ADDENDUM TO ASSET PURCHASE AGREEMENT DATED FEBRUARY 1, 2006 BETWEEN EDDINS- WALCHER COMPANY AND QUEEN OIL & GAS COMPANY
ADDENDUM
DATED
FEBRUARY 1, 2006
BETWEEN
XXXXXX-XXXXXXX COMPANY AND
QUEEN
OIL & GAS COMPANY
THIS
ADDENDUM effective this 10th
day of
March, 2006 (“Effective Date”) modifies, alters and amends certain terms of the
Asset Purchase Agreement (“Agreement”) dated February 1, 2006 between
Xxxxxx-Xxxxxxx Company, a indirectly wholly owned subsidiary of United Fuel
& Energy Corporation (the “Buyer”), and Queen Oil & Gas Company and each
stockholder of Queen Oil & Gas Company (the “Seller”) (collectively referred
to as the “Parties”). Capitalized terms in this Addendum shall have the meaning
set forth in the Agreement if not otherwise defined herein.
RECITALS
WHEREAS,
Section 7.1(a) of the Agreement defines the Termination Date to be February
28,
2006, and provides that the Termination Date may be automatically extended
by
Buyer for no more than fifteen (15) days; and
WHEREAS,
the Buyer has informed the Seller that it wishes to extend the Termination
Date
to March 31, 2006; and
WHEREAS,
the Seller has agreed to extend the Termination Date under the terms and
conditions as set forth in this Addendum.
NOW
THEREFORE, the Parties agree as follows:
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1.
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The
Seller agrees to extend the Termination Date for the purchase and
sale of
the Purchased Assets under Section
7.1(a)
of
the Agreement to March 31, 2006 (the “New Termination Date”). The New
Termination Date will not be subject to any automatic extension at
the
Buyer’s sole discretion.
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2.
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The
Parties agree to increase the Xxxxxxx Money Deposit as provided in
Section
1.5
of
the Agreement to an aggregate of $1,000,000 ($100,000 of which was
delivered by Buyer at the execution of the Agreement). On the date
of this
Addendum, the Buyer shall deliver to Seller the additional $900,000
of the
Xxxxxxx Money Deposit.
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3.
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Should
the Buyer fail to close on or before the New Termination Date, the
Seller
agrees to extend the Termination Date, if so requested by Buyer,
for up to
90 days after March 31, 2006, at an additional charge to the Buyer
in the
amount of Two Thousand Five Hundred Dollars ($2,500) per day starting
April 1, 2006 (the “Delay Cost”), which shall continue to accrue until the
date that the Closing actually takes place; provided,
however,
that the failure to close was not caused by Seller or due to any
Order or
request of a Governmental Body. The Delay Cost shall be paid by the
Buyer
to the Seller on a weekly basis in cash or cash equivalent.
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4.
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Should,
for any reason, the Buyer fail to close on or before June 30, 2006
(the
“Final Termination Date”), the Buyer and Seller agree that the Agreement
shall be terminated by mutual consent of the Parties under Section
7.1
of
the Agreement, without the Parties having to provide further written
notice, and the Seller shall be entitled to retain $100,000 from
the
Xxxxxxx Money Deposit and all Delay Cost payments, shall refund the
remainder of the Xxxxxxx Money Deposit to Buyer, and the Seller shall
have
no further obligations to the Buyer. If Buyer terminates the Agreement
prior to the Final Termination Date pursuant to
Section 7.1,
provided that Buyer is not in breach of the Agreement, as modified,
altered or amended by this Addendum, then Seller shall be obligated
to
return the total Xxxxxxx Money Deposit and any Delay Cost payments
to
Buyer within ten (10) days.
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1
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5.
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The
Parties acknowledge that certain of the title work relating to the
transfer of the Owned Real Property from Seller to Buyer may not
be
finalized by the New Termination Date and agree that any costs relating
to
the cure of such title issues shall be indemnifiable costs under
Article 6
and subject to the Buyer’s set-off rights in Section
6.2,
but shall not be subject to the Basket/Threshold provisions of
Section
6.5(b).
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6.
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Except
as expressly set forth in this Addendum, the Agreement remains unmodified
and in full force and effect.
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[SIGNATURE
PAGE TO ADDENDUM TO ASSET PURCHASE AGREEMENT]
IN
WITNESS WHEREOF, the Parties have caused this Addendum to be executed as of
the
date stated in the introductory paragraph of this Agreement.
BUYER:
XXXXXX-XXXXXXX
COMPANY
BY:
/s/
Xxxxxxx
XxXxxxxx
NAME:
Xxxxxxx
XxXxxxxx
TITLE:
CEO
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Address:
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000
X. Xxxxxxxxxx, 0xx
xxxxx
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| Xxxxxxx, Xxxxx 00000 |
UNITED
FUEL & ENERGY CORPORATION
(solely
for the purpose set forth in Section 1.4(h) of the
Agreement)
BY:
/s/
Xxxxxxx
XxXxxxxx
NAME:
Xxxxxxx
XxXxxxxx
TITLE:
CEO
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Address:
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000
X. Xxxxxxxxxx, 0xx
xxxxx
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| Xxxxxxx, Xxxxx 00000 |
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[SIGNATURE
PAGE TO ADDENDUM TO ASSET PURCHASE AGREEMENT]
SELLER
PARTIES:
SELLER:
QUEEN
OIL & GAS COMPANY
BY:
/s/
Xxxxxxx X.
Xxxxx
NAME:
Xxxxxxx X.
Xxxxx
TITLE:
President
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Address:
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000
X. Xxxx Xxxxxx
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| Xxxxxxxx, Xxx Xxxxxx 00000 |
STOCKHOLDERS:
/s/
Xxxxxxx X.
Xxxxx
Xxxxxxx
X. Xxxxx, individually and in her
capacity
as Co-Trustee of the Xxxxxx X.
Xxxxx
Testamentary Trust
/s/
Xxxx X.
Xxxxx
Xxxx
X.
Xxxxx, individually and in his
capacity
as Co-Trustee of the Xxxxxx X.
Xxxxx
Testamentary Trust
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