Date Certain: _______________
AGREEMENT FOR PLEDGE OF RIGHTS AND RECEIVABLES
This agreement is made on March 9, 2001, by and between:
(1) FX Energy Poland Sp. z o.o. with its seat in Warsaw at 29 Xxxx Paw(3)a
II Al., entered into the Commercial Register maintained by the District
Court for the capital city of Warsaw under the number RHB 50620, having
the share capital in the amount of PLN 10,000 and the Management Board
consisting of Xxxxx Bogumi(3) Macio(3)ek, Xxxxx Xxxxxx Xxxxxx and
Xxxxxx Xxxx Xxxxxx (hereinafter, the "Pledgor"), represented by Xxxxx
Xxxxxx Xxxxxx.
and
(2) Rolls-Royce Power Ventures Limited, an English limited liability
company of Xxxxxxxxx Xxxxx, 000 Xxxxxxxx Xxxxxx, Xxxxxx, XX0X 0XX,
Xxxxxxx with registered no. 2916875 (hereinafter, the "Pledgee"),
represented by Xxxxxx Xxxxxxxxx, attorney-in-fact.
The foregoing parties are hereinafter individually referred to as the "Party" or
collectively referred to as the "Parties".
An excerpt from the Commercial Register of the Pledgor and a copy of the power
of attorney for Xx. Xxxxxx Xxxxxxxxx are attached to this Agreement as Schedule
No. 1.
RECITALS:
WHEREAS, pursuant to the USD 5,000,000 Convertible Secured Note (the "Note") of
FX Energy, Inc. with its seat in Salt Lake City, Utah, USA ("FXE"), the Pledgee
has undertaken to make available to FXE, in two equal drawings of USD 2,500,000
and subject to the terms and conditions of the Note, a loan in the amount of USD
5,000,000.
WHEREAS, the Note is a debt instrument, other than bond, issued under US law,
and it indicates the Pledgee as the creditor thereunder.
WHEREAS, the Pledgor is, indirectly, a wholly owned subsidiary of FXE.
WHEREAS, the funds obtained by FXE from the Pledgee under the Note will be used
to finance operations of the Pledgor.
WHEREAS, in consideration for the making of the loan, the Pledgor has entered
into an option agreement for the sale and purchase of natural gas in Poland
dated the date hereof with the Pledgee.
WHEREAS, the Pledgor has undertaken to pledge to the Pledgee the Rights and
Receivables (as defined below) in order to secure the payment by FXE of amounts
due to the Pledgee under the Note.
NOW, THEREFORE, the Parties have agreed as follows:
Article I. Definitions.
1. In this agreement the following capitalized terms shall have the
meanings set forth opposite them respectively:
"Agreement" - this agreement;
"Bankruptcy Law" - Title 11, U.S. Code or any similar federal,
state or foreign law for the relief of
debtors or the protection of creditors
including the Polish Bankruptcy Law of 1934
and the Polish Law on Composition Proceeding
of 1934;
"Business Day" - a calendar day other than Saturday, Sunday
or public holidays in the Republic of
Poland;
"Custodian" - any receiver, trustee, assignee, liquidator
or similar official under any Bankruptcy
Law;
"Date Certain" - the date this Agreement is certified by a
notary, which certification shall be made
promptly upon its execution;
"Enforcement Notice" - the notice referred to in Art. VI.1 hereof;
"Event of Default" - shall have the meaning set forth in the
Note;
"FXE" - an entity referred to in the Recitals to the
Agreement;
"Indebtedness" - with respect to any Person, any indebtedness
of such Person, under contract or statute,
whether or not contingent, in respect of
borrowed money or evidenced by bonds, notes,
debentures or similar instruments or letters
of credit (or reimbursement agreements in
respect thereof) or representing the balance
deferred and unpaid of the purchase price of
any property (including pursuant to capital
leases and sale-and-leaseback transactions)
or representing any hedging obligations
under an Exchange Rate Contract or an
Interest Rate Agreement, if and to the
extent any of the foregoing indebtedness
(other than obligations under an Exchange
Rate Contract or an Interest Rate Agreement)
would appear as a liability upon a balance
sheet of such Person prepared in accordance
with GAAP, and also includes, to the extent
not otherwise included, the Guarantee of
items which would be included within this
definition. "Indebtedness" does not include
accrued operating costs, expenses or
liabilities, open account advances or trade
accounts payable;
"Material Adverse Effect" - an event or circumstance (or any combination
thereof) which is or is reasonably likely to
be materially adverse to the ability of FXE
to satisfy in full its material obligations
under the Note or to the ability of the
Pledgor to satisfy in full its material
obligations under this Agreement or any
other Security Agreement, including the
perfection, priority or enforceability of
any security created or purported to be
created pursuant to any Security Agreement;
"Note" - the note referred to in the Recitals to this
Agreement;
"Party" - a party to this Agreement;
"Parties" - the parties to this Agreement;
"Payment Default" - a payment default defined in Art. VI.2 b.(1)
hereof;
"Pledge" - the pledge established hereunder (Art. II.1
hereof);
"Pledgee" - a party defined on the front page hereof;
"Pledgor" - a party defined on the front page hereof;
"Project Finance Debt" - any agreement with CIBC and/or other banks
and/or financial institutions or other
entities for the provision of additional
financing in connection with Pledgor's
projects in Poland;
"Registered Pledge" - a registered pledge referred to in Art. II.6
hereof;
"Registered Pledge Agreement" - an agreement referred to in Art. II.6
hereof;
"Relevant Agreement" - [insert description of Relevant Agreement]
"Rights and Receivables" - any and all rights, to the extent such
rights are transferable, and pecuniary
receivables of the Pledgor (whether actual
or contingent) in, to or arising under the
Relevant Agreement; "transferable" in
relation to any right (including, inter
alia, any receivable or claim) means either:
(a) there is no prohibition on the transfer
of, or no other impediment to, the Pledge
hereunder; or (b) there is such a
prohibition or impediment and any consent
required to remove such prohibition or
impediment has been obtained;
"Secured Obligations" - the rights and claims of the Pledgee under:
(i) the Note, and (ii) this Agreement to the
extent provided in Art. 314 of the Polish
Civil Code;
"Security Period" - without prejudice to Art. VIII.2 hereof,
means the period beginning on the date
hereof and ending on the earlier of: (i) the
date on which FXE has duly performed,
discharged or paid the Secured Obligations
in full, or (ii) the date on which the
Registered Pledge has been duly and validly
entered into the register of pledges, such
entry being final in the course of the court
proceedings.
2. "Exchange Rate Contract", "GAAP", "Interest Rate Agreement", "Person",
"Security Agreement" and other capitalized terms used herein and not
otherwise defined herein shall have the meanings set forth in the Note.
Article II. Pledge of Rights and Receivables.
1. As collateral security for the discharge, payment and performance of
the Secured Obligations by FXE, the Pledgor hereby pledges to the
Pledgee the Rights and Receivables (the "Pledge").
2. To the extent that any of the Rights and Receivables which are of a
contingent nature are not automatically pledged by virtue of this
Agreement, the Pledgor shall:
(a) in the event the establishment of the Pledge requires the
execution of one or more other agreements for the
establishment of a pledge, the Pledgor shall enter into any
such agreements with the Pledgee on essentially the same terms
herein within 15 Business Days following the Pledgee's
request, but in no event later than December 31, 2009;
(b) the Pledgor shall promptly undertake any and all other actions
reasonably necessary or desirable to ensure the establishment
of, or to evidence, the Pledge with respect to each of the
Rights and Receivables not automatically pledged hereunder.
3. The Pledgor undertakes to pledge in favour of the Pledgee any and all
rights, to the extent such rights will be transferable, and pecuniary
receivables of the Pledgor (whether actual, contingent or potential)
in, to or arising under any agreements or other instruments, other than
the Relevant Agreement, entered into by the Pledgor from time to time
during the Security Period relating to or in connection, in whole or in
part, with the Pledgor's rights and interests under the Relevant
Agreement. The Pledgor shall enter into any such agreements with the
Pledgee on essentially the same terms herein within 15 Business Days
following the Pledgee's request, but in no event later than December
31, 2009.
4. Whereas the amounts of certain components of the Secured Obligations
are not known at the date hereof, the Secured Obligations shall be
secured up to the maximum amount equal to USD7,500,000 (seven million
five hundred thousand United States dollars).
5. The Pledgee may enforce all and any of its rights in connection with
the Secured Obligations and any other rights which the Pledgee may have
under Polish law,
including, but not limited to, the right to apply to a court for an
appropriate enforcement title (tytu(3) wykonawczy) in accordance with
the provisions of the Polish Code of Civil Procedure.
6. The Parties have entered, on the date hereof, into an agreement for a
registered pledge on the Rights and Receivables (zastaw rejestrowy) for
the benefit of the Pledgee as collateral security for the discharge,
payment and performance of the Secured Obligations by FXE. Such
registered pledge shall be established pursuant to, and within the
meaning of, the Polish Law on Registered Pledge and Register of Pledges
of December 6, 1996, on the Rights and Receivables (respectively, the
"Registered Pledge Agreement" and the "Registered Pledge").
7. The Pledgor shall be entitled to exercise all of its rights under the
Relevant Agreement as long as no Event of Default occurs and no
Enforcement Notice is delivered.
8. The Pledgor shall ensure that the Pledge is immediately notified to the
counterparty under the Relevant Agreement. A form of notification is
attached as Schedule No. 3 hereto.
Article III. Representations, Warranties and other Covenants of the Pledgor.
1. The Pledgor hereby represents and warrants to the Pledgee that:
(a) it is duly organized and validly existing under the laws of
the Republic of Poland;
(b) the documents which contain or establish its constitution
include provisions, which give power for it to own its assets
and carry on its business and operations as they are now being
conducted;
(c) all necessary corporate authority has been obtained and action
taken by it to duly execute and deliver this Agreement and to
perform the transactions contemplated in this Agreement, and
this Agreement constitutes valid and legally binding
obligations of it enforceable against it in accordance with
its terms;
(d) neither the signing of this Agreement nor the performance of
any transactions contemplated within the said Agreement, does
or will contravene or constitute a default under or cause to
be exceeded, any limitation on it or the powers of its
directors imposed by or contained in:
(i) any law by which it or any of its assets is bound or
affected,
(ii) any document which contains or establishes its
constitution, or
(iii) any agreement to which it is a party or by which any
of its assets is bound;
(e) except for (1) the execution hereof, (2) obtainment of the
Date Certain, (3) the notification to the counterparty under
the Relevant Agreement as referred to in Schedule No. 3
hereto, and (4) the corporate authorization of the Pledgor
attached as Schedule No. 4 hereto, no authorization, approval,
consent, license, exemption, registration, recording, filing
or notarization and no payment of any
duty or tax and no other action whatsoever which has not been
duly and unconditionally obtained, made or taken is necessary
or desirable to ensure the validity, legality or priority of
the liabilities and obligations of the Pledgor or the rights
of the Pledgee under this Agreement.
2. The Pledgor further represents and warrants to the Pledgee that:
(a) the Rights and Receivables (1) are, or upon their coming into
existence, will be due to the Pledgor, (2) are not disputed as
regards the principal and, if due, the amount, (3) are not
restricted by the provisions of law or barred by the statutes
of limitation, (4) have not been the subject of disposal, sale
or any other similar agreement, (5) are not the subject of a
pledge, including any registered, regular, statutory or
Treasury pledge, or assignment or any other rights or claims
of third parties, (6) are not secured by a mortgage or seized
by execution bodies, (7) are not subject to any
administrative, judicial or arbitration proceedings or
decision, judgment or ruling, and (8) other than any right of
set-off under the Relevant Agreement, there are no objections
or exceptions to the Rights and Receivables which the
counterparty under the Relevant Agreement could raise against
the Pledgor;
(b) the Relevant Agreement was validly entered into between the
parties thereto and is still binding, has not been amended or
terminated, and neither party therein has breached it,
renounced it or otherwise withdrawn therefrom; in particular,
all permits and approvals referred to in Art. 7.1 of the
Relevant Agreement have been validly obtained; and
(c) it is not in arrears for any payment of any taxes or other
public charges.
3. The Pledgor covenants to:
(a) use reasonable efforts to obtain, or cause to be obtained,
maintain and comply with, or cause to be maintained and
complied with, and do all that is necessary to maintain in
full force and effect the terms of all government concessions,
approvals, licences and permits required in relation to this
Agreement and the Pledgor's interests and rights under the
Relevant Agreement, except where failure to do so would not
have a Material Adverse Effect;
(b) comply in all material respects with, or do or cause to be
done, all acts and things which may from time to time be
required under, all laws (including environmental laws),
statutes, orders, decrees, injunctions and regulations
applicable to or having jurisdiction over this Agreement or
any of the Pledgor's interests and rights under the Relevant
Agreement, except where failure to do so would not have a
Material Adverse Effect;
(c) promptly file, or cause to be filed, all tax returns required
to be filed by the Pledgor and pay all taxes when due;
(d) comply in all material respects with and perform its
obligations as they fall due under the Relevant Agreement and
each contract or agreement in relation thereto and meet all of
its other material obligations as they fall due, except where
failure
to do so would not have a Material Adverse Effect during the
whole Security Period;
(e) to the maximum extent permissible under Polish law, maintain
the Rights and Receivables in full force and effect, free of
any third party claims or rights of whatever nature and free
from any objections or exceptions that could be raised against
it or the Pledgee;
(f) take all steps which are reasonably required to maintain,
pursue and enforce its rights under the Relevant Agreement and
all contracts or agreements in relation thereto, except where
failure to do so would not have a Material Adverse Effect;
(g) do or cause to be done all such things as are necessary to
maintain and keep in full force and effect its existence as a
legal person and all material rights arising as a consequence
thereof;
(h) indemnify the Pledgee and keep it at all times (whether during
or after the Security Period) harmless from and against all
liabilities and expenses incurred by it in connection with the
performance and/or enforcement of this Agreement and/or any
rights vested in it pursuant hereto except that the Pledgee
shall not be indemnified in respect of liabilities and
expenses incurred by it as a result of its own gross
negligence or wilful misconduct;
(i) in the event of sale of the Rights and Receivables in the
course of the enforcement of the Pledge, execute and deliver
at its own costs any appropriate instruments necessary or
advisable to assign the Rights and Receivables;
(j) upon a written request of the Pledgee, execute and deliver at
its own cost such further documents and do such further acts
and things as the Pledgee may reasonably request for the
security in respect of the Rights and Receivables or any
collateral rights pursuant to Art. IV hereof; and
(k) promptly furnish the Pledgee with all information reasonably
requested in writing by the Pledgee concerning the Rights and
Receivables and the Relevant Agreement and promptly give
notice in writing to the Pledgee of any event which might make
any part of the Relevant Agreement ineffective or
unenforceable or which may result in a Material Adverse
Effect, as well as to permit the Pledgee or any person
authorized by it, upon prior written notice to make copies of
all documentation relating to the Rights and Receivables and
the Relevant Agreement at any time.
To the extent compliance with the foregoing covenants would require
actions to be taken by entities in which the Pledgor has an ownership
interest or with which the Pledgor has contracted, the Pledgor shall
use its reasonable efforts to cause such entities to take such
necessary actions.
4. Throughout the term of this Agreement and provided the Note has not
been repaid in full, the Pledgor shall not, without the prior written
consent of the Pledgee in each instance, cause, suffer or permit any of
the following to occur:
(a) to encumber or otherwise cause, suffer or permit any lien or
other defect in title to be filed or recorded against its
interests in the Rights and Receivables or the Relevant
Agreement, except where Polish law does not allow the
pertinent restriction to be imposed on the Pledgor;
(b) to incur any Indebtedness other than Project Finance Debt;
(c) to amend, novate, terminate, renounce or otherwise change or
eliminate the Rights and Receivables or the Relevant Agreement
without the prior written consent of the Pledgee or default
under any agreement to which it is a party now or hereafter
affecting any of its rights or interests in relation thereto,
except where such action would not have a Material Adverse
Effect; and
(d) to voluntarily sell, transfer, assign or otherwise dispose of
all or any portion of its interests in relation thereto, the
Rights and Receivables or the Relevant Agreement, except where
such action would not have a Material Adverse Effect and
except where Polish law does not allow the pertinent
restriction to be imposed on the Pledgor.
To the extent compliance with the foregoing covenants would require
entities in which the Pledgor has an ownership interest or with which
the Pledgor has contracted, the Pledgor shall use its reasonable
efforts to cause such entities to refrain from taking such actions.
5. Notwithstanding any of the provisions of this Agreement:
(i) the Pledgor shall duly perform its obligations and remain
liable under the Relevant Agreement;
(ii) the Pledgee shall be under no obligation or liability under
the Relevant Agreement, including the obligation to make any
payment under or in respect thereof; and
(iii) the Pledgee shall not be obliged to enforce any rights arising
under the Relevant Agreement or to make any inquiries as to
the nature or sufficiency of any payment received by it.
Article IV. Power of Attorney, Assignment.
1. As additional, and unrelated to the Pledge, collateral security for
payment, performance and discharge of the Secured Obligations by FXE,
the Pledgor hereby grants to the Pledgee an irrevocable power of
attorney to:
(i) exercise any and all rights to which the Pledgor as party to
the Relevant Agreement is entitled; and
(ii) assign the Rights and Receivables and receive the proceeds of
such an assignment.
The foregoing power of attorney constitutes Schedule No. 5 to this
Agreement.
2. The Pledgee undertakes not to exercise the authority granted under the
power of attorney referred to in Art. IV.1 above, prior to the
Enforcement Notice being delivered.
3. While the assignment of the Rights and Receivables effected by the
Pledgee on the basis of the foregoing power of attorney will be made in
the name of the Pledgor, the Pledgor hereby assigns to the Pledgee,
subject to receipt of any required foreign exchange permit, the
proceeds resulting from such an assignment, the foregoing assignment to
constitute an additional, and unrelated to the Pledge, collateral
security for the discharge, payment and performance of the Secured
Obligations by FXE.
Article V. Separate Security Interest.
1. The Parties hereby expressly acknowledge and confirm that the Pledge
and the additional collateral securities granted in Art. IV hereof,
shall constitute a security interest on behalf of the Pledgee separate
from one another, and unrelated to one another, and additional and
unrelated to any other security interest which has been or shall have
been granted by FXE or the Pledgor to the Pledgee to secure the
discharge, performance and payment of the Secured Obligations.
2. The Parties hereby agree that the Pledgee may exercise its rights
hereunder irrespective of its rights under any other security interest
securing the discharge, performance and payment of the Secured
Obligations.
3. For the avoidance of doubt, all types of rights granted to the Pledgee
hereunder are established for the purpose of securing the discharge,
performance and payment of the Secured Obligations and shall only be
exercised in respect of the Secured Obligations and other related
claims which may be secured by operation of law.
Article VI. Enforcement of the Pledgee's Rights under this Agreement.
1. Immediately upon delivery of written notice (the "Enforcement Notice")
by the Pledgee to the Pledgor, the Pledgee shall be irrevocably and
unconditionally entitled to freely and fully exercise its rights
hereunder, including the rights granted under Art. IV hereof and any
other rights available to pledgees and creditors under applicable laws.
2. An Enforcement Notice may be delivered if:
(a) there is an Event of Default;
(b) there is a default under any mortgage, indenture or instrument
under which there may be issued or by which there may be
secured or evidenced any Indebtedness (including for the
avoidance of doubt, any Project Finance Debt) for money
borrowed by the Pledgor (or the payment of which is guaranteed
or otherwise secured by the Pledgor), whether such
Indebtedness or guarantee now exists or is created after the
date hereof, which default:
(1) is caused by a failure to pay when due any amounts
payable on such Indebtedness within the grace period
provided for in such Indebtedness
(which failure continues beyond any applicable grace
period) (a "Payment Default");
(2) results in the acceleration of such Indebtedness
prior to its express maturity; and
(3) in each case, the principal amount of any such
Indebtedness, together with the principal amount of
any other such Indebtedness under which there is a
Payment Default or the maturity of which has been so
accelerated, aggregates US$250,000 or more;
(c) the Pledgor pursuant to or within the meaning of any
Bankruptcy Law:
(1) commences a voluntary case;
(2) consents to the entry of an order for relief against
it in an involuntary case in which it is the debtor;
(3) consents to the appointment of a Custodian of it or
for all or substantially all of its property;
(4) makes a general assignment for the benefit of its
creditors; or
(5) generally is unable to pay its debts as the same
become due or otherwise becomes insolvent;
(d) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
(1) is for relief against the Pledgor in an involuntary
case;
(2) appoints a Custodian for the Pledgor or for all or
substantially all of its property; or
(3) orders the liquidation of the Pledgor, and the order
or decree remains unstayed and in effect for 60 days;
(e) any concession agreement, consent, license, permit, approval
or authorization required for the development activities of
the Pledgor with respect to the Relevant Agreement is revoked,
suspended, cancelled, terminated or otherwise ceases to be in
full force and effect, excluding any relinquishment of rights
to non-producing property interests the Pledgor deems not to
be commercially prospective, in each case, where such act
would have a Material Adverse Effect.
3. The proceeds received by the Pledgee from enforcement of its rights
hereunder shall be applied in the order of priority determined by the
Pledgee.
4. In the course of enforcement of the rights under this Agreement, the
Pledgee shall use its reasonable endeavours to maximize the proceeds of
such enforcement; provided,
however, that the Pledgee may choose to enforce its rights hereunder in
such manner as it reasonably sees fit and shall not be required to
spend any money or to incur any costs in any attempt to maximize the
proceeds of enforcement, and the Pledgee shall not be responsible to
FXE or the Pledgor for any failure to enforce or to maximize the
proceeds of enforcement.
5. The Pledgee shall be accountable to the Pledgor only for amounts
actually received by the Pledgee from enforcement of the Pledge.
6. The Pledgee shall not be liable to the Pledgor or FXE as a result of
anything done or neglected to be done by the Pledgee hereunder, except
that the Pledgee shall be liable for its gross negligence or wilful
misconduct.
7. The enforcement of the Pledgee's rights hereunder and the application
of the proceeds received thereupon as aforesaid shall not cure or waive
any default or waive, modify or affect any notice of default under the
Note or invalidate any act done pursuant to such notice.
Article VII. Expense of Enforcement, Payment of Public Charges.
1. The Pledgor agrees that it shall pay any and all duties, taxes and
other public charges including, but not limited to, any civil law
transaction tax and notarial fees, which shall have become due and
payable under Polish law in connection with the execution, performance
and enforcement of this Agreement. Further, it shall pay to the Pledgee
all other costs and expenses relating to this Agreement other than the
Pledgee's legal fees and internal costs in connection with the
execution of this Agreement. If any such charges, costs or expenses are
incurred by the Pledgee, the Pledgor shall reimburse the Pledgee for
all such sums promptly after receiving from the Pledgee a relevant
request accompanied by a receipt or other document evidencing the
payment thereof by the Pledgee.
2. Any clause included in this Agreement obligating one Party to indemnify
the other Party constitutes an agreement for release of debt (umowa o
zwolnienie z d(3)ugu) within the meaning of Art. 392 of the Polish
Civil Code to the extent that the duty to indemnify does not constitute
an obligation to compensate for damage (obowi(1)zek naprawienia
szkody).
Article VIII. Expiration of Pledge.
1. Without prejudice to mandatory provisions of Polish law, the Pledgee's
rights and powers hereunder shall continue and remain in full force and
effect throughout the Security Period unless the Parties hereto agree
in writing on an earlier termination.
2. The Parties agree that in the event the Pledge has expired due to the
Registered Pledge being duly and validly entered into the register of
pledges, such entry being final in the course of court proceedings, and
in the event the Registered Pledge has subsequently turned out to be
invalid or expired for reasons other than FXE having duly performed,
discharged or paid the Secured Obligations in full, this Agreement
shall be deemed re-entered into as of the moment of declaration of
invalidity or expiration of the Registered Pledge. In such case, at the
Pledgee's request, the Parties shall immediately
confirm in writing that the Pledge has been re-established in
accordance with this Art. VIII.2.
3. Promptly following payment or other satisfaction, whether by conversion
of the Note to common stock of FXE or otherwise, of the Secured
Obligations in full, the Pledgee shall execute and deliver to the
Pledgor such releases, notices and terminations of the Pledge as the
Pledgor may reasonably request. Such releases, notices and terminations
shall be in a form suitable for recording and filing in each office and
location in which any notice of the Pledge is recorded or filed and may
be so recorded and filed by the Pledgor.
Article IX. Notices.
All notices or other communications given under or in connection with
this Agreement shall, in order to be effective, be given in writing
and, unless otherwise stated may be delivered either personally, by
registered mail or fax. Any such notice shall be deemed received by the
other Party:
(i) in the case of personal delivery, on personal delivery to the
address specified below;
(ii) in the case of registered mail, on the date the registered
mail is indicated by the postal authorities as having been
received by the addressee; and
(iii) in the case of fax, on the time and date stated on the
transmission report confirming the receipt of a given fax by
the addressee; provided that if the date of transmission is
not a Business Day or the fax transmission took place on a
Business Day after 5.30 p.m. on such day at the place of
receipt, such fax shall be deemed received at the beginning of
the following Business Day.
The addresses and facsimile numbers of the Parties are as follows:
for the Pledgor:
FX Energy Poland Sp. z o.o.
Xx. Xxxx Xxx(0)x XX 00
00-000 Xxxxxx, Xxxxxx
Phone: x00 00 000 0000
Fax: x00 00 000 0000
Attn.: General Manager
with a copy to:
FX Energy, Inc.
0000 Xxxxxxxx Xxxxx, #000
Xxxx Xxxx Xxxx, XX 00000, XXX
Phone: x0 000 000 0000
Fax: x0 000 000 0000
Attn.: Xxxx Xxxxxx
or such other address or facsimile number as the Pledgor may notify
to the Pledgee, giving not less than five Business Days' notice.
for the Pledgee:
Rolls-Royce Power Ventures Limited
Xxxxxxxxx House
000 Xxxxxxxx Xxxxxx
Xxxxxx XX0X 0XX
Xxxxxxx
Phone: x00 00 0000 0000
Fax: x00 00 0000 0000
Attn.: Xxxxxx Xxxxxxxxx
or such other address or facsimile number as the Pledgee may notify
to the Pledgor, giving not less than five Business Days' notice.
Article X. Saving of Rights.
The failure of the Pledgee to enforce any of its rights hereunder or to
require the performance of any provision of this Agreement or its
waiver of any breach under this Agreement shall not prevent a
subsequent enforcement of such right or term, nor be deemed a waiver of
any subsequent breach of any of the terms hereof.
Article XI. Invalidity of any Provision.
If any provision of the Agreement becomes invalid, illegal or
unenforceable in any respect under any law, the validity, legality or
enforceability of the remaining provisions shall not in any way be
affected or impaired.
Article XII. Applicable Law.
This Agreement shall be governed and interpreted in accordance with the
laws of the Republic of Poland.
Article XIII. Entire Agreement. Interpretation.
1. This Agreement supersedes any prior agreements and understandings
between the Parties hereto with respect to subject matter hereof and is
the complete agreement of the Parties hereto with respect to the
subject matter hereof, except for the Registered Pledge Agreement.
2. In the Agreement, unless the contrary intention appears, a reference
to:
(a) a provision of law or regulation is a reference to that
provision as amended or subsequently substituted;
(b) an Article or a Schedule is a reference to a clause of or a
Schedule to this Agreement;
(c) any person includes any individual, partnership or legal
person and such reference shall also include a reference to
its successors and assigns;
(d) any assets includes, unless the context otherwise requires,
present and future assets; and
(e) the Note or any other document is a reference to the Note or
such other documents as amended, novated or supplemented.
3. Words importing the singular shall include the plural and vice versa.
Article XIV. Amendments.
Any and all amendments and additions to this Agreement shall be invalid
unless made in writing with a notarized date certain.
Article XV. Assignment.
The Pledgee shall have the right to assign or transfer all or part of
its rights hereunder to any third party; provided that the Note has
been, or concurrently will be, validly assigned to such third party,
and provided that the assignee or transferee expressly agrees in
writing to the Pledgor to be bound by the terms of this Agreement. The
Pledgor shall not have the right to assign or transfer either all or
part of its rights hereunder to any third party without the prior
written consent of the Pledgee.
Article XVI. Headings.
All headings in this Agreement are inserted solely for convenience of
reference and shall be given no effect in the interpretation of this
Agreement.
Article XVII. Language.
This Agreement has been made in the English and Polish languages. All
notices or communications under this Agreement shall be in the English
language, or if in any other language, accompanied by a translation
into English. In the event of any conflict between the English and
Polish versions, the Polish language version shall prevail.
Article XVIII. Dispute Resolution.
1. All disputes arising out of this Agreement or connected therewith,
shall be amicably settled by the Parties in good faith negotiations. If
any dispute hereunder is not resolved amicably within 30 days from the
date of a pertinent request by a Party, it will be settled finally by
the Arbitration Court at the National Chamber of Commerce.
2. The arbitration shall be conducted in Warsaw in accordance with the
Arbitration Rules of the Arbitration Court at the National Chamber of
Commerce, subject to the following stipulations. The proceedings shall
be conducted in the English language.
The arbitration court shall be composed of three arbitrators, one
appointed by the claimant(s), one appointed by the defendant(s), and
one appointed jointly by the arbitrators appointed by the claimant(s)
and defendant(s). The third arbitrator shall chair the arbitration
court. If any of the Parties to a dispute fails to appoint its
arbitrator within the period specified in the arbitration rules, or the
two arbitrators fail to appoint the chairman of the arbitration panel,
then the Chairman of the Arbitration Court at the National Chamber of
Commerce in Warsaw shall act as an "appointing authority" within the
meaning of the arbitration rules. The arbitration award shall be final
and enforceable in any court of competent jurisdiction and the Parties
agree to comply with it voluntarily within 10 days from its receipt.
3. The provisions of this Article XVIII constitute an arbitration clause
within the meaning of Art. 697 of the Polish Code of Civil Procedure.
IN WITNESS WHEREOF, the Parties have caused these presents to be executed by
their respective corporate officers thereunto duly authorized.
FX Energy Poland Sp. z o.o.
Place: _________________
By: _________________
Name: Xxxxx Xxxxxx Xxxxxx
Title: Member of the Management Board
Rolls-Royce Power Ventures Limited
Place: _________________
By: _________________
Name: Xxxxxx Xxxxxxxxx
Title: Attorney-in-fact
LIST OF SCHEDULES
Schedule 1 - An excerpt from the Commercial Register of the
Pledgor and a copy of the power of attorney for Xx.
Xxxxxx Xxxxxxxxx..
Schedule 2 - A copy of the Relevant Agreement with all subsequent
amendments.
Schedule 3 - A form of notice to the counterparty under the
Relevant Agreement.
Schedule 4 - Resolution of the Pledgor's sole shareholder.
Schedule 5 - A form of power of attorney for the Pledgee [date
certain].
AGREEMENT FOR REGISTERED PLEDGE OF RECEIVABLES NO.
This Agreement for Registered Pledge of Receivables is made on March 9,
2001, by and among:
(1) PLEDGEE:
Name: Rolls-Royce Power Ventures Limited
REGON: -------------------
Country: United Kingdom
City: London
Municipality: -------------------
Voivodship: -------------------
Street: Victoria Street
House No.: 150
Office No.: -------------------
Post Code: SW1E 5 LB
(hereinafter, the "Pledgee"), represented by Xx. Xxxxxx Xxxxxxxxx an
attorney-in-fact
(2) PLEDGOR:
Name: FX Energy Poland Sp. z o.o.
REGON: 012659847
Country: Poland
City: Warsaw
Municipality: Warszawa Centrum
Voivodship: Mazovian
Street: Xxxx Paw(3)a II
House No.: 29
Office No.: -------------------
Post Code: 00 - 867
(hereinafter, the "Pledgor"), represented by Xxxxx Xxxxxx Xxxxxx, a
Management Board member of the Pledgor.
A copy of an excerpt from the Commercial Register of the Pledgor and a copy of
the power of attorney for Xx. Xxxxxx Xxxxxxxxx are attached to this Agreement as
Schedule 1.
Agreement for Pledge of Rights and Receivables No. __
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WITNESSETH
WHEREAS, pursuant to the USD 5,000,000 Convertible Secured Note (the "Note") of
FX Energy, Inc. with its seat in Salt Lake City, Utah, USA ("FXE"), the Pledgee
has undertaken to make available to FXE, in two equal drawings of USD 2,500,000
each, and subject to the terms and conditions of the Note, a loan in the amount
of USD 5,000,000.
WHEREAS, the Note, a debt instrument (other than a bond) issued in accordance
with the pertinent laws of the United States (an OECD member), indicates the
Pledgee as a creditor thereunder, and thus, provides for an obligation defined
under Art. 1 Sec.1 Subsec. 8) of RPL (as defined below).
WHEREAS, the Pledgor is, indirectly, a wholly owned subsidiary of FXE.
WHEREAS, the funds obtained by FXE from the Pledgee under the Note will be used
to finance operations of the Pledgor.
WHEREAS, in consideration for the making of the loan, the Pledgor has entered
into an option agreement for the sale and purchase of natural gas in Poland
dated the date hereof with the Pledgee.
WHEREAS, the Pledgor has undertaken to pledge in favor of the Pledgee the Rights
and Receivables (as defined below) in order to secure the payment by FXE of the
amounts due to the Pledgee under the Note.
NOW, THEREFORE, the Parties have agreed as follows:
Article I. Definitions.
1. In this agreement the following capitalized terms shall have the
meanings set forth below:
"Agreement" this agreement;
"Bankruptcy Law" the Polish Bankruptcy Law (Decree of the
President of the Republic of Poland dated
October 24, 1934 (Unified text dated October
24, 1991 (Journal of Laws No. 118, Item
512)), the Polish Law on Composition
Proceedings dated October 24, 1934 (Journal
of Laws No. 93, Item 836, as amended), or
any similar foreign applicable law,
Agreement for Pledge of Rights and Receivables No. __
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including Xxxxx 00, Xxxxxx Xxxxxx Code, for
the relief of debtors or the protection of
creditors;
"Business Day" a calendar day other than Saturday, Sunday
or a public holiday in the Republic of
Poland;
"Catalogue" the Catalogue of Methods of Describing
Subject Matter of Pledge constituting
Attachment No. 1 to the Decree of the
Minister of Justice dated October 15, 1997
on detailed organization and maintaining of
a register of pledges (Journal of Laws dated
October 30, 1997, No. 134, item 892);
"CC" Polish Civil Code dated April 23, 1964
(Journal of Laws No. 16, Item 93, as
amended);
"Custodian" any receiver, trustee, assignee, liquidator
or similar official under any Bankruptcy
Law;
"Enforcement Notice" the notice referred to in Art. V.1 hereof;
"Event of Default" shall have the meaning set forth in the
Note;
"FXE" an entity referred to in the Recitals to the
Agreement;
"Indebtedness" with respect to any Person, any indebtedness
of such Person, under a contract or statute,
whether or not contingent, in respect of
borrowed money or evidenced by bonds, notes,
debentures or similar instruments or letters
of credit (or reimbursement agreements in
respect thereof) or representing the balance
deferred and unpaid of the purchase price of
any property (including pursuant to capital
leases and sale-and-leaseback transactions)
Agreement for Pledge of Rights and Receivables No. __
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or representing any hedging obligations
under an Exchange Rate Contract or an
Interest Rate Agreement, if and to the
extent any of the foregoing indebtedness
(other than obligations under an Exchange
Rate Contract or an Interest Rate Agreement)
would appear as a liability upon a balance
sheet of such Person prepared in accordance
with GAAP, and also includes, to the extent
not otherwise included, the Guarantee of
items which would be included within this
definition. "Indebtedness" does not include
accrued operating costs, expenses or
liabilities, open account advances or trade
accounts payable;
"LRP" the Law on Registered Pledge of December 6,
1996 of the Republic of Poland (Journal of
Laws No. 149, item 703, as amended);
"Material Adverse Effect" an event or circumstance (or any combination
thereof) which is or is reasonably likely to
be materially adverse to the ability of FXE
to satisfy in full its material obligations
under the Note or to the ability of the
Pledgor to satisfy in full its material
obligations under this Agreement or any
other Security Agreement, including the
perfection, priority or enforceability of
any security created or purported to be
created pursuant to any Security Agreement;
"Note" the note referred to in the Recitals to the
Agreement;
"Party" a party to this Agreement;
"Parties" the parties to this Agreement;
"Payment Default" a payment default defined in Art. V.2b.(1)
hereof;
"Pledgee" the party defined on the front page hereof;
Agreement for Pledge of Rights and Receivables No. __
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"Pledgor" the party defined on the front page hereof;
"Project Finance Debt" any agreement with CIBC and/or
other banks and/or financial institutions or
other entities for the provision of
additional financing in connection with
Pledgor's projects in Poland;
"Relevant Agreement" - [insert description of Relevant Agreement]
"Regular Pledge" a pledge referred to in Art. II.4 hereof;
"Rights and Receivables" any and all rights, to the extent such
rights are transferable, and pecuniary
receivables of the Pledgor (whether actual
or contingent) in, to or arising under the
Relevant Agreement; "transferable" in
relation to any right (including, inter
alia, any receivable or claim) means either:
(a) there is no prohibition on the transfer
of, or no other impediment to, the Pledge
hereunder; or (b) there is such a
prohibition or impediment and any consent
required to remove such prohibition or
impediment has been obtained;
"Secured Obligations" the rights and claims of the Pledgee under:
(i) the Note, and (ii) this Agreement to the
extent provided in Art. 314 CC;
"Security Period" the period beginning on the date on which
the Pledge will have been entered into the
register of pledges and ending upon the date
of the entire expiration of the Secured
Obligations.
2. "Exchange Rate Contract", "GAAP", "Interest Rate Agreement", "Person",
"Security Agreement" and other capitalized terms used herein and not
otherwise defined herein shall have the meanings ascribed thereto in
the Note.
Agreement for Pledge of Rights and Receivables No. __
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Article II. Establishment and Subject Matter of Pledge.
1. As a collateral security for the discharge, payment and performance of
the Secured Obligations by FXE, the Pledgor hereby establishes in favor
of the Pledgee a registered pledge on the Rights and Receivables, in
accordance with Art. 2.1 of the LRP (the "Pledge"). The pledged Rights
and Receivables shall consist of:
(i) receivables of the following characteristics (within the
meaning of and according to the Catalogue):
(A) Name of subject matter of the pledge:
receivables
(B) Position Number in the Catalogue of Description of
Subject Matter of Pledge:
D 1
(C) Features of the subject matter of the pledge:
feature (a) Type of receivable
non-pecuniary receivable
feature (b) Parties entitled
FX Energy Poland Sp. z o.o. with
its seat at Xxxx Paw(3)a 29, Warsaw
00 - 867
feature (c) Parties obligated
Polskie Gornictwo Naftowe i
Gazownictwo S.A with its seat at
Krucza 6/14, Warsaw 00-537
feature (d) Name (description) of legal
relationship
the Natural Gas Sale and Purchase
Agreement, Fences Area Fields,
Republic of Poland, entered into on
December 18, 2000 by and between FX
Energy Poland Sp. z o.o. and
Polskie Gornictwo Naftowe i
Gazownictwo S.A.
Agreement for Pledge of Rights and Receivables No. __
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feature (e) Value of subject matter of pledge
(nominal amount, interest rate)
200,000 PLN
feature (f) Type of collateral security of
receivable
NONE
(D) Manner of marking the subject of the pledge
NONE
(ii) future rights of the following characteristics (within the
meaning of and according to the Catalogue):
(A) Name of subject matter of the pledge:
other inter parties right
(B) Position Number in the Catalogue of Description of
Subject Matter of Pledge:
D 2
(C) Features of the subject matter of the pledge:
feature (a) Type (name) of right
future rights
feature (b) Parties entitled
FX Energy Poland Sp. z o.o. with
its seat at Xxxx Paw(3)a 29, Warsaw
00 - 867
feature (c) Parties obligated
Polskie Gornictwo Naftowe i
Gazownictwo S.A with its seat at
Krucza 6/14, Warsaw 00-537
feature (d) Name (description) of legal
relationship
the Natural Gas Sale and Purchase
Agreement, Fences Area Fields,
Republic of Poland, entered into on
Agreement for Pledge of Rights and Receivables No. __
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December 18, 2000 by and between FX
Energy Poland Sp. z o.o. and
Polskie Gornictwo Naftowe i
Gazownictwo S.A.
feature (e) Value of subject matter of pledge
(nominal value)
200,000 PLN
feature (f) Type of collateral security of
right
NONE
(D) Manner of marking the subject of the pledge
NONE
2. The Pledgor undertakes to pledge via a registered pledge in favour of
the Pledgee any and all rights, to the extent such rights will be
transferable, and pecuniary receivables of the Pledgor (whether actual,
contingent or potential) in, to or arising under any agreements or
other instruments, other than the Relevant Agreement, entered into by
the Pledgor from time to time during the Security Period relating to or
in connection, in whole or in part, with the Pledgor's rights and
interests under the Relevant Agreement. The Pledgor shall enter into
any such registered pledge agreements with the Pledgee on essentially
same terms as those contained herein, within 15 Business Days
immediately following the Pledgee's request but in no event later than
December 31, 2009.
3. Whereas the amounts of certain components of the Secured Obligations
are not known at the date hereof, the Secured Obligations shall be
secured up to the maximum amount equal to USD 7,500,000 (Seven Million
Five Hundred Thousand United States Dollars).
4. On the date hereof, the Parties have entered into a certain agreement
for a regular pledge (zastaw zwyk(3)y) with respect to the Rights and
Receivables for the benefit of the Pledgee as collateral security for
the discharge, payment and performance of the Secured Obligations by
FXE. Such regular pledge was established pursuant to Art. 327 of CC and
will expire immediately prior to the registration of the Pledge
contemplated herein, in accordance with the terms of that certain
pledge agreement (respectively, the "Regular Pledge Agreement" and the
"Regular Pledge").
5. The Pledgor shall be entitled to exercise all of its rights as creditor
with regard to the Rights and Receivables, as long as no Event of
Default occurs and no Enforcement Notice is served by the Pledgee on
the Pledgor.
Agreement for Pledge of Rights and Receivables No. __
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6. Immediately after the registration of the Pledge, the Pledgor shall
notify, essentially in the form presented in Part I of Schedule 3
hereto, the counterparty under the Relevant Agreement of the
establishment of the Pledge, and shall ensure that such counterparty
will acknowledge its acceptance of the terms of such notice,
essentially in the form presented in Part II of Schedule 3 hereto, no
later than 30 days of the date hereof.
Article III. Representations, Warranties and other Covenants of the Pledgor.
1. The Pledgor hereby represents and warrants to the Pledgee that:
(a) it is duly organized and validly existing under the laws of
the Republic of Poland;
(b) the documents which contain or establish its constitution
include provisions, which give power for it to own its assets,
and carry on its business and operations as they are now being
conducted;
(c) all necessary corporate authority has been obtained and action
taken by it to duly execute and deliver this Agreement and to
perform the transactions contemplated in this Agreement, and
this Agreement constitutes valid and legally binding
obligations of the Pledgor, enforceable against it, in
accordance with its terms;
(d) neither the signing of this Agreement nor the performance of
any transactions contemplated under this Agreement, does or
will contravene or constitute a default under or cause to be
exceeded, any limitation on the Pledgor or the powers of its
directors imposed by or contained in:
(i) any law by which it or any of its assets is bound or
affected,
(ii) any document which contains or establishes its
constitution, or
(iii) any agreement to which it is a party or by which any
of its assets is bound;
(e) except for (1) the execution hereof, (2) the notification to
the counterparty under the Relevant Agreement as referred to
in Schedule 3 hereto, (3) the corporate authorization of the
Pledgor attached as Schedule 4 hereto and, (4) registration of
the Pledge established under this Agreement in the register of
pledges maintained by the competent Polish court as required
under LRP, no authorization, approval, consent, license,
exemption, registration, recording, filing or notarization and
no payment of any duty or tax and no other action whatsoever
which has not been duly and unconditionally obtained, made or
taken is necessary or desirable to ensure the validity,
Agreement for Pledge of Rights and Receivables No. __
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legality or priority of the liabilities and obligations of the
Pledgor or the rights of the Pledgee under this Agreement.
2. The Pledgor further represents and warrants to the Pledgee that:
(a) the Rights and Receivables (1) are, or upon their coming into
existence, will be due to the Pledgor, (2) are not disputed as
regards the principal and, if due, the amount, (3) are not
restricted by the provisions of law or barred by the statutes
of limitation, (4) have not been the subject of disposal, sale
or any other similar agreement, (5) save for the Regular
Pledge are not the subject of a pledge, including any
registered, regular, statutory or Treasury pledge, or
assignment or any other rights or claims of third parties, (6)
are not secured by a mortgage or seized by execution bodies,
(7) are not subject to any administrative, judicial or
arbitration proceedings or decision, judgment or ruling, and
(8) other than any right of set-off under the Relevant
Agreement there are no objections or exceptions to the Rights
and Receivables which the counterparty under the Relevant
Agreement could raise against the Pledgor;
(b) the Relevant Agreement was validly entered into between the
parties thereto and is still binding, has not been amended or
terminated, and neither party therein has breached it,
renounced it or otherwise withdrawn therefrom; in particular,
all permits and approvals referred to in Art. 7.1 of the
Relevant Agreement have been validly obtained; and
(c) it is not in arrears for any payment of any taxes or other
public charges.
3. The Pledgor covenants to:
(a) use reasonable efforts to obtain, or cause to be obtained,
maintain and comply with, or cause to be maintained and
complied with, and do all that is necessary to maintain in
full force and effect the terms of all government concessions,
approvals, licences and permits required in relation to this
Agreement and the Pledgor's interests and rights under the
Relevant Agreement, except where failure to do so would not
have a Material Adverse Effect;
(b) comply in all material respects with, or do or cause to be
done, all acts and things which may from time to time be
required under, all laws (including environmental laws),
statutes, orders, decrees, injunctions and regulations
applicable to or having jurisdiction over this Agreement or
any of the Pledgor's interests and rights under the Relevant
Agreement, except where failure to do so would not have a
Material Adverse Effect;
(c) promptly file, or cause to be filed, all tax returns required
to be filed by the Pledgor and pay all taxes when due;
Agreement for Pledge of Rights and Receivables No. __
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(d) comply in all material respects with and perform its
obligations as they fall due under the Relevant Agreement and
each contract or agreement in relation thereto and meet all of
its other material obligations as they fall due, except where
failure to do so would not have a Material Adverse Effect
during the whole Security Period;
(e) to the maximum extent permissible under Polish law, maintain
the Rights and Receivables in full force and effect, free of
any third party claims or rights of whatever nature and free
from any objections or exceptions that could be raised against
it or the Pledgee;
(f) take all steps which are reasonably required to maintain,
pursue and enforce its rights under the Relevant Agreement and
all contracts or agreements in relation thereto, except where
failure to do so would not have a Material Adverse Effect;
(g) do or cause to be done all such things as are necessary to
maintain and keep in full force and effect its existence as a
legal person and all material rights arising as a consequence
thereof;
(h) indemnify the Pledgee and keep it at all times (whether during
or after the Security Period) harmless from and against all
liabilities and expenses incurred by it in connection with the
performance and/or enforcement of this Agreement and/or any
rights vested in it pursuant hereto except that the Pledgee
shall not be indemnified in respect of liabilities and
expenses incurred by it as a result of its own gross
negligence or wilful misconduct;
(i) in the event of sale of the Rights and Receivables in the
course of the enforcement of the Pledge, execute and deliver
at its own costs any appropriate instruments necessary or
advisable to assign the Rights and Receivables;
(j) upon a written request of the Pledgee, execute and deliver at
its own cost such further documents and do such further acts
and things as the Pledgee may reasonably request for the
security in respect of the Rights and Receivables; and
(k) promptly furnish the Pledgee with all information reasonably
requested in writing by the Pledgee concerning the Rights and
Receivables and the Relevant Agreement and promptly give
notice in writing to the Pledgee of any event which might make
any part of the Relevant Agreement ineffective or
unenforceable or which may result in a Material Adverse
Effect, as well as to permit the Pledgee or any person
authorized by it, upon prior written notice to make copies of
all documentation relating to the Rights and Receivables and
the Relevant Agreement at any time.
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To the extent compliance with the foregoing covenants would require
actions to be taken by entities in which the Pledgor has an ownership
interest or with which the Pledgor has contracted, the Pledgor shall
use its reasonable efforts to cause such entities to take such
necessary actions.
4. Throughout the term of this Agreement and provided the Note has not
been repaid in full, the Pledgor shall not, without the prior written
consent of the Pledgee and save for the Regular Pledge in each
instance, cause, suffer or permit any of the following to occur:
(a) to encumber or otherwise cause, suffer or permit any lien or
other defect in title to be filed or recorded against its
interests in the Rights and Receivables or the Relevant
Agreement except where Polish law does not allow the pertinent
restriction to be imposed on the pledgor;
(b) to incur any Indebtedness other than Project Finance Debt;
(c) to amend, novate, terminate, renounce or otherwise change or
eliminate the Rights and Receivables or the Relevant Agreement
without the prior written consent of the Pledgee or default
under any agreement to which it is a party now or hereafter
affecting any of its rights or interests in relation thereto,
except where such action would not have a Material Adverse
Effect;
(d) to voluntarily sell, transfer, assign or otherwise dispose of
all or any portion of its interests in relation thereto, the
Rights and Receivables or the Relevant Agreement, except where
such action would not have a Material Adverse Effect and
except where Polish law does not allow the pertinent
restriction to be imposed on the pledgor; and
(e) to remove any xxxxx within the meaning of Art. 2.1.(d) of the
Relevant Agreement.
To the extent compliance with the foregoing covenants would require
entities in which the Pledgor has an ownership interest or with which
the Pledgor has contracted, the Pledgor shall use its reasonable
efforts to cause such entities to refrain from taking such actions.
Agreement for Pledge of Rights and Receivables No. __
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5. Notwithstanding any of the provisions of this Agreement:
(i) the Pledgor shall duly perform its obligations and remain
liable under the Relevant Agreement;
(ii) the Pledgee shall be under no obligation or liability under
the Relevant Agreement, including the obligation to make any
payment under or in respect thereof; and
(iii) the Pledgee shall not be obliged to enforce any rights arising
under the Relevant Agreement or to make any inquiries as to
the nature or sufficiency of any payment received by it.
Article IV. Registration of Pledge.
1. Promptly upon execution hereof, however in any event not later than
within seven Business Days from the date hereof, the Pledgor shall
undertake all formalities necessary or advisable for registration of
the Pledge contemplated hereunder in accordance with the provisions of
the LRP. In particular, the Pledgor shall submit the registration
applications to the pertinent court.
2. The court of proper jurisdiction for registration of the Pledge
established herein shall be District Court in Warsaw - Registry of
Pledges.
3. The Pledgor shall promptly inform in writing the Pledgee about any
summons or decision(s) of the pertinent court concerning the entry of
the Pledge contemplated herein into the registry of pledges, attaching
a respective copy of each such document.
4. If the court rejects any of the applications for registration of the
Pledge, then the Pledgor shall promptly inform the Pledgee about such
fact and present to the Pledgee a copy of the pertinent court
decision(s), and not later than within the prescribed statutory period,
the Pledgor shall submit new application(s), free of defects defined by
respective court decision(s) rejecting the application(s).
5. In order to complete the registration procedure referred to in this
Article, the Pledgor and the Pledgee shall co-operate in good faith,
and in particular:
(a) in the event that the establishment of the Pledge requires
execution of one or more other agreements for the
establishment of a registered pledge, the Pledgor and the
Pledgee shall promptly enter into any such agreements on
essentially same terms as hereof, providing for, however,
provisions ensuring registration of the Pledge;
Agreement for Pledge of Rights and Receivables No. __
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(b) the Pledgor shall promptly undertake all and any other actions
necessary or desirable to ensure the establishment, or
evidencing, of the Pledge with respect to each of the Rights
and Receivables.
Article V. Enforcement of Pledge.
1. Immediately upon delivery of a written notice (the "Enforcement
Notice") by the Pledgee to the Pledgor, the Pledgee shall be
irrevocably and unconditionally entitled to freely and fully exercise
its rights hereunder and any other rights available to pledgees and
creditors under applicable laws.
2. An Enforcement Notice may be delivered if:
(a) there is an Event of Default;
(b) there is a default under any mortgage, indenture or other
instrument under which there may be issued or by which there
may be secured or evidenced any Indebtedness (including for
the avoidance of doubt, any Project Finance Debt) for money
borrowed by the Pledgor (or the payment of which is guaranteed
or otherwise secured by the Pledgor, whether such Indebtedness
or guarantee now exists or is created after the date hereof,
which default:
(1) is caused by a failure to pay when due any amounts
payable on such Indebtedness within the grace period
provided for in such Indebtedness (which failure
continues beyond any applicable grace period the
"Payment Default");
(2) results in the acceleration of such Indebtedness
prior to its express maturity; and
(3) in each case, the principal amount of any such
Indebtedness, together with the principal amount of
any other such Indebtedness under which there is a
Payment Default or the maturity of which has been so
accelerated, aggregates USD 250,000 or more;
(c) the Pledgor pursuant to or within the meaning of any
Bankruptcy Law:
(1) commences a voluntary case;
(2) consents to the entry of an order for relief against
it in an involuntary case in which it is the debtor;
(3) consents to the appointment of a Custodian of it or
for all or substantially all of its property;
Agreement for Pledge of Rights and Receivables No. __
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(4) makes a general assignment for the benefit of its
creditors; or
(5) generally is unable to pay its debts as the same
become due or otherwise becomes insolvent;
(d) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
(1) is for relief against the Pledgor in an involuntary
case;
(2) appoints a Custodian for the Pledgor or for all or
substantially all of its property; or
(3) orders the liquidation of the Pledgor, and the order
or decree remains unstayed and in effect for 60 days;
(e) any concession agreement, consent, license, permit, approval
or authorization required for the development activities of
the Pledgor with respect to the Relevant Agreement is revoked,
suspended, cancelled, terminated or otherwise ceases to be in
full force and effect, excluding any relinquishment of rights
to non-producing property interests which the Pledgor deems
not to be commercially prospective, in each case, where such
act would have a Material Adverse Effect.
3. Upon the service of the Enforcement Notice, the Pledgee shall be
entitled, subject to the mandatory provisions of the Polish law, and in
particular subject to the receipt of an appropriate foreign exchange
permit whenever required, to freely and fully exercise its rights
hereunder, including rights available to pledgees and creditors under
applicable laws, and the Pledgee shall have the right, without any
limitations, at its sole discretion, to choose one of the following
methods of enforcement of the Pledge:
(1) to initiate or join the enforcement proceedings pursuant to
Art. 21 of the LRP;
(2) to acquire the Rights and Receivables pursuant to Art. 22 of
the LRP;
(3) to initiate the sale of the Rights and Receivables on a public
auction carried out by a notary public or a public bailiff,
pursuant to the provisions of Art. 24 of the LRP.
4. As required by Art. 22.1.3 of the LRP, the Parties establish the value
of the Rights and Receivables in the amount of Zloty 400,000 (say: four
hundred thousand Zlotys).
5. The proceeds received by the Pledgee from enforcement of its rights
hereunder shall be applied in the order of priority determined by the
Pledgee.
Agreement for Pledge of Rights and Receivables No. __
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6. In the course of enforcement of the rights under this Agreement, the
Pledgee shall use its reasonable endeavours to maximize the proceeds of
such enforcement; provided, however, that the Pledgee may choose to
enforce its rights hereunder in such manner as it reasonably sees fit
and shall not be required to spend any money or incur any costs in any
attempt to maximize the proceeds of enforcement, and the Pledgee shall
not be responsible to FXE or the Pledgor for any failure to enforce or
to maximize the proceeds of enforcement.
7. The Pledgee shall be accountable to the Pledgor only for amounts
actually received by the Pledgee from enforcement of the Pledge.
8. The Pledgee shall not be liable to the Pledgor or FXE as a result of
anything done or neglected to be done by the Pledgee hereunder, except
that the Pledgee shall be liable for its gross negligence or willful
misconduct.
9. The enforcement of the Pledgee's rights hereunder and the application
of the proceeds received thereupon as aforesaid shall not cure or waive
any default or waive, modify or affect any notice of default under the
Note or invalidate any act done pursuant to such notice.
Article VI. Expense of Enforcement, Payment of Public Charges.
1. The Pledgor agrees that it shall pay any and all duties, taxes and
other public charges including, but not limited to, any civil law
transaction tax and notarial fees, which shall have become due and
payable under Polish law in connection with the execution, performance
and enforcement of this Agreement. Further, it shall pay to the Pledgee
all other costs and expenses relating to this Agreement other than the
Pledgee's legal fees and internal costs in connection with the
execution of this Agreement. If any such charges, costs or expenses are
incurred by the Pledgee, the Pledgor shall reimburse the Pledgee for
all such sums promptly after receiving from the Pledgee a relevant
request accompanied by a receipt or other document evidencing the
payment thereof by the Pledgee.
2. Any clause included in this Agreement obligating one Party to indemnify
the other Party constitutes an agreement for release of debt (umowa o
zwolnienie z d(3)ugu) within the meaning of Art. 392 of the Polish
Civil Code to the extent that the duty to indemnify does not constitute
an obligation to compensate for damage (obowi(1)zek naprawienia
szkody).
Agreement for Pledge of Rights and Receivables No. __
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Article VII. Expiry or Termination of Agreement.
1. Without prejudice to mandatory provisions of Polish law, the
Pledgee's rights and powers hereunder shall continue and remain in
full force and effect throughout the Security Period unless the
Parties hereto agree in writing on an earlier termination.
2. Promptly following payment or other satisfaction, whether by
conversion of the Note into common stock of FXE or otherwise, of
the Secured Obligations in full, the Pledgee shall execute and
deliver to the Pledgor such releases, notices and terminations the
expiry of the Pledge as the Pledgor may reasonably request. Such
releases, notices and terminations shall be in a form suitable for
recording and filing in each office and location in which any
notice of the Pledge is recorded or filed and may be so recorded
and filed by the Pledgor.
Article VIII. Notices.
All notices or other communications given under or in connection with this
Agreement shall, in order to be effective, be given in writing and, unless
otherwise stated may be delivered either personally, by registered mail or fax.
Any such notice shall be deemed received by the other Party:
(i) in the case of personal delivery, on personal delivery to the
address specified below;
(ii) in the case of registered mail, on the date the registered
mail is indicated by the postal authorities as having been
received by the addressee; and
(iii) in the case of fax, on the time and date stated on the
transmission report confirming the receipt of a given fax by
the addressee; provided that if the date of transmission is
not a Business Day or the fax transmission took place on a
Business Day after 5.30 p.m. on such day at the place of
receipt, such fax shall be deemed received at the beginning of
the following Business Day.
The addresses and facsimile numbers of the Parties are as follows:
for the Pledgor:
FX Energy Poland Sp. z o.o.
Xx. Xxxx Xxx(0)x XX 00
00-000 Xxxxxx, Xxxxxx
Phone: x00 00 000 0000
Fax: x00 00 000 0000
Attn.: General Manager
Agreement for Pledge of Rights and Receivables No. __
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with a copy to:
FX Energy, Inc.
0000 Xxxxxxxx Xxxxx, #000
Xxxx Xxxx Xxxx, XX 00000, XXX
Phone: x0 000 000 0000
Fax: x0 000 000 0000
Attn.: Xxxx Xxxxxx
or such other address or facsimile number as the Pledgor may notify
to the Pledgee, giving not less than five Business Days' notice.
for the Pledgee:
Rolls-Royce Power Ventures Limited
Xxxxxxxxx House
000 Xxxxxxxx Xxxxxx
Xxxxxx XX0X 0XX
Xxxxxxx
Phone: x00 00 0000 0000
Fax: x00 00 0000 0000
Attn.: Xxxxxx Xxxxxxxxx
or such other address or facsimile number as the Pledgee may notify
to the Pledgor, giving not less than five Business Days' notice.
Article IX. Saving of Rights.
The failure of the Pledgee to enforce any of its rights hereunder or to require
the performance of any provision of this Agreement or its waiver of any breach
under this Agreement shall not prevent a subsequent enforcement of such right or
term, nor be deemed a waiver of any subsequent breach of any of the terms
hereof.
Article X. Invalidity of any Provision
If any provision of the Agreement becomes invalid, illegal or unenforceable in
any respect under any law, the validity, legality or enforceability of the
remaining provisions shall not in any way be affected or impaired.
Article XI. Applicable Law.
This Agreement shall be governed and interpreted in accordance with the laws of
the Republic of Poland.
Agreement for Pledge of Rights and Receivables No. __
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Article XII. Entire Agreement. Interpretation.
1. This Agreement supersedes any prior agreements and understandings
between the Parties hereto with respect to subject matter hereof and,
except for the Regular Pledge Agreement, is the complete agreement of
the Parties hereto with respect to the subject matter hereof.
2. In the Agreement, unless the contrary intention appears, a reference
to:
(a) a provision of law or regulation is a reference to that
provision as amended or subsequently substituted;
(b) an Article or a Schedule is a reference to a clause of or a
Schedule to this Agreement;
(c) any person includes any individual, partnership or legal
person and such reference shall also include a reference to
its successors and assigns;
(d) any assets includes, unless the context otherwise requires,
present and future assets; and
(e) the Note or any other document is a reference to the Note or
such other documents as amended, novated or supplemented.
3. Words importing the singular shall include the plural and vice versa.
Article XIII. Amendments.
Any and all amendments and additions to this Agreement shall be invalid
unless made in writing.
Article XIV. Assignment.
The Pledgee shall have the right to assign or transfer all or part of
its rights hereunder to any third party; provided that the Note has
been, or concurrently will be validly assigned to such third party, and
provided that the assignee or transferee expressly agrees in writing to
the Pledgor to be bound by the terms of this Agreement. The Pledgor
shall not have the right to assign or transfer either all or part of
its rights hereunder to any third party without the prior written
consent of the Pledgee.
Agreement for Pledge of Rights and Receivables No. __
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Article XV. Headings.
All headings in this Agreement are inserted solely for convenience of
reference and shall be given no effect in the interpretation of this
Agreement.
Article XVI. Language.
This Agreement has been made in the English and Polish languages. All
notices or communications under this Agreement shall be in the English
language, or if in any other language, accompanied by a translation
into English. In the event of any conflict between the English and
Polish versions, the Polish language version shall prevail.
Article XVII. Dispute Resolution.
1. All disputes arising out of this Agreement or connected therewith,
shall be amicably settled by the Parties in good faith negotiations. If
any dispute hereunder is not resolved amicably within 30 days from the
date of a pertinent request by a Party, it will be settled finally by
an ad hoc Arbitration Court at the National Chamber of Commerce
(Krajowa Izba Gospodarcza).
2. The arbitration shall be conducted in Warsaw in accordance with the
Arbitration Rules of the Arbitration Court at the National Chamber of
Commerce, subject to the following stipulations. The proceedings shall
be conducted in the English language. The arbitration court shall be
composed of three arbitrators, one appointed by the claimant(s), one
appointed by the defendant(s), and one appointed jointly by the
arbitrators appointed by the claimant(s) and defendant(s). The third
arbitrator shall chair the arbitration court. If any of the Parties to
a dispute fails to appoint its arbitrator within the period specified
in the arbitration rules, or the two arbitrators fail to appoint the
chairman of the arbitration panel, then the Chairman of the Arbitration
Court at the National Chamber of Commerce in Warsaw shall act as an
"appointing authority" within the meaning of the arbitration rules. The
arbitration award shall be final and enforceable in any court of
competent jurisdiction and the Parties agree to comply with it
voluntarily within 10 days from its receipt.
3. The provisions of this Article XVII constitute a prorogation for
arbitration adjudication (zapis na s(1)d polubowny) within the meaning
of Art. 697 of the Polish Code of Civil Procedure.
Agreement for Pledge of Rights and Receivables No. __
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IN WITNESS WHEREOF, the Parties have caused these presents to be executed by
their respective corporate officers thereunto duly authorized.
FX Energy Poland Sp. z o.o.:
By: _________________
Name: Xxxxx Xxxxxx Xxxxxx
Title: Member of the Management Board
Place: _________________
Rolls-Royce Power Ventures Limited:
By: _________________
Name: Xxxxxx Xxxxxxxxx
Title: Attorney-in-fact
Place: _________________
LIST OF SCHEDULES
Schedule 1 - An excerpt from the Commercial Register of the
Pledgor and a copy of the power of attorney for Xx.
Xxxxxx Xxxxxxxxx.
Schedule 2 - A copy of the Relevant Agreement with all subsequent
amendments.
Schedule 3 - A form of notice of pledge and acceptance statement.
Schedule 4 - Resolution of the Pledgor's sole shareholder.
SCHEDULE 1
AN EXCERPT FROM THE COMMERCIAL REGISTER OF THE
PLEDGOR AND A COPY OF THE POWER OF ATTORNEY FOR XX.
XXXXXX XXXXXXXXX
SCHEDULE 2
A COPY OF THE RELEVANT AGREEMENT WITH ALL SUBSEQUENT AMENDMENTS
SCHEDULE 3
PART I
FORM OF NOTICE OF PLEDGE
To: Polskie Gornictwo Naftowe i Gazownictwo S.A
0/00 Xxxxxx Xx.
00-000 Xxxxxx
Dear Sirs,
We hereby give you notice that by the Agreement for Registered Pledge of
Receivables No. 1 dated March 9, 2001, we FX Energy Poland Sp. z o.o. with its
seat in Warsaw (the ,,Company") established a registered pledge in favor of
Rolls-Royce Power Ventures Limited with its seat at Xxxxxxxxx Xxxxx, 000
Xxxxxxxx Xxxxxx, Xxxxxx XX0X 0XX, Xxxxxxx (the "Pledgee") over all our rights
and receivables which arise or may arise under, or in connection with the
Natural Gas Sale and Purchase Agreement, Fences Area Fields, Republic of Poland,
entered into on December 18, 2000 by and between FX Energy Poland Sp. z o.o. and
Polskie Gornictwo Naftowe i Gazownictwo S.A. (the "Agreement").
We irrevocably instruct and authorize you to:
(a) disclose to the Pledgee on its request any information relating to the
value of the rights and receivables owed to the Company under the
Agreement; and
(b) once you receive a copy of the Enforcement Notice from the Pledgee
which has been served on us, comply with the terms of any written
notice or instructions from the Pledgee relating to the said Agreement
for Registered Pledge of Receivables No. 1, and in particular, to pay
to the bank account of the Pledgee specified in such Enforcement Notice
all amounts which are or will be due to us under, or in connection
with, the Agreement, without any enquiry by you as to the justification
for the disclosure or, as the case may be, validity of the notice or
instructions.
The instructions in this notice may not be revoked or amended without the prior
written consent of the Pledgee.
This document is governed by and construed in accordance with the laws of the
Republic of Poland.
Please confirm your acceptance of the above by sending within 30 (Thirty) days
of [the date of registration of the Pledge] one copy of the attached Acceptance
Statement to us and one copy to the Pledgee at the following address:
Rolls-Royce Power Ventures Limited
Xxxxxxxxx House
000 Xxxxxxxx Xxxxxx
Xxxxxx XX0X 0XX
Xxxxxxx
Phone: x00 00 0000 0000
Fax: x00 00 0000 0000
Attn.: Xxxxxx Xxxxxxxxx
Yours faithfully
FX Energy Poland Sp. z o.o.
By: ______________________________
Authorized Representative(s)
PART II
FORM OF ACCEPTANCE STATEMENT
To: Rolls-Royce Power Ventures Limited
Xxxxxxxxx House
000 Xxxxxxxx Xxxxxx
Xxxxxx XX0X 0XX
Xxxxxxx
Phone: x00 00 0000 0000
Fax: x00 00 0000 0000
Attn.: Xxxxxx Xxxxxxxxx
and
FX Energy Poland Sp. z o.o.
Xx. Xxxx Xxx(0)x XX 00
00-000 Xxxxxx, Xxxxxx
Phone: x00 00 000 0000
Fax: x00 00 000 0000
Attn.: General Manager
We, [ o ] of Polskie Gornictwo Naftowe i Gazownictwo S.A with its seat at Xxxxxx
0/00, Xxxxxx 00-537 acknowledge receipt of the notice of pledge ("Notice of
Pledge") a copy of which is enclosed herewith and we:
(i) confirm that we have not received any other notice of transfer or
pledge with respect rights or receivables relating to the Natural Gas
Sale and Purchase Agreement, Fences Area Fields, Republic of Poland,
entered into on December 18, 2000 by and between FX Energy Poland Sp. z
o.o. and Polskie Gornictwo Naftowe i Gazownictwo S.A. (the
"Agreement"); and
(ii) accept the terms of the Notice of Pledge, and in particular, agree that
we will pay all amounts hereafter which are or may be due to FX Energy
Poland Sp. z o.o. under the Agreement to the bank account of
Rolls-Royce Power Ventures Limited that is specified in the Enforcement
Notice sent to us, and will comply with all other instructions of
Rolls-Royce Power Ventures Limited with respect to the Agreement and in
accordance with the terms of the Notice of Pledge.
Yours faithfully
By: __________________________________
Authorized Representative(s)
SCHEDULE 4
RESOLUTION OF THE PLEDGOR'S SOLE SHAREHOLDER
Description of Relevant Agreements
SECURITY AGREEMENTS
1. The Agreement for Pledge of Rights and Receivables dated March 9, 2001,
in relation to the Joint Operating Agreement Covering Areas in the
Foresudetic Monocline dated May 12, 2000, between FXEP and POGC and
FXEP's other contractual rights in relation thereto.
2. The Agreement for Registered Pledge of Rights and Receivables dated
March 9, 2001, in relation to the Joint Operating Agreement Covering
Areas in the Foresudetic Monocline dated May 12, 2000, between FXEP and
POGC and FXEP's other contractual rights in relation thereto.
3. The Agreement for Pledge of Rights and Receivables dated March 9, 2001,
in relation to the Agreement on Cooperation in Exploration of
Hydrocarbons on Foresudetic Monocline dated April 11, 2000, between
FXEP and XXXX.
0. The Agreement for Registered Pledge of Rights and Receivables dated
March 9, 2001, in relation to the Agreement on Cooperation in
Exploration of Hydrocarbons on Foresudetic Monocline dated April 11,
2000, between FXEP and XXXX.
0. The Agreement for Pledge of Rights and Receivables dated March 9, 2001,
in relation to the Natural Gas Sale and Purchase Agreement, Fences Area
Fields, dated December 18, 2000, between FXEP and XXXX.
0. The Agreement for Registered Pledge of Rights and Receivables dated
March 9, 2001, in relation to the Natural Gas Sale and Purchase
Agreement, Fences Area Fields, dated December 18, 2000, between FXEP
and XXXX.
0. The Agreement for Pledge of Rights and Receivables dated March 9, 2001,
in relation to the Joint Operating Agreement Covering Block 255 dated
October 22, 1999, between FXEP, POGC and Apache and FXEP's other
contractual rights in relation thereto.
8. The Agreement for Registered Pledge of Rights and Receivables dated
March 9, 2001, in relation to the Joint Operating Agreement Covering
Block 255 dated October 22, 1999, between FXEP, POGC and Apache and
FXEP's other contractual rights in relation thereto.
