EXHIBIT 10.4
OIL AND GAS
ASSET PURCHASE AGREEMENT
between
GOTHIC ENERGY CORPORATION
and
CHESAPEAKE GOTHIC CORP.
Effective January 1, 1998
SELF, XXXXXXX & XXXX, INC.
ATTORNEYS AND COUNSELORS
2725 Oklahoma Tower . 000 Xxxx Xxxxxx .
Xxxxxxxx Xxxx, Xxxxxxxx 00000-0000
Telephone (000) 000-0000 . Telecopier (000) 000-0000
TABLE OF CONTENTS
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Page
1. Sale Agreement........................................................... 1
2. Purchase Price........................................................... 3
2.1 Cash at Closing................................................... 3
2.2 Allocation........................................................ 3
3. Representations and Warranties........................................... 3
3.1 Organization, Good Standing, Etc.................................. 3
3.2 Authority......................................................... 3
3.3 No Assumption of Obligations...................................... 3
3.4 Absence of Liabilities............................................ 4
3.5 Contracts......................................................... 4
3.6 Consents and Approvals............................................ 4
3.7 Litigation........................................................ 5
3.8 Title............................................................. 5
3.9 Foreign Person.................................................... 5
3.10 Broker's or Finder's Fees......................................... 6
3.11 Permits........................................................... 6
3.12 Compliance with Laws.............................................. 6
3.13 Oil and Gas Leases in Good Standing............................... 6
3.14 Taxes............................................................. 6
3.15 Contracts, Consents and Preferential Rights....................... 6
3.16 Tax Partnerships.................................................. 7
3.17 Financial Statements.............................................. 7
3.18 Insurance......................................................... 7
3.19 Planned Future Commitments........................................ 7
3.20 Environmental and Safety Matters.................................. 7
3.21 Powers of Attorney................................................ 8
3.22 Plugging Status................................................... 8
3.23 Equipment......................................................... 8
3.24 Payout and Gas Balancing.......................................... 8
3.25 Affiliate Transactions............................................ 8
3.26 Intangible Property............................................... 8
3.27 Full Disclosure................................................... 9
4. Purchaser's Representations and Warranties............................... 9
5. Covenants................................................................ 9
5.1 Access to Information............................................. 9
5.2 Inspection........................................................ 9
5.3 Title Adjustments................................................. 9
5.4 Conduct of Businesses.............................................10
5.5 Consents..........................................................10
5.6 Conditions........................................................10
5.7 Capital Expenditures..............................................10
6. Purchaser's Conditions Precedent.........................................11
7. Seller's Conditions Precedent............................................12
8. The Closing..............................................................13
8.1 Purchaser's Deliveries............................................13
8.1.1 Payment..................................................13
8.1.2 Evidence of Authority....................................13
8.1.3 Closing Memorandum.......................................13
8.1.4 Additional Documents.....................................13
8.2 Seller's Deliveries...............................................13
8.2.1 Assignments..............................................13
8.2.4 Evidence of Authority....................................14
8.2.5 Closing Memorandum.......................................14
8.2.6 Additional Documents.....................................14
8.3 Costs.............................................................14
9. Adjustments..............................................................14
10. Operations...............................................................14
11. Indemnification..........................................................15
12. Termination..............................................................17
13. Default..................................................................17
14. Miscellaneous............................................................17
14.1 Time..............................................................17
14.2 Notices...........................................................17
14.3 Representations and Warranties....................................18
14.4 Cooperation.......................................................18
14.5 Press Release.....................................................19
14.6 Choice of Law.....................................................19
14.7 Headings..........................................................19
14.8 Entire Agreement..................................................19
14.9 Assignment........................................................19
14.10 Amendment.........................................................19
14.11 Severability......................................................19
14.12 Attorney Fees.....................................................19
14.13 Waiver............................................................19
14.14 No Third Party Beneficiaries......................................20
14.15 Execution in Counterparts.........................................20
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Schedule "1.1" Properties
Schedule "3.3" Obligations
Schedule "3.4" Liabilities
Schedule "3.5" Contracts
Schedule "3.7" Litigation
Schedule "3.8" Title
Schedule "3.12" Violations of Law
Schedule "3.13" Oil and Gas Leases
Schedule "3.15" Contracts
Schedule "3.16" Tax Partnerships
Schedule "3.17" Financial Statements
Schedule "3.19" Planned Future Commitments
Schedule "3.20" Environmental & Safety Matters
Schedule "3.24" Payout and Gas Balancing
Schedule "3.25" Affiliate Transactions
Exhibit "6.7" Participation Agreement
Exhibit "8.2.1" Assignments and Conveyances
Exhibit "8.2.3A" Letters in Lieu of Transfer Orders
Exhibit "8.2.3B" Notice of Change of Operations and Ballots
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OIL AND GAS ASSET PURCHASE AGREEMENT
------------------------------------
THIS AGREEMENT is entered into the 31st day of March, 1998,
effective January 1, 1998, among CHESAPEAKE GOTHIC CORP., an Oklahoma
corporation, CHESAPEAKE ACQUISITION CORPORATION, an Oklahoma corporation
(collectively, referred to herein as the "Purchaser"), and GOTHIC ENERGY
CORPORATION, an Oklahoma corporation (the "Seller").
B A C K G R O U N D :
A. The Seller owns various interests (the "Interests") in oil and gas
properties located in Atoka, Haskell, Latimer, XxXxxxx and Pittsburg Counties,
Oklahoma and Crawford, Franklin, Xxxxxxx and Xxxxx Counties, Arkansas (the
"Arkoma Basin") including, without implied limitation, those listed at Schedule
"1.1" attached hereto as a part hereof.
B. The Purchaser desires to acquire and the Seller desires to sell an
undivided fifty percent (50%) of the Interests together with all assets, rights,
properties and claims which are used in or related to the ownership, operation
or maintenance of the Interests (the "Properties") as provided in this
Agreement.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties agree as follows:
1. Sale Agreement. Subject to the terms and conditions of this Agreement, the
Purchaser agrees to purchase and the Seller agrees to sell absolute ownership of
an undivided fifty percent (50%) of all of the Seller's right, title and
interest in the Interests effective at 7:00 a.m. on January 1, 1998 (the
"Effective Date"), free and clear of all liens, claims and encumbrances. The
Properties include, without limitation, the following:
1.1 An undivided fifty percent (50%) interest in all of Seller's right,
title and interest in, to and under the leases, overriding royalty
interests, fee mineral interests, mineral rights, fee royalty
interests, carried interests, net revenue interests, net profits
interests, licenses, production payments, permits and other
interests and agreements relating to the lands in the Arkoma Basin
whether developed or undeveloped (the "Lands") including, without
limitation, the Lands described in Schedule "1.1" attached hereto as
a part hereof.
1.2 An undivided fifty percent (50%) interest in all of Seller's right,
title and interest in all Hydrocarbons produced from or allocated to
the Properties and sold after the Effective Date. The term
"Hydrocarbons" means and includes oil, gas, casinghead gas,
condensate, natural gas liquids and all components of the foregoing.
1.3 An undivided fifty percent (50%) interest in all of Seller's
interest in and to all documents, agreements and contracts relating
to the Properties or Lands including, without limitation, the
Purchase and Sale Agreement dated November 24, 1997 between the
Seller and Amoco Production Company ("Amoco") with respect to any
Interests in the Arkoma Basin (the "Amoco Agreement"), leases,
operating agreements, gas balancing agreements, oil, gas and
condensate purchase and sale agreements, processing, gathering,
compression and transportation agreements, joint venture agreements,
farmout agreements, farmin agreements, dry hole agreements, bottom
hole agreements, acreage contribution agreements, area of mutual
interest agreements, easements, permits, salt water disposal
agreements, surface agreements, unitization or pooling agreements,
warranties, covenants, indemnities and representations from third
parties.
1.4 An undivided fifty percent (50%) interest in all of Seller's
interest in and to all real, personal and mixed, movable, immovable,
tangible and intangible property, and all other fixtures and
improvements appurtenant to or used in connection with the Interests
or Lands, including, without implied limitation, all xxxxx,
fixtures, equipment, claims, rights and causes of action against
third parties whether asserted and unasserted or known and unknown.
1.5 An undivided fifty percent (50%) interest in all of Seller's
interest and estate in and to or derived under any oil, gas and
mineral unitization, pooling and communitization agreements,
declarations or orders relating to the Interests or Lands, and the
units, pools or communitized areas, if any, created thereby
(including, without limitation, all units, pools or communitized
areas formed under orders, regulations, rules or other official acts
of any federal, state or other governmental agency having or
asserting jurisdiction) and all interests in any xxxxx within the
units, pools or communitized areas associated with the Interests or
Lands.
1.6 An undivided fifty percent (50%) interest in all of Seller's
interests in all permits, franchises, easements, rights-of-way,
contract rights, intangible rights, inchoate rights, choses in
action, rights under warranties made by prior owners of the
Interests or Lands, and other third parties, rights accruing under
applicable statutes of limitation or prescription and other rights,
estates and hereditaments incident or relating to the Interests or
Lands, or any of the foregoing items set forth in this description
of the Properties.
1.7 Access to and the right to copy all books, land records, geology
records, geophysical records and other business records relating to
the Interests or the Lands including, without implied limitation,
title opinions, abstracts of title, curative documents, division of
interest statements, accounting records, joint interest xxxxxxxx,
revenue decks and other computerized data, well files, land
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files, logs, test data, production records, geologic and geophysical
records, maps and all other records, materials and files related to
the Interests or Lands (the "Records").
2. Purchase Price. Subject to the adjustments and prorations hereafter
described, the total purchase price to be paid by the Purchaser to the Seller
for the purchase of the Properties is the sum of Twenty Million Dollars
($20,000,000.00) (the "Purchase Price"). The Purchase Price will be adjusted and
paid as follows:
2.1 Cash at Closing. On the Closing Date (as hereafter defined), the
Purchaser will pay to the Seller the Purchase Price as adjusted
under paragraphs 5.2, 5.3 and 9 of this Agreement in immediately
available funds.
2.2 Allocation. Any adjustments to the Purchase Price under paragraphs
5.2, 5.3 or 9 of this Agreement will be deducted from the Purchase
Price. The Purchaser will allocate the Purchase Price among the
Properties according to sound accounting practices and such
allocation will be delivered to the Seller within three (3) days
after execution of this Agreement.
3. Representations and Warranties. As an inducement to the Purchaser to enter
into this Agreement, the Seller represents and warrants to the Purchaser that as
of the date of this Agreement and the Closing Date:
3.1 Organization, Good Standing, Etc. The Seller is a corporation duly
organized, validly existing and in good standing under the laws of
the State of Delaware and has the corporate power to own the
Seller's property and to carry on the Seller's business as now being
conducted. The Seller has the power to execute and deliver this
Agreement and to consummate the transaction contemplated hereby. The
Seller is duly qualified and/or licensed, as may be required, and in
good standing in each of the jurisdictions in which the Interests
are located. The Seller is not in default under or in violation of
any provision of the Seller's certificate of incorporation or
bylaws.
3.2 Authority. The Seller has taken all necessary action to authorize
the execution, delivery and performance of this Agreement and has
adequate power, authority and legal right to enter into, execute,
deliver and perform the transactions contemplated by this Agreement.
This Agreement is legal, valid and binding with respect to the
Seller and is enforceable in accordance with its terms. On
execution, delivery and performance of this Agreement in accordance
with its terms, the Purchaser will acquire all of the Properties
free of all claims, liens, encumbrances and liabilities.
3.3 No Assumption of Obligations. Except as set forth in Schedule "3.3"
attached hereto as a part hereof, the execution and consummation of
this Agreement by
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the Purchaser will not obligate the Purchaser with respect to (or
result in the assumption by the Purchaser of) any obligation of the
Seller arising prior to the Effective Date under or with respect to,
any liability, agreement or commitment relating to the Properties
including, without implied limitation, to pay to or share with any
third party any portion of the Hydrocarbons attributable to the
Properties.
3.4 Absence of Liabilities. Except as set forth in Schedule "3.4"
attached hereto as a part hereof to the best of the Seller's
knowledge: (a) the Seller has no debt, liability, obligation or
commitment, absolute or contingent, known or unknown, relating to or
connected with the Properties; (b) neither the Purchaser nor the
Properties will be subject to or liable for any claim, debt,
liability, lien, encumbrance, obligation, guaranty, commitment on
the Closing Date; and (c) any such claims, debts, liabilities,
obligations or commitments will be the sole responsibility of the
Seller and the Seller hereby agrees to indemnify and hold harmless
the Purchaser from all such matters. The Seller has complied and
will continue to comply with all applicable federal, state or local
statutes, laws and regulations.
3.5 Contracts. The Seller has delivered to the Purchaser true copies (or
descriptions, in the case of oral agreements) of all of the
contracts and agreements relating to the Properties, including,
without limitation, all marketing and production sales contracts.
Except as provided in Schedule 3.5 attached hereto as a part hereof
no such marketing or production sales contracts will in any way
prevent or hinder the Purchaser in taking in kind the Purchaser's
share of production from the Properties. There are no other material
contracts, commitments or agreements in effect related to the
Properties that have not been disclosed to the Purchaser in writing.
Except as set forth in Schedule "3.5," to the best of the Seller's
knowledge: (a) such contracts and agreements are in full force and
effect; (b) no event of default or event which would become an event
of default with the giving of notice or passage of time has
occurred; and (c) no condition presently exists which would give any
party to any such contract the right to terminate such contract.
There are no other material contracts, commitments or agreements in
effect related to the Properties that have not been disclosed to the
Purchaser in writing.
3.6 Consents and Approvals. No notice to, filing with, or authorization,
consent or approval of any governmental entity, person or other
entity is necessary for the consummation of the transactions
contemplated by this Agreement. The execution, delivery, performance
and consummation of this Agreement does not and will not: (a)
violate, conflict with or constitute a default or an event that,
with notice or lapse of time or both, would be a default, breach or
violation under any term or provision of any instrument, agreement,
contract,
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commitment, license, promissory note, conditional sales contract,
indenture, mortgage, deed of trust, lease or other agreement,
instrument or arrangement to which the Seller is a party or by which
the Seller or, to the best of the Seller's knowledge the Properties
are bound; (b) violate, conflict or constitute a breach of any
statute, regulation or judicial or administrative order, award,
judgment or decree to which the Seller is a party or to which the
Seller or, to the best of the Seller's knowledge the Properties are
bound; or (c) result in the creation or imposition of any adverse
claim or interest, lien, encumbrance, charge, equity or restriction
of any nature whatever, upon or affecting the Seller, or to the best
of the Seller's knowledge, the Properties or the Purchaser.
3.7 Litigation. Except as disclosed in Schedule "3.7" attached hereto as
a part hereof, there is to the best of the Seller's knowledge and
subject to the Seller's rights under the Amoco Agreement: (a) no
action, suit or proceeding pending, threatened or contemplated
against the Seller or the Properties; and (b) no proceeding,
investigation, charges, audit or inquiry threatened or pending
before or by any federal, state, municipal or other governmental
court, department, commission, board, bureau, agency or
instrumentality which might result in an adverse effect on the
Seller or the Properties. The Seller hereby agrees to indemnify and
hold harmless the Purchaser with respect to any and all litigation
and proceedings including, without limitation, the matters described
in Schedule "3.7."
3.8 Title. Except as set forth in Schedule "3.8" attached hereto as a
part hereof, the Seller owns, possesses and holds good and
defensible title beneficially and of record in and to the respective
Properties free and clear of all claims, liens, encumbrances,
conditions, restrictions, calls on production, obligations to pay to
or share with third parties any revenue or other matter adversely
affecting the value or ownership of the Properties. All of the oil,
gas and related interests of every kind and character owned by the
Seller or any of the Seller's direct or indirect subsidiaries which
are located in the Arkoma Basin are described in Schedule "1.1"
hereto. The Seller is entitled to receive not less than the "Net
Revenue Interest" set forth on Schedule "1.1" of all Hydrocarbons
produced, saved and marketed from the Properties without reduction,
suspension or termination of such interest throughout the duration
of the productive life of such Properties and is in no event
obligated to bear any of the costs and expenses related to the
maintenance, development or operation (including, without
limitation, the costs and expenses of plugging and abandoning any
xxxxx and removal and salvage of any equipment and facilities) of
the Properties throughout the productive life of the Properties in
excess of the "Working Interest" set forth in Schedule "1.1." To the
best of the Seller's knowledge, Amoco has been receiving the
percentage of the fair market value of all Hydrocarbons produced,
saved or used from each of the Properties equal to the Net Revenue
Interest designated on Schedule "1.1" for such Property.
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To the best of the Seller's knowledge, there are no suspended
revenues or any basis to suspend revenues from the Properties. To
the best of the Seller's knowledge, there does not exist any lien,
claim, encumbrance, restriction or other matter which might cause
the Purchaser to not receive for its own account free and clear of
all liens, claims and encumbrances the percentage of the fair market
value of all Hydrocarbons produced, saved or used from each of the
Properties after the Effective Date equal to the Net Revenue
Interest designated on Schedule "1.1."
3.9 Foreign Person. The Seller is not a "foreign person" as that term is
defined under the Internal Revenue Code of 1986.
3.10 Broker's or Finder's Fees. The Seller has not incurred any
liability, contingent or otherwise, for broker's or finder's fees in
respect of this Agreement for which the Purchaser will have any
responsibility whatsoever.
3.11 Permits. On the Closing Date, the Seller will have all approvals,
authorizations, consents, licenses, orders, franchises, rights,
registrations and permits of all governmental agencies, whether
federal, state or local, United States or foreign, required to
permit the operation of the Seller's business as presently conducted
(the "Permits") and each will be in full force and effect and will
have been duly and validly issued, except where the absence of
which, singly or in the aggregate, would not have a material adverse
effect on the Properties. The execution and delivery of this
Agreement and the consummation of the transactions contemplated
hereby will not result in any revocation, cancellation, suspension
or modification of any such Permit except where such revocation,
cancellation, suspension or modification would not have a material
adverse effect on the Properties. On the Closing Date, there will be
no outstanding violation of any of the Permits.
3.12 Compliance with Laws. Except as disclosed in Schedule "3.12," the
Seller is not in violation of any applicable law, ordinance,
regulation, writ, judgment, decree or order of any court or
government or governmental unit in connection with the Properties,
the consequences of which singly or in the aggregate would have a
material adverse effect on the Seller or the Properties.
3.13 Oil and Gas Leases in Good Standing. Except as disclosed in Schedule
"3.13" attached hereto as a part hereof, to the best of the Seller's
knowledge all oil and gas leases which are material singly or in the
aggregate are in full force and effect, and the Seller is not in
default thereunder.
3.14 Taxes. All ad valorem, property, production, severance and similar
taxes and assessments based on or measured by the ownership of
property comprising the Properties or the production or removal of
hydrocarbons or the receipt of
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proceeds therefrom have been timely paid when due and are not in
arrears.
3.15 Contracts, Consents and Preferential Rights. To the best of the
Seller's knowledge, the Seller has described in Schedule "3.15"
attached hereto as a part hereof: (a) all partnership, joint
venture, farmin/farmout, dry hole, bottom hole, acreage
contribution, area of mutual interest, purchase and/or acquisition
agreements of which any terms remain executory which materially
affect the Properties; (b) all other executory contracts to which
the Seller is a party which materially affect any item of the
Properties; (c) all governmental or court approvals and third party
contractual consents required in order to consummate the
transactions contemplated by this Agreement; (d) all agreements
pursuant to which third parties have preferential rights or similar
rights to acquire any portion of the Properties upon the sale
contemplated by this Agreement; and (e) all other contracts and
agreements which are in any single case of material importance to
the Properties.
3.16 Tax Partnerships. None of the Properties is treated for income tax
purposes as being owned by a partnership except as disclosed in
Schedule "3.16" attached hereto as a part hereof.
3.17 Financial Statements. The Seller has provided to the Purchaser all
reserve reports, cash flow and operational information in the
Seller's possession relating to the Properties and to the best of
the Seller's knowledge since the respective dates of such items no
material adverse change has occurred with respect to the Properties.
To the best of the Seller's knowledge, the Seller has no liabilities
of any kind whatsoever relating to the Properties, whether accrued,
contingent or otherwise except as disclosed in Schedule "3.17"
attached hereto as a part hereof and trade payables arising in the
ordinary course of business.
3.18 Insurance. The Seller will maintain or cause to be maintained
through the Closing Date, with financially sound and reputable
insurers, insurance to the extent and against such hazards and
liabilities and in such types and amounts as is commonly maintained
by entities similarly situated.
3.19 Planned Future Commitments. The Seller has not planned or budgeted
future expenditure commitments relating to the Properties prior to
the Closing Date (drilling of xxxxx, workovers, contract
settlements, pipeline projects, production facilities, etc.) in
excess of Twenty-Five Thousand Dollars ($25,000.00) in the aggregate
which are not disclosed in Schedule "3.19" attached hereto as a part
hereof.
3.20 Environmental and Safety Matters. Except as set forth in Schedule
"3.20" attached hereto as a part hereof and insofar as it pertains
to the Properties:
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3.20.1 The Seller is not aware, and has not received notice from
any person, entity or governmental body, agency or
commission, of any release, disposal, event, condition,
circumstance, activity, practice or incident concerning any
land, facility, asset or property that: (a) interferes with
or prevents compliance or continued compliance by the Seller
(or by the Purchaser after the Closing Date) with any United
States, state or local law, regulation, code or ordinance or
the terms of any license or permit issued pursuant thereto;
or (b) gives rise to or results in any common law or other
liability of the Seller to any person, entity or
governmental body, agency or commission for damage or injury
to natural resources, wildlife, human health or the
environment which would have a material adverse effect on
the Seller in each case.
3.20.2 The Seller is not aware of any civil, criminal or
administrative action, lawsuit, demand, litigation, claim,
hearing, notice of violation, investigation or proceeding,
pending or threatened, against the Seller or operator of any
of the lands, facilities, assets and properties owned or
formerly owned, operated, leased or used by the Seller as a
result of the violation or breach of any federal, state, or
local law, regulation, code or ordinance or any duty arising
at common law to any person, entity or governmental body,
singly or in the aggregate, which if determined adversely
would have a material adverse effect on the Seller.
3.21 Powers of Attorney. There are no outstanding powers of attorney
relating to or affecting any of the Properties.
3.22 Plugging Status. To the best of the Seller's knowledge, all xxxxx on
the Properties that have been permanently plugged and abandoned have
been so plugged and abandoned in accordance in all material respects
with all applicable requirements of each governmental authority
having jurisdiction over the Seller and the Properties.
3.23 Equipment. To the best of the Seller's knowledge, the equipment has
been installed, maintained and operated by the operator thereof as a
prudent operator in accordance with oil and gas industry standards
and is currently in a state of repair so as to be adequate for
normal operations of the Properties.
3.24 Payout and Gas Balancing. To the best of the Seller's knowledge,
Schedule "3.24" attached hereto as a part hereof, contains a
complete and accurate list of: (a) the status of any "payout"
balance as of December 31, 1997, for each of the Properties that is
subject to a reversion or other adjustment at some level
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of cost recovery or payout (or passage of time or other event, other
than cessation of production); and (b) all over or under gas
imbalances relating to the Properties as of December 31, 1997.
3.25 Affiliate Transactions. There are no transactions affecting any of
the Properties between the Seller and any of the Seller's
affiliates, except as set forth in Schedule "3.25" attached hereto
as a part hereof. As used in this Agreement, "affiliate" means, with
respect to any person or entity, each other person or entity
directly or indirectly controlling, controlled by or under common
control with such person.
3.26 Intangible Property. To the best of the Seller's knowledge, there
are no material trademarks, trade names, patents, service marks,
brand names, computer programs, data bases, industrial designs,
copyrights or other intangible properties that are necessary for the
operation, or continued operation, or for the ownership and
operation, or continued ownership and operation, of any of the
Properties.
3.27 Full Disclosure. This Agreement, any schedule referenced in or
attached to this Agreement, any document furnished to the Purchaser
under this Agreement and any certification furnished to the
Purchaser under this Agreement does not contain any untrue statement
of a material fact and does not omit to state a material fact
necessary to make the statements made, in the circumstances under
which they were made, not misleading. All of the representations,
warranties and covenants in this Agreement: (a) are true and correct
as of the date made; (b) will be true and correct as of the Closing
Date; and (c) will survive and not be waived, discharged, released,
modified, terminated or affected by any due diligence by the
Purchaser.
4. Purchaser's Representations and Warranties. The Purchaser is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Oklahoma and has all requisite corporate power and authority to own,
lease, and operate its properties and to conduct its business as now being
conducted. The Purchaser has full corporate power and authority to execute,
deliver and perform this Agreement.
5. Covenants. The parties agree to perform the following prior to the Closing
Date:
5.1 Access to Information. During the period commencing on the date of
this Agreement and ending on the Closing Date, the Seller will
afford the Purchaser and the Purchaser's authorized representatives
full access during normal business hours to the properties, books,
records, employees, accountants and lawyers of the Seller to make
such investigation as the Purchaser desires regarding the Properties
and furnish such financial, operating data, information and
responses as the Purchaser might reasonably request with respect to
the
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Properties.
5.2 Inspection. Prior to the Closing Date the Purchaser will conduct
such investigation and inspection with respect to the Properties as
the Purchaser deems appropriate. If the Purchaser determines that by
comparing the Reserve Report to more accurate title, net revenue and
net working interests information, the amount of reserves
attributable to the Properties is less than ninety-five percent
(95%) of the amount set forth in the Reserve Report, the Purchase
Price will be adjusted by an amount equal to the amount by which
such discrepancies exceed five percent (5%) of the Purchase Price.
5.3 Title Adjustments. In addition to any other remedies available to
the Purchaser, if a casualty or title defect exists with respect to
one (1) or more of the Properties which the Seller refuses to or
cannot cure on or before August 1, 1998, then the Purchase Price
will be adjusted downward as provided herein with such adjustment
being accounted for in the post closing allocations under paragraph
9 of this Agreement. If the casualty or title defect is an
encumbrance or charge which is undisputed and liquidated the
decrease in the Purchase Price will be the amount necessary to
satisfy such charge and remove the title defect. In all other cases,
the amount of the decrease in the Purchase Price will be the amount
determined by multiplying (a) the percentage of the specific
Property affected by the casualty or title defect by (b) the
allocation of the Purchase Price to that specific Property. As used
in this Agreement, "title defect" means: (a) the Seller's title at
the Effective Date or at the Closing Date is subject to a mortgage,
deed of trust, lien or security interest; (b) any of the interests
in the Properties are subject to being reduced by virtue of the
exercise by a third party of any preferential purchase rights,
reversionary or back-in interest, farmout of other than wellbore
rights or other similar rights; or (c) any claim, encumbrance,
defect or other matter which: (i) would cause the Purchaser to
receive (free and clear of all royalties, overriding royalties, net
profits interests or other burdens on or measured by production of
hydrocarbons and associated gases) less than one hundred percent
(100%) of the "Net Revenue Interests" set forth in Schedule "1.1" of
all oil, gas, sulfur and associated liquid and gaseous hydrocarbons
and other associated gases produced, saved and marketed from the
Properties for the productive life of such Properties; or (ii) would
obligate the Purchaser to bear costs and expenses relating to the
maintenance, development or operation of any of the Properties in an
amount greater than the "Working Interests" set forth in Schedule
"1.1" during the productive life of such Property.
5.4 Conduct of Businesses. Prior to the Closing Date, the Seller will
operate the Properties in a businesslike manner in accordance with
the Seller's prior practices and will use the Seller's best efforts
to maintain and preserve the Properties. In addition, unless the
Purchaser otherwise consents in writing (a)
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the Seller has not and will not transfer, sell, mortgage, pledge,
encumber or dispose of any of the Properties; or (b) make, permit
any amendment or permit the termination of any material contract,
agreement or commitment relating to the Properties. The Seller and
the Seller's affiliates, advisors or representatives will not,
directly or indirectly, encourage, initiate, engage in discussions
or negotiations with, or provide any information to, any
corporation, partnership, person or other entity or group concerning
the sale of the Properties.
5.5 Consents. The parties will use their best efforts to obtain all
licenses, permits, consents, approvals, authorizations,
qualifications and orders of governmental authorities and parties to
contracts with the Seller as are necessary for the consummation of
the transactions contemplated by this Agreement. However, no
contract will be amended to increase the amount payable thereunder
and no burden to the Seller or the Purchaser will be increased to
obtain any consent, approval or authorization.
5.6 Conditions. The Seller and the Purchaser will use their respective
best efforts to cause the conditions in paragraphs 6 and 7 to be
satisfied.
5.7 Capital Expenditures. The Seller will not incur or make any
commitment to incur any costs or expenses relating to the Properties
in excess of Twenty-Five Thousand Dollars ($25,000.00) unless the
Purchaser otherwise consents thereto in writing, which consent will
not be unreasonably withheld.
6. Purchaser's Conditions Precedent. The obligation of the Purchaser to
consummate the transactions contemplated by this Agreement is subject to the
satisfaction or waiver (subject to applicable law) on or before the Closing Date
of each of the following conditions:
6.1 No preliminary or permanent injunction or other order will have been
issued by any court of competent jurisdiction or any regulatory body
preventing consummation of the transactions contemplated by this
Agreement;
6.2 No action will have been commenced or threatened against the Seller,
Purchaser or any of their respective affiliates, associates,
officers or directors seeking damages arising from, or to prevent or
challenge the transactions contemplated by this Agreement;
6.3 All representations and warranties of the Seller contained herein
will be true and correct in all material respects;
6.4 The Seller will have performed or satisfied as of the Closing Date
all obligations, covenants, agreements and conditions contained in
this Agreement to be performed or complied with by the Seller;
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6.5 All actions, proceedings, instruments and documents required to
carry out the transactions contemplated hereby will have been
satisfactory to the Purchaser's counsel, including, without
limitation, corporate resolutions authorizing the transactions
contemplated hereby, and releases of any and all liens, claims,
security interests or other encumbrances affecting any of the
Properties, and the Seller will have delivered such additional
certificates and other documents as the Purchaser reasonably
requests including, without limitation, such certificates of the
Seller dated as of the Closing Date evidencing compliance with the
conditions set forth in this paragraph 6;
6.6 The Purchaser shall have received and reviewed all Schedules to be
provided by the Seller and such Schedules shall not be materially
different than anticipated by the Purchaser as determined in the
Purchaser's reasonable judgment;
6.7 All of the transactions contemplated by the Sale and Participation
Agreement in the form of Exhibit "6.7" (the "Participation
Agreement") and the Securities Purchase Agreement of even date
herewith between the Seller and the Purchaser (the "Related
Agreements") shall have been consummated on the terms and conditions
set forth in the Related Agreements;
6.8 The Seller shall have obtained and delivered to the Purchaser
consents to the transactions contemplated by this Agreement from the
parties whose consent is required by contract or otherwise;
6.9 There shall not have occurred since December 31, 1997 any material
loss or damage to any of the Properties;
6.10 The Purchaser shall have received from legal counsel to the
Purchaser an opinion dated the Closing Date, in form and substance
satisfactory to the Purchaser's counsel, to the effect that: (a)
the Seller is a corporation duly incorporated and validly existing
and in good standing under the laws of the State of Oklahoma; (b)
the Seller has the corporate power to carry on its business as not
being conducted; (c) the Seller has the requisite corporate power
and authority and has taken all requisite corporate action necessary
to enable the Seller to execute and deliver this Agreement and to
consummate the transactions contemplated hereby; and (d) this
Agreement has been duly and validly executed and delivered by the
Seller and is enforceable against the Seller in accordance with its
terms; and
6.11 As of the Closing Date, the Seller shall not have sold, assigned,
transferred or otherwise conveyed any of the Interests to any person
except as disclosed to and approved by the Purchaser.
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7. Seller's Conditions Precedent. The obligation of the Seller to consummate
the transactions contemplated by this Agreement is subject to the satisfaction,
on or before the Closing Date of each of the following conditions, any or all of
which may be waived in whole or in part:
7.1 No preliminary or permanent injunction or other order will have been
issued by any court of competent jurisdiction or any governmental or
regulatory body preventing consummation of the transactions
contemplated by this Agreement;
7.2 No action will have been commenced or threatened against the Seller,
the Purchaser or any of their respective affiliates, associates,
officers or directors seeking damages arising from, to prevent or to
challenge the transactions contemplated by this Agreement;
7.3 All representations and warranties of the Purchaser contained herein
will be true and correct in all material respects;
7.4 The Purchaser will have performed in all material respects all
obligations, agreements and conditions contained in this Agreement
to be performed or complied with by the Purchaser; and
7.5 The Seller will have received such certificates of the Purchaser,
dated the Closing Date, signed by officers of the Purchaser and
others to evidence compliance with the conditions set forth in this
paragraph 7.
7.6 All of the transactions contemplated by the Related Agreements shall
have been consummated on the terms and conditions set forth in the
Related Agreements.
8. The Closing. Unless extended in writing executed by the Seller and the
Purchaser, the transactions contemplated by this Agreement will be consummated
at 10:00 a.m. local time in the offices of the Purchaser on or before April 27,
1998 (the "Closing Date").
8.1 Purchaser's Deliveries. On the Closing Date, the Purchaser will
deliver or cause to be delivered to the Seller the following items
(all documents will be duly executed and acknowledged where
required):
8.1.1 Payment. The portion of the Purchase Price due under
paragraph 2 as adjusted under paragraphs 5.3 and 9 of this
Agreement;
8.1.2 Evidence of Authority. Such corporate resolutions,
certificates of good standing, incumbency certificates and
other evidence of authority with respect to the Purchaser as
might be reasonably requested by the Seller;
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8.1.3 Closing Memorandum. A memorandum setting forth the items
delivered and accounting for the payments made on the
Closing Date; and
8.1.4 Additional Documents. Such additional documents as might be
reasonably requested by the Seller to consummate this
Agreement.
8.2 Seller's Deliveries. On the Closing Date, the Seller will deliver or
cause to be delivered to the Purchaser the following items (all
documents will be duly executed and acknowledged where required):
8.2.1 Assignments. Assignments and conveyances in substantially
the form of Exhibit "8.2.1" attached hereto as a part hereof
conveying to the Purchaser all of the Seller's right, title
and interest in and to the Properties;
8.2.2 Releases. Releases and termination statements with respect
to any and all liens, claims, security interests and other
encumbrances covering any of the Properties;
8.2.3 Notices. Letters in lieu of transfer orders addressed to all
purchasers of production from the Properties in the form of
Exhibit "8.2.3A" attached hereto as a part hereof and
notices of change of operations and ballots (where
applicable) in the form of Exhibit "8.2.3B" attached hereto
as a part hereof.
8.2.4 Evidence of Authority. Such corporate resolutions,
certificates of good standing, incumbency certificates and
other evidence of authority with respect to the Seller as
might be reasonably requested by the Purchaser;
8.2.5 Closing Memorandum. A memorandum setting forth the items
delivered and accounting for the payments made on the
Closing Date; and
8.2.6 Additional Documents. The Records and such additional
documents as might be reasonably requested by the Purchaser
to consummate this Agreement.
8.3 Costs. The Seller will pay the following closing costs: (a) the
Seller's attorneys' fees, investment banker's fees and bank fees;
(b) the cost of recording all mortgage or other lien releases and
the cost of documentary stamps to be affixed to any deeds conveying
title to the Properties to the Purchaser; and (c) any other charge
imposed for the transfer of any item
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comprising the Properties. The Purchaser will pay only the following
closing costs: (y) the Purchaser's attorneys' fees; and (z) the cost
of recording the transfer documents.
9. Adjustments. All receipts and disbursements with respect to the Properties
will be prorated as of the Effective Date as follows: (a) gross proceeds from
sales of Hydrocarbons prior to the Effective Date attributable to the Properties
will be the property of and payable to the Seller; (b) gross proceeds from sales
of Hydrocarbons after the Effective Date attributable to the Properties will be
the property of and payable to the Purchaser; (c) all costs, expenses and
expenditures attributed directly to the Properties and arising prior to the
Effective Date will be the obligation of the Seller; (d) all costs, expenses and
expenditures attributed directly to the Properties and arising after the
Effective Date will be the obligation of the Purchaser; and (e) all real and
personal property ad valorem taxes and special assessments for the Properties
payable for any taxable period prior to the calendar year in which the Closing
Date occurs will be the obligation of the Seller. At least ten (10) days prior
to the Closing Date the Seller will provide the Purchaser with an itemized
statement of all preferential purchase rights which have been exercised by third
parties. All exercised preferential purchase rights will be treated as an
adjustment to the Purchase Price on the Closing Date. On or before August 1,
1998, the Purchaser and the Seller will account for and agree on all of the
foregoing adjustments and any adjustments required under paragraph 5.3 of this
Agreement and the net adjustment will be paid to the appropriate party on or
before the fifth (5th) day thereafter.
10. Operations. Subject to the rights of unaffiliated third parties, the Seller
and the Purchaser hereby agree that with respect to their respective interests
in the existing xxxxx in the Arkoma Basin: (a) the Purchaser will be appointed
the operator on all xxxxx now or hereafter located in townships 4N-19E, 4N-20E,
5N-19E and 5N-20E, except for xxxxx located in Sections 1-7, 5N-19E; and (b) the
Seller will remain the operator of all xxxxx located in Sections 1-7, 5N-19E and
the remainder of the Arkoma Basin. Township references in this paragraph are to
the Indian Meridian, State of Oklahoma. The operational rights and obligations
with respect to future development in the Arkoma Basin will be determined in
accordance with the Participation Agreement, including, without limitation the
provisions of paragraph 10 of the Participation Agreement.
11. Indemnification. The Seller and the Purchaser hereby agree to indemnify
each other as follows:
11.1 Seller Indemnity. The Seller agrees to pay, defend, indemnify,
reimburse and hold harmless the Purchaser and its directors,
officers, agents and employees (the "Purchaser Indemnified Parties")
for, from and against any loss, damage, claim, liability, debt,
obligation or expense (including interest, reasonable legal fees,
and expenses of litigation) incurred or suffered or paid by, imposed
upon, resulting to or threatened against any of the Purchaser
Indemnified Parties or the Properties which directly or indirectly
results from, arises out of or in connection with, is based upon, or
exists by reason of: (a) the execution,
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delivery, validity and enforceability of this Agreement; (b) the
performance of this Agreement by the Seller; (c) the Purchaser not
obtaining one hundred percent (100%) ownership of the interest
agreed to be conveyed in the Properties; (d) any misrepresentation
of facts relating to the Seller or the Properties (whether contained
in this Agreement or any other document delivered or required to be
delivered pursuant to this Agreement) or any other representation or
warranty made by the Seller in this Agreement; (e) the existence of
any facts or circumstances which constitute a breach, violation or
inaccuracy of, incorrectness in, or conflict with any representation
or warranty by Seller relating to the Properties; (f) the litigation
described in Schedule "3.7" and any other claims or liabilities
relating to the Properties arising prior to the Effective Date; or
(g) the ownership or operation of the Properties prior to the
Effective Date or any breach or default in performance by the Seller
of any covenant or obligation set forth in this Agreement, the
Related Agreements or any related document.
11.2 Purchaser Indemnity. The Purchaser agrees to pay, defend, indemnify,
reimburse and hold harmless the Seller and its directors, officers,
agents, and employees (the "Seller Indemnified Parties") for, from
and against any loss, damage, claim, liability, debt, obligation or
expense (including interest, reasonable legal fees, and expenses of
litigation) incurred or suffered or paid by, imposed upon, resulting
to or threatened against any of the Seller Indemnified Parties which
directly or indirectly results from, arises out of or in connection
with, is based upon or exists by reason of: (a) the performance of
this Agreement by the Purchaser; (b) any misrepresentation of facts
relating to the Purchaser (whether contained in this Agreement or
any other document delivered or required to be delivered pursuant to
this Agreement) or any other representation or warranty made by the
Purchaser in this Agreement; or (c) any claims or liabilities
relating to the Properties arising after the Effective Date,
provided, however, any such claims and liabilities arising prior to
the Closing Date which are outside the ordinary course of ownership
and operation of the Properties shall have been disclosed to the
Purchaser and subject to adjustment under paragraph 5.3 of this
Agreement.
11.3 Indemnification Procedure. If any party hereto discovers or
otherwise becomes aware of an indemnification claim arising under
this Agreement, such indemnified party will give written notice to
the indemnifying party, specifying such claim, and may thereafter
exercise any remedies available to such party under this Agreement;
provided, however, that the failure of any indemnified party to give
notice as provided herein will not relieve the indemnifying party of
any obligations hereunder, to the extent the indemnifying party is
not materially prejudiced thereby. Further, promptly after receipt
by an indemnified party hereunder of written notice of the
commencement of any action or proceeding with respect to which a
claim for indemnification may be
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made against any indemnifying party, the indemnified party will give
written notice to the latter of the commencement of such action;
provided, however, that the failure of any indemnified party to give
notice as provided herein will not relieve the indemnifying party of
any obligations hereunder, to the extent the indemnifying party is
not materially prejudiced thereby.
11.4 Defense. If any such action is brought against an indemnified party,
the indemnifying party will be entitled to participate in and to
assume the defense thereof to the extent that it may wish, with
counsel reasonably satisfactory to such indemnified party, and after
such notice from the indemnifying party to such indemnified party of
its election so to assume the defense thereof, the indemnifying
party shall not be liable to such indemnified party for any legal or
other expenses subsequently incurred by the latter in connection
with the defense thereof unless the indemnifying party has failed to
assume the defense of such claim and to employ counsel reasonably
satisfactory to such indemnified person. Notwithstanding any of the
foregoing to the contrary, the indemnified party will be entitled to
select its own counsel and assume the defense of any action brought
against it if the indemnifying party fails to select counsel
reasonably satisfactory to the indemnified party, the expenses of
such defense is to be paid by the indemnifying party. No
indemnifying party shall consent to entry of any judgment or enter
into any settlement with respect to a claim without the consent of
the indemnified party, which consent shall not be unreasonably
withheld, or unless such judgment or settlement includes as an
unconditional term thereof the giving by the claimant or plaintiff
to such indemnified party of a release from all liability with
respect to such claim. No indemnified party shall consent to entry
of any judgment or enter into any settlement of any such action, the
defense of which has been assumed by an indemnifying party, without
the consent of such indemnifying party, which consent shall not be
unreasonably withheld.
11.5 Interest. In addition to the foregoing, the indemnifying party will
pay to the indemnified party interest on the amount of any loss,
damage, claim, liability, debt, obligation or expense the payment of
which is not paid within ten (10) days after notification by the
indemnified party by the indemnifying party, such interest to be at
a floating rate of interest equal to the prime rate published from
time to time in The Wall Street Journal. The remedies provided by
this paragraph 11 are in addition to, and not in lieu of, such other
remedies as may be available under applicable laws. Claims for
indemnification will be paid by the indemnifying party within ten
(10) days after notification thereof.
12. Termination. This Agreement may be terminated and the transactions
contemplated hereby may be abandoned by: (a) mutual consent of the Seller and
the Purchaser; (b) the Purchaser, if the Purchaser is not in default and the
conditions set forth in paragraph 6 of this Agreement have not been satisfied by
the Seller or waived by the Purchaser; or (c) the Seller, if
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the Seller is not in default, and the conditions precedent set forth in
paragraph 7 of this Agreement have not been satisfied or waived by the Seller.
In the event of termination, written notice thereof will be given to the other
party or parties specifying the provision pursuant to which such termination is
made. On termination pursuant to this paragraph 12, this Agreement will become
void and have no effect, and there will be no liability hereunder on the part of
the Purchaser or the Seller or any of their respective officers, directors,
employees, agents, stockholders or principals.
13. Default. If a party fails to perform any obligation contained in this
Agreement, the party claiming default will serve written notice to the other
party specifying the nature of such default and demanding performance. If the
Seller fails to cure such default within ten (10) days after receipt thereof,
the Purchaser will have the option to waive such default, to demand specific
performance, to exercise any other remedy available at law or in equity or to
terminate this Agreement. If the Purchaser fails to cure such default within ten
(10) days after receipt thereof, the Seller will have the option to waive such
default, terminate this Agreement or exercise any other remedy available at law
or in equity. The Purchaser is entitled to enforce this Agreement by specific
performance without the necessity of demonstrating inadequacy of damages or
irreparable harm.
14. Miscellaneous. It is further agreed as follows:
14.1 Time. Time is of the essence of this Agreement.
14.2 Notices. Any notice, demand or communication required or permitted
to be given by any provision of this Agreement will be in writing
and will be deemed to have been given and received when delivered
personally or by telefacsimile to the party designated to receive
such notice, or on the date following the day sent by overnight
courier, or on the third (3rd) business day after the same is sent
by certified mail, postage and charges prepaid, directed to the
following addresses or to such other or additional addresses as any
party might designate by written notice to the other parties:
To the Purchaser: Chesapeake Gothic Corp.
0000 Xxxxx Xxxxxxx
Xxxxxxxx Xxxx, Xxxxxxxx 00000
Attn: Xx. Xxxxxx X. XxXxxxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
Chesapeake Acquisition Corporation
0000 Xxxxx Xxxxxxx
Xxxxxxxx Xxxx, Xxxxxxxx 00000
Attn: Xx. Xxxxxx X. XxXxxxxxx
Telephone: (000) 000-0000
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Fax: (000) 000-0000
With a copy to: Self, Xxxxxxx & Xxxx, Inc.
2725 Oklahoma Tower
000 Xxxx Xxxxxx
Xxxxxxxx Xxxx, XX 00000
Attn: C. Xxx Xxxx, Esquire
Telephone: (000) 000-0000
Fax: (000) 000-0000
To the Seller: Gothic Energy Corporation
0000 Xxxxx Xxxxx Xxxxxx
Xxxxx, Xxxxxxxx 00000-0000
Attn: Xxxxxxx X. Xxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
With a copy to: Pray, Walker, Jackman, Xxxxxxxxxx
& Xxxxxx, A P.C.
Attn: Xxx X. Xxxxxxx, Xx., Esquire
000 X. 0xx Xxxxxx, Xxxxx 000
Xxxxx, Xxxxxxxx 00000-0000
Telephone: (000) 000-0000
Fax: (000) 000-0000
14.3 Representations and Warranties. The respective representations and
warranties of the Seller and the Purchaser contained in this
Agreement, any certificate or any other document delivered prior to
or on the Closing Date will not be deemed waived or otherwise
affected by any investigation made by any party hereto. Each and
every such representation and warranty will survive the Closing Date
and will not be terminated or extinguished. This paragraph 14.3 will
have no effect on any other obligation of the parties hereto,
whether to be performed before or after the Closing Date.
14.4 Cooperation. Prior to and at all times following the termination of
this Agreement the parties agree to execute and deliver, or cause to
be executed and delivered, such documents and do, or cause to be
done, such other acts and things as might reasonably be requested by
any party to this Agreement to assure that the benefits of this
Agreement are realized by the parties.
14.5 Press Release. The Purchaser and the Seller will each prepare and
issue their own press releases relating to this Agreement and the
sale of the Properties, however, each party will have the right to
approve the other party's proposed press release.
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14.6 Choice of Law. This Agreement will be interpreted, construed and
enforced in accordance with the laws of the State of Oklahoma.
14.7 Headings. The paragraph headings contained in this Agreement are for
reference purposes only and are not intended to affect in any way
the meaning or interpretation of this Agreement.
14.8 Entire Agreement. This Agreement, the Related Agreements and any
document executed in connection herewith or therewith on or after
the date of this Agreement constitute the entire agreement between
the parties with respect to the subject matters hereof and thereof.
14.9 Assignment. It is agreed that the parties may not assign such
party's rights nor delegate such party's duties under this Agreement
without the express written consent of the other party to this
Agreement.
14.10 Amendment. Neither this Agreement, nor any of the provisions hereof
can be changed, waived, discharged or terminated, except by an
instrument in writing signed by the party against whom enforcement
of the change, waiver, discharge or termination is sought.
14.11 Severability. If any clause or provision of this Agreement is
illegal, invalid or unenforceable under any present or future law,
the remainder of this Agreement will not be affected thereby. It is
the intention of the parties that if any such provision is held to
be illegal, invalid or unenforceable, there will be added in lieu
thereof a provision as similar in terms to such provisions as is
possible and to be legal, valid and enforceable.
14.12 Attorney Fees. If any party institutes an action or proceeding
against any other party relating to the provisions of this
Agreement, the party to such action or proceeding which does not
prevail will reimburse the prevailing party therein for the
reasonable expenses of attorneys' fees and disbursements incurred by
the prevailing party.
14.13 Waiver. Waiver of performance of any obligation or term contained in
this Agreement by any party, or waiver by one party of the other's
default hereunder will not operate as a waiver of performance of any
other obligation or term of this Agreement or a future waiver of the
same obligation or a waiver of any future default.
14.14 No Third Party Beneficiaries. This Agreement has been and is made
solely for the benefit of and shall be binding upon the parties
hereto and their respective successors and permitted assigns and no
other person will acquire or have any
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rights under or by virtue of this Agreement.
14.15 Execution in Counterparts. This Agreement may be executed in any
number of counterparts, each of which when so executed and delivered
will be deemed an original and which together will constitute one
and the same instrument.
IN WITNESS WHEREOF, the Seller and the Purchaser have executed this
Agreement on the date to be effective on the Effective Date.
CHESAPEAKE GOTHIC CORP., an Oklahoma corporation
By
------------------
Xxxxxx X. XxXxxxxxx, President
CHESAPEAKE ACQUISITION CORPORATION, an Oklahoma
corporation
By
------------------
Xxxxxx X. XxXxxxxxx, President
(the "Purchaser")
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GOTHIC ENERGY CORPORATION, a Delaware corporation
By
------------------
Xxxxxxx X. Xxxxx, President
(the "Seller")
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