EXHIBIT 10.2
PURCHASE AND SALE AGREEMENT
AMONG
BRISBANE PETROLEUM LTD.
- AND -
DELBAERE ASSOCIATES PTY. LIMITED
(COLLECTIVELY AS THE VENDOR)
- AND -
CHELSEA OIL AUSTRALIA PTY LTD
(AS THE PURCHASER)
- AND -
AUSTRALIAN-CANADIAN OIL ROYALTIES LTD.
(FOR THE SOLE PURPOSE OF THE ISSUANCE OF THE CONSIDERATION SHARES)
MADE AS OF THE 17TH DAY OF NOVEMBER 2011
ARTICLE 1
INTERPRETATION.......................................................2
ARTICLE 2
CONDITIONS PRECEDENT................................................14
ARTICLE 3
PURCHASE AND SALE...................................................17
ARTICLE 4
TITLE AND RISK......................................................20
ARTICLE 5
ASSUMED CONTRACTS...................................................20
ARTICLE 6
ON AND AFTER CLOSING................................................22
ARTICLE 7
INTERIM PROVISIONS..................................................23
ARTICLE 8
DUE DILIGENCE.......................................................25
ARTICLE 9
REPRESENTATIONS AND WARRANTIES......................................30
ARTICLE 10
CONFIDENTIALITY.....................................................39
ARTICLE 11
LIABILITIES AND INDEMNITIES.........................................40
ARTICLE 12
INDEPENDENT EXPERT DETERMINATIONS...................................44
ARTICLE 13
GST.................................................................45
ARTICLE 14
STAMP DUTY..........................................................47
ARTICLE 15
MISCELLANEOUS.......................................................47
SCHEDULES
---------
SCHEDULE "A" - Lands
- Petroleum and Natural Gas Rights
- Xxxxx
SCHEDULE "B" - Facilities
- Leased Tangibles
- Assumed Contracts
SCHEDULE "C" - AFEs
SCHEDULE "D" - Not Used
SCHEDULE "E" - Not Used
SCHEDULE "F" - Form of Royalty Deed
SCHEDULE "G" - Allocation of Consideration
SCHEDULE "H" - Form of Promissory Notes
SCHEDULE "I" - Form of Security
SCHEDULE "J" - Form of Share Exchange Agreement
PURCHASE AND SALE AGREEMENT
THIS AGREEMENT is made this 17th day of November 2011.
AMONG:
BRISBANE PETROLEUM LTD. ACN 009 065 043,a body corporate incorporated under
the laws of Australia, having an office in the City of Sydney, New South
Wales (hereinafter referred to as "BPL")
- and -
DELBAERE ASSOCIATES PTY. LIMITED ACN003 197 939,a body corporate
incorporated under the laws of Australia, having an office in the City of
Sydney, New South Wales (hereinafter referred to as "DAPL")
(BPL and DAPL hereinafter collectively referred to as the "VENDOR")
- and -
CHELSEA OILAUSTRALIA PTY LTD, a body corporate incorporated under the laws
of Australia, having an office in the City of Brisbane, Queensland
(hereinafter referred to as the "PURCHASER")
- and -
AUSTRALIAN-CANADIAN OIL ROYALTIES LTD., a body corporate incorporated under
the laws of the Province of British Columbia and listed on the OTC Bulletin
Board (hereinafter referred to as "ACOR")
WHEREAS the Vendor is the beneficial owner of the Assets;
AND WHEREAS the Purchaser is a wholly-owned subsidiary of ACOR;
AND WHEREAS the Vendor desires to sell and transfer the Assets to the Purchaser
and the Purchaser desires to purchase and receive the Assets from the Vendor,
subject to and in accordance with the terms and conditions hereof;
AND WHEREAS ACOR is a Party to this Agreement for the sole and limited purpose
of the issuance of the Consideration Shares, subject to and in accordance with
the terms and conditions hereof;
NOW THEREFORE in consideration of the premises hereto and of the covenants,
warranties, representations, agreements and payments herein set forth and
provided for, the Parties covenant and agree as follows:
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ARTICLE 1
INTERPRETATION
1.1 DEFINITIONS
In this Agreement, unless the context otherwise requires, the words and phrases
set forth below shall have the meaning ascribed thereto below, namely:
(a) "ABANDONMENT AND RECLAMATION OBLIGATIONS" means all duties and
obligations, whether arising under contract or Applicable Law,
relating to:
(i) the abandonment of any Xxxxx and restoration and reclamation of
the surface sites thereof and any other lands used to gain access
thereto; and
(ii) the closure, decommissioning, dismantling and removal of any
structures, buildings, pipelines, facilities, equipment and
other, tangible depreciable property and assets forming the
Tangibles, together with the restoration and reclamation of the
lands on or in which any of the foregoing are or were located and
any other lands used to gain access thereto;
(b) "AFES" means the authorities for expenditure, cash calls, operations
notices, amounts budgeted and mail ballots, if any, set out in
Schedule "C";
(c) "AFFILIATE" of a Person means a corporation or partnership that
controls the Person, is controlled by the Person or is controlled by
the same Person, corporation or partnership that controls the Person
and for which purpose a corporation shall be deemed to be controlled
by those persons, corporations or partnerships who own (directly or
indirectly) or effectively control, other than by way of a security
interest only, sufficient voting shares of the corporation (whether
directly through the ownership of shares of the corporation or
indirectly through the ownership of shares of another corporation
which directly or indirectly owns shares of the corporation) to elect
the majority of its board of directors and a partnership shall be
deemed to be controlled by those persons, corporations or partnerships
that are able to determine policies or material decisions of that
partnership, provided that a partnership which is composed solely of
corporations which are Affiliates, as described above, shall be deemed
to be an Affiliate of each such corporation and its other Affiliates;
(d) "AGREEMENT" means this purchase and sale agreement including the
recitals hereto, this clause and each Schedule, as may be amended
after the date hereof by written agreement of the Parties;
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(e) "APPLICABLE LAW" means, in relation to any Person, property or
circumstance, all laws and statutes, including regulations, rules,
bylaws, ordinances and other statutory instruments enacted thereunder;
all judgments, decrees, rulings and orders of courts, tribunals,
commissions and other similar bodies of competent jurisdiction; all
orders, rules, directives, policies and guidelines having force of law
issued by any Governmental Authority; and all terms and conditions of
the Petroleum Tenures and any Permits; that are in effect as of the
relevant time and are applicable to such Person, property or
circumstance;
(f) "APPROVALS" means the Purchaser's Approvals and the Vendor's
Approvals;
(g) "ASSETS" means the Petroleum and Natural Gas Rights, the Tangibles,
the Assumed Contracts and the Miscellaneous Interests;
(h) "ASSUMED CONTRACTS" means any and all contracts and agreements
relating to the Petroleum and Natural Gas Rights or the Tangibles or
either of them, including the agreements set out in Schedule B under
the heading "Assumed Contracts";
(i) "BUSINESS DAY" means a day other than a Saturday, a Sunday or a
statutory holiday in Brisbane, Queensland or Vancouver, British
Columbia;
(j) "CLAIM" means any claim, demand, action, lawsuit, proceeding,
arbitration or investigation, in each case, whether asserted,
threatened, pending or existing;
(k) "CLAIM NOTICE" has the meaning specified in subclause 11.3(a);
(l) "CLOSING" means the completion of the Transaction in accordance with
the terms of this Agreement;
(m) "CLOSING DATE" means the date on which Closing occurs;
(n) "CLOSING TIME" means 10:00 a.m., on the later of:
(i) the 30th day of November, 2011;
(ii) the fifth (5th) Business Day following the day on which all of
the Conditions Precedent have been satisfied or waived in
accordance with clause Article 2; or
such other date or time as provided for in clause 8.4 or 8.7 or
as may be mutually agreed in writing by the Parties;
(o) "CONDITIONS PRECEDENT" means the conditions precedent to Closing set
out in clause 2.1;
(p) "CONSIDERATION" means the:
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(i) issuance of the Promissory Notes;
(ii) issuance of the Consideration Shares; and
(iii) the execution and delivery of the Royalty Deed;
by the Purchaser in accordance with this Agreement.
(q) "CONSIDERATION SHARES" means8,571,429 fully paid common shares in the
share capital of ACOR; 4,688,319 of which shall be issued to BPL or
its designated nominee and 3,883,110 of which shall be issued to DAPL
or its designated nominee;
(r) "DEVELOPMENT PLAN" means, in respect of a Petroleum Tenure, the
development plan approved under the P&G Act or the Petroleum Act, as
applicable;
(s) "DISCLOSURE LETTER" means the letter from the Vendor to the Purchaser
dated the date of this Agreement and containing disclosures to the
Warranties;
(t) "DOLLAR" or "$" means a U.S. dollar;
(u) "ENCUMBRANCE" means any royalty, overriding royalty, profit interest,
production payment or similar burden on production, mortgage, charge,
pledge, lien, attachment, hypothecation or other encumbrance, security
interest, deferred purchase, title retention, leasing, sale and
purchase, sale and leaseback arrangement, call or put option, co-sale
or tag-along right, farmout agreements under which the right to earn
an interest has not yet expired or other Third Party rights of
whatever nature or interest or any agreement for any of the same;
(v) "ENVIRONMENT" means the components of the earth, alone or in
combination, and includes ambient air, land, surface and sub-surface
strata, groundwater, surface water, all layers of the atmosphere, all
organic and inorganic matter and living organisms, including plants,
animals and humans, and the interacting natural systems that include
such components;
(w) "ENVIRONMENTAL AUTHORITIES" means environmental authorities numbered
PEN200030407 (PL18), PEN20029909 (PL40) and PEN200313009 (PL280)
granted under the EP Act which authorise the holder of the Petroleum
Tenures to carry out the activities which the holder is permitted to
carry out under the Petroleum Tenures.
(x) "ENVIRONMENTAL DEFECT" means, in respect of any particular Asset, any
existing Environmental Liabilities, excluding Abandonment and
Reclamation Obligations arising in the ordinary course of business;
(y) "ENVIRONMENTAL DEFECT AFFECTED ASSET" has the meaning specified in
subclause 8.5(b);
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(z) "ENVIRONMENTAL LIABILITIES" means all past, present and future Losses
and Liabilities, Claims and other duties and obligations, whether
arising under contract, Applicable Law or otherwise, arising from or
associated with:
(i) Abandonment and Reclamation Obligations;
(ii) any damage to, or contamination of, the Environment howsoever and
by whomsoever caused and regardless of whether such damage,
contamination or other adverse situations occur or arise in whole
or in part prior to, at or subsequent to the date of this
Agreement;
(iii) the release, emission or discharge of Petroleum Substances,
oilfield wastes, water, hazardous substances, environmental
contaminants and all other substances and materials regulated
under any Applicable Law, including any forms of energy; (iv)
compliance with or the consequences of any non-compliance with,
or violation
or breach of, any Applicable Law pertaining to the Environment or
to the protection of the Environment;
(v) sampling, monitoring or assessing the Environment or any
potential impacts thereon from any past, present or future
activities or operations; or
(vi) the protection, reclamation, remediation or restoration of the
Environment;
that relate to or arise by virtue of the Assets or the ownership
thereof or any past, present or future operations and activities
conducted in connection with the Assets;
(aa) "EP ACT" means the Environmental Protection Act 1994 (Qld);
(bb) "EP AUTHORITY" means the Environmental Protection Authority
constituted under the EP Act;
(cc) "EXPIRY DATE"means January 31, 2012 or such later date agreed in
writing by the Parties.
(dd) "FACILITIES" means the facility or facilities, if any, set forth and
described in Schedule "B" under the heading "Facilities";
(ee) "FINANCING" has the meaning ascribed to such term in the Share
Exchange Agreement;
(ff) "GOVERNMENTAL AUTHORITY" means any:
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(i) governmental entity or authority of any nature, including any
governmental ministry, agency, branch, department or official,
and any court, regulatory board or other tribunal; or
(ii) individual or body exercising, or entitled to exercise, any
administrative, executive, judicial, legislative, regulatory or
taxing authority or power of any nature;
having or purporting to exercise jurisdiction or power over any
Person, property, operation, transaction or other matter or
circumstance;
(gg) "INDEMNIFIED PERSON" has the meaning specified in clause 11.3;
(hh) "INDEMNIFYING PERSON" has the meaning specified in clause 11.3;
(ii) "INDEPENDENT EXPERT" means a Person appointed jointly by the Vendor
and the Purchaser or if they do not agree on the Person to be
appointed within three (3) Business Days of either the Vendor or the
Purchaser requesting appointment, then a Person appointed by the
President of the Institute of Chartered Accountants in Australia
(Queensland branch) at the request of either the Vendor or the
Purchaser.
(jj) "INTERIM PERIOD" means the period from and including the date hereof
up to but not including the day of Closing;
(kk) "LANDS" means the lands set forth and described in Schedule "A" under
the heading "Lands";
(ll) "LEASED SUBSTANCES" means all Petroleum Substances, rights to or in
respect of which are granted, reserved or otherwise conferred by or
under, or evidenced by the grant of, the Petroleum Tenures;
(mm) "LOSSES AND LIABILITIES" means in respect of a Party and in relation
to a matter, any and all:
(i) losses, costs, damages, expenses and charges (including all
penalties, assessments and fines) which such Party suffers,
sustains, pays or incurs in connection with such matter and
includes reasonable costs of legal counsel and other professional
advisors and reasonable costs of investigating and defending
Claims arising from the matter, regardless of whether such Claims
are sustained and includes taxes payable on any settlement
payment or damage award in respect of such matter; and
(ii) liabilities and obligations (whether under Applicable Law or
otherwise; whether tortious, contractual, vicarious, statutory or
otherwise; whether absolute or contingent; and whether based on
fault, strict liability or otherwise) which such Person incurs as
a result of such matter or in connection therewith;
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excluding indirect, special, aggravated, consequential, exemplary
or punitive damages, whether in an action in contract or tort, or
for any other reason whatsoever;
(nn) "MATERIAL ENVIRONMENTAL DEFECT" means any Environmental Defect
identified by the Purchaser where the value by which the Assets
affected by the Environmental Defect has been reduced as a consequence
of such Environmental Defect, is estimated by the Purchaser, acting
reasonably and in good faith, to exceedfifty thousand Dollars
($50,000.00);
(oo) "MATERIAL TITLE DEFECT" means any Title Defect identified by the
Purchaser where the value by which the Assets affected by the Title
Defect has been reduced as a consequence of the Title Defect, is
estimated by the Purchaser, acting reasonably and in good faith, to
exceed fifty thousand Dollars ($50,000.00);
(pp) "MINISTER" means the Minister of the State of Queensland who
administers the P&G Act and the Petroleum Act;
(qq) "MISCELLANEOUS INTERESTS" means, subject to any and all limitations
and exclusions provided for in this definition, the Vendor's right,
title and interest in and to all property, assets, interests and
rights pertaining to the Petroleum and Natural Gas Rights and the
Tangibles, or either of them, but only to the extent that such
property, assets, interests and rights pertain to the Petroleum and
Natural Gas Rights and the Tangibles, or either of them, including any
and all of the following:
(i) rights to enter upon, use or occupy, the surface of the Lands;
(ii) the Xxxxx, including the wellbores and any and all casing;
(iii) the Permits; and
(iv) records, files, reports, data, correspondence and other
information, including lease, contract, well, production and
facilities files and records;
(rr) "P&G ACT" means the Petroleum and Gas (Production and Safety) Xxx 0000
(Qld);
(ss) "PARTY" means a Person who is bound by this Agreement;
(tt) "PERMITS" means all licences, permits, approvals and authorizations
granted or issued by any Governmental Authorities that relate to the
exploration, construction, ownership, use or operation of the Assets,
including the Environmental Authorities, but does not include the
Petroleum Tenures;
(uu) "PERMITTED ENCUMBRANCES" means:
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(i) liens for taxes, assessments and governmental charges that are
not due and payable or not delinquent or the validity of which is
being diligently contested in good faith;
(ii) liens incurred or created in the ordinary course of business as
security in favour of the Person who is conducting the
development or operation of the property to which such liens
relate, that are not due and payable or not delinquent or the
validity of which is being diligently contested in good faith;
(iii) mechanics', builders' and materialmen's liens in respect of
services rendered or goods supplied for which payment is not due
or delinquent or the validity of which is being diligently
contested in good faith;
(iv) easements, rights of way, servitudes and other similar rights in
land (including rights of way and servitudes for highways and
other roads, railways, sewers, drains, gas and oil pipelines, gas
and water mains, electric light, power, telephone, telegraph and
cable television conduits, poles, wires and cables) which do not
materially impair the use of the Assets affected thereby;
(v) the right reserved to or vested in any municipality or
Governmental Authority by the terms of any lease, licence,
franchise, grant or permit or by any statutory provision, to
terminate any such lease, licence, franchise, grant or permit or
to require annual or other periodic payments as a condition of
the continuance thereof;
(vi) rights of general application reserved to or vested in any
Governmental Authority to levy taxes of any kind or type,
including imposts, custom duties and excises, stamp duties
or similar duties on the Leased Substances or any of them or
the income therefrom, and governmental requirements and
limitations of general application as to production rates on
the operations of any property;
(vii) royalties which are or may become payable for any reason under
any Applicable Law, including the P&G Act and the Petroleum Act,
which relate to the production, extraction, sale or transfer of
Leased Substances or otherwise relate to the Petroleum Tenures;
(viii) statutory exceptions to title;
(ix) any security held by any Third Party encumbering the Vendor's
interest in and to the Assets or any part or portion thereof, in
respect of which the Vendor delivers a discharge or no interest
letter to the Purchaser at or prior to Closing, in a form that is
satisfactory to the Purchaser acting reasonably;
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(x) the terms and conditions of the Petroleum Tenures; and
(xi) all Encumbrances set out and described in Schedule "A";
(vv) "PERSON" means any individual, body corporate, partnership (limited or
general), trust, trustee, executor or similar official, Governmental
Authority or other entity;
(ww) "PETROLEUM ACT" means the Xxxxxxxxx Xxx 0000 (Qld);
(xx) "PETROLEUM AND NATURAL GAS RIGHTS" means all of the Vendor's right,
title, interest in and to the Leased Substances and the Petroleum
Tenures, including:
(i) a one hundred percent (100%) interest in PL18;
(ii) a one hundred percent (100%) interest in PL40; and
(iii) a fifty percent (50%) interest in PL280;
(yy) "PETROLEUM SUBSTANCES" means any of crude oil, crude bitumen and
products derived therefrom, synthetic crude oil, petroleum, natural
gas, natural gas derived from coal, natural gas liquids, and any and
all other substances related to any of the foregoing, whether liquid,
solid or gaseous, and whether hydrocarbons or not;
(zz) "PETROLEUM TENURES" means PL18, PL40 and PL280;
(aaa) "PL18" means petroleum lease number 18 granted under the Petroleum
Act and includes any variation, renewal, permit, license or other
interest issued in substitution thereof and any other petroleum tenure
or rights to explore for or produce Petroleum Substances which may be
granted to the Vendor in lieu of or related to the same area covered
by petroleum lease number 18;
(bbb) "PL40" means petroleum lease number 40 granted under the Petroleum
Act and includes any variation, renewal, permit, license or other
interest issued in substitution thereof and any other petroleum tenure
or rights to explore for or produce Petroleum Substances which may be
granted to the Vendor in lieu of or related to the same area covered
by petroleum lease number 40;
(ccc) "PL280" means petroleum lease number 280 granted under the P&G Act
and includes any variation, renewal, permit, license or other interest
issued in substitution thereof and any other petroleum tenure or
rights to explore for or produce Petroleum Substances which may be
granted to the Vendor in lieu of or related to the same area covered
by petroleum lease number 280;
(ddd) "PRRT" means the petroleum resource rent tax imposed pursuant to the
PRRT Act and assessed pursuant to the Petroleum Resource Rent Tax
Assessment Act 1987 (Cth) (as amended from time to time);
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(eee) "PRRT ACT" means Petroleum Resource Rent Tax Act 1987 (Cth) (as
amended from time to time) and any associated regulations and
legislative determinations;
(fff) "PROJECT INTERESTS" means an interest in relation to a petroleum
project or an exploration right for the purposes of the PRRT Act;
(ggg) "PROMISSORY NOTES" means an original promissory note from the
Purchaser to each of the entities comprising the Vendor in the form
set forth in Schedule "H" in an aggregate amount equal to three
million Dollars ($3,000,000.00);
(hhh) "PURCHASER'S APPROVALS" means the satisfaction, or approval by the
relevant authority or party, of a matter the subject of the Conditions
Precedent in Article 2;
(iii) "PURCHASER'S LOSSES" means Losses and Liabilities of the Purchaser
and its Related Parties;
(jjj) "RELATED PARTIES" means, in reference to a Party, its Affiliates,
successors and assigns and its or its Affiliates' respective
directors, officers and employees;
(kkk) "REPRESENTATIVES" means, in reference to a Party, its and its Related
Parties' representatives, agents, legal counsel, accountants,
consultants and advisors;
(lll) "ROYALTY DEED" means a deed substantially in the form set forth in
Schedule "F";
(mmm) "SECURITY" means the Mortgage of Petroleum and Natural Gas Rights
substantially in the form set forth in Schedule "I";
(nnn) "SHARE EXCHANGE AGREEMENT" means the share exchange agreement among
ACOR, 1629518 Alberta Ltd. and others dated on or about the date
hereof, substantially in the form set forth in Schedule "J";
(ooo) "STARTING BASE"means the starting base which is immediately
deductible or uplifted at the relevant rate when carried forward under
the PRRT Act and which is calculated by reference to the market or
book value of assets or to expenditure under a 'look back' method or
by any other method specified in the PRRT Act;
(ppp) "TAKE OR PAY OBLIGATIONS" means obligations to sell or deliver
Petroleum Substances or any of them, without being entitled in due
course to receive and retain full payment for such Petroleum
Substances;
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(qqq) "TANGIBLES" means all of the Vendor's right, title and interest in
and to the Facilities and any and all tangible depreciable property
and assets other than the Facilities which are located within, upon or
in the vicinity of the Lands and which have been used, are being used,
are capable of being used or are intended to be used to produce,
process, gather, treat, measure, make marketable or inject the Leased
Substances or any of them or in connection with water injection or
removal operations that pertain to the Petroleum and Natural Gas
Rights, including any and all gas plants, oil batteries, buildings,
well heads, production equipment, pipelines, pipeline connections,
meters, generators, motors, compressors, treaters, dehydrators,
scrubbers, separators, pumps, tanks, boilers, improvements,
communication equipment and other equipment and apparatus;
(rrr) "THIRD PARTY" means any Person other than any of the Parties and
their Related Parties;
(sss) "THIRD PARTY CLAIM" has the meaning specified in subclause 11.3(a);
(ttt) "TITLE DEFECT" means, in respect of any particular Asset:
(i) that the Vendor holds a smaller beneficial interest in and to
such particular Asset than as attributed to it in Schedule "A";
(ii) that such particular Asset as described in Schedule "A" is
subject to an Encumbrance that is either not described in or is
misdescribed in Schedule "A" where such omission or
misdescription is adverse to the value of such particular Asset;
(iii) that the interest of the Vendor in and to such particular Asset
is subject to a reduction or penalty that has not been disclosed
in Schedule "A"; or
(iv) any other adverse defect, omission, deficiency or discrepancy in
or affecting the title of the Vendor in and to such particular
Asset;
provided that notwithstanding the foregoing, a "Title Defect"
excludes:
(v) the Permitted Encumbrances; and
(vi) all Environmental matters;
(uuu) "TITLE DEFECT AFFECTED ASSET" has the meaning specified in subclause
8.2(b);
(vvv) "TRANSACTION" means the purchase of the Assets by the Purchaser from
the Vendor on and subject to the terms and conditions, and as more
fully described, in this Agreement;
(www) "VENDOR'S APPROVALS" means the satisfaction, or approval by the
relevant authority or party, of a matter the subject of the Conditions
Precedent in Article 2;
(xxx) "VENDOR'S LOSSES" means Losses and Liabilities of the Vendor and its
Related Parties;
(yyy) "WARRANTIES" means the representations and warranties given by the
Vendor under clauses 9.1 and 9.2;
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(zzz) "WARRANTY CLAIM" means a Claim by the Purchaser against the Vendor
(or either of them) arising as a result of a breach of a Warranty; and
(aaaa) "XXXXX" means the well(s) identified in Schedule "A" under the
heading "Xxxxx" and all other xxxxx which are located on the Lands
which are, may be or were used in connection with the Petroleum and
Natural Gas Rights, including producing, shut-in, suspended,
abandoned, water source, injection or disposal xxxxx.
1.2 SCHEDULES
The following schedules (the "SCHEDULES") are attached to, form part of and are
incorporated in this Agreement:
(a) SCHEDULE "A" - Lands, Petroleum and Natural Gas Rights, Xxxxx,
Encumbrances;
(b) SCHEDULE "B" - Facilities, Leased Tangibles, Assumed Contracts;
(c) SCHEDULE "C" - AFEs;
(d) SCHEDULE "D" - Not Used;
(e) SCHEDULE "E" - Not Used;
(f) SCHEDULE "F" - Form of Royalty Deed;
(g) SCHEDULE "G" - Allocation of Consideration;
(h) SCHEDULE "H" - Form of Promissory Notes;
(i) SCHEDULE "I" - Form of Security; and
(j) SCHEDULE "J" - Form of Share Exchange Agreement.
1.3 INTERPRETATION
Unless otherwise stated or the context otherwise necessarily requires, in this
Agreement:
(a) the headings of Articles, clauses, subclauses, sections, subsections
and Schedules herein are inserted for convenience of reference only
and shall not affect or be considered to affect the construction or
interpretation of the provisions hereof;
(b) the word "including" and like words used in this Agreement shall be
deemed to mean "including, without limitation";
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(c) whenever the singular or masculine or neuter is used in this Agreement
or in the Schedules, each shall be interpreted as meaning the plural
or feminine or body politic or corporate or vice versa, as the context
requires;
(d) the provisions contained in all documents and agreements collateral
hereto shall at all times be read subject to the provisions of the
body of this Agreement and, in the event of conflict between the
provisions contained in any Schedule; and any documents or agreements
collateral hereto and the provisions of the body of this Agreement,
the provisions of the body of this Agreement shall prevail unless
otherwise expressly provided herein;
(e) "this Agreement", "herein", "hereby", "hereunder", "hereof" and
similar expressions refer to this Agreement as a whole and not to any
particular Article, clause, subclause, section or subsection or other
provision hereof and references herein to any agreement or instrument,
including this Agreement, shall be a reference to the agreement or
instrument as varied, amended, renewed, modified, or supplemented or
replaced from time to time;
(f) a reference to an Article, clause, subclause, section, subsection or
Schedule is a reference to an Article, clause, subclause, section or
subsection in, or a Schedule to, this Agreement and unless otherwise
stated or the context so requires, a reference in a clause to a
subclause is a reference to a subclause of that clause;
(g) except as otherwise expressly provided herein, references in this
Agreement to any statute, statutory provision or other legislation
include a reference to that statute, statutory provision or
legislation as amended, extended, re-enacted, consolidated or replaced
from time to time (whether before or after the date of this Agreement)
and include any order, regulation, instrument or other subordinate
legislation made under the relevant statute, statutory provision or
legislation;
(h) if Closing does not occur, each provision of this Agreement which
presumes the Purchaser has acquired the Assets shall be construed as
having been contingent upon Closing having occurred;
(i) any references to time herein shall be references to [Brisbane] time;
and
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(j) the knowledge or awareness of the Vendor consists of the actual
knowledge or awareness of its current officers and employees who are
primarily responsible for the matter in question in the course of
their normal duties (other than those employees employed in the field
who do not have management responsibilities), after reasonable inquiry
of the Vendor's applicable files and records. Knowledge and awareness
does not include the knowledge of any Third Party or constructive
knowledge.
ARTICLE 2
CONDITIONS PRECEDENT
2.1 CONDITIONS PRECEDENT
Closing is conditional on the satisfaction of, or the waiver of, the
following Conditions Precedent:
CONDITION PARTY ENTITLED TO BENEFIT
--------------------------------------------------------------------------------
(a) Obtaining indicative approval of the Minister: Purchaser and Vendor
(i) under section 80H of the Petroleum Act
to the transfer to the Purchaser of the
Vendor's interests in PL18 and the grant
of the Security;
(ii) under section 80H of the Petroleum Act
to the transfer to the Purchaser of the
Vendor's interests in PL40 and the grant
of the Security; and
(iii) under section 571 of the P&G Act to the
transfer to Purchaser of BPL's interests
in PL280 and the grant of the Security,
and such indicative approvals being notified
to the Purchaser and the Vendor.
--------------------------------------------------------------------------------
(b) Obtaining any consent or approval of any person Vendor
(other than the Minister) required in respect
of the grant of the Security.
--------------------------------------------------------------------------------
(c) Obtaining the consent (on such terms as are Purchaser and BPL
satisfactory to BPL and the Purchaser) of
Longreach Oil Limited ACN 000 131 797
("LONGREACH") to the transfer of PL280, and
the corresponding Environmental Authority, to the
Purchaser including the due execution by
Longreach of the application for transfer
in registrable form of PL280 and the
corresponding Environmental Authority.
14
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(d) If applicable, either Purchaser and Vendor
(i) the Purchaser receiving a written notice
issued by or on behalf of the Treasurer
of the Commonwealth of Australia pursuant
to the Foreign Acquisitions and Takeovers Xxx
0000 (Cth) stating that the Australian
Government does not object to the proposed
acquisition by the Purchaser of the Assets
unconditionally or on terms acceptable
to the Purchaser acting reasonably; or
(ii) following written notice of the proposed
acquisition of the Assets having been given
by the Purchaser to the Treasurer of the
Commonwealth of Australia pursuant to the
Foreign Acquisitions and Takeovers Xxx
0000 (Cth), the Treasurer of the Commonwealth
of Australia ceasing to be empowered to make
any order under Part II of that Act because of
lapse of time or otherwise.
--------------------------------------------------------------------------------
(e) BPL passing a resolution in general meeting BPL
approving the sale of the Assets to the
Purchaser under this Agreement.
--------------------------------------------------------------------------------
(f) The Share Exchange Agreement being duly Vendor and Purchaser
executed by all parties to it.
--------------------------------------------------------------------------------
(g) The completion of the Financing for Vendor and Purchaser
minimum gross proceeds of not less than
US$1,000,000.00 at 35c per ACOR share.
2.2 WAIVER OF CONDITIONS
(a) A Condition Precedent may only be waived in writing by a Party
entitled to the benefit of that Condition Precedent (as set out in the
table in clause 2.1) and will be effective only to the extent
specifically set out in that waiver.
(b) If both the Vendor and the Purchaser are entitled to the benefit of a
Condition Precedent (as set out in the table in clause 2.1), that
Condition Precedent may only be waived in writing by agreement between
the Vendor and the Purchaser.
15
2.3 CONDUCT OF THE PARTIES
(a) The Purchaser must at its sole cost apply for the Purchaser's
Approvals immediately following execution of this Agreement and
thereafter with the reasonable assistance of the Vendor, do all things
reasonably necessary to obtain the Purchaser's Approvals as soon as
reasonably practicable after execution of this Agreement and in any
event before 5.00pm on the Expiry Date.
(b) The Vendor must at its sole cost apply for the Vendor's Approvals
immediately following execution of this Agreement and thereafter with
the reasonable assistance of the Purchaser, do all things reasonably
necessary to obtain the Vendor's Approvals as soon as reasonably
practicable after execution of this Agreement and in any event before
5.00pm on the Expiry Date.
(c) Each Party must keep the other Parties informed as to the status of
and notify the other Parties immediately on the outcome of each
application for an Approval and provide the other Parties with a copy
of each Approval.
(d) If a notice received from the relevant authority or Person (as the
case may be) specifies conditions to an Approval, each Party must
notify the other Parties whether or not any conditions are reasonably
acceptable to it. If any Party notifies that such conditions are not
reasonably acceptable, the Approval is deemed not to have been
granted.
(e) If any Party fails to notify the other Parties that conditions to an
Approval are not reasonably acceptable within 14 days after receipt of
a notice from another Party accepting such conditions, the conditions
are deemed to be accepted by all Parties and the relevant Condition
Precedent in clause 2.1 is deemed to have been satisfied.
(f) If a condition to an Approval is acceptable or is deemed acceptable to
all of the Parties, the Parties must execute any documents and do all
things as are reasonably necessary in satisfaction of the conditions
to an Approval.
2.4 FAILURE OF CONDITION
If a Party has complied with its obligations under clause 2.3, it may terminate
this Agreement by giving notice in writing to the other Parties if:
(a) a Condition Precedent is or becomes incapable of being satisfied;
(b) each Condition Precedent is not satisfied, or waived by each Party
entitled to the benefit of that Condition Precedent, before 5.00pm on
the Expiry Date; or
(c) a Condition Precedent, having been satisfied, does not remain
satisfied in all respects at all times before Closing.
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2.5 EFFECT OF TERMINATION
On termination of this Agreement under clause 2.4:
(a) clauses 2.5 (Effect of termination), Article 1 (Interpretation),
Article 10 (Confidentiality) and 15.4 (Governing Law) continue to
apply;
(b) accrued rights and remedies of a Party are not affected; and
(c) subject to clauses 2.5(a) and 2.5(b), the Parties are released from
further performing their obligations under this Agreement.
2.6 ACKNOWLEDGEMENT REGARDING CONDITIONS PRECEDENT
The Purchaser acknowledges that the transfer of the Environmental Authority in
relation to PL18, PL40 and PL 280 will require an application to the relevant
Governmental Authority under section 311C of the EP Act and that, upon such
application, the relevant Governmental Authority may require an audit statement
and may amend the conditions of the Environmental Authority as a condition of
approving the transfer of the Environmental Authority.
ARTICLE 3
PURCHASE AND SALE
3.1 PURCHASE AND SALE
The Vendor shall sell and convey the Assets to the Purchaser and the Purchaser
shall purchase the Assets from the Vendor at the Closing Time, for the
Consideration, subject to and in accordance with the terms and conditions of
this Agreement.
3.2 CLOSING TIME AND PLACE
Subject to the other provisions of the Agreement, Closing shall take place at
the Closing Time, at the offices of Vendor's counsel located at Xxxxxxxxxx
Xxxxx, 0 Xxxxx Xxxxxx, Xxxxxxxx, Xxxxxxxxxx, or such other place as may be
agreed by the Parties.
3.3 PURCHASER'S OBLIGATIONS
(a) At Closing, the Purchaser must:
(i) deliver to each Vendor the Promissory Note (applicable to such
Vendor entity) duly executed by the Purchaser;
(ii) cause the Consideration Shares to be issued to each Vendor or
their designated nominee;
(iii) deliver to each Vendor the Royalty Deed duly executed by the
Purchaser;
17
(iv) deliver to each Vendor the Security duly executed by the
Purchaser; and
(v) deliver to the Vendor any and all other documents which are
required to be delivered by the Purchaser pursuant to this
Agreement;
(b) All deliveries of the Purchaser shall, except as otherwise stated, be
in a form acceptable to the Vendor and its counsel, acting reasonably.
3.4 VENDOR'S OBLIGATIONS
(a) At Closing, the Vendor must deliver to the Purchaser:
(i) possession and control of the Assets;
(ii) a copy of the notice of indicative approval of the Minister under
section 80H of the Petroleum Act to the transfer of the Vendor's
interests in PL18 and PL40, and under section 571 of the P&G Act
to the transfer of the Vendor's interests in PL280 to the
Purchaser;
(iii) an application for transfer in registrable form executed by the
Vendor in respect of the Vendor's interests in each of PL18, PL40
and PL280, and executed by Longreach Oil Limited ACN 000 131 797
respect of PL 280, together with the original instrument of title
for each of PL18, PL40 and PL280 and any other accompanying
documents required to register the transfer of the Vendor's
interests in PL18, PL40 and PL280 in the name of the Purchaser
and to vest the Vendor's interests in PL18, PL40 and PL280 in the
Purchaser;
(iv) duly executed by the Vendor, and by Longreach Oil Limited ACN 000
131 797 in respect of the Environmental Authority corresponding
to PL280, duly completed (except for stamping) applications for
transfer in favour of the Purchaser in respect of any
Environmental Authorities corresponding to the Vendor interests
in each of PL18, PL40 and PL280;
(v) the Royalty Deed duly executed by the Vendor;
(vi) any assignment and assumption agreements relating to any
landholder compensation agreements or native title agreements in
the name of the Vendor (if any)]; and
(vii) any and all other documents which are required to be delivered
by the Vendor pursuant to this Agreement.
(b) All deliveries of the Vendor shall, except as otherwise stated, be in
a form acceptable to the Purchaser and its counsel, acting reasonably.
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3.5 ALLOCATION OF CONSIDERATION
The Consideration shall be allocated as set out in Schedule G.
3.6 SIMULTANEOUS ACTIONS AT CLOSING
In respect of Closing:
(a) the obligations of the Parties under this Agreement are
interdependent;
(b) all actions required to be performed will be taken to have occurred
simultaneously on the Closing Date; and
(c) completion of the sale and purchase of each Asset is dependent on the
completion of the sale and purchase of each other Asset.
3.7 CLOSING OBLIGATIONS BREACHED
If by 5:00 pm on the Closing Date:
(a) the Purchaser has not complied in any material respect with any of its
obligations under clause 3.3, the Vendor is entitled, at its
discretion; or
(b) if the Vendor has not complied in any material respect with any of its
obligations under clause 3.4, the Purchaser is entitled, at its
discretion,
in either case:
(c) to defer Closing to any subsequent Business Day falling not more than
five (5) Business Days after the scheduled Closing Date or any later
date set for Closing in accordance with this clause (in such event,
this clause will apply to the scheduled Closing Date so deferred);
(d) if applicable, to waive the requirement to fulfill those obligations,
in whole or in part, and following such waiver to complete the sale
and purchase of the Assets;
(e) so far as practicable, to complete the sale and purchase of the
Assets; or
(f) to terminate this Agreement.
3.8 CLOSING UNDER THIS AGREEMENT AND SHARE EXCHANGE AGREEMENT
Despite anything to the contrary in this Agreement, Closing under this Agreement
and closing under the Share Exchange Agreement are conditional upon each other's
closing and must be completed simultaneously. If there is a failure to close
under the Share Exchange Agreement, any Party may terminate this Agreement and
each Party will do everything reasonably required by the other Parties to
reverse any action taken under this Article 3.
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ARTICLE 4
TITLE AND RISK
4.1 TITLE AND RISK IN ASSETS
Title to possession of and risk related to the Assets passes to the Purchaser at
Closing.
ARTICLE 5 ASSUMED CONTRACTS
5.1 ASSIGNMENT
(a) Subject to Closing, and on and with effect from the Closing Date, the
Vendor assigns and the Purchaser accepts an assignment of all of the
Vendor's rights under, benefits of and interests in ("Benefits") and
assumes the burden of the Assumed Contracts in accordance with this
Article 5.
(b) This Agreement does not constitute an assignment or an attempted
assignment of an Assumed Contract if an assignment or attempted
assignment requires the consent of the counterparty to the Assumed
Contract and would constitute a breach of that Assumed Contract if an
assignment were made without that consent.
5.2 CONSENT TO TRANSFER OF ASSUMED CONTRACTS
(a) If the consent of any Third Party is required for the transfer of an
Assumed Contract to the Purchaser under clause 5.1, the Vendor and the
Purchaser must use their reasonable endeavours to obtain that consent
by or as soon as reasonably practicable after Closing.
(b) Pending the transfer of an Assumed Contract to the Purchaser under
clause 5.1, the Vendor must:
(i) hold the Benefits of the Assumed Contract in trust for the
Purchaser and account to the Purchaser promptly after receipt by
it for the value of any Benefit of the Assumed Contract that
arises (or relates to the period) after the Closing Date;
(ii) enforce the Assumed Contract against any counterparty to it in
the manner that the Purchaser directs (and promptly following
such direction) from time to time, at the expense of the
Purchaser; and
(iii) not agree to any termination, amendment or variation of or
waiver of any of the Vendor's rights under the Assumed Contract
without the prior written approval of the Purchaser.
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5.3 PERFORMANCE OF ASSUMED CONTRACTS
(a) The Vendor must perform and observe all obligations of the Vendor
under the Assumed Contract which are due to be performed (or relate to
the period) on or before the Closing Date.
(b) The Purchaser must, to the extent it lawfully can, assume, perform and
observe all obligations of the Vendor under the Assumed Contract which
are due to be performed (or relate to the period) after Closing.
(c) The Vendor must, at the request and expense of and with the assistance
of the Purchaser, use its reasonable endeavours to perform any
obligation of it under the Assumed Contract which arises (or relates
to the period) from Closing which the Purchaser cannot lawfully
assume, perform or observe.
5.4 VENDOR TO COOPERATE GENERALLY
Pending the transfer of an Assumed Contract to the Purchaser under clause 5.1
and to give effect to the allocation of responsibility for performance of and
liabilities and obligations under an Assumed Contract under clauses 5.3, 5.5 and
5.6, the Vendor must fully cooperate with the Purchaser in any reasonable
arrangements designed to provide for the Purchaser the Benefits of the Assumed
Contract subject to the Purchaser assuming the burden of the Assumed Contract.
5.5 VENDOR'S INDEMNITY
Subject to Closing occurring, the Vendor indemnifies the Purchaser from and
against all Losses and Liabilities suffered, paid or incurred by the Purchaser
from:
(a) any breach, non-performance or non-observance of any obligation of the
Vendor under an Assumed Contract which is due to be performed (or
relates to the period) on or before the Closing Date;
(b) any Claim made by a counterparty under an Assumed Contract arising
from events, acts or omissions occurring on or before the Closing
Date;
(c) any breach, non-performance or non-observance of any obligation of the
Vendor under an Assumed Contract which is due to be performed (or
relates to the period) after the Closing Date incurred from acts,
omissions or events caused or contributed to by the Vendor, other than
at the direction of the Purchaser; and
(d) any breach by the Vendor of clauses 5.2(b), 5.3 or 5.4.
5.6 PURCHASER'S INDEMNITY
Subject to Closing occurring, the Purchaser indemnifies the Vendor from and
against all Losses and Liabilities suffered, paid or incurred by the Vendor
from:
21
(a) any breach, non-performance or non-observance of any obligation of the
Purchaser under an Assumed Contract which is due to be performed (or
relates to the period) after the Closing Date except to the extent
that any such Loss or Liability is suffered, paid or incurred from
acts, omissions of or events caused or contributed to by the Vendor
(other than at the direction of the Purchaser);
(b) any Claim made by a counterparty under an Assumed Contract arising
from events, acts or omissions occurring after the Closing Date except
to the extent that any such Loss or Liability is suffered, paid or
incurred from acts, omissions of or events caused or contributed to by
the Vendor (other than at the direction of the Purchaser); and
(c) any breach by the Purchaser of clause 5.3.
ARTICLE 6
ON AND AFTER CLOSING
6.1 PURCHASERS' OBLIGATIONS
The Purchaser:
(a) must, as soon as practicable after Closing, lodge for registration:
(i) under the Petroleum Act and the P&G Act, the instruments of
transfer of the Petroleum Tenures; and
(ii) under the EP Act, the instruments of transfer in respect of any
Environmental Authorities corresponding to the Petroleum Tenures,
received by it on Closing, and thereafter to do all commercially
reasonable things as may be necessary to facilitate registration
of those instruments of transfer;
(b) must, as soon as practicable after Closing, lodge security of an
amount and in cash or in a form required or approved by the Minister
or the EP Authority in respect of the Petroleum Tenures, so as to
enable the release and replacement of all security or undertaking
lodged by or on behalf of the Vendor in relation to the Petroleum
Tenures; and
(c) notwithstanding any other provision of this Agreement (including the
Purchaser's obligations set forth above and the Security), during the
period after Closing in which the Vendor continues to hold legal title
(as trustee for the benefit of the Purchaser) to any of the Assets
until such assets are legally transferred to the Purchaser and
registered in the name of the Purchaser, the Purchaser shall only be
required to perform any applicable obligations of the Purchaser set
out herein or in the Security to the extent possible while not holding
legal title to such Assets.
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6.2 VENDOR'S OBLIGATIONS
Without limiting any other obligation under this Agreement, unless otherwise
expressly disclosed in this Agreement or first consented to by the Purchaser in
writing, on and after Closing until the transfer of the Petroleum Tenures and
the Environmental Authorities to the Purchaser (as the case may be) and (where
required by Applicable Law) completion of registration of those transfers, the
Vendor must:
(a) not dispose or agree to dispose of, encumber, take any steps to
surrender, cancel, transfer or declare itself a trustee of the
Petroleum and Natural Gas Rights or the Environmental Authorities;
(b) not of their own volition, seek to amend the conditions of, or
terminate, any of the Petroleum Tenures or the Environmental
Authorities; and
(c) promptly give to the Purchaser any notices or correspondence received
from the Minister, the EP Authority or any other Governmental
Authority as to any Petroleum Tenure or Environmental Authority.
6.3 PURCHASER TO COMPLY WITH DEVELOPMENT PLANS
(a) The Purchaser acknowledges and understands that each of the Petroleum
Tenures is subject to a Development Plan and failure to comply with
the Development Plan could result in the Petroleum Tenures being
cancelled, terminated or revoked.
(b) On and from Closing the Purchaser will comply with the requirements of
the Development Plan for each Petroleum Tenure to the extent possible
while not holding legal title to such Petroleum Tenure.
ARTICLE 7
INTERIM PROVISIONS
7.1 MAINTENANCE OF ASSETS
During the Interim Period, the Vendor shall:
(a) conduct its business in material compliance with Applicable Laws and
generally accepted oil and gas industry practices in Queensland;
(b) operate and maintain the Assets:
(i) in a proper and prudent manner consistent with the Vendor's past
practices; and
23
(ii) in material compliance with all Applicable Laws;
(c) except as otherwise provided in this Agreement, pay or cause to be
paid all costs and expenses relating to the Assets that become due
prior to the Closing Time; and
(d) perform and comply with all of the material provisions of the
Petroleum Tenures;
provided that where the Vendor is not the operator of any Asset (or the holder
of one hundred percent (100%) of the interests therein), the Vendor shall be
obligated to do only that which a prudent non-operator would be expected to do
in similar circumstances in accordance with good oil and gas industry practices.
7.2 CONSENT OF PURCHASER
Notwithstanding clause 7.1, during the Interim Period, the Vendor shall not
without the prior written consent of the Purchaser, which consent shall not be
unreasonably withheld by the Purchaser and which, if provided, shall be provided
in a timely manner:
(a) make any commitment or propose, initiate or authorize any capital
expenditure with respect to the Assets of which the Vendor's share is
in excess of ten thousand Dollars ($10,000.00), except in case of an
emergency or in respect of amounts which the Vendor may be committed
to expend or be deemed to authorize for expenditure without its
consent;
(b) surrender or abandon any of the Assets;
(c) amend or terminate any Petroleum Tenure or any other agreement or
document to which the Assets are subject, or enter into any new
agreement or commitment relating to the Assets; or
(d) sell, encumber or otherwise dispose of any of the Assets or any part
or portion thereof excepting sales of produced Leased Substances or
any of the Assets in the normal course of business.
7.3 PRE-CLOSING INTEGRATION OF ASSETS
The Vendor shall make reasonable commercial efforts after the execution of this
Agreement, and prior to Closing, to provide the Purchaser, at the Purchaser's
expense, with the information that it reasonably requires and requests to aid in
the planning for, and the integration of, the Assets into the Purchaser's
business. The Vendor shall ensure that the Purchaser has reasonable access
during business hours prior to Closing to the Vendor's accounting, land and
operational records that pertain to the Assets for the purposes of the planning
for, and the integration of, the Assets into the Purchaser's business.
24
ARTICLE 8
DUE DILIGENCE
8.1 ACCESS
(a) Between the date hereof and the Closing Time, the Vendor shall allow
the Purchaser and its Representatives to have reasonable access,
during normal business hours of the Vendor, to the field locations at
which the Xxxxx and the Facilities and other Tangibles are situated
and to the Lands and any other lands to which the rights and interests
included in the Miscellaneous Interests relate in order to conduct a
physical inspection thereof, including reasonable inspections to
determine and evaluate the environmental condition thereof in order to
assess the Environmental Liabilities associated with the Assets. The
Purchaser shall use all reasonable efforts to limit and minimize any
disruption to operations that may be caused by such inspections and
will follow all of the Vendor's safety and work permit requirements.
All such inspections shall be conducted at the Purchaser's sole cost,
risk and expense and the Purchaser shall indemnify the Vendor and each
of the Vendor's Related Parties from and against all Losses and
Liabilities suffered, sustained, paid or incurred by any of them and
all Claims made against any of them as a consequence of any bodily
injury or death suffered by any person or any damage to the property
of any person in connection with such access and inspections.
(b) Between the date hereof and the Closing Time, the Vendor shall provide
to the Purchaser and its Representatives reasonable access to all:
(i) title opinions and reports;
(ii) Petroleum Tenures;
(iii) agreements and documents to which the Assets are subject;
(iv) documents relating to Encumbrances affecting the Assets;
(v) evidence with respect to the payment of all rentals, royalties
and other payments due under the Petroleum Tenures and any other
agreements and documents to which the Assets are subject;
(vi) evidence with respect to the payment of all taxes, charges and
assessments pertaining to the Assets;
(vii) lease records, data sheets, production records, ownership maps
and surveys;
(viii) Permits;
(ix) all documents and information relevant to Environmental
Liabilities;
25
(x) accounting records, policies of insurance, consulting agreements,
field contracts and other agreements relating to the operation of
the Assets; and
(xi) other documentation relating to or comprising the Assets;
that are in the Vendor's possession and control. Such review shall be
conducted at the Purchaser's sole cost, risk and expense.
8.2 NOTICE OF TITLE DEFECTS
If the Purchaser becomes aware of any Title Defects as a result of its review of
title to the Assets, then the following shall apply:
(a) no later than ten (10) Business Days after it has first come to the
Purchaser's attention but no later than five (5) Business Days prior
to the Closing Time, the Purchaser shall notify the Vendor in writing
of the Title Defects it becomes aware of during the course of its
title review; and
(b) such notice shall include a description of each Title Defect in
reasonable detail, the Assets directly and adversely affected thereby
(hereinafter, the "TITLE DEFECTAFFECTED ASSET"), and, in the case of
each Material Title Defect, the bona fide value allocated by the
Purchaser acting reasonably, by which the value of each Title Defect
Affected Asset has, in the Purchaser's opinion, acting reasonably and
in good faith, been reduced by such Material Title Defect, taking into
account the likelihood the Material Title Defect will manifest itself,
and the Purchaser's reasonable requirements for the remedying thereof.
8.3 RECTIFICATION OF MATERIAL TITLE DEFECTS
(a) Prior to the Closing Time, the Vendor shall use reasonable commercial
efforts to cure or rectify all the Title Defects of which Purchaser
gives notice pursuant to clause 8.2, or of which the Vendor otherwise
has knowledge, however, priority shall be given to Material Title
Defects. The Vendor shall not be required to make any payment to cure
a Title Defect.
(b) If any Material Title Defect described in the Purchaser's notice is
not cured or removed to the Purchaser's reasonable satisfaction within
three (3) Business Days prior to the Closing Time, the following shall
apply:
(i) where the aggregate amount by which the value of all of the Title
Defect Affected Assets has been reduced by such Material Title
Defects is, in the Purchaser's opinion, acting reasonably and in
good faith, two hundred and fifty thousand Dollars ($250,000.00)
or less, the Purchaser shall be deemed to waive permanently such
uncured Material Title Defects and shall complete the Transaction
without an adjustment to the Consideration on account of such
Material Title Defects and the Purchaser shall be deemed to have
waived all Title Defects; or
26
(ii) where the aggregate amount by which the value of all of the Title
Defect Affected Assets has been reduced by such Material Title
Defects is, in the Purchaser's opinion, acting reasonably and in
good faith, equal to or more than two hundred and fifty thousand
Dollars ($250,000.00), either Party may elect, subject to clause
8.4, by notice in writing delivered to the other Party prior to
the Closing Time, to terminate this Agreement, in which case the
Parties shall thereupon be discharged from further obligations
hereunder, except for those arising under Article 10. If no Party
elects to terminate this Agreement in accordance with this clause
prior to the Closing Time then, subject to clause 8.4, the
Parties will proceed to Closing with the Consideration adjusted
accordingly and the Purchaser shall be deemed to have waived all
Title Defects.
8.4 VALUE DISPUTES FOR UNCURED MATERIAL TITLE DEFECTS
In determining any reduction in value of the Title Defect Affected Assets due to
uncured Material Title Defects, it is the intent of the Parties to include, when
reasonably possible, only those Assets directly and adversely affected by the
uncured Material Title Defect. If the Vendor disagrees with (i) the value
allocated by the Purchaser to any of the Title Defect Affected Assets, (ii) the
Purchaser's statement of the value by which a Title Defect Affected Asset has
been reduced by a Material Title Defect, or (iii) the validity of a Material
Title Defect; or in the instance that the amount by which the value of the Title
Defect Affected Assets has been reduced, as allocated by the Purchaser, is equal
to or greater than one of the adjustment or termination thresholds provided in
clause 8.3 if the Vendor believes such amount, (if any) by which the value has
been reduced is less than such adjustment or termination threshold, the Parties
shall promptly meet to discuss in good faith the issue and the following shall
apply:
(a) if after such a meeting, the issue has not been resolved or if a Party
does not forthwith meet to discuss the issue, the issue shall be
referred to an Independent Expert pursuant to the provisions of
Article 12, in which case Closing shall be delayed until after the
decision of the Independent Expert has been rendered, subject to the
remainder of this clause 8.4;
(b) if, based on the Independent Expert's decision, the cumulative amount
by which the value of all the Title Defect Affected Assets has been
reduced is equal to or less than the adjustment threshold provided in
clause 8.3(b)(i), the Parties shall proceed to close the Transaction
on the third (3rd) Business Day after the decision of the Independent
Expert has been rendered and given to both Parties, without an
adjustment to the Consideration on account of such Material Title
Defects; or
27
(c) if, based on the Independent Expert's decision, the cumulative amount
by which the value of all the Title Defect Affected Assets has been
reduced is greater than the termination threshold described in clause
8.3(b)(ii), either Party may elect termination as provided by this
Agreement upon written notice to the other Party delivered within
three (3) Business Days after the decision of the Independent Expert
has been rendered and given to both Parties, in which case the Parties
shall thereupon be discharged from all further obligations hereunder,
except for those arising under Article 10, provided, however, that
failure by the Purchaser to elect in writing to terminate this
Agreement within the time period set out in this subclause (3) above
shall be deemed to be an election by the Purchaser to complete the
Transaction in accordance with the reduction in price mechanism
prescribed in subclause 8.3(b)(ii), such that the Parties shall
proceed to Closing on the fifth (5th) Business Day after the decision
of the Independent Expert has been rendered and given to both Parties,
with the Consideration being adjusted by taking into account the
findings of the Independent Expert.
8.5 NOTICE OF ENVIRONMENTAL DEFECTS
If the Purchaser becomes aware of any Environmental Defects as a result of its
inspection of the Assets, then the following shall apply:
(a) no later than ten (10) Business Days after it has first come to the
Purchaser's attention but no later than five (5) Business Days prior
to the Closing Time, the Purchaser shall notify the Vendor in writing
of the Environmental Defects; and
(b) such notice shall include a description of each Environmental Defect
in reasonable detail, the Assets directly and adversely affected
thereby (the "ENVIRONMENTAL DEFECT AFFECTED ASSET"), and, in the case
of each Material Environmental Defect, the bona fide value allocated
by the Purchaser acting reasonably, by which the value of each
Environmental Defect Affected Asset has, in the Purchaser's opinion,
acting reasonably and in good faith, been reduced by such Material
Environmental Defect, taking into account only the reasonable
requirements for the remedying thereof.
8.6 RECTIFICATION OF MATERIAL ENVIRONMENTAL DEFECTS
(a) Prior to the Closing Time, the Vendor shall use reasonable commercial
efforts to cure or rectify all the Environmental Defects of which the
Purchaser gives notice pursuant to clause 8.5,or of which Vendor
otherwise has knowledge, however, priority shall be given to Material
Environmental Defects.
(b) If any Material Environmental Defect described in the Purchaser's
notice is not cured or removed to the Purchaser's reasonable
satisfaction within three (3) Business Days prior to the Closing Time,
the following shall apply:
(i) if the aggregate amount by which the value of all of the
Environmental Defect Affected Assets has been reduced by such
Material Environmental Defects is, in the Purchaser's opinion,
acting reasonably and in good faith, two hundred and fifty
thousand Dollars ($250,000.00) or less, the Purchaser shall be
deemed to waive permanently such uncured Material Environmental
Defects and shall complete the Transaction without an adjustment
to the Consideration on account of such Material Environmental
Defects and the Purchaser shall be deemed to have accepted and
waived all Environmental Defects for the purpose of this clause
8.6 and clause 9.2; or
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(ii) if the aggregate amount by which the value of all of the
Environmental Defect Affected Assets has been reduced by such
Material Environmental Defects is, in the Purchaser's opinion,
acting reasonably and in good faith, more than two hundred and
fifty thousand Dollars ($250,000.00), either Party may elect,
subject to clause 8.7, by notice in writing delivered to the
other Party prior to the Closing Time, to terminate this
Agreement, in which case the Parties shall thereupon be
discharged from further obligations hereunder, except for those
arising under Article 10. If no Party elects to terminate this
Agreement in accordance with this clause prior to the Closing
Time then, subject to clause 8.7, the Parties will proceed to
Closing with the Consideration adjusted accordingly and the
Purchaser shall be deemed to have waived all Environmental
Defects.
8.7 VALUE DISPUTES FOR UNCURED MATERIAL ENVIRONMENTAL DEFECTS
In determining any reduction in value of the Environmental Defect Affected
Assets due to uncured Material Environmental Defects, it is the intent of the
Parties to include, when reasonably possible, only those Assets directly and
adversely affected by the uncured Material Environmental Defect. If the Vendor
disagrees with (i) the value allocated by the Purchaser to any of the
Environmental Defect Affected Assets, (ii) the Purchaser's statement of the
value by which an Environmental Defect Affected Asset has been reduced by a
Material Environmental Defect, or (iii) the validity of a Material Environmental
Defect; or in the instance that the amount by which the value of the
Environmental Defect Affected Assets has been reduced, as allocated by the
Purchaser, is equal to or greater than one of the adjustment or termination
thresholds provided in clause 8.6 if the Vendor believes such amount, (if any)
by which the value has been reduced is less than such adjustment or termination
threshold, the Parties shall promptly meet to discuss in good faith the issue
and the following shall apply:
(a) if after such a meeting, the issue has not been resolved or if a Party
does not forthwith meet to discuss the issue, the issue shall be
referred to an Independent Expert pursuant to the provisions of
Article 12, in which case Closing shall be delayed until after the
decision of the Independent Expert has been rendered, subject to the
remainder of this clause 8.7;
(b) if, based on the Independent Expert's decision, the cumulative amount
by which the value of all the Environmental Defect Affected Assets has
been reduced is equal to or less than the adjustment threshold
provided in clause 8.6(b)(i), the Parties shall proceed to close the
Transaction on the third (3rd) Business Day after the decision of the
Independent Expert has been rendered and given to both Parties,
without an adjustment to the Consideration on account of such Material
Environmental Defects; or
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(c) if, based on the Independent Expert's decision, the cumulative amount
by which the value of all the Environmental Defect Affected Assets has
been reduced is greater than the termination threshold described in
clause 8.6(b)(ii), either Party may elect termination as provided by
this Agreement upon written notice to the other Party delivered within
three (3) Business Days after the decision of the Independent Expert
has been rendered and given to both Parties, in which case the Parties
shall thereupon be discharged from all further obligations hereunder,
except for those arising under Article 10, provided, however, that
failure by the Purchaser to elect in writing to terminate this
Agreement within the time period set out in this subclause (c) above
shall be deemed to be an election by the Purchaser to complete the
Transaction in accordance with the reduction in price mechanism
prescribed in subclause 8.6(b)(ii), such that the Parties shall
proceed to Closing on the fifth (5th) Business Day after the decision
of the Independent Expert has been rendered and given to both Parties,
with the Consideration being adjusted by taking into account the
findings of the Independent Expert.
ARTICLE 9
REPRESENTATIONS AND WARRANTIES
9.1 REPRESENTATIONS AND WARRANTIES OF THE VENDOR REGARDING THE VENDOR
Each Vendor represents and warrants to the Purchaser that as of the date of this
Agreement and as at the Closing Time, and subject to the satisfaction of the
Conditions Precedent (as applicable), by reference to the facts and
circumstances then existing:
(a) it is a corporation duly organized and validly existing under the laws
of the Commonwealth of Australia, is authorized to carry on business
in the State in which the Lands are located, and now has good right,
full power and absolute authority to sell and convey its interest in
and to the Assets to the Purchaser according to the true intent and
meaning of this Agreement;
(b) the execution, delivery and the performance of this Agreement has been
duly and validly authorized by any and all requisite corporate,
shareholders' and directors' actions and will not result in any
violation of, be in conflict with or constitute a default under any
articles, charter, bylaw or other governing document to which the
Vendor is bound;
(c) the execution, delivery and performance of this Agreement, will not
result in any violation of, be in conflict with or constitute a
default under any term or provision of any agreement or document to
which it is party or by which it is bound, nor under any Applicable
Law;
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(d) this Agreement and any other agreements delivered in connection
herewith constitute valid and binding obligations of the Vendor
enforceable against it in accordance with their terms subject to the
availability of equitable remedies and to laws and regulations
relating to bankruptcy and creditor's rights;
(e) other than the Approvals, no authorization or approval or other action
by, and no notice to or filing with, any Governmental Authority or
regulatory body exercising jurisdiction over the Assets, or the Vendor
is required for the due execution, delivery and performance by it of
this Agreement, other than authorizations, approvals or exemptions
from requirement therefore, previously obtained and currently in
force; and
(f) it has not incurred any obligation or liability, contingent or
otherwise, for brokers' or finders' fees in respect of this Agreement,
the Transaction or any matter for which the Purchaser shall have any
obligation or liability.
9.2 REPRESENTATIONS AND WARRANTIES OF THE VENDOR REGARDING THE ASSETS
Each Vendor represents and warrants to the Purchaser that as of the date of this
Agreement and as at the Closing Time, by reference to the facts and
circumstances then existing:
(a) each of PL18, PL40 and PL280 has not been amended or modified and is
in full force and effect and, to the Vendor's knowledge, no party
thereto is in default thereunder;
(b) no Person has made or, to the knowledge of the Vendor, is threatening
to make, any Claim challenging the validity or enforceability of its
interest in each of PL18, PL40 and PL280;
(c) it has been paid all amounts due to it and borne all material expenses
payable by it under each of PL18, PL40 and PL280 in accordance with
its terms and in proportion to the Petroleum and Natural Gas Rights;
(d) it has not subjected XX00, XX00 or PL280 to any Encumbrance other than
the Permitted Encumbrances and is not obligated to pay a share of any
costs arising under each of PL18, PL40 or PL280 that is
disproportionate to the Petroleum and Natural Gas Rights;
(e) subject to the Permitted Encumbrances, it has not:
(i) alienated or encumbered the Assets or any part or portion
thereof, or
(ii) committed or is aware of there having been committed any act or
omission whereby its interest in and to the Assets or any part or
portion thereof may be cancelled, reduced or terminated;
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(f) subject to the Permitted Encumbrances, the Assets are free and clear
of all Encumbrances created by, through or under it or of which it has
knowledge;
(g) it has not received notice from any Third Party claiming an interest
in and to any of the Assets adverse to the interest of the Vendor and
it has no reason to believe that any such claim may be made;
(h) it has not received notice of default and it is not in any default
under any obligation, agreement, document, order, writ, injunction or
decree of any court or of any commission or administrative agency,
which might result in impairment or loss of its interest in and to any
of the Assets or any impairment to or restrictions on the use and
enjoyment of any of the Assets after Closing;
(i) no Claim has been commenced against it or, to its knowledge, has been
threatened against it or any Third Party, which might result in
material impairment or loss of its interest in and to any of the
Assets or the use and enjoyment thereof or which might otherwise
materially and adversely affect any of the Assets (including the value
thereof) or any rights to, and rights to enter upon, use or occupy the
surface of any Lands; nor is it aware of any fact or circumstance that
could reasonably be expected to give rise to such a Claim;
(j) all amounts due and payable to Third Parties or its Affiliates prior
to the date hereof and pertaining to any of the Assets have been fully
paid, including (i) all royalties, (ii) any and all ad valorem and
property taxes, and (iii) any and all production, severance and
similar taxes, charges and assessments based upon or measured by the
ownership or production of the Leased Substances or any of them or the
receipt of proceeds therefore; provided however, in the case of any
and all amounts due and payable prior to the time it first acquired an
interest in and to any of the Assets to which such amounts pertain,
provided that, in respect of any of the Assets that are not operated
by it, it makes this representation and warranty only based upon its
knowledge;
(k) in respect of any of the Assets, except in connection with the AFEs,
it has no financial commitments which are (individually) in excess of
ten thousand Dollars ($10,000.00) or in the aggregate in excess of
fifty thousand Dollars ($50,000.00) and which are due as of the date
hereof or which may become due after the date hereof by virtue of
matters occurring or arising prior to the date hereof, other than
usual operating expenses incurred in the normal conduct of operations;
(l) in respect of any of the Assets that are operated by it, it holds all
valid Permits and similar rights and privileges, and, in respect of
any of the Assets that are operated by Third Parties, it has not
received written notice, nor is it aware that, such Third Parties do
not hold all valid Permits and similar rights and privileges, that are
required under Applicable Law to operate any of the Assets as
presently operated;
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(m) in respect of any of the Assets that are operated by it, any and all
of its operations on or in respect of any of the Assets have been,
and, in respect of any of the Assets that are operated by Third
Parties, it has not received written notice that such operations by
Third Parties have not been, conducted in accordance, in all material
respects, with good oil and gas industry practices and in material
compliance with all Applicable Laws;
(n) the Tangibles operated by it are, and, in respect of the Tangibles
operated by Third Parties, to its knowledge are, in good and operable
condition, reasonable wear and tear excepted;
(o) it has not received and is not aware of:
(i) any orders or directives from any Governmental Authority having
jurisdiction which relate to Environmental Liabilities and which
require any work, repairs, construction or capital expenditures
with respect to any of the Assets, where such orders or
directives have not been complied with in all material respects;
(ii) any demand or notice issued with respect to the breach of any
Applicable Law or any other Claim relating to the Environment,
Environmental Liabilities, health or safety applicable to any of
the Assets, including respecting the use, storage, treatment,
transportation or disposition of environmental contaminants or
the abandonment or reclamation of any Xxxxx, Facilities or Lands,
which demand or notice remains outstanding on the date hereof;
(iii) written notice that there has been any releases, deposits or
discharges, in violation of Applicable Law, of any hazardous or
toxic substances, contaminants or wastes into the Environment in
respect of any of any of the Assets or the operation thereof of
that have not been rectified in all material respects;
(iv) any releases, deposits or discharges, in violation of Applicable
Law, of any hazardous or toxic substances, contaminants or wastes
into the Environment which if known to any Governmental Authority
could reasonably be expected to lead to any order, directive,
demand or notice described in clause9.2(o)(i), (ii) or (iii)
above, that have not been rectified, remedied or abated in all
material respects;
(p) it has no Take or Pay Obligations in respect of the Assets;
(q) it has not received nor delivered any written notices, nor is it aware
of, any material breach of or material default under or alleged
material breach of or material default under of any provisions of any
Petroleum Tenure or any of the agreements included in the
Miscellaneous Interests;
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(r) subject to Permitted Encumbrances and the satisfaction by the
Purchaser after Closing of all of the obligations accruing after
Closing required to maintain the Petroleum Tenures in good standing,
after Closing the Purchaser will have the right to hold and enjoy the
Assets for the residue of their respective terms and all renewals or
extensions thereof for the Purchaser's own use and benefit, without
any lawful interruption of or by the Vendor or any Person claiming or
able to claim by, through or under the Vendor;
(s) to its knowledge, (i) the Assets are not bound by or comprised of any
contract or other arrangement for the sale, gathering, processing,
treating, storage, balancing, compression, transmission,
transportation, injection or subsurface disposal, fractionation of, or
the provision of any similar services in respect of, any (A) Petroleum
Substances, (B) construction, ownership and operating agreements, (C)
agreements for the use of wellbores, or (D) agreements for the
contract operation of any Xxxxx or Tangibles by a Third Party or any
custom usage of the Facilities or other Tangibles by a Third Party;
and (ii) it is not a party to any such contract or arrangement for
which it is liable; except for, in each case of (i) and (ii) above,
any agreements or arrangements identified in a Schedule, including the
Assumed Contracts, or contracts or arrangements which are terminable
without penalty on 31 days or less notice;
(t) other than as identified in Schedule "B" under the heading "Leased
Tangibles", none of the Tangibles are leased or rented;
(u) all material information in its possession and control that pertains
to the Assets or the condition or operation thereof, including
records, files and documents relating to any of the Assets, Petroleum
Tenures, Assumed Contracts, AFEs and all other material agreements,
instruments and other documents included in the Miscellaneous
Interests or identified in a Schedule has been or will be made
available for review by the Purchaser or its Representatives on or
prior to Closing;
(v) to the extent that another Person was disposing of its share of
production from or allocated to any of the Assets prior to the date
hereof, to its knowledge;
(i) it has been receiving its share of the proceeds from the
disposition of such production from or allocated to such Assets;
and
(ii) no Person other than the Vendor has claimed any entitlement to
such proceeds;
(w) to its knowledge each Well for which it was or is the operator has
been drilled by the Vendor and, if completed, completed and operated
by the Vendor, in all material respects, in accordance with generally
accepted oil and gas field practices and the material requirements of
the Applicable Laws as they existed at the relevant time;
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(x) other than the Xxxxx described in Schedule "A", to its knowledge there
are no xxxxx located on the Lands for which the Purchaser will assume
any liability by virtue of the completion of this Transaction;
(y) to its knowledge each Well that has been abandoned has been plugged
and abandoned by the Vendor, and the wellsite therefore properly
restored, in all material respects, in accordance with generally
accepted oil and gas field practices and the material requirements of
the Applicable Laws as they existed at the relevant time;
(z) to its knowledge the Tangibles have been constructed, installed,
maintained and operated, in all material respects, in accordance with
generally accepted oil and gas field practices and the material
requirements of the Applicable Laws as they existed at the relevant
time; and
(aa) as of the date hereof, to the Vendor's knowledge, no royalty or joint
venture audits have been demanded or are underway pursuant to the
Petroleum Tenures in respect of any of the Assets.
9.3 APPLICATION OF WARRANTIES
Each of the Warranties:
(a) is separate and independent and not limited or restricted by any other
Warranty; and
(b) continues in full force after Closing.
9.4 QUALIFICATIONS TO WARRANTIES
The Warranties are qualified by, and the Purchaser and any Affiliate of the
Purchaser may not make any Warranty Claim for, anything:
(a) fairly disclosed in this Agreement or the Disclosure Letter; or
(b) the Purchaser has actual knowledge of before entering in this
Agreement.
9.5 EXCLUSION OF OTHER REPRESENTATIONS AND WARRANTIES
Except as expressly stated in the Warranties, the Vendor give no representations
or warranties whatever about anything including:
(a) future matters, including the future value or performance of the
Assets; or
(b) the accuracy or completeness of any information provided to the
Purchaser about the Assets.
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9.6 PURCHASER'S ACKNOWLEDGMENTS
The Purchaser acknowledges and agrees that:
(a) the Warranties are the only representations and warranties the Vendor
has given;
(b) the Warranties are the only representations and warranties the
Purchaser has relied on in entering into this Agreement;
(c) before entering into this Agreement, it did not know of anything that
was likely to result in a Warranty Claim.
9.7 NOTICE OF WARRANTY CLAIMS
(a) The Purchaser must give the Vendor written notice of a Warranty Claim
or anything the Purchaser becomes aware of that is reasonably likely
to result in a Warranty Claim (including any Third Party Claim) (a
"WARRANTY CLAIM NOTICE").
(b) A Warranty Claim Notice must include reasonable details of the
Warranty Claim (to the extent known by the Purchaser) including:
(i) the nature of the Warranty Claim;
(ii) the circumstances resulting in the Warranty Claim;
(iii) whether the Warranty Claim involves a Third Party Claim; and
(iv) a bona fide estimate of the likely amount of the Warranty Claim
and the basis for that estimate.
9.8 MITIGATION
Without limiting the Purchaser's obligations at law or the Vendor's rights under
clause 15.14, the Purchaser must take reasonable steps to minimise the Losses
and Liabilities incurred by it or any Affiliate of it in connection with
anything that is reasonably likely to result in a Warranty Claim.
9.9 TIME LIMITS FOR WARRANTY CLAIM NOTICES AND WARRANTY CLAIMS
The Vendor will not be liable for any Warranty Claim unless they receive a
Warranty Claim Notice for the Warranty Claim within twelve (12) months after the
Closing Date.
9.10 LOWER LIMITS FOR WARRANTY CLAIMS
The Vendor will not be liable for a Warranty Claim unless:
(a) the amount of the Warranty Claim is more than ten thousand Dollars
($10,000.00); and
36
(b) the aggregate amount of all Warranty Claims more than ten thousand
Dollars ($10,000.00) exceeds fifty thousand Dollars ($50,000.00);
in which case the Vendor will be liable only for the excess amount.
9.11 UPPER LIMIT FOR WARRANTY CLAIMS
The Vendor's maximum, total, aggregate and combined liability for Warranty
Claims, and all other Claims under this Agreement, is limited to three million
Dollars ($3,000,000.00).
9.12 OTHER LIMITS
The Vendor will not be liable for a Warranty Claim to the extent that:
(a) it results from any voluntary act, omission, arrangement or
transaction of the Purchaser or any Related Party of the Purchaser
after Closing;
(b) anything causing the Warranty Claim is remediable and is remedied by
the Vendor within ninety (90) days after the Vendor receives the
Warranty Claim Notice for that Warranty Claim;
(c) anything causing the Warranty Claim entitles the Purchaser or any
Affiliate of the Purchaser to any, and the Purchaser or such Affiliate
of the Purchaser actually recovers any:
(i) tax allowance, credit, deduction, exemption, rebate, relief or
set-off;
(ii) compensation or indemnification under any insurance policy;
(iii) recovery under any Third Party Claim; or
(iv) other credit, recovery or benefit; or
(d) it results from any change (whether applying retrospectively or not)
after Closing to any Applicable Law.
9.13 RECOVERY ONCE
The Purchaser and any Related Parties of the Purchaser may not recover from the
Vendor more than once for anything causing any Warranty Claim; provided that
this clause shall not be construed as a waiver by the Purchaser of a continuing
breach by the Vendor.
9.14 REIMBURSEMENT IF SUBSEQUENT RECOVERY FROM THIRD PARTIES
If the Purchaser or any Related Parties of the Purchaser receive any payment
from or on behalf of the Vendor for any Warranty Claim ("VENDOR PAYMENT") and
the Purchaser or any Related Parties of the Purchaser subsequently recover any
amount from any Third Party (including under a Third Party Claim) for anything
causing that Warranty Claim ("RECOVERED AMOUNT"), the Purchaser must promptly:
37
(a) notify the Vendor of the Recovered Amount; and
(b) pay the Vendor an amount equal to the lesser of:
(i) the Recovered Amount less any reasonable costs and expenses
incurred by the Purchaser or any Related Parties of the Purchaser
(as the case may be) in making that recovery; and
(ii) the Vendor Payment.
9.15 REDUCTION IN CONSIDERATION
Any payment by the Vendor for a Warranty Claim will be treated as a reduction in
the Consideration.
9.16 REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
The Purchaser represents and warrants to the Vendor that as of the date of this
Agreement and as at the Closing Time, by reference to the facts and
circumstances then existing:
(a) the Purchaser is a corporation duly organized and validly existing
under the laws of Australia,
(b) the Purchaser, is or by the Closing Time will be authorized to carry
on business in the State in which the Lands are located, and now has
or by the Closing Time will have good right, full power and absolute
authority to purchase the Assets according to the true intent and
meaning of this Agreement;
(c) the execution, delivery and performance of this Agreement has been
duly and validly authorized by any and all requisite corporate,
shareholders' and directors' actions and will not result in any
violation of, be in conflict with or constitute a default under any
articles, charter, bylaw or other governing document to which the
Purchaser is bound;
(d) the execution, delivery and performance of this Agreement will not
result in any violation of, be in conflict with or constitute a
default under any term or provision of any agreement or document to
which the Purchaser is party or by which the Purchaser is bound, nor
under any Applicable Law;
(e) this Agreement has been duly executed and delivered by the Purchaser;
38
(f) this Agreement and any other agreements delivered in connection
herewith constitute valid and binding obligations of the Purchaser
enforceable against the Purchaser in accordance with their terms
subject to the availability of equitable remedies and to laws and
regulations relating to bankruptcy and creditor's rights;
(g) other than the Approvals, no authorization or approval or other action
by, and no notice to or filing with, any Governmental Authority
exercising jurisdiction over any of the Assets is required for the due
execution, delivery and performance by the Purchaser of this
Agreement, other than authorizations, approvals or exemptions from
requirement therefore, previously obtained and currently in force; and
(h) the Purchaser has not incurred any obligation or liability, contingent
or otherwise, for brokers' or finders' fees in respect of this
Agreement or the transaction to be effected by it for which the Vendor
shall have any obligation or liability.
ARTICLE 10
CONFIDENTIALITY
10.1 CONFIDENTIAL INFORMATION
Until Closing has occurred, the Purchaser shall keep confidential all
information respecting the Assets obtained from the Vendor. Such confidential
information respecting the Assets shall be used only for the purposes of this
acquisition and disclosed only to those of its Representatives with a need to
know such information in connection with the Transaction. In addition, any
information obtained by the Purchaser as a result of such access which does not
relate to the Assets shall continue to be treated as confidential and shall not
be used by the Purchaser without the prior written consent of the Vendor, which
may be withheld in the Vendor's sole discretion. The foregoing restrictions on
disclosure and use of information shall not apply to information, to the extent
that the Purchaser can show by documentary evidence that such information is:
(a) publicly available through no act or omission of the Purchaser or its
Representatives;
(b) subsequently obtained lawfully from a Third Party who is not bound to
the Vendor to restrict the use or disclosure of such information;
(c) already in the Purchaser's possession at the time of disclosure,
without any restriction on its disclosure; or
(d) required to be disclosed pursuant to Applicable Law or by the
direction of any Governmental Authority having jurisdiction or the
rules of any stock exchange.
Specific items of information shall not be considered to be in the public domain
merely because more general information respecting the Assets is in the public
domain.
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10.2 ACCESS BY REPRESENTATIVES
The Purchaser shall be responsible to the Vendor for ensuring that its
Representatives comply with the restrictions on the use and disclosure of the
information set forth in clause 10.1, and the Purchaser shall be liable to the
Vendor for any and all damages, costs and expenses that the Vendor may suffer or
incur as a result of any unauthorized use or disclosure of such confidential
information by such Representatives of the Purchaser.
10.3 RETURN OF DOCUMENTS
Other than any of the following that are required or desirable to pursue a
potential Claim under this Agreement, if Closing does not occur and this
Agreement is terminated, the Purchaser shall ensure that all documents, working
papers and other written material obtained from the Vendor in connection with
this Agreement are returned to the Vendor forthwith. In addition, all copies of
such information, whether electronic or hard copies, and all documents prepared
by the Purchaser and its Representatives containing such information shall be
destroyed and, if requested by the Vendor, an officer of the Purchaser shall
provide a certificate, in form and content reasonably satisfactory to the
Vendor, confirming that all such documents and copies have been returned to the
Vendor or destroyed.
ARTICLE 11
LIABILITIES AND INDEMNITIES
11.1 VENDOR'S INDEMNITIES
Except to the extent any Claim arises out of or relates to events or
circumstances which would constitute a breach of a representation, warranty or
covenant of the Purchaser under this Agreement for which the Purchaser would be
liable to indemnify the Vendor pursuant to clause11.2 and subject to the
qualifications and limitations in clauses 9.7 to 9.14 (which are to be read as
if a reference to a 'Warranty Claim' were a reference to a Claim by the
Purchaser against the Vendor (or either of them) under this clause 11.1), 11.2
and 11.3, from and after Closing, the Vendor shall be liable for and, as an
independent covenant, shall indemnify, defend and save harmless the Purchaser
and its Related Parties from and against any and all Purchaser's Losses that any
of them may suffer, sustain, pay or incur and all Claims made against the
Purchaser or any of its Related Parties, in each case, to the extent caused by
or arising out of or resulting from (i) breaches of the representations or
warranties made by the Vendor in clause 9.1 and 9.2; or (ii) breaches of
covenants made by the Vendor in this Agreement.
11.2 PURCHASER'S INDEMNITIES
(a) Except to the extent any Claim arises out of or relates to events or
circumstances which constitute a breach of a representation, warranty
or covenant of the Vendor under this Agreement for which the Vendor
would be liable to indemnify the Purchaser pursuant to clause 11.1
and, subject to clauses 11.1 and 11.3, from and after Closing, the
Purchaser shall be liable for and, as an independent covenant, shall
indemnify, defend and save harmless the Vendor and its Related Parties
from and against any and all Vendor's Losses that any of them may
suffer, sustain, pay or incur and all Claims made against the Vendor
or any of its Related Parties, in each case, to the extent:
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(i) subject to clause 9.3, caused by or arising out of or resulting
from breaches of the representations or warranties made by the
Purchaser in clause 9.16, for which written notice of such Losses
and Liabilities or Claims with reasonable particulars shall have
been provided by the Vendor to the Purchaser within twelve (12)
months from the Closing Time;
(ii) caused by or arising out of or resulting from breaches of
covenants made by the Purchaser in this Agreement;
(iii) caused by or arising out of the ownership or operation of the
Assets by the Purchaser from and after the Closing Time;
(iv) arising out of the Vendor holding title (registered or otherwise)
to any of the Assets after Closing in accordance with the terms
of this Agreement, which relate to events or circumstances
occurring after Closing; and
(v) caused by or arising out of or resulting from all Environmental
Liabilities, however and by whomsoever caused, and whether such
Environmental Liabilities occur or arise in whole or in part
prior to, at or subsequent to the Closing Time. The Purchaser
shall not be entitled to exercise and hereby waives any rights or
remedies the Purchaser may now or in the future have against the
Vendor in respect of such Environmental Liabilities, whether such
rights and remedies are pursuant to the common law or statute or
otherwise, including the right to name the Vendor as a third
party to any action commenced by any Third Party against the
Purchaser.
(b) From and after Closing, the Purchaser shall see to the timely
performance of all Abandonment and Reclamation Obligations pertaining
to the Assets. Subject to clauses 11.1 and 11.3, the Purchaser shall
be liable to the Vendor for and shall, in addition, indemnify the
Vendor and its Related Parties from and against, all Losses and
Liabilities suffered, sustained, paid or incurred by any of them
should the Purchaser fail to timely perform such obligations.
11.3 INDEMNIFICATION ACTIONS
For purposes of this clause 11.3, the term "INDEMNIFYING PERSON" when used in
connection with particular Losses and Liabilities shall mean the Person having
an obligation to indemnify another Person or Persons with respect to such Losses
and Liabilities pursuant to clauses 8.1(a), 11.1 and 11.2, and the term
"INDEMNIFIED PERSON" when used in connection with particular Losses and
Liabilities shall mean a Person having the right to be indemnified with respect
to such Losses and Liabilities pursuant to clauses 8.1, 11.1 and 11.2. All
claims for indemnification under clauses 8.1(a), 11.1 and 11.2 shall be asserted
and resolved as follows:
41
(a) to make a claim for indemnification under clauses8.1(a), 11.1 and
11.2, an Indemnified Person shall notify the Indemnifying Person of
its claim, including specific details of and specific basis under this
Agreement for its claim (the "CLAIM NOTICE"). If the claim for
indemnification is based upon a claim by a Third Party against the
Indemnified Person (a "THIRD PARTY CLAIM"), the Indemnified Person
shall provide its Claim Notice promptly after the Indemnified Person
has actual knowledge of the Third Party Claim and shall enclose a copy
of all papers (if any) served with respect to the Third Party Claim;
provided that the failure of any Indemnified Person to give notice of
a Third Party Claim as provided in this clause 11.3 shall not relieve
the Indemnifying Person of its obligations under clauses8.1(a), 11.1
and 11.2 except to the extent such failure materially prejudices the
Indemnifying Person's ability to defend against the Third Party Claim;
(b) in the case of a claim for indemnification based upon a Third Party
Claim, the Indemnifying Person shall have thirty (30) days from its
receipt of the Claim Notice to notify the Indemnified Person whether
it admits or denies its obligation to defend the Indemnified Person
against such Claim under this Article. If the Indemnifying Person does
not notify the Indemnified Person within such thirty (30) day period
regarding whether the Indemnifying Person admits or denies its
obligation to defend the Indemnified Person, the Losses and
Liabilities for which the Indemnified Person is seeking indemnity
shall be conclusively deemed a liability of the Indemnifying Person
hereunder. The Indemnified Person is authorized, prior to and during
such thirty (30) day period, to file any motion, answer or other
pleading that it shall deem necessary or appropriate to protect its
interests or those of the Indemnifying Person and that is not
prejudicial to the Indemnifying Person;
(c) if the Indemnifying Person admits its obligation to indemnify the
Indemnified Person, it shall have the right and obligation to
diligently defend, at its sole cost and expense, the Third Party
Claim. The Indemnifying Person shall have full control of such defence
and proceedings, including any compromise or settlement thereof. If
requested by the Indemnifying Person, the Indemnified Person agrees to
cooperate in contesting any Third Party Claim which the Indemnifying
Person elects to contest (provided, however, that the Indemnified
Person shall not be required to bring any counterclaim or
cross-complaint against any Person). The Indemnified Person may
participate in, but not control, any defence or settlement of any
Third Party Claim controlled by the Indemnifying Person pursuant to
this subclause (c). An Indemnifying Person shall not, without the
written consent of the Indemnified Person, such consent not to be
unreasonably withheld, settle any Third Party Claim or consent to the
entry of any judgment with respect thereto that (i) does not result in
a final resolution of the Indemnified Person's liability with respect
to the Third Party Claim (including, in the case of a settlement, an
unconditional written release of the Indemnified Person from all
liability in respect of such Third Party Claim) or (ii) may materially
and adversely affect the Indemnified Person (other than as a result of
money damages covered by the indemnity);
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(d) if the Indemnifying Person does not admit its obligation to indemnify
the Indemnified Person or admits its obligation but fails to
diligently defend or settle the Third Party Claim, the Indemnified
Person shall have the right to defend against the Third Party Claim
(at the sole cost and expense of the Indemnifying Person, if the
Indemnified Person is entitled to indemnification hereunder), with
counsel of the Indemnified Person's choosing, subject to the right of
the Indemnifying Person to admit its obligation to indemnify the
Indemnified Person and assume the defence of the Third Party Claim at
any time prior to settlement or final determination thereof. If the
Indemnifying Person has not yet admitted its obligation to indemnify
the Indemnified Person, the Indemnified Person shall send written
notice to the Indemnifying Person of any proposed settlement and the
Indemnifying Person shall have the option for ten (10) days following
receipt of such notice to (i) admit in writing its obligation for
indemnification with respect to such Third Party Claim and (ii) if its
obligation is so admitted, assume the defence of the Third Party
Claim, including the power to reject the proposed settlement. If the
Indemnified Person settles any Third Party Claim over the objection of
the Indemnifying Person after the Indemnifying Person has timely
admitted its obligation for indemnification in writing and assumed the
defence of the Third Party Claim, the Indemnified Person shall be
deemed to have waived any right to indemnity therefore; and
(e) in the case of a claim for indemnification not based upon a Third
Party Claim, the Indemnifying Person shall have thirty (30) days from
its receipt of the Claim Notice to (i) cure the Losses and Liabilities
complained of, (ii) admit its obligation to indemnify the Indemnified
Person for such Losses and Liabilities or (iii) dispute the
Indemnified Person's claim for such Losses and Liabilities. If the
Indemnifying Person does not notify the Indemnified Person within such
thirty (30) day period that it has cured the Losses and Liabilities or
that it disputes the claim for such Losses and Liabilities, the amount
of such Losses and Liabilities shall conclusively be deemed an
obligation of the Indemnifying Person hereunder.
11.4 SUBROGATION
If a Party indemnifies another Party or any of its Related Parties for Losses
and Liabilities pursuant to this Agreement, the indemnifying Party shall be
subrogated to all rights of the other Party and its Related Parties to recover
such Losses and Liabilities from any Third Party.
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11.5 STATUTES OF LIMITATIONS
Unless otherwise expressly specified in this Agreement, any Claim may be made
and enforceable by a Party pursuant to or based in any way upon a
representation, warranty, covenant or indemnity in this Agreement at any time
until the expiration of all applicable statutes of limitations with respect to
the matters covered thereby.
11.6 NO CONSEQUENTIAL LOSSES
Notwithstanding any other provision of this Agreement in no event shall a Party
be liable for any indirect, special, aggravated, consequential, exemplary or
punitive damages suffered, paid, sustained by the other Party or its Related
Parties, or be liable to indemnify the other Party or its Related Parties from
or against any of the foregoing, howsoever arising under or in respect of this
Agreement, including in respect of any termination thereof.
ARTICLE 12
INDEPENDENT EXPERT DETERMINATIONS
12.1 DISPUTE RESOLUTION PROCEDURE
(a) Any disputed matter referred to the Independent Expert must be
resolved in accordance with the procedures set out in this clause.
(b) The disputed matters must be referred to the Independent Expert by
written submission which must include copies of relevant documentation
relating to the dispute and reference to the relevant provisions of
this Agreement.
(c) The Independent Expert must be instructed to finish his or her
determination as soon as practicable and in any event no later than 10
Business Days after his or her appointment (or other period agreed by
the Vendor and the Purchaser).
(d) The Vendor and the Purchaser must promptly supply the Independent
Expert with any information, assistance and cooperation requested in
writing by the Independent Expert in connection with his or her
determination. All correspondence between the Independent Expert and a
Party must be copied to the other Parties.
(e) The Independent Expert will determine the procedures for settlement of
the disputed matter.
(f) The Independent Expert shall act as an independent expert and not an
arbitrator. The Independent Expert's decision will be conclusive,
final and binding on the Parties (except in the case of manifest
error).
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(g) The costs of the Independent Accountant will be paid as determined by
the Independent Expert, having regard to the relative position of the
Parties on the disagreement.
ARTICLE 13
GST
13.1 INTERPRETATION
Words or expressions used in this clause 13 which are defined in the A New Tax
System (Goods and Services Tax) Xxx 0000 (Cth) (GST ACT) have the same meaning
in this clause.
13.2 GOING CONCERN AGREEMENT
(a) The Vendor and the Purchaser agree that the sale of the Assets under
this Agreement constitutes the supply of a going concern for the
purposes of the GST Act.
(b) Within 10 Business Days following execution of this Agreement, the
Purchaser and the Vendor will jointly seek a private ruling from the
relevant Governmental Authority that the supply of the Assets under
this Agreement constitutes a supply of a going concern for GST
purposes. The cost of obtaining such private ruling will be on account
of the Purchaser.
13.3 VENDOR WILL CARRY ON ENTERPRISE
The Vendor undertakes that it will carry on the enterprise transferred under
this Agreement until the day that the supply is made for the purposes of the GST
Act.
13.4 PURCHASER REGISTRATION FOR GST
The Purchaser warrants that within a reasonable time following the execution of
this Agreement it will register for GST purposes and that it will be registered
for GST purposes prior to Closing. The Purchaser will provide written evidence
of its GST registration to the Vendor as soon as practicable after such
registration is obtained. If the Purchaser does not provide evidence of
registration as required, the Vendor may elect to treat the supply of the Assets
as a taxable supply and accordingly the Purchaser must pay the GST Amount
(calculated under clause 13.5) to the Vendor on the Closing Date.
13.5 GST GROSS UP
If notwithstanding clause 13.2, the applicable Governmental Authority determines
that the Vendor is liable to pay GST on a supply made under or in connection
with this Agreement:
45
(a) the Purchaser must pay to the Vendor in addition to the Consideration
and any other consideration to be provided by the Purchaser to the
Vendor for that supply under this Agreement ('GST exclusive
consideration'), an amount equal to the GST exclusive consideration
multiplied by the prevailing rate of GST ('GST Amount');
(b) in addition to the GST Amount, the Purchaser must pay to the Vendor an
amount equal to any interest, fines, penalties and additional tax
payable by the Vendor as a result of the supply of the Property being
incorrectly treated as a supply of a going concern or otherwise
resulting from the GST payable on the supply being paid late or the
GST Amount being paid late;
(c) the GST Amount and any amount payable under clause 13.5(b) must be
paid by the Purchaser to the Vendor within two (2) Business Days of
the Vendor issuing a tax invoice to the Purchaser for the relevant
taxable supply, except where the GST Amount is payable on the Closing
Date under clause 13.4; and
(d) it will not be a defence to any claim against the Purchaser pursuant
to this clause 13.5 that the Vendor did not pay the GST on the supply
when it fell due under the GST
Act.
13.6 REIMBURSEMENTS (NET DOWN)
If a payment to a Party under this clause 13 is a reimbursement or
indemnification, calculated by reference to a loss, cost or expense incurred by
that Party, then the payment will be reduced by the amount of any input tax
credit to which that Party, or the representative member of the GST group of
which either of the Vendor is a member, is entitled for that loss, cost or
expense.
13.7 RIGHTS
Rights under this clause 13.7 continue after the Closing Date, whether or not
other rights continue.
13.8 ADJUSTMENTS
If an adjustment event occurs in relation to a taxable supply made under or in
connection with this Agreement then the consideration payable in respect of the
supply shall also be adjusted as follows:
(a) if the adjustment event gives rise to an increase in the GST payable
by the Vendor in relation to the supply, a payment equal to that
increase will be made by the Purchaser to the Vendor; and
(b) if the adjustment event gives rise to a decrease in the GST payable by
the Vendor in relation to the supply, a payment equal to that decrease
will be made by the Vendor to the Purchaser.
46
Any payment that is required under this clause 13.8 will be made within five (5)
Business Days of the issuing of an adjustment note or an amended tax invoice, as
the case may be, by the Vendor. If the adjustment event gives rise to an
adjustment, the Vendor must issue an adjustment note to the Purchaser as soon as
the Vendor become aware of the adjustment event.
13.9 PETROLEUM RENT RESOURCES TAX
If the Petroleum Tenures transferred to the Purchaser are subject to PRRT and
constitute Project Interests, then the Vendor agrees:
(a) at no cost of the Purchaser, that it will provide the Purchaser with
all information relating to the four (4) year period prior to the
Closing Time; and
(b) at the cost of the Purchaser, that it will use its reasonable
endeavours to provide the Purchaser with all information relating to
any time prior to the four (4) year period priorto the Closing Time;
in each case reasonably required by the Purchaser to allow it to calculate its
Starting Base for the Petroleum Tenures, excluding information which may be
subject to confidentiality obligations to a Third Party or the subject of legal
professional privilege. Such information may include, but is not limited to,
accounts (financial and management), tax returns, invoices, transaction
listings, royalty returns and other contractual information relating to the
period prior to Closing. The Vendor also agrees, at the cost of the Purchaser,
to use its reasonable endeavours to assist the Purchaser to obtain such
information that is not in the possession of the Vendor.
ARTICLE 14
STAMP DUTY
14.1 STAMP DUTY
Any stamp duty, duties or other taxes of a similar nature (including fines,
penalties and interest and any increase in stamp duty which becomes payable as a
result of the sale of the Assets not being a sale of a going concern) in
connection with this Agreement or a transaction contemplated by this Agreement,
must be paid by the Purchaser. The Purchaser must promptly attend to stamping of
this agreement and all related documentation including all forms of transfer.
ARTICLE 15
MISCELLANEOUS
15.1 FURTHER ASSURANCES
At Closing and thereafter as may be necessary or desirable, and without further
consideration, the Parties shall execute, acknowledge and deliver such other
instruments and shall take such other action as may be reasonably necessary to
carry out their respective obligations under this Agreement. Until the Purchaser
is novated, with respect to the interest of the Vendor in and to the Assets,
into the Petroleum Tenures and any other agreements and documents to which the
Assets are subject, the Vendor shall act as the Purchaser's agent as the
Purchaser reasonably and lawfully directs. The Purchaser shall be liable to the
Vendor and shall, in addition, indemnify the Vendor from and against, all of the
Vendor's Losses arising in connection with all acts or omissions of the Vendor
in its capacity as agent of the Purchaser to the extent such acts and omissions
were expressly or impliedly authorized by the Purchaser.
47
15.2 ACCESS TO RECORDS
For a period of not less thanseven (7)years after the Closing Time, the
Purchaser shall allow the Vendor and its Representatives, to have access to the
premises of the Purchaser during normal business hours of the Purchaser in order
to inspect and take copies, at the Vendor's sole cost, of such information
delivered by the Vendor to the Purchaser in accordance with this Agreement, if
reasonably required by the Vendor, in connection with any joint venture audit,
any potential or threatened legal or administrative proceeding by or against the
Vendor in relation to the Assets, or to enable the Vendor to comply with a law
or the requirement of any Governmental Authority. Nothing herein shall prevent
the Vendor from making and retaining copies of any such documents at any time,
provided that, if during such seven (7) year period the Purchaser intends to
destroy any such information, the Purchaser shall provide the Vendor with notice
of such intended destruction and shall provide the Vendor a reasonable
opportunity (not to be less than ninety (90) days from the date of such notice)
to copy, at the Vendor's sole cost, any such information which the Purchaser
intends to destroy. The Vendor shall keep all such information and documents
confidential.
15.3 JOINT AND SEVERAL LIABILITY
All obligations and liabilities of each Party comprising the "Vendor" (being BPL
and DAPL), in respect of all covenants, representations, warranties, liabilities
and obligations in this Agreement, shall be joint and several.
15.4 GOVERNING LAW
This Agreement shall be construed in accordance with the laws of the State of
Queenslandand the Commonwealth laws of Australia applicable therein, without
reference to any provision thereof which would refer the choice of law to the
law of another jurisdiction. Subject to clause 12.1, the Parties irrevocably
submit to the non-exclusive jurisdiction of the courts of the State of
Queensland in respect of all matters under or relating to this Agreement or the
Transaction.
15.5 TRANSFER OF OPERATORSHIP
The Vendor shall do all such commercially reasonable things as the Purchaser may
request in order to assist the Purchaser to become the operator of those of the
Assets which the Purchaser desires to operate and which the Vendor operates as
of the Closing Time.
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15.6 COSTS AND EXPENSES
Unless otherwise provided for in this Agreement, all fees, costs and expenses
incurred in connection with the Transaction shall be paid by the Party incurring
such cost or expense.
15.7 TIME OF ESSENCE
Time shall be of the essence in this Agreement.
15.8 NOTICES
The address for notices of each of the Parties shall be as follows:
--------------------------------------------------------------------------------
PURCHASER: BPL:
--------------------------------------------------------------------------------
Chelsea Oil Australia Pty Ltd Brisbane Petroleum Ltd.
x/x Xxxxx XXX
Xxxxx 000 Xxxxxxxx, Xxxxxxxxxx
000-0xx Xxxxxx X.X. 65 Burswood Road
Calgary, Alberta Xxxxxxxx
X0X 0X0 Xxxxxxx Xxxxxxxxx
Attention: Xxxxx Xxxxxxxx Attention: Lindsay Colless
Fax: (000) 000-0000 Fax: 00 0000 0000
--------------------------------------------------------------------------------
DAPL: ACOR:
Delbaere Associates Pty. Limited Australian-Canadian Oil Royalties Ltd.
00 Xxxxxxxxx Xxxx x/x Xxxxx XXX
Xxxxx Xxxxxxx Xxxxx 000
XXX 0000 000-0xx Xxxxxx X.X.
Xxxxxxxxx: Xxxxx Xxxxxxxx Xxxxxxx, Xxxxxxx
Fax: 000 0000-0000 T2P 4H2
Attention: Xxxxx Xxxxxxxx
Fax: (000) 000-0000
--------------------------------------------------------------------------------
Each Party may from time to time change its address for service herein by giving
written notice to the other Parties. Any notice, required or contemplated
hereunder, may be given by personal service or by facsimile transmission. Any
notice given by personal service or by facsimile transmission to a Party hereto
shall be deemed to be given on the date of such delivery; provided that if such
delivery occurs on a day that is not a Business Day, delivery will be deemed to
have occurred on the next Business Day thereafter.
49
15.9 ENTIRE AGREEMENT
The provisions contained in any and all documents and agreements collateral
hereto shall at all times be read subject to the provisions of this Agreement
and, in the event of conflict, the provisions of this Agreement shall prevail.
No amendments shall be made to this Agreement unless in writing, executed by the
Parties. This Agreement supersedes all other agreements, documents, writings and
verbal understandings among the Parties relating to the subject matter hereof
and this Agreement expresses the entire agreement of the Parties with respect to
the subject matter hereof.
15.10 ASSIGNMENT AND ENUREMENT
(a) Subject to subclause (b), this Agreement may not be assigned by a
Party without the prior written consent of the other Party, which
consent may be unreasonably and arbitrarily withheld.
(b) Notwithstanding subclause (a), after Closing, either Party may assign
this Agreement to an Affiliate, provided that the assigning Party
remains bound by this Agreement notwithstanding such assignment.
(c) This Agreement shall be binding upon and shall enure to the benefit of
the Parties and their respective administrators, trustees, receivers,
successors and permitted assigns.
15.11 ANNOUNCEMENTS
Except as may be required by Applicable Law or the rules of any stock exchange,
neither Party will make any press release or other public disclosure of this
Agreement or the Transaction without the prior consent of the other Party, not
to be unreasonably withheld or delayed. The Parties will consult with each other
on public disclosure with a view to joint disclosure where practicable or where
required by Applicable Law or stock exchange rules.
15.12 NO MERGER
The covenants, representations, warranties and indemnities contained in this
Agreement shall be deemed to be restated in any and all other documents
conveying the interests of the Vendor in and to the Assets to the Purchaser,
subject to any and all time and other limitations contained in this Agreement.
There shall not be any merger of any covenant, representation, warranty or
indemnity in such assignments, conveyances, transfers and other documents
notwithstanding any rule of law, equity or statute to the contrary and such
rules are hereby waived.
15.13 SEVERABILITY
If any provision of this Agreement is held to be invalid, illegal or
unenforceable, the invalidity, illegality or unenforceability will not affect
any other provision of this Agreement and this Agreement will be construed as if
the invalid, illegal or unenforceable provision had never been contained herein
unless the deletion of the provision would result in such material change to
cause the completion of the Transaction to be unreasonable.
50
15.14 WAIVER
No failure on the part of either Party in exercising any right or remedy
hereunder shall operate as a waiver thereof, nor shall any single or partial
exercise of any such right or remedy preclude any other or further exercise
thereof or the exercise of any right or remedy in law or in equity or by statute
or otherwise conferred. No waiver of any provision of this Agreement, including
this clause, shall be effective otherwise than by an instrument in writing dated
subsequent to the date hereof, executed by a duly authorized representative of
the Party making such waiver.
15.15 WAIVER OF SOVEREIGN IMMUNITY
Each Party consents generally to the issue of any process in connection with
court or arbitration proceedings and to the giving of any type of relief or
remedy against it, including the making, enforcement or execution against any of
its property or assets (regardless of its or their use or intended use) of any
order, judgment or arbitration award. Notwithstanding the foregoing sentence, to
the extent that a Party hereto or any of its property or assets is or are
entitled in any jurisdiction to any sovereign immunity from service of process
or of other documents relating to court or arbitration proceedings, or to any
sovereign immunity from jurisdiction, suit, judgment or arbitration award,
execution, attachment (whether before judgment or arbitration award, in aid of
execution or otherwise) or other legal process, this is irrevocably waived to
the fullest extent permitted by the law of that jurisdiction. Each Party hereto
also irrevocably agrees not to claim any such immunity for itself or its
property or assets.
15.16 AMENDMENT
This Agreement shall not be varied in its terms or amended by oral agreement or
by representations or otherwise other than by an instrument in writing dated
subsequent to the date hereof, executed by a duly authorized representative of
each Party.
15.17 COUNTERPART EXECUTION
This Agreement may be executed in counterpart and all executed counterparts
together shall constitute one agreement. Signature pages from separate
counterparts may be faxed and delivered by electronic means and may be combined
to form a single counterpart. This Agreement shall not be binding upon any Party
unless and until executed by all Parties.
51
IN WITNESS WHEREOF the Parties have executed this Agreement as of the date first
above written.
EXECUTED by BRISBANE PETROLEUM
LTD ACN 009 065 043 in accordance with
Section 127 of the Corporations Xxx 0000
/s/ Kin T. Tshin /s/ Xxxxx Xxxxxxxx
----------------------------------------- ------------------------------------
Signature of director Signature of director/company
secretary
(Please delete as applicable)
Kin T. Tshin Xxxxx Xxxxxxxx
----------------------------------------- ------------------------------------
Name of director (print) Name of director/company secretary
(print)
EXECUTED by DELBAERE ASSOCIATES PTY. LIMITED
ACN 003 197 939 in accordance with Section 127
of the Corporations Xxx 0000
/s/ Xxxxx Xxxxxxxx /s/ Xxxxx Xxxxxxxx
----------------------------------------- ------------------------------------
Signature of director Signature of director/company
secretary
(Please delete as applicable)
Xxxxx Xxxxxxxx Xxxxx Xxxxxxxx
----------------------------------------- ------------------------------------
Name of director (print) Name of director/company secretary
(print)
EXECUTED by CHELSEA OIL AUSTRALIA PTY LTD in
accordance with Section 127 of the Corporations
Xxx 0000
/s/ Xxxx Xxxxxxxx /s/ Xxxxx Xxxxx
----------------------------------------- ------------------------------------
Signature of director Signature of director/company
secretary
(Please delete as applicable)
Xxxx Xxxxxxxx Xxxxx Xxxxx
----------------------------------------- ------------------------------------
Name of director (print) Name of director/company secretary
(print)
SIGNED for AUSTRALIAN-CANADIAN OIL ROYALTIES
LTD.(for the sole purpose of the issuance of
the Consideration Shares) by an authorised
officer in the presence of /s/ Xxxxx Xxxxxx
------------------------------------
Signature of officer
/s/ Xxxxxx Xxxxx /s/ Xxxxx Xxxxxx
----------------------------------------- ------------------------------------
Signature of witness Name of officer (print)
Xxxxxx Xxxxx President
----------------------------------------- ------------------------------------
Name of witness (print) Office held
52
