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EXHIBIT 2.3
AGREEMENT
THIS AGREEMENT made the day and year hereafter set forth by and
between XXXXX OIL INTERNATIONAL CANADA, INC., a corporation organized and
existing under the laws of the Commonwealth of the Bahamas, ("Xxxxx") and
XXXXXXX OIL AND GAS, INC. a corporation organized and existing under the laws
of the State of Texas, ("Xxxxxxx").
In consideration of the covenants set forth herein, the parties hereto
agree as follows:
ARTICLE I.
EXCHANGE OF ASSETS FOR CAPITAL STOCK
1.1. Assignment of Assets. At the closing of the transactions
contemplated hereunder, Xxxxx will sell, convey and assign an undivided
interest in those certain contracts for the exploration and production of oil
and gas described in Exhibit A and Exhibit B attached hereto and made a part
hereof (the "Contracts"). Such interest shall entitle Xxxxxxx to a five
percent (5%) share in the net profits earned from the exploration and
production of oil and gas from the properties referred to in the Contracts (the
"Properties"), but shall not entitle Xxxxxxx to participate in the management
and operation of the Properties.
1.2. Issuance of Capital Stock. At such closing, Xxxxxxx will issue
to Xxxxx, 10,200,000 shares of its voting stock.
1.3. Closing. The closing of the above described exchange shall take
place at the offices of Xxxxxxx Oil and Gas, Inc., West Memorial Office park,
0000 Xxxxxxxxxx Xxxxxxx 00 Xxxx, Xxxxx 000, Xxxxxxx, Xxxxx at 10:00 A.M. on
Monday, June 16, 1997.
1.4 Officer's Certificates. At the closing, Xxxx X. Xxxxxxx shall
deliver to Xxxxx his affidavit stating that to the best of his knowledge and
belief Xxxxxxx' warranties and representations hereafter set forth are true on
the closing date as though made on such day. At the closing, Xxxx x. Xxxxx,
Xxxxx Xxxxxxx and Xxxxxxx X. Xxxxx shall each deliver his affidavit stating
that to best of his knowledge and belief Xxxxx'x warranties and representations
hereafter set forth are true on the closing date as though made on such day.
1.5 Purchase for Investment. The certificate evidencing the shares
delivered to Xxxxx shall bear the following legend:
"The shares represented by this certificate have not been registered
under the securities Act of 1933 (the "Act") and are "restricted
securities" as that term is defined in Rule 144 under the Act. The
shares may not be offered for sale, sold or otherwise transferred
except pursuant to an effective registration statement under the Act
or pursuant to an exemption from registration under the Act, the
availability of which is to be established to the satisfaction of the
Company."
ARTICLE II
WARRANTIES AND REPRESENTATIONS
2.1 Xxxxx'x /Warranties and Representations. Xxxxx warrants and
represents to Xxxxxxx as follows:
a. Contracts. To the best knowledge and belief of Xxxxx'x officers,
the Contracts are valid, existing and in full force and effect.
b. Assignability. To the best knowledge and belief of
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Xxxxx'x officers, there is no prohibition against the assignment of an interest
in the Contracts to Xxxxxxx by the terms of the Contracts or the laws and
regulations of the governments having jurisdiction over the Contracts and Xxxxx
has the power and authority to assign such Contracts
c. Extent of Xxxxx'x Interest. Xxxxx intends to assign the
Contracts, subject to the interest to be assigned to Xxxxxxx hereunder, to
another entity in which Xxxxx will own a fifty percent (50%) interest for the
purpose of securing funds for the exploration and development of the Properties
and of properties owned by Xxxxxxx.
d. Organization. Xxxxx is a corporation organized and existing under
the laws of the Commonwealth of the Bahamas and is in good standing in such
commonwealth.
e. Authority. Xxxx X. Xxxxx, as the Chief Executive Officer of
Xxxxx, Xxxxx Alghani, as its Chief Financial Officer, and Xxxxxxx X. Xxxxx, as
its President, have been duly authorized by its Board of Directors and
Shareholders to enter into this Agreement on behalf of Xxxxx.
f. Financial Statements. Xxxxx has delivered to Xxxxxxx a copy of
its balance sheet compiled on March 18, 1997 by Xxxxxx, Xxxx & Co., Certified
Public Accountants, of Santa Monica, California. To the best knowledge and
belief of the officers of Xxxxx, such balance sheet fairly presents the
financial condition of Xxxxx as of March 1, 1997 and was prepared on the basis
of generally acceptable accounting principles, except that the values listed
therein are based on market values and not on cost.
g. Geophysical and Geological Reports. Every fact set forth in the
documents listed below is true and correct to best knowledge and belief of
Xxxxx'x officers, such document being:
"Geophysical and Geological Report on the Alto Panama and San Xxxxx
Blocks in Paraguay, South America for Xxxxx International Oil
Co.-Canada, Inc. by Xxxxx X. Xxxx, X.Xx. April 4, 1997", and
"Exploration: Xxxxx 00 xxx Xxxxx 00, Xxxxxxxx of Yemen, Xxxxx Oil
International, Inc., a Subsidiary of Xxxxx International, Inc."
h. Share Ownership. No person owns any of the issued and outstanding
shares of Xxxxx except those persons listed on Exhibit C, each of whom owns the
number of shares set forth opposite his respective name:
i. Binding Effect. The execution and delivery by Xxxxx to Xxxxxxx of
a counterpart of this Agreement in consideration of the execution and delivery
by Xxxxxxx to Xxxxx of a counterpart of this Agreement constitutes a binding
and enforceable obligation of Xxxxx, subject to the conditions set forth
herein.
j. Purchase of Investment. Xxxxx'x acquisition of Robert's shares is
being made for its own account for investment and with no present intention of
resale.
k. Securities Violations. No officer, director or shareholder of
Xxxxx has been convicted for the violations of the securities laws of the
United states or is now under investigation for the violation of such
securities laws,
2.2 Robert's Warranties and Representations. Xxxxxxx warrants and
represents to Xxxxx as follows:
a. Organization. Xxxxxxx is a corporation organized and existing
under the laws of the State of Texas and is in good
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standing in such and in all other states and countries in which it engages in
business. The only states or countries in which the character of the
properties it owns or the nature of its business makes a licensing authority or
qualification necessary are Texas and Oklahoma.
b. Corporate Records. All of Xxxxxxx' Articles of Incorporation and
Bylaws, amendments thereto, Minutes of Meetings of Xxxxxxx' Board of Directors,
Unanimous Consents of its Directors, Minutes of Meetings of its Shareholders,
Unanimous Consents of its Shareholders, Capital Stock Records, List of
Shareholders, Forms 10-K, and other Corporate Records have been presented to
Xxxxx for inspection, are the originals or true and correct copies of such and,
where applicable, represent the actions of its Directors and Shareholders. To
the best knowledge and belief of Robert's officers, the facts set forth in each
Form 10-K are true and correct, except that the reserve information is not
current.
c. Subsidiaries. Xxxxxxx owns no interest in the capital stock of
another corporation.
d. Capitalization. Xxxxxxx is authorized to issue 20,000,000 shares
of common stock of which 10,000,000 shares have been issued and are outstanding
and is authorized to issue 5,000,000 shares of preferred stock of which 600
shares have been issued and are outstanding. All of such shares are validly
issued, fully paid and non-assessable. It is not authorized to issue any other
classes of shares. Xxxxxxx has no outstanding subscriptions, contracts,
options, warrants, or other obligations to issue, sell, or otherwise dispose
of, purchase, redeem or otherwise acquire any of its shares.
e. Authority. Xxxx X. Xxxxxxx, as the President of Xxxxxxx and
Xxxxxxx Xxxx, as its Secretary, have been duly authorized by its Board of
Directors to enter into this Agreement on behalf of Xxxxxxx.
f. Share Ownership. No persons owns more than one percent (1%) of
the issued and outstanding common shares of Xxxxxxx except those persons listed
on Exhibit D, each of whom owns the number of shares set forth opposite his
respective name:
g. S.E.C. Reporting. Xxxxxxx is in compliance with the reporting
requirements of a "reporting company" pursuant to the Securities Act of 1933,
including, without limitation, forms 10-K and 10-Q, except the financial
statements included therein are unaudited.
h. Financial Statements. Xxxxxxx has delivered to Xxxxx copies of
the financial statements included in Forms 10-K filed with the Securities and
Exchanger Commission for the years ended May 31, 1996, May 31, 1995, May 31,
1994, May 31, 19993, May 31, 1992, May 31, 1991, May 31, 1990 and May 31, 1989.
Each balance sheet fairly presents the financial condition of Xxxxxxx as of the
date of such balance sheet, each statement of income and surplus fairly
presents the results of its operations for the period ending on the date of
such statement, and all such financial statements were prepared on the basis of
generally accepted accounting principles, consistently applied.
i. Undisclosed Liabilities. As of the date of each balance sheet
referred to above, Xxxxxxx has no liabilities or obligations of any nature,
whether accrued, absolute, contingent, or other wise, not shown on such balance
sheet, Xxxxxxx is not a party to
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any contract not terminable by it at will. Xxxxxxx is not a party to any
litigation, and no such litigation is threatened or contemplated.
j. Subsequent Changes. Since May 31, 1996, there has been no change
in Robert's financial condition, assets, liabilities or business, except:
(i) changes occurring in the ordinary course of business, none of
which have a materially adverse effect on its financial
conditions or business; and
(ii) the issuance by Xxxxxxx of 6,000,000 shares of its common
stock in exchange for the acquisition of the right to explore
for and produce oil and gas on certain properties in Columbia.
k. Binding Effect. The execution and delivery by Xxxxxxx to
Xxxxx of a counterpart of this Agreement in consideration of the execution and
delivery by Xxxxx to Xxxxxxx of a counterpart of this Agreement shall
constitute a binding and enforceable obligation of Xxxxxxx, subject to the
conditions set forth herein.
l. Securities Violations. No officer or director of Xxxxxxx or
any of its shareholders owning one percent or more of its common stock has been
convicted for the violations of the securities laws of the United States or is
now under investigation for the violation of such securities laws.
ARTICLE III
CONDUCT OF BUSINESS UNTIL CLOSING
3.1 Xxxxx. Until the closing of the transactions contemplated
hereunder, Xxxxx will refrain from any action which would cause its warranties
and representations as set forth herein to not be true on the closing date as
though made on such day. However, specifically, without limitation, Xxxxx is
permitted to assign to persons other than Xxxxxxx undivided interests in the
Contracts so long as they retain at least a five-percent (5%) undivided
interest therein.
3.2 Xxxxxxx. Until the closing of the transactions contemplated
hereunder, Xxxxxxx will refrain from any action which would cause its
warranties and representations as set forth to not be true on the closing date
as though made on such day, and will conduct its business only in the ordinary
course.
ARTICLE IV
CONDITIONS PRECEDENT
4.1 Xxxxx'x Obligations. Xxxxx shall be required to perform its
obligations at closing only if:
x. Xxxxxxx' warranties and representations were true on the date
of this Agreement and are true as of the closing date as though made on such
day.
x. Xxxxxxx shall have performed all of its obligations to be
performed by it before the closing and shall contemporarily perform all
obligations to be performed by it at the closing.
x. Xxxxxxx shall have delivered to Xxxxx the irrevocable proxies
of its shareholders in form satisfactory to Xxxxx, which together with the
shares to be acquired by Xxxxx pursuant to this agreement, shall entitle Xxxxx
to vote two-thirds of the commonstock of Xxxxxxx in favor of the amendment of
its Articles of Incorporation.
d. All members of the current Board of Directors of Xxxxxxx,
except Xxxx X. Xxxxxxx, shall have resigned, and there have been elected new
directors approved by Xxxxx.
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4.2 Xxxxxxx' Obligations. Xxxxxxx shall be required to perform
its obligations at closing only if:
x. Xxxxx'x warranties and representations were true on the date
of this Agreement and are true as of the closing date as though made on such
day.
x. Xxxxx shall have performed all of its obligations to be
performed by it before the closing and shall contemporarily perform all
obligations to be performed by it at the closing.
x. Xxxxx shall have furnished Xxxxxxx with evidence reasonably
satisfactory to it that Xxxxx has strategic partners with sufficient financial
to develop the property described in the Contracts.
x. Xxxxx shall have furnished Xxxxxxx with the original executed
documents evidencing the Contracts and Xxxxxxx shall have determined that such
contracts are reasonable satisfactory to it.
ARTICLE V
TRANSACTIONS AFTER CLOSING
5.1 Robert's Current Projects. After the closing, Xxxxx will
furnish to Xxxxxxx funding for the purpose of developing the projects approved
by Robert's Board of Directors as constituted after the Closing.
ARTICLE VI
OTHER
6.1 Effective Date. The effective date of the closing shall be
deemed to be May 31, 1997.
6.2 Survival of Representations. All warranties and
representations of either party hereto shall survive the closing of the
transactions contemplated hereby.
6.3 Benefits. This Agreement shall be binding on and inure to the
benefit of the successors and assigns of each of the parties hereto.
6.4 Construction. This Agreement is to be delivered in the State
of Texas, is intended to be performed in the State of Texas, and shall be
construed and enforced in accordance with the laws of such state.
6.5 Notices. All notices, demands and other communications
hereunder shall be in writing, and shall be deemed to have been given if
delivered or mailed, first class, postage prepaid, certified, return receipt
requested, and addressed to a respective party at the address set forth below:
If to Xxxxx:
Xxxxx Oil International Canada, Inc.
Xx. Xxxx X. Xxxxx
00000 Xxxx 00xx Xxxxxx
Xxxxx, Xxxxxxxx 00000
If to Xxxxxxx:
Xxxxxxx Oil and Gas, Inc.
Xx. Xxxx X. Xxxxxxx
X.X. Xxx 00000
Xxxxxxx, Xxxxx 00000-0000
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IN WITNESS WHEREOF the parties hereto have signed this Agreement on
the 30th day of May, 1997.
XXXXX OIL INTERNATIONAL CANADA, INC.
By
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Xxxx X. Xxxxx, Chairman and
Chief Executive Officer
By
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Xxxxx Xxxxxxx, Vice Chairman
and Chief Financial Officer
By
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Xxxxxxx X. Xxxxx, President
XXXXXXX OIL AND GAS, INC.
By
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Xxxx X. Xxxxxxx, President
By
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Xxxxxxx Xxxx, Secretary
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XXXXX'X SHAREHOLDERS
Xxxx X. Xxxxx 10,000,000 shares
Xxxxx Xxxxxxx 10,000,000 shares
Xxxxxxx X. Xxxxx 10,000,000 shares
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Xxxxxxx' Shareholders
Xxxxxx X. Xxxx 216,000
Carmina Panamericana, S.A. 500,000
CEDE & Co. 335,666
Xxxxx X. Xxxx 100,000
Inversiones Petroleras 400,000
Xxxxxxx X. Xxxxx 567,616
Key Paradise Designs, Inc. 100,000
Kolima Trading, Inc. 650,000
Xxxxx Investors, Inc. 750,000
Petroleum Exploration Services, Inc. 1,600,000
Xxxx X. Xxxxxxx 1,050,950
Sales Development Services, Inc. 128,744
Xxxxx X. Xxxxxxxx 484,658
Xxxxxx X. Xxxxxxxxxxx 736,018
Sun-Shine financing Development Corp. 650,000
Terra Group, Inc. 500,000
Vigilant Investments, S.A. 750,000
Total 9,519,652
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