx Overhead Cost or to disburse Xxxxxx
Incentive.
4.6 Upon termination of this Agreement for any reason, all funds
deposited in the Acquisition Account and all interest accrued
shall be returned to MGPX as of the date of such termination.
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ARTICLE V
PROSPECT SALES AND INTEREST OF THE PARTIES
5.1 As one of the purposes of this Agreement is to sell Leasehold
Interest in Prospects to third parties under certain terms and
conditions; Xxxxxx shall not sell, assign, transfer, trade or
otherwise dispose of a Leasehold Interest unless MGPX has
approved the general terms and conditions of the sale. If the
Parties determine it is in the best interest of the Parties to
accept an offer by a third party to participate in a Prospect
generated by Xxxxxx, Xxxxxx may enter into an exploration
agreement for the Prospect with the third party that reflects
the approved terms of the trade.
5.2 The Parties agree ownership of the Promotional Interest
retained from the sale of a Prospect to a third party shall be
as follows.
Xxxxxx - 50%
MGPX - 50%
5.3 The Parties agree ownership of the Xxxxxx Incentive shall be
as follows.
Xxxxxx - 100%
MGPX - 0%
5.4 The Parties agree that in the event a Prospect sale to a third
party occurs and Payback Point does not occur and there is a
Payout Deficit the ownership of the Prospect Sales Proceeds
shall be as follows.
Xxxxxx - 0%
MGPX - 100%
5.5 The Parties agree that in the event MGPX purchases a Prospect
or a portion thereof generated, approved and funded under this
Agreement that is greater than a depth of 7,500 feet below the
surface of the Earth, it will be considered that Payback Point
has been reached proportionately and the amount of the Xxxxxx
Incentive shall be $75,000.00 proportionately reduced. In the
event Xxxxxx purchases a Prospect generated, approved and
funded under this Agreement that is greater than a depth of
7,500 feet below the surface of the Earth, the cash
consideration Xxxxxx shall pay for the Prospect shall be
Payback Point proportionately reduced to the interest
purchased.
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5.6 In the event MGPX and/or Xxxxxx purchases a Prospect
generated, approved and funded under this Agreement that is
greater than a depth of 7,500 feet below the surface of the
Earth; the Parties will retain a Promotional Interest in the
Prospect in the form of a two percent (2%) of 8/8ths
overriding royalty interest for all leases with a net revenue
interest greater than seventy-five percent (75%) or a one
percent (1%) of 8/8ths overriding royalty interest for all
leases with a net revenue interest less than or equal to
seventy-five percent (75%) and a twenty five percent (25%)
back in after payout working interest. Payout means the point
in time when MGPX's and/or Xxxxxx'x interest in cumulative
revenues from production from the Prospect, after deducting
applicable royalties, overriding royalties which are not
solely the burden of MGPX and/or Xxxxxx, the Parties
overriding royalty, shut-in payments, delay rentals,
non-participating royalties and/or mineral interests and/or
any other similar burdens attributable to MGPX's and/or
Xxxxxx'x interest, production taxes and other taxes (excluding
income taxes), shall first equal the sum of (a) 100% of the
costs and expenses incurred in drilling, testing, completing,
equipping and operating the first two xxxxx drilled on the
Prospect, (b) the Xxxxxx Incentive (c) Prospect Acquisition
Costs and (d) any unrecovered Prospect Acquisition Cost and
Xxxxxx Overhead Cost from Prospects approved and funded prior
to the date of approval and funding of the Prospect purchased
by MGPX and/or Xxxxxx. The Promotional Interest will be owned
as follows.
Xxxxxx - 50%
MGPX - 50%
5.7 The Parties agree that in the event MGPX purchases a Prospect
or any portion thereof generated, approved and funded under
this Agreement that is less than a depth of 7,500 feet below
the surface of the Earth, it will be considered that Prospect
Payout has been reached proportionately reduced to the
interest purchased and the amount of the Xxxxxx Incentive
shall be $20,000.00 proportionately reduced to the interest
purchased. In the event Xxxxxx purchases a Prospect generated,
approved and funded under this Agreement that is less than a
depth of 7,500 feet below the surface of the Earth, the cash
consideration Xxxxxx shall pay for the Prospect shall be
Prospect Payout proportionately reduced to the interest
purchased.
5.8 In the event MGPX and/or Xxxxxx purchases a Prospect
generated, approved and funded under this Agreement that is
less than a depth of 7,500 feet below the surface of the
Earth; the Parties will retain a Promotional Interest in the
Prospect in the form of a two percent (2%) of 8/8ths
overriding royalty interest for all leases with a net revenue
interest greater than seventy-five percent (75%) or a one
percent (1%) of 8/8ths overriding royalty interest for all
leases with a net revenue interest less than or equal to
seventy-five percent (75%) and a twenty percent (20%) back in
after payout working interest. Payout means the point in time
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when MGPX's and/or Xxxxxx'x interest in cumulative revenues
from production from the Prospect, after deducting applicable
royalties, overriding royalties which are not solely the
burden of MGPX and/or Xxxxxx, the Parties overriding royalty,
shut-in payments, delay rentals, non-participating royalties
and/or mineral interests and/or any other similar burdens
attributable to MGPX's and/or Xxxxxx'x interest, production
taxes and other taxes (excluding income taxes), shall first
equal the sum of (a) 100% of the costs and expenses incurred
in drilling, testing, completing, equipping and operating the
first well drilled on the Prospect, (b) the Xxxxxx Incentive
and (c) Prospect Acquisition Costs. The Promotional Interest
will be owned as follows.
Xxxxxx - 50%
MGPX - 50%
5.9 In the event a third well is drilled on a Prospect purchased
by MGPX and/or Xxxxxx generated, approved and funded under
this Agreement that is greater than a depth of 7,500 feet
below the surface of the Earth, the ownership of the
twenty-five percent (25%) working interest shall be as
follows.
Xxxxxx - 50%
MGPX - 50%
5.10 In the event a second well is drilled on a Prospect purchased
by MGPX and/or Xxxxxx generated, approved and funded under
this Agreement that is less than a depth of 7,500 feet below
the surface of the Earth, the ownership of the twenty percent
(20%) working interest shall be as follows.
Xxxxxx - 50%
MGPX - 50%
ARTICLE VI
DUTIES OF XXXXXX AND MGPX
6.1 Xxxxxx shall have and exercise the powers and be subject to
the duties set forth for the joint benefit of the parties.
Xxxxxx hereby agrees to have and exercise such powers and be
subject to such duties and to provide the services and perform
the functions assigned to it herein.
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6.2 Xxxxxx shall provide the services of the following personnel:
(a) Geological personnel for the purposes of planning,
geological studies and advice necessary in the
preparation and evaluation of potential prospects
within which to acquire Leasehold Interest; and
(b) Clerical personnel for the purpose of maintaining all
records necessary in connection with the joint
interests of the Parties.
6.3 Xxxxxx shall perform the following duties and have the
following responsibilities, subject to any specific
limitations contained in this Agreement.
(a) Arrange for such geological, geophysical,
engineering, land, and legal services as may be
necessary to carry on the activities contemplated by
this Agreement.
(b) Perform or cause to be performed geologic exploratory
work to evaluate potential Prospects.
(c) Negotiate for and acquire geophysical data.
(d) Negotiate for and acquire Leasehold Interest.
(e) Market Prospects to third parties.
(f) Negotiate and execute exploration agreements with
third parties for the exploration of Prospects owned
by the Parties.
(g) Maintain records and accounts as are customary in the
oil and gas industry and as may be necessary to
fulfill the requirements and obligations of the
Parties.
(h) Meet and comply with requirements of any governmental
or regulatory body.
(i) Any such other matters as may be necessary to carry
out the terms of this Agreement.
6.4 At such time as Xxxxxx has made a determination to pursue
assembling a Prospect, Xxxxxx will designate the particular
geographical area and assign the area a specific Prospect
name. Xxxxxx will then present the Prospect to MGPX for
approval and funding of the Prospect. Xxxxxx will provide MGPX
with the following materials
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to aid MGPX in it's evaluation.
(a) A plat depicting the Prospect area or a description
of the land within the Prospect,
(b) An estimate of Prospect Acquisition Cost.
(c) Information supporting the Prospect.
6.5 In the acquisition of Leasehold Interest, Xxxxxx shall cause
all title examination and curative performed in accordance
with accepted industry standards.
6.6 Xxxxxx shall timely notify MGPX of any annual delay rentals
due on any Leasehold Interest. Upon approval and funding by
MGPX, Xxxxxx shall pay such rentals from the Acquisition
Account. In the event MGPX does not approve or fund the annual
delay rentals, Xxxxxx shall have the option to pay such annual
delay rentals. If Xxxxxx exercises its option to pay the
rentals, Xxxxxx will become the sole owner of the Leasehold
Interest and such Leasehold Interest will no longer be subject
to this Agreement.
6.7 Title to all Leasehold Interest acquired pursuant to this
Agreement shall be held in the name of Nominee. All agreements
with third parties made on behalf of the Parties shall be in
the name of the Nominee. Xxxxxx and MGPX will be the
beneficial owners in the respective percentages specified in
Article V hereof. Each Party shall have the right at any time
to request and receive an appropriate assignment from the
Nominee of such Party's respective interest in any Leasehold
Interest. Nominee shall prepare, execute and record in a
workmanlike manner the Leasehold Interest assignment requested
by the Party. Any such assignments from the Nominee to the
Parties shall be in proper form; shall contain a special
warranty by, through and under Nominee and shall be made
expressly subject to all agreements with third parties
affecting the Leasehold Interest. Each Leasehold Interest
assigned shall be subject to all existing burdens.
6.8 Xxxxxx shall be responsible for the maintenance of all
operational records, Leasehold Interest, land maps, geological
maps, well data and seismic data.
6.9 Xxxxxx shall conduct the activities contemplated by this
Agreement in good faith and shall expend funds from the
Acquisition Account in an orderly manner. Xxxxxx shall perform
all of its duties hereunder in a good and workmanlike manner
and in conformity with accepted industry practice. Xxxxxx
shall have no liability of any kind, direct or contingent to
MGPX for losses sustained or liabilities incurred hereunder,
except, as may be the result of gross negligence, willful
misconduct, or fraud. Xxxxxx agrees to indemnify and hold MGPX
harmless from any liability
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arising out of or in connection with such gross negligence,
willful misconduct or fraud by Xxxxxx or its officers,
directors, employees or agents.
6.10 On or before the 15th day of each month commencing October 15,
1999, Xxxxxx will furnish MGPX a general status report of all
activities occurring during the previous month.
6.11 For the term of this Agreement Xxxxxx and Nominee shall
conduct all efforts in the Area of Interest exclusively for
and on behalf of Xxxxxx and MGPX pursuant to this Agreement;
save and except, Prospects MGPX failed to fund into the
Acquisition Account. It is agreed and understood that MGPX has
no such reciprocal exclusivity obligation to Xxxxxx.
ARTICLE VII
COSTS AND ACCOUNTING
7.1 Prospect Acquisition Costs made or incurred on behalf of the
Parties under this Agreement, Xxxxxx Overhead Cost, return of
funds to MGPX and Xxxxxx Incentive shall be paid out of the
Acquisition Account by Xxxxxx.
7.2 Xxxxxx shall supply MGPX, true, accurate and complete records
reflecting all receipts and all costs and expenses incurred in
connection with the activities performed per this Agreement.
Xxxxxx will provide MGPX a copy of the check register of the
Acquisition Account within five (5) days after the last day of
each month along with copies of all invoices paid.
7.3 MGPX shall provide Xxxxxx with a monthly statement reflecting
all receipts and disbursements during such monthly period. The
monthly statements will provide receipts and disbursements on
a Prospect by Prospect basis. All accounting records relating
to this Agreement shall be maintained in MGPX's offices in
Houston, Texas, and such records shall be open to Xxxxxx or
its representatives at all reasonable times during MGPX's
normal business hours. Xxxxxx shall have the right to audit
the books relating to this Agreement.
ARTICLE VIII
INCOME TAX
8.1 Each Party shall be responsible for the preparation and filing
of its own federal and state income tax returns. MGPX agrees
to provide Xxxxxx any necessary financial information in order
to assist Xxxxxx with respect to taxes.
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ARTICLE IX
REMEDIES
9.1 The Parties shall be entitled to any remedy available at law
or in equity for any breach of this Agreement.
ARTICLE X
MISCELLANEOUS PROVISIONS
10.1 In connection with the transactions contemplated by this
Agreement, Xxxxxx and Nominee represent and warrant that: (a)
Xxxxxx and Nominee are corporations duly organized, existing,
and in good standing under the laws of the State of Texas,
with full power and authority to conduct their business as now
conducted and to own and operate their properties and other
assets; (b) Xxxxxx and Nominee have all requisite power and
authority to execute and deliver this Agreement and to perform
their obligations hereunder; and (c) this Agreement has been
duly and validly executed and delivered by Xxxxxx and Nominee,
and, assuming its due authorization, execution, and delivery
by MGPX, constitutes the legal, valid, and binding obligation
of Xxxxxx and Nominee, enforceable against Xxxxxx and Nominee
in accordance with its terms, except as such enforcement my be
limited by bankruptcy, insolvency, reorganization, moratorium,
or similar laws now or hereafter in effect relating to or
limiting creditors' right or by legal principles of general
applicability governing the availability of equitable
remedies.
10.2 In connection with the transactions contemplated by this
Agreement, MGPX represents and warrants that: (a) MGPX is a
Nevada corporation authorized to do business in the State of
Texas; (b) MGPX has all requisite power and authority to
execute and deliver this Agreement and to perform its
obligations hereunder; (c) this Agreement has been duly and
validly executed and delivered by Participant and, assuming
its due authorization, execution, and delivery by Xxxxxx and
Nominee, constitutes the legal, valid, and binding obligation
of MGPX, enforceable against MGPX in accordance with its
terms, except as such enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium, or similar
laws now or hereafter in effect relating to or limiting
creditors' rights or by legal principles of general
applicability governing the availability of equitable
remedies.
10.3 The Parties do not intend to create, nor shall this Agreement
be construed to create, a partnership, mining partnership,
joint venture, or other relationship of mutual agency between
the Parties, their relation with respect to this Agreement and
all rights, interests, and obligations hereunder being solely
one of co-owners or
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co-tenants. Nothing herein shall be construed as authorization
of one Party hereto to act as general agent for the other
Party nor to permit either Party to act for or on behalf of
the other Party outside the terms of the Agreement.
10.4 Time is of the essence of each and every provision of this
Agreement.
10.5 The Parties hereto agree to execute, acknowledge, and deliver,
as appropriate, such other and further instruments, documents,
and assurances as the other of them may reasonably require to
effectuate the purpose and intent of this Agreement.
10.6 All notices, requests, and other communications required or
permitted hereunder shall be in writing and shall be deemed to
have been duly given if delivered by hand (including, without
limitation, by overnight courier), transmitted by facsimile,
or mailed, certified or registered mail (return receipt
requested) with postage prepaid to the applicable party as
follows:
Xxxxxx Exploration, Inc.
0000 Xxxx Xxx Xxxx., Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attention: Xx. Xxxxxxx X. Xxxxx and
Xx. Xxxxxx X. Xxxxxx, Xx.
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
MGPX
0000 Xxxxxxx Xxxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Attention: Mr. Xxxxxxx Peak
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
or to such other persons or entities or addresses as the
applicable Party shall furnish to the other Party in writing
in accordance with this Section 10.6. Delivery of notices
shall be effective only upon actual receipt by the intended
recipient (or in the case of facsimile transmission, the
completion of such transmission during the recipient's normal
business hours).
10.7 This Agreement, and the legal relations among the Parties
hereto arising from this Agreement, shall be governed by and
construed in accordance with the laws of the State of Texas.
10.8 This Agreement embodies the entire agreement and understanding
of the Parties hereto in respect of the subject matter
contained herein; there are no restrictions,
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promises, warranties, covenants or undertakings, other than
those expressly set forth or referred to herein; and this
Agreement supercedes all prior agreements and understandings
among the Parties with respect to such subject matter.
10.9 Neither this Agreement nor any other agreement between the
Parties nor any uncertainty or ambiguity herein or therein
shall be construed or resolved using any presumption against
any Party hereto or thereto, whether under any rule of
construction or otherwise. On the contrary, this Agreement and
the other agreements between the Parties have been reviewed by
the Parties and their counsel and, in the case of any
ambiguity or uncertainty, shall be construed accordingly to
the ordinary meaning of the words used so as to fairly
accomplish the purposes and intentions of all Parties hereto.
10.10 The headings contained in this Agreement are inserted for
convenience only and shall not affect in any way the meaning
or interpretation of this Agreement.
10.11 This Agreement may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original, but
all of which together shall constitute one and the same
instrument.
10.12 The Parties shall make no press release or other public
announcement or public disclosure relating to this Agreement
or the subject matter of this Agreement, except as necessary
to meet legal or regulatory requirements, or as mutually
approved.
10.13 Any controversy or claim arising out of or relating to this
Agreement, or the breach thereof, shall be settled by
arbitration in accordance with the Commercial Arbitration
Rules of the American Arbitration Association ("AAA") by three
(3) arbitrators. Each Party shall appoint one arbitrator who
shall be an impartial and independent person. If a Party fails
to appoint an arbitrator within thirty (30) days from the date
a Demand to Arbitrate was made under Rule 6, the AAA shall
make the appointment of the arbitrator. The two (2)
arbitrators thus appointed shall appoint the third arbitrator
who shall be an impartial and independent person. If said two
(2) arbitrators fail to appoint the third arbitrator within
sixty (60) days from the date a Demand to Arbitrate was made
under Rule 6, the AAA shall make the appointment of the third
arbitrator. Should any of the arbitrators appointed die,
resign, refuse or become unable to act before a decision is
given, the vacancy shall be filled by the method set forth in
this clause for the original appointment. The arbitration
shall be held in Houston, Texas. Judgment upon the award
rendered by the arbitrators may be entered in any court having
jurisdiction thereof.
Page 14
15
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as
of the dates of the individual acknowledgments, below, but same shall be
effective as of the Effective Date.
XXXXXX EXPLORATION, INC.
By: /s/ XXXXXX X. XXXXXX
--------------------------------
Xxxxxx X. Xxxxxx, President
XXXXXX-TEXAS PROPERTIES, INC.
By: /s/ XXXXXX X. XXXXXX
--------------------------------
Xxxxxx X. Xxxxxx, President
MGPX VENTURES, INC.
By: /s/ XXXXXXX PEAK
--------------------------------
Xxxxxxx Peak, President
THE STATE OF TEXAS
COUNTY OF XXXXXX
This instrument was acknowledged before me on this 31st day of August,
1999, by Xxxxxx X. Xxxxxx, President of Xxxxxx Exploration, Inc. and
Xxxxxx-Texas Properties, Inc., both Texas corporations, on behalf of the
corporations.
/s/ XXXXXXX X. XXXXX
-------------------------
Notary Public Signature
(PERSONALIZED SEAL)
Page 15
16
THE STATE OF TEXAS
COUNTY OF XXXXXX
This instrument was acknowledged before me on this 31st day of August,
1999, by Xxxxxxx Peak, President of MGPX VENTURES, INC., a Nevada corporation,
on behalf of this company.
/s/ XXXXXXX X. XXXXX
---------------------------
Notary Public Signature
(PERSONALIZED SEAL)
Page 16
