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Exhibit 2.2
PURCHASE AND SALE AGREEMENT
DATED DECEMBER 31, 1996
BETWEEN
ROCKLAND, L.P.
AS SELLER
AND
LOMAK PETROLEUM, INC.
AS BUYER
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TABLE OF CONTENTS
ARTICLE I PURCHASE AND SALE.......................................................1
1.01 - PURCHASE AND SALE.......................................................1
1.02 - EXCLUDED ASSETS.........................................................2
1.03 - EFFECTIVE TIME..........................................................2
ARTICLE II PURCHASE PRICE.........................................................2
2.01 - PURCHASE PRICE..........................................................2
2.02 - ADJUSTMENTS TO PURCHASE PRICE...........................................3
ARTICLE III REPRESENTATIONS AND WARRANTIES........................................4
3.01 - REPRESENTATIONS AND WARRANTIES OF SELLER................................4
3.02 - REPRESENTATIONS AND WARRANTIES OF BUYER.................................6
ARTICLE IV COVENANTS..............................................................7
4.01 - COVENANTS OF SELLER.....................................................7
4.02 - COVENANTS OF BUYER......................................................9
ARTICLE V TITLE MATTERS AND DEFECTIVE INTERESTS..................................10
5.01 - DEFENSIBLE TITLE.......................................................10
5.02 - DEFECTIVE..............................................................12
5.03 - BUYER'S RIGHT OF INSPECTION............................................13
5.04 - NOTICE OF DEFECTIVE INTERESTS..........................................15
5.05 - ARBITRATION PROCEDURES.................................................16
5.06 - EFFECT OF DEFECTIVE INTERESTS ON CLOSING...............................17
ARTICLE VI CONDITIONS TO CLOSING.................................................18
6.01 - SELLER'S CONDITIONS....................................................18
6.02 - BUYER'S CONDITIONS.....................................................19
ARTICLE VII CLOSING..............................................................19
7.01 - CLOSING................................................................19
7.02 - CLOSING OBLIGATIONS....................................................20
ARTICLE VIII OBLIGATIONS AFTER CLOSING...........................................21
8.01 - POST-CLOSING ADJUSTMENTS...............................................21
8.02 - SALES TAXES AND RECORDING FEES.........................................22
8.03 - FURTHER ASSURANCES.....................................................22
8.04 - BUYER'S POST-CLOSING OBLIGATIONS.......................................22
8.05 - SELLER'S POST-CLOSING OBLIGATIONS......................................24
8.06 - FILES AND RECORDS......................................................25
8.07 - DISCLAIMERS OF REPRESENTATIONS AND WARRANTIES..........................25
8.08 - WAIVER OF DTPA.........................................................26
8.09 - SURVIVAL...............................................................26
ARTICLE IX TERMINATION OF AGREEMENT..............................................27
9.01 - TERMINATION............................................................27
9.02 - LIABILITIES............................................................27
ARTICLE X XXXXXXX MONEY..........................................................28
ARTICLE XI INDEMNIFICATION.......................................................28
11.01 - RIGHT TO EMPLOY COUNSEL...............................................28
11.02 - CLAIM REIMBURSEMENT AND REDUCTION.....................................29
ARTICLE XII GENERAL..............................................................29
12.01 - EXHIBITS..............................................................30
12.02 - EXPENSES..............................................................30
12.03 - NOTICES...............................................................30
12.04 - AMENDMENTS............................................................30
12.05 - HEADINGS..............................................................30
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12.06 - COUNTERPARTS..........................................................31
12.07 - REFERENCES............................................................31
12.08 - GOVERNING LAW.........................................................31
12.09 - ENTIRE AGREEMENT......................................................31
12.10 - PARTIES IN INTEREST...................................................31
12.11 - ASSIGNMENTS...........................................................31
12.12 - PUBLIC ANNOUNCEMENTS..................................................31
12.13 - NOTICES AFTER CLOSING.................................................31
12.14 - SEVERABILITY..........................................................32
12.15 - TIME IS OF THE ESSENCE................................................32
Exhibit "A" - Easements and Surface Agreements
Exhibit "B" - Facilities Description
Exhibit "C" - Contracts
Exhibit "D" - Litigation
Exhibit "E" - Additional Permitted Encumbrances
Exhibit "F" - Form of Conveyance
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PURCHASE AND SALE AGREEMENT
This Purchase and Sale Agreement (this "Agreement") dated as of the
31st day of December, 1996 is executed by ROCKLAND, L.P., a Texas limited
partnership, the general partner of which is Xxxxxxxxx Pipeline, Inc. a Delaware
corporation ("Seller") and LOMAK PETROLEUM, INC., a Delaware corporation
("Buyer").
In consideration of the mutual promises contained herein, the benefits
to be derived by each party hereunder and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, Seller and Buyer
agree as follows:
ARTICLE I
PURCHASE AND SALE
1.01 - PURCHASE AND SALE. Subject to the terms and conditions of this
Agreement, Seller agrees to sell and convey to Buyer, and Buyer agrees to
purchase and pay for the following described assets (hereinafter referred to as
the "Properties"):
(a) All of the rights-of-way, easements, surface use
agreements and other agreements described on Exhibit "A" attached
hereto and made a part hereof together with any other easement, surface
use agreement or other similar agreement relating to the Facilities
(defined below) held by Seller and not described on Exhibit "A" hereto
(in the aggregate the "Easements").
(b) All of those certain plants, pipelines and related
separating equipment and meter stations, compressors and compressor
stations, valves, pumps, and other equipment, personal property and
fixtures described on Exhibit "B" attached hereto and made a part
hereof (collectively the "Facilities").
(c) All of the Contract Rights (defined below) under those
certain contracts described on Exhibit "C" attached hereto and made a
part hereof together with all other gas purchase agreements,
transportation agreements, gathering agreements, marketing agreements
and other similar agreements relating to gas moved through the
Facilities and not described on Exhibit "C" attached hereto (in the
aggregate the "System Contracts").
(d) All of Seller's right, title and interest in and to all of
the environmental and other governmental (whether federal, state or
local) permits, licenses. orders, authorizations, franchises and
related instruments or rights relating to the ownership, operation or
use of the Facilities (the "Permits"), including without limitation
those described on Exhibit "C" attached hereto and made a part hereof.
(e) Any office building, district office, or similar facility
used in connection
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with or relating to the Properties and the entire furnishing and
contents thereof (other than the Records).
(f) Any vehicles used by Seller in the operation of the
Properties.
(g) All inventory items related to the operation of the
Properties.
(h) All of Seller's right, title and interest in and to all
books, files, records, correspondence, studies, surveys, reports and
other data in the actual possession or control of Seller relating to
the operation of the Facilities, including without limitation all title
records, customer lists, supplier lists, sales materials, promotional
materials, operational records, technical records, production and
processing records, division order and lease right-of-way files,
accounting files and contract files (the "Records").
As used herein, the term "Contract Rights" shall mean all rights,
titles, interests, benefits and remedies in, to and under a contract,
which under the terms of such contract inure to the benefit of Seller,
together with all other rights titles, interests, benefits, obligations
and remedies of Seller in, to and under the contract.
1.02 - EXCLUDED ASSETS. Notwithstanding anything to the contrary
contained herein, there is hereby excluded from this purchase and sale, and the
Properties not cover or include any of the following:
(a) All accounts receivable related to the period prior to the
Effective Time and all deposits with utilities made prior to the
Effective Time and all claims, credits and causes of action of Seller
arising under the System Contracts or otherwise attributable to the
Properties which arise prior to the Effective Time and for which Seller
has not otherwise received payment or an adjustment credit under the
terms of this Agreement..
(b) Photocopies of any Records made by Seller.
1.03 - EFFECTIVE TIME. The purchase and sale of the Properties shall be
effective as of 7:00 a.m. on October 1, 1996, local time at the location of the
Properties (herein called the "Effective Time").
ARTICLE II
PURCHASE PRICE
2.01 - PURCHASE PRICE. The purchase price payable by Buyer for the
Properties shall be FIFTY MILION AND NO/100DOLLARS ($50,000,000) (the "Purchase
Price"), payable in cash at the Closing, inclusive of the cash payments
represented by transfer of the Xxxxxxx Money to Seller.
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2.02 - ADJUSTMENTS TO PURCHASE PRICE. The Purchase Price shall be
subject to adjustment as follows:
(a) The Purchase Price shall be adjusted upward as follows:
(i) The value of all merchantable, allowable
condensate in storage at the Effective Time,
which is sold and which is credited to the
Properties and paid to Buyer, such value to
be the actual price received less taxes and
deductions by the purchaser;
(ii) The amount of all verifiable expenditures
paid by Seller or any affiliate of Seller in
connection with the operation of the
Properties in accordance with this Agreement
for work actually performed subsequent to
the Effective Time, but specifically
excluding any amounts attributable to
Seller's overhead;
(iii) An amount equal to all prepaid ad valorem,
property, production, severance and similar
taxes (but not including income taxes) based
upon or measured by the ownership of
property or the production of hydrocarbons
or the receipt of proceeds therefrom;
(iv) an aggregate amount equal to $12,500.00 per
month (pro rated for partial months) for the
period between the Effective Time and the
Closing Date as reimbursement to Seller for
costs incurred in operating and managing the
Properties after the Effective Time;
(v) Any other amount agreed upon by Seller and
Buyer.
(b) The Purchase Price shall be adjusted downward as follows:
(i) Proceeds and revenues received by Seller
from the Properties which are attributable
to the period after the Effective Time;
(ii) An amount equal to all unpaid ad valorem,
property, production, severance and similar
taxes and assessments (but not including
income taxes) based upon or measured by the
ownership of property or the production of
hydrocarbons or the receipt of proceeds
therefrom accruing to the Properties prior
to the Effective Time;
(iii) The amount of all verifiable expenditures
paid by Buyer for work actually done and
performed in connection with the Properties
prior
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to the Effective Time;
(iv) The aggregate amount of the Defect Value
(defined below) of any Defective Interest
(defined below) determined to exist in
accordance with Article V hereof, to the
extent the Defect Value of all such
Defective Interests exceeds one half of one
percent (1/2%) of the Purchase Price
(without giving effect to this Section
2.02(b)(iv)); and
(v) Any other amount agreed upon by Seller and
Buyer, including without limitation the
amounts provided in Section 5.04(c).
ARTICLE III
REPRESENTATIONS AND WARRANTIES
3.01 - REPRESENTATIONS AND WARRANTIES OF SELLER. Except as provided
below, Seller represents and warrants to Buyer as follows:
(a) Seller is a duly organized, validly existing limited
partnership organized and in good standing under the laws of its state
of formation and is qualified to do business in the State of Texas.
(b) Seller has all requisite power and authority, partnership,
corporate and otherwise, to carry on its business as presently
conducted, to enter into the Agreement, to sell and convey, free and
clear of all adverse claims, the Properties on the terms described in
the Agreement and to perform its other obligations under the Agreement.
(c) The execution and delivery of this Agreement has been, and
the execution and delivery of all certificates, documents and
instruments required to be executed and delivered by Seller at the
Closing, and the consummation of the transactions contemplated hereby
as of the Effective Time shall have been duly authorized by all
necessary partnership and corporate action on the part of the Seller,
and, assuming expiration or termination of the applicable waiting
period under the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976
("HSR Act"), no further authorization is required by any law, statute,
regulation, court order or judgment applicable to Seller. This
Agreement constitutes a legal, valid and binding obligation of Seller
enforceable in accordance with its terms, subject however, to the
effects of bankruptcy, insolvency, reorganization, moratorium and
similar laws, as well as to principles of equity (regardless of whether
such enforceability is considered in a proceeding in equity or at law).
(d) The execution and delivery of the Agreement and the
consummation of the transactions contemplated hereby will not (i)
violate, or be in conflict with, any provisions of Seller's agreement
of limited partnership or governing documents, (ii) constitute a
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material breach of, or any event of default under, any contract or
agreement to which Seller is a party or by which it or its assets are
bound, or constitute the happening of an event or condition upon which
any other party to such a contract or agreement may exercise any right
or option which will materially adversely affect any of the Properties
(except any provision as to (A) required consents to transfer and
related provisions, (B) maintenance of uniform interests provisions and
(C) any other third-party approvals contemplated herein), (iii)
assuming expiration or termination of the applicable waiting period
under the HSR Act, violate any judgment, decree, order, statute, rule
or regulation applicable to Seller, or (iv) result in any material
liability to Buyer under the terms of any contracts or agreements,
except those obligations related to the Properties after the Effective
Time and assumed by Buyer pursuant to the terms of the Agreement.
(e) Except as shown on Exhibit "D" attached hereto and made a
part hereof, no suit, action or other proceeding is pending before any
court or governmental agency as of the date of this Agreement to which
Seller is a party and which might result in substantial impairment or
loss of Seller's title to any material part of the Properties or that
might materially hinder or impede the operation of the Leases or the
ability of Seller to perform its obligations hereunder.
(f) Seller holds such permits, governmental licenses,
approvals, authorizations and exemptions, including environmental
permits, that are necessary to carry on its business as presently
conducted and all of same are transferable to Buyer. The Facilities, as
currently operated by Seller, do not require certificate authority from
the Federal Energy Regulatory Commission. Seller has complied with all
of the laws, regulations and orders of the Texas Railroad Commission
and the United States Department of Transportation affecting the
Properties. While Seller has owned the Properties (the "Ownership
Period"), all necessary reports required by any governmental agency
with respect to the Properties have been timely, properly and
accurately made.
(g) During the Ownership Period, all ad valorem, property,
production, severance and similar taxes and assessments based on or
measured by the ownership of property or the production of hydrocarbons
or the receipt of proceeds therefrom on the Properties have been
properly paid.
(h) Seller has incurred no liability, contingent or otherwise,
for brokers' or finders' fees relating to the transactions contemplated
by this Agreement for which Buyer shall have any responsibility
whatsoever.
(i) The contracts described on Exhibit "C" hereto are the only
material agreements which provide for the purchase, sale, gathering,
delivery, compressing, transporting, processing, marketing or any other
disposition of the gas through the Facilities, and the contracts
described on Exhibit "C" hereto and the easements described on Exhibit
"A" hereto are the only agreements relating to the Facilities which
might require a consent to assign or contain a preferential right to
purchase or similar provision.
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(j) Seller is not a "foreign person" within the meaning of
Section 1445 of the Internal Revenue Code of 1986, as amended.
(k) The Properties comprise all assets, equipment and
agreements that are necessary to operate the Properties in the ordinary
course of business as such business was conducted as of the Effective
Time.
(l) Seller is not in material default under any of the System
Contracts.
(m) Seller has complied with all terms of the Surface Lease
("Plant Lease") dated December 17, 1993 by and between Xxxxxxx X.
Xxxxxx, Xxx X. Xxxxxx and Xxxx X. Xxxxxx (collectively "Grantor") and
Seller.
3.02 - REPRESENTATIONS AND WARRANTIES OF BUYER. Buyer represents and
warrants to the Seller that:
(a) Buyer is a duly organized, validly existing corporation
organized and in good standing under the laws of the State of its
incorporation and is qualified to do business in the State of Texas.
(b) Buyer has all requisite power and authority, corporate and
otherwise, to carry on its business as presently conducted, to enter
into the Agreement, and to perform its obligations under the Agreement.
(c) The execution and delivery of this Agreement has been, and
the execution and delivery of all certificates, documents and
instruments required to be executed and delivered by Buyer at Closing,
and the consummation of the transactions contemplated hereby as of the
Effective Time shall have been duly authorized by all necessary
corporate action on the part of the Buyer and, assuming expiration or
termination of the applicable waiting period under the HSR Act, no
further authorization is required by any law, statute, regulation,
court order or judgment applicable to Buyer. This Agreement constitutes
a legal, valid and binding obligation of Buyer enforceable in
accordance with its terms, subject however, to the effects of
bankruptcy, insolvency, reorganization, moratorium and similar laws, as
well as to principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
(d) The execution and delivery of the Agreement and the
consummation of the transactions contemplated hereby will not (i)
violate, or be in conflict with, any provisions of Buyer's articles of
incorporation, bylaws or governing documents, (ii) constitute a
material breach of, or any event of default under, any contract or
agreement to which Buyer is a party or by which it or its assets are
bound, or constitute the happening of an event or condition upon which
any other party to such a contract or agreement may
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exercise any right or option which will materially adversely affect the
ability of Buyer to perform its obligations hereunder, (iii) assuming
expiration or termination of the applicable waiting period under the
HSR Act, violate any judgment, decree, order, statute, rule or
regulation applicable to Buyer, or (iv) result in any material
liability to Seller under the terms of any contracts or agreements to
which Buyer is a party.
(e) No suit, action or other proceeding is pending before any
court or governmental agency as of the date of this Agreement to which
Buyer is a party and which might materially hinder or impede the
ability of Buyer to perform its obligations hereunder. Buyer shall
promptly notify Seller of any such proceeding arising prior to the
Closing with respect to which Buyer receives actual notice.
(f) Buyer has incurred no liability, contingent or otherwise,
for brokers' or finders' fees relating to the transactions contemplated
by this Agreement for which Seller shall have any responsibility
whatsoever.
(g) Buyer is a knowledgeable purchaser, owner and operator of
oil and gas properties, has the ability to evaluate (and in fact has
evaluated) the Properties for purchase, and is acquiring the Properties
for its own account and not with the intent to make a distribution
thereof within the meaning of the Securities Act of 1933 (and the rules
and regulations pertaining thereto) or a distribution thereof in
violation of any other applicable securities laws.
(h) In entering into this Agreement, Buyer has relied solely
on the express representations and covenants of Sellers in this
Agreement, its independent investigation of, and judgment with respect
to, the Properties and the advice of its own legal, tax, economic,
environmental, engineering, geological and geophysical advisors and not
on any comments or statements of Seller or any representatives of, or
consultants or advisors engaged by Seller.
ARTICLE IV
COVENANTS
4.01 - COVENANTS OF SELLER. Seller agrees with Buyer that:
(a) Prior to the Closing, Seller will make available to Buyer
for examination at a Seller's offices in Fort Worth, Texas, all title
and other information relating to the Properties insofar as the same
are in Seller's possession and will cooperate with Buyer in Buyer's
efforts to obtain, at Buyer's expense, such additional information
relating to the Properties as Buyer may reasonably desire, to the
extent in each case that Seller may do so without violating legal
constraints or any obligation of confidence or other contractual
commitment of Seller to a third party. Historical file information in
Seller's possession regarding condensate which may have been spilled or
disposed of on-site and the locations
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thereof; pits and pit closures; burials; landfarming; landspreading;
underground injection; and solid waste disposal sites will be made
available to Buyer for inspection prior to Closing. Seller shall permit
representatives of Buyer to make such environmental tests as they deem
appropriate, including without limitation Phase I and Phase II testing.
Seller shall permit Buyer, at Buyer's expense, to inspect and photocopy
such information and records at any reasonable time during the term of
this Agreement but only to the extent, in each case, that Seller may do
so without violating any obligation of confidence or contractual
commitment to a third party. Seller shall not be obligated to furnish
any updated abstracts, title opinions or additional title information,
but shall cooperate with Buyer in Buyer's efforts to obtain, at Buyer's
expense, such additional title information as Buyer may reasonably deem
prudent.
(b) From the date of this Agreement, Seller shall furnish to
Buyer and shall cause its independent auditors to furnish to Buyer all
information regarding the Properties, Seller and its respective
business, assets, properties, and financial condition which, in the
reasonable judgment of Buyer and/or its legal counsel and independent
auditors, is necessary to enable Buyer to comply with filing
requirements under the Securities Act of 1933 (the "Act") and the
Securities and Exchange Act of 1934 ("Exchange Act") to the extent
deemed necessary by the Buyer and its representatives.
(c) From the date of this Agreement until Closing, Seller (i)
will cause the Properties to be operated and maintained in a good and
workmanlike manner consistent with prior practices, and will pay or
cause to be paid all costs and expenses in connection therewith, (ii)
will not abandon any of the Properties, (iii) will maintain insurance
now in force with respect to the Properties, (iv) will comply with all
the rules, regulations and orders of the Texas Railroad Commission and
the United States Department of Transportation which are applicable to
Seller and the Properties, and will timely, properly and accurately
make all reports required to be filed with the Texas Railroad
Commission and the United States Department of Transportation (v) will
perform and comply with all the covenants and conditions contained in
the System Contracts, and (vi) will pay all taxes and assessments with
respect to the Properties which come due and payable prior to the
Closing Date; provided, however, in the absence of Buyer's written
consent, from the date of this Agreement until the Closing, Seller
shall not conduct or authorize any operation on the Properties
requiring an expenditure of $100,000 or more for the entire 100% of any
single project (except emergency operations).
(d) Without the prior written consent of Buyer from the date
of this Agreement until Closing, Seller shall not enter into any new
agreements or commitments with respect to the Properties, will not
modify or terminate any of the agreements relating to the Properties,
shall not encumber, sell, transfer, assign, convey, or otherwise
dispose of any of the Properties other than personal property which is
replaced by equivalent property or consumed in the operation of the
Properties, and will not voluntarily compromise any amounts payable to
Seller due to any casualty loss or any pending or
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threatened taking related to the Properties..
(e) Seller shall use all reasonable efforts to maintain its
partnership status and to assure that as of the Closing it shall not be
under any material partnership, legal or contractual restriction that
would prohibit or delay the timely consummation of this transaction..
With respect to any third-party consents and notices required under
preferential rights to purchase provisions, Seller shall make requests
of such third parties in compliance with applicable agreements, that
such consents be given or waived and that such preferential rights be
waived; provided however, nothing contained in this subsection of
Section 4.01 shall require Seller to pay money or undertake any
additional legal obligation.
(f) Seller shall permit Buyer's authorized representatives to
consult with Seller and/or such third-party operator's agents and
employees during reasonable business hours and to conduct, at Buyer's
sole risk and expense, on-site inspections, environmental assessments,
reasonable tests and inventories of the Properties as provided in
Section 5.03 hereof.
(g) As promptly as practicable and in any event not more than
ten (10) days following the date on which the parties hereto shall have
executed and delivered this Agreement, Seller will file with the
Federal Trade Commission and the Department of Justice the notification
and report form required for the transactions contemplated hereby and
will as promptly as practicable furnish any supplemental information
which may be reasonably requested in connection therewith pursuant to
the HSR Act. Seller shall bear one-half of the filing fees associated
with filings made under the HSR Act and paid by Buyer or Seller.
(h) During the period from the date of this Agreement to the
Closing Date, Seller shall use its best efforts to maintain its
relationships with all suppliers, customers and others having business
relationships with Seller with respect to the Properties so that such
relationships will be preserved for Buyer on and after the Closing
Date.
(i) Seller shall give Buyer notice of any litigation initiated
by or against against Seller, of which Seller has notice, and which
relates to the Properties or the ability of Seller to proceed to
Closing.
4.02 - COVENANTS OF BUYER. Buyer covenants and agrees with Seller as
follows:
(a) Buyer shall use all reasonable efforts to maintain its
corporate status and to assure that as of the Closing, it will not be
under any material corporate, legal or contractual restriction that
would prohibit or delay the timely consummation of this transaction.
(b) As promptly as practicable and in any event not more than
ten days
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following the date on which each of the parties hereto shall have
executed and delivered this Agreement, Buyer will file with the Federal
Trade Commission and the Department of Justice the notification and
report form required for the transactions contemplated hereby and will
as promptly as practicable furnish any supplemental information which
may be reasonably requested in connection therewith pursuant to the HSR
Act. Buyer shall bear one-half of the filing fees associated with
filings made under the HSR Act and paid by Buyer or Seller
(c) Buyer shall exercise all due diligence in safeguarding and
maintaining secure all engineering data, reports and maps, accounting
records, and all other confidential data or information relating to the
Properties in the possession of Buyer. If the transaction contemplated
by this Agreement is not consummated, Buyer shall return to Seller all
information which Seller has delivered to Buyer which relate to the
Properties.
(d) Buyer shall give Seller notice of any litigation initiated
by or against against Buyer, of which Buyer has notice, and which
relates to the Properties or the ability of Buyer to proceed to
Closing.
ARTICLE V
TITLE MATTERS AND DEFECTIVE INTERESTS
5.01 - DEFENSIBLE TITLE.
(a) As used herein, the term "Defensible Title" shall have the
following meaning
(i) With respect to the Easements, Defensible Title
means that subject to the Permitted Encumbrances (A)
Seller owns all of the rights of the original grantee
of the Easements free and clear of mortgages, liens,
security interests, pledges, charges, encumbrances,
claims, limitations, irregularities, burdens or
defects, and is otherwise only subject to
contractually binding arrangements which are
conventional and which are customarily experienced in
the oil and gas industry, (B) the Easements grant to
the grantee the right to construct, maintain and
operate the Facilities (C) all necessary consents,
permissions, novations and approvals by third parties
in connection with the sale and transfer of the
Easements shall have been received, except those
governmental consents customarily generated and
received in the ordinary course of business at a
Post-Closing date; and (D) with respect to
preferential rights to purchase, waivers of such
rights have been obtained, or the time period for
exercising such right has expired without an exercise
of such right;
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(ii) With respect to the Facilities, Defensible Title
means that (A) either (I) Seller constructed the
particular component of the Facilities, or (II)
Seller has acquired the rights of the person who
originally constructed the particular component of
the Facilities through a chain of one or more
assignments, (B) the Facilities are located on
Easements as to which Seller has Defensible Title,
and (C) the rights of Seller to the Facilities are
free and clear (except for Permitted Encumbrances) of
mortgages, liens, security interests, pledges,
charges, encumbrances, claims, limitations,
irregularities, burdens or defects, and is otherwise
only subject to contractually binding arrangements
which are conventional and which are customarily
experienced in the oil and gas industry.
(iii) With respect to the System Contracts,
Defensible Title means that subject to the Permittted
Encumbrances (A) either (I) Seller was an original
signatory to the contract, or (II) Seller has
acquired the rights of an original signatory to the
contract through a chain of one or more assignments,
(B) the rights of Seller under the contract are free
and clear of mortgages, liens, security interests,
pledges, charges, encumbrances, claims, limitations,
irregularities, burdens or defects, and is otherwise
only subject to contractually binding arrangements
which are conventional and which are customarily
experienced in the oil and gas industry; (C) all
necessary consents, permissions, novations and
approvals by third parties in connection with the
sale and transfer of the System Contracts shall have
been received; and (D) with respect to preferential
rights to purchase, waivers of such rights have been
obtained, or the time period for exercising such
right has expired without an exercise of such right;
(b) The term "Permitted Encumbrances" as used herein
shall mean:
(i) Any (A) undetermined or inchoate liens or
charges constituting or securing the payment
of expenses that were incurred incidental to
maintenance or operation of the Properties
or for the purpose of processing oil, gas or
other hydrocarbons, and (B) materialman's,
mechanics', repairman's, employees',
contractors', operators', or other similar
liens or charges for liquidated amounts
arising in the ordinary course of business
(x) that Seller has agreed to assume or pay
pursuant to the terms hereof, (y) for which
Seller is responsible for paying or
releasing at Closing, or (z) for which Buyer
has agreed to assume or pay pursuant to the
terms hereof;
(ii) Preferential rights to purchase and required
third party consents to assignments and
similar agreements with respect to which
prior to Closing (i) waivers or consent are
obtained from the appropriate parties, (ii)
the appropriate time period for asserting
such rights has
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expired without an exercise of such rights,
and (iii) with respect to consent, such
consent is not necessary to the validity of
an assignment to Buyer and need not be
obtained prior to an assignment;
(iii) Liens for taxes or assessments not yet due
or not yet delinquent or, if delinquent,
that are being contested in good faith in
the normal course of business;
(iv) All rights to consent by, required notices
to, filings with, or other actions by
governmental entities if the same are
customarily obtained subsequent to such sale
or conveyance;
(v) Rights of reassignment in the event of
intended release or surrender of any of the
Properties;
(vi) Easements, rights-of-way, servitudes,
permits, surface leases and other rights in
respect of surface operations, pipelines,
grazing, logging, canals, ditches,
reservoirs or the like; and easements for
streets, alleys, highways, pipelines,
telephone lines, power lines, railways and
other easements and rights-of-way, on, over
or in respect of any of the Properties which
do not materially interfere with the
operation of the Properties;
(vii) Rights reserved to or vested in any
municipality or governmental, statutory or
public authority to control or regulate any
of the Properties in any manner, and all
applicable laws, rules and orders of any
governmental authority;
(viii) Such Title Defects (defined below) or other
defects as Buyer has waived in writing or
otherwise pursuant to this Agreemnt, or
which individually and in the aggregate do
not operate to interfere materially with the
operation, value or use of the Properties;
and
(ix) Those matters described on Exhibit "E"
attached hereto and made a part hereof.
(c) The term "Title Defect" as used herein shall mean any
encumbrances, encroachment, irregularity, defect in or objection to
Seller's title to the Properties (expressly excluding Permitted
Encumbrances), that alone or in combination with other defects renders
Seller's title to the Properties less than Defensible Title.
5.02 - DEFECTIVE INTERESTS.
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(a) As used herein the term "Defective Interest" shall mean
(1) That portion of the Properties affected by a
Title Defect.;
(2) That portion of the Properties adversely affected
by Seller's material noncompliance with the laws, rules,
regulations, ordinances or orders of any governmental agency
or authority having jurisdiction over any portion of the
Properties, including without limitation Environmental Laws
(defined below) as may be reasonably determined in accordance
with generally accepted industry practices and standards;
(3) That portion of the Properties adversely affected
by the default of Seller, or any other party, under an
obligation under the Systems Contracts;
(4) That portion of the Properties with respect to
which any preferential right to purchase is exercised unless
Buyer elects to receive the consideration received from the
exercise of such preferential right to purchase;
(5) That portion of the Facilities which have a
defect (resulting from design, construction, wear or other
reason) which will prevent the continued operation of the
Facilities in accordance with prior practice;
(6) That portion of the Properties affected by any
suit, action or other proceeding before any court or
government agency that would result in loss or impairment of
Seller's title to any portion of the Properties, or a portion
of the value thereof;
(7) That portion of the Properties destroyed by fire
or other casualty, or with respect to which there is a taking
or threatened taking in condemnation or under the right of
eminent domain, unless Buyer elects to receive the proceeds
payable under any insurance policy covering such events; and
(8) Any Easement or Systems Contract which is not
valid and subsisting and in full force and effect.
(b) As used herein the term "Defect Value" shall mean the the
reduction in value of the Properties caused by a Defective Interest.
5.03 - BUYER'S RIGHT OF INSPECTION. Seller grants Buyer and its duly
authorized representatives, contractors and subcontractors
(collectively "Representatives") the limited right of entry to the
Properties for the purpose of, inspecting the Properties in accordance
with the terms of Section 4.01(e) hereof, ("Permitted Activities"),
subject however, to the following conditions:
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(a) Buyer shall notify Seller of its desire to enter the
Properties to conduct Permitted Activities at least 48 hours prior to
such entry.
(b) Upon receipt of such notice, Seller shall allow Buyer and
its Representatives to enter the Properties during normal business
hours to conduct Permitted Activities. The Permitted Activities of
Buyer and its Representatives shall not unreasonably interfere with
Seller's operations or business, and Buyer and its Representatives
shall not remain on the Properties subsequent to the completion of
their Permitted Activities. As soon as reasonably possible, Buyer shall
provide Seller with a copy of all reports prepared for Buyer as a
result of conducting Permitted Activities.
(c) The Permitted Activities shall be conducted in accordance
with all applicable environmental and regulatory laws, rules and
regulations, and commonly accepted standards for conducting such
activities. Upon completion of its activity, Buyer and its
Representatives shall restore the Property to its condition existing as
of Buyer's entry thereon and remove all equipment and materials that
were brought onto the Properties by Buyer and its Representatives. As
soon as reasonably possible, Buyer shall provide Seller with a copy of
all written reports prepared for Buyer as a result of conducting
Permitted Activities.
(d) Buyer will be responsible for the conduct and protection
of all persons involved in the Permitted Activities. Seller shall not
have any right to control and shall not exercise any responsibility
with respect to the Permitted Activities conducted by Buyer on the
Properties, except that Seller shall have the right (but not the
obligation) to prevent any damage to its property or disruption to its
business. Buyer and its Representatives will undertake all measures
reasonably necessary to protect all persons conducting the Permitted
Activities on the Properties and any other persons who may enter the
Properties during or after completion of the Permitted Activities.
(e) Neither Buyer nor its Representatives shall contact any
federal, state, or local agency with respect to environmental
conditions discovered on the Properties without the prior written
permission and consent of Seller, except as may be otherwise required
by applicable law, rule or regulation. Any proposal of Buyer or its
Representatives to contact any federal, state, or local agency shall be
delivered in writing to Seller for review and approval.
(f) BUYER AGREES TO FULLY INDEMNIFY, DEFEND, AND HOLD SELLER,
ITS AFFILIATES AND THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES,
AGENTS AND CONTRACTORS HARMLESS FROM AND AGAINST ANY ALL CLAIMS,
LIABILITIES, CAUSES OF ACTIONS, JUDGMENTS OR DEFENSE EXPENSES
(INCLUDING REASONABLE ATTORNEYS FEES AND EXPERT EXPENSES) OF ANY
PERSON, INCLUDING BUYER, ITS AFFILIATES AND THEIR RESPECTIVE OFFICERS,
DIRECTORS, EMPLOYEES, AGENTS AND CONTRACTORS, FOR
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(I) PERSONAL INJURY OR DEATH OF ANY PERSON, (II) DAMAGE TO THE PROPERTY
OF SELLER, BUYER OR ANY OTHER PERSON, OR (III) ALL OTHER DAMAGES OR
ECONOMIC LOSSES (INCLUDING ANY DAMAGES CAUSED BY THE NEGLIGENCE OF
SELLER), ATTRIBUTABLE TO OR ARISING FROM THE PERMITTED ACTIVITIES,
EXCEPT THER SHALL BE NO LIABILITY OF BUYER TO THE EXTENT ANY SUCH
INJURY, DAMAGE, OR LOSS IS CAUSED BY THE GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT OF SELLER.
5.04 - NOTICE OF DEFECTIVE INTERESTS.
(a) Buyer shall give Seller notice of Defective Interests not
later than twenty-one (21) days from the date of this Agreement. Such
notice shall be in writing and shall include (i) a description of the
Defective Interest (ii) the reason Buyer believes such Properties to be
a Defective Interest, and (iii) the Defect Value asserted by Buyer with
respect to the asserted Defective Interest. Buyer's notice(s) of
Defective Interests shall not be effective unless and until the total
of the asserted Defect Values for the asserted Defective Interests
exceeds one-half of one percent (1/2%) of the Purchase Price. Buyer
shall be deemed to have waived all Defective Interests of which Seller
has not been given such notice within the time period prescribed in
this Section 5.04(a).
(b) Upon being notified by Buyer pursuant to Section 5.04(a)
of any asserted Defective Interest the Seller shall give written
counter-notice to Buyer within five (5) days (i) that it either (A)
will attempt to correct the asserted Defective Interest, or (B) does
not intend to attempt to correct the Defective Interest; and (ii)
whether it agrees or disagrees that the asserted Defective Interest
exist, and (iii) whether it agrees or disagrees with the Defect Value
asserted by the Buyer.
(c) If Seller gives counter-notice of intent to attempt to
correct any asserted Defective Interest, it shall have a period of
thirty (30) days from the receipt of the Buyer's notice (the "Cure
Period") to attempt to correct such asserted Defective Interest at its
own expense. The Closing shall not be extended, but to the extent that
the Defect Value allocated to the Defective Interest when combined with
the Defect Value of all other asserted Defective Interests exceeds
one-half of one percent (1/2%) of the Purchase Price, a downward
adjustment of the Purchase Price shall be made in such amount according
to Section 2.02(b)(5). If Seller shall subsequently cure such Defective
Interest within the Cure Period, such Defect Value as to which curative
has been effected shall be a credit to Seller in the determination of
the Final Settlement according to Section 8.01 hereof. If Seller is
unable to cure such Defective Interest, Seller shall still have the
right to assert the provisions of Sections 5.04 (d) and (e) below after
Closing, in which case Buyer shall deposit the amount of the disputed
Defect Value with the Escrow Agent according to Section 5.06(b) below.
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(d) If Seller gives counter-notice (or notice after the Cure
Period according to Section 5.04(c)) that it disagrees there is a
Defective Interest, then the existence (and if it exists, the Defect
Value), will be determined by arbitration pursuant to Section 5.05
hereof.
(e) If Seller gives counter-notice (or notice after the Cure
Period according to Section 5.04(c)) that it disagrees with the Defect
Value asserted by Buyer in connection with a Defective Interest, then
the amount of the Defect Value will be determined by arbitration
pursuant to Section 5.05 hereof.
(f) The failure of Seller to deliver written counter-notice
shall be deemed to be notice that Seller (i) will not attempt to
correct that asserted Defective Interest, (ii) agrees
that there is a Defective Interest and (iii) agrees with the Defect
Value asserted by the Buyer.
(g) In determining which portions of the Properties are
Defective Interests, it is the intent of the parties to include, when
possible, only that portion of the Properties affected by the defect.
5.05 - ARBITRATION PROCEDURES. If any matter is required by this
Article to be arbitrated, such arbitration shall be conducted as set forth in
this Section 5.05.
(a) The parties shall jointly select an acceptable person as
the sole arbitrator under this Agreement. If the parties are unable to
agree upon the designation of a person as arbitrator, then either
Seller or Buyer, or both such parties, may in writing request the
American Arbitration Association to appoint a qualified arbitrator.
(b) Any arbitration hearing shall be held at a place in Fort
Worth, Texas acceptable to the arbitrator.
(c) The arbitrator shall settle disputes regarding the
existence of Defective Interests and/or the Defect Value thereof and
Seller's attempts to correct any Title Defects
in accordance with the Texas General Arbitration Act. Such arbitrator
shall hear all arbitration matters arising under this Article V. The
decision of the arbitrator shall be binding upon the parties, and may
be enforced in any court of competent jurisdiction.
Seller and Buyer, respectively, shall bear their own legal fees and
other costs incurred in presenting their respective cases. The charges
and expenses of the arbitrator shall be shared equally by Seller and
Buyer.
(d) The arbitration shall commence within ten days after the
arbitrator is selected as set forth in Section 5.05(a) above. In
fulfilling his duties hereunder, the arbitrator shall be bound by the
terms of this Agreement. In fulfilling any of his arbitration duties,
the arbitrator may consider such other matters as in the opinion of the
arbitrator are necessary or helpful to make a proper evaluation.
Additionally, the arbitrator may
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consult with and engage disinterested third parties, including, without
limitation, petroleum engineers, attorneys and consultants, to advise
the arbitrator.
(e) If any arbitrator selected hereunder should die, resign or
be unable to perform his duties hereunder the parties or if the parties
are unable to agree, the American Arbitration Association shall select
a replacement arbitrator. The aforesaid procedure shall be followed
from time to time as necessary.
5.06 - EFFECT OF DEFECTIVE INTERESTS ON THE CLOSING. If Buyer asserts
any Defective Interests the following shall apply:
(a) The parties shall proceed to the Closing as provided in
this Agreement if (i) Seller elects to cure the asserted defect
according to Section 5.04(c), (ii) Buyer agrees to waive the relevant
Defective Interest and purchase the Defective Interest notwithstanding
the asserted Defective Interest, or (iii) Buyer and Seller agree to a
Defect Value and the Purchase Price is reduced by such amount in
accordance with Section 2.02(b) hereof.
(b) If any matter is referred to arbitration under Section
5.05 of this Agreement and the Defect Value or Values asserted by Buyer
with respect to the matters under arbitration when combined with all
other Defective Interests totals less than ten percent (10%) of the
Purchase Price (including an agreement by Buyer to waive any
arbitration award which when combined with all other Defective
Interests would exceed ten percent (10%) of the Purchase Price), then
the parties shall proceed to Closing, the asserted Defective Interests
shall be conveyed to Buyer, and the Closing Amount (defined below)
shall be reduced by an amount equal to the asserted Defect Values of
the asserted Defective Interests (the "Withheld Payment"). The Withheld
Payment shall be placed in escrow with the same entity under
essentially the same terms as the Xxxxxxx Money (defined below). The
Withheld Payment shall be paid as follows:
(i) If the arbitrator decides that any Defective
Interest asserted by the Buyer is not a Defective
Interest, then the Withheld Payment with respect to
the asserted Defective Interest shall be paid to the
Seller.
(ii) If the arbitrator decides that any one or more
of the Defective Interests asserted by the Buyer are
in fact Defective Interests, then, the Withheld
Payment, to the extent it, when combined with all
other Defective Interests, exceeds one-half (1/2) of
one percent (1/2%) of the Purchase Price up to the
amount of the Defect Value, as determined by the
arbitrator, shall be distributed to the Buyer, and
the remainder, if any, shall be distributed to the
Seller.
(c) If any matter is referred to arbitration under Section
5.05 of this Agreement and the Defect Value asserted by Buyer with
respect to the matters under arbitration when combined with all other
Defective Interests totals ten percent (10%) of the Purchase Price
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or more, then, unless the parties otherwise agree, the Buyer waives its
rights to an arbitration award which, when combined with all other
Defective Interests exceeds ten percent (10%) of the Purchase Price, or
this Agreement is terminated by Seller pursuant to Article IX hereof.
If none of the foregoing occurs, the Closing shall be postponed until
the arbitrator renders his final decision. After the arbitrator renders
his final decision the parties shall proceed to the Closing, and the
Purchase Price will be reduced by the Defect Value found by the
arbitrator to the extent it, when combined with all other Defective
Interests, exceeds one-half of one percent (1/2%) of the Purchase
Price; provided however, nothing contained in this Section 5.06(c)
shall be deemed to in any way modify or terminate Seller's or Buyer's
conditions to Closing under Section 6.01(d) or 6.02(d).
ARTICLE VI
CONDITIONS TO CLOSING
6.01 - SELLER'S CONDITIONS. The obligations of Seller at the Closing
are subject, at the option of Seller, to the satisfaction at or prior to the
Closing of all of the following conditions, any one or more of which may be
waived, in whole or in part, in writing by Seller:
(a) All representations and warranties of Buyer contained in
this Agreement shall be true in all material respects at and as of the
Closing as if such representations and warranties were made at and as
of the Closing; and Buyer shall have performed and satisfied all
material obligations in all material respects required by this
Agreement to be performed and satisfied by Buyer at or prior to the
Closing.
(b) No suit or other proceeding shall be pending before any
court or governmental agency seeking to restrain or prohibit or declare
illegal, or seeking substantial damages in connection with, the
purchase and sale contemplated by this Agreement.
(c) All necessary consents, permissions, novations and
approvals by third parties in connection with the sale and transfer of
the Properties shall have been received prior to Closing, except those
required consents, permissions, novations and approvals which are
Permitted Encumbrances.
(d) Defective Interests will not reduce the Purchase Price by
more than ten percent (10%).
(e) The waiting period (and any extension thereof) under the
HSR Act applicable to the transactions contemplated hereby shall have
expired or been terminated.
(f) All transactions contemplated by that certain Purchase and
Sale Agreement of even date herewith between Cometra Energy, L.P.,
Cometra Production Company, L.P.
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and Buyer ( the "Producing Properties Agreement") shall have closed
pursuant to the terms of the Producing Properties Agreement.
6.02 - BUYER'S CONDITIONS. The obligations of Buyer at the Closing are
subject, at the option of Buyer, to the satisfaction at or prior to the Closing
of all of the following conditions, any one or more of which may be waived, in
whole or in part, in writing by Buyer:
(a) All representations and warranties of Seller contained in
this Agreement (except for the representations and warranties set forth
in Sections 3.01(k) and (l) shall be true in all material respects at
and as of the Closing as if such representations and warranties were
made at and as of the Closing; and Seller shall have performed and
satisfied all material agreements in all material respects required by
this Agreement to be performed and satisfied by Seller at or prior to
the Closing.
(b) No suit or other proceeding shall be pending before any
court or governmental agency seeking to restrain or prohibit or declare
illegal, or seeking substantial damages in connection with, the
purchase and sale contemplated by this Agreement.
(c) All necessary consents, permissions, novations and
approvals by third parties in connection with the sale and transfer of
the Properties shall have been received prior to Closing, except those
required consents, permissions, novations and approvals which are
Permitted Encumbrances, but specifically including the consent to
assign the Surface Lease (as defined in Section 8.05(d) below) from the
Surface Owners (as defined in Section 8.05(d) below).
(d) Defective Interests will not reduce the Purchase Price by
more than ten percent (10%).
(e) The waiting period (and any extension thereof) under the
HSR Act relating to the transactions contemplated hereby shall have
expired or been terminated.
(f) All transactions contemplated by the Producing Properties
Agreement shall have closed pursuant to the terms of the Producing
Properties Agreement.
ARTICLE VII
CLOSING
7.01 - CLOSING. Unless the parties hereto agree otherwise and subject
to the conditions stated in this Agreement, the consummation of the transactions
contemplated hereby (herein called the "Closing") shall be held at the offices
of Seller in Fort Worth, Texas, on the later of:
(i) February 14, 1997;
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(ii) February 21, 1997, if the period to close the Producing Properties
Agreement is extended to such date according to the terms of the
Producing Properties Agreement;
(iii) February 28, 1997, if the period to close the Producing
Properties Agreement is extended to such date according to the terms of
the Producing Properties Agreement; or
(iv) Three (3) business days following the expiration or termination of
the applicable waiting period (and any extension thereof) under the HSR
Act.
The date on which closing occurs is referred to herein as the "Closing Date."
7.02 - CLOSING OBLIGATIONS. At the Closing, the following events shall
occur, each being a condition precedent to the others and each being deemed to
have occurred simultaneously with the others:
(a) Seller shall execute, acknowledge and deliver an
assignment, xxxx of sale, and conveyance in recordable form (in
sufficient counterparts to facilitate recording) sufficient to convey
to Buyer the Properties with covenants of special warranty as to all
Leases, such conveyance to be in the form attached hereto as Exhibit
"F", provided, however, the assets described in Sections 1.01 (e), (f)
and (g) hereof shall be transferred to Buyer on a form of conveyance or
xxxx of sale reasonably acceptable to Buyer and Seller without warranty
of title, AS IS, WHERE IS, and with all faults, and disclaiming all
implied warranties.
(b) Seller shall prepare and deliver to Buyer and Seller and
Buyer shall execute and deliver a settlement statement (herein called
the "Preliminary Settlement Statement") that shall set forth the
Closing Amount (as hereinafter defined) and each adjustment and the
calculation of such adjustments used to determine such amount. The term
"Closing Amount" shall mean the Purchase Price adjusted as provided in
Section 2.02, using for such adjustments the best information then
available. Seller shall deliver a draft of the Preliminary Settlement
Statement to Buyer at least three (3) days prior to Closing.
(c) Buyer shall pay the Purchase Price other than the Xxxxxxx
Money to Seller by wire transfer in immediately available funds.
(d) The Escrow Agent shall deliver the Xxxxxxx Money plus
interest earned thereon to Seller.
(e) Seller shall deliver to Buyer, (1) a certificate signed by
a responsible officer of the General Partner of Seller certifying that
all of the representations and warranties of Seller made hereunder are
true and correct at and as of Closing, as if made on the Closing Date,
(2) a certified copy of the Executive Committee of the Board of
Directors of the General Partner of Seller authorizing the transaction
contemplated by the Agreement, such
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certified copy to show the dates of adoption and that on the Closing
Date the resolutions have not been rescinded or modified, and (3) a
Certificate of the Secretary of Seller showing the incumbency of the
officers of the General Partner of Seller executing instruments on
behalf of the General Partner of Seller.
(f) Buyer shall deliver to Seller (1) a certificate signed by
a responsible officer of Buyer certifying that all of the
representations and warranties of Buyer made hereunder are true and
correct at and as of Closing, as if made on the Closing Date, (2) a
certified copy of the Board of Directors resolution of Buyer
authorizing the transaction contemplated by the Agreement, such
certified copy to show the date of adoption and that on the Closing
Date it has not been rescinded or modified, and (3) a Certificate of
the Secretary of Buyer showing the incumbency of the officers of Buyer
executing instruments on behalf of Buyer.
(g) Seller shall deliver to Buyer all funds held in suspense
by Seller with respect to the Properties together with a report in
reasonable detail setting forth the reasons such funds are held in
suspense.
(h) Seller shall have delivered to Buyer a favorable opinion
of Xxxxxx Xxxxx Xxxxxxx & Xxxxxxx, L.L.P., counsel to Seller, dated the
Closing Date, substantially in the form of Exhibit "G" hereof.
(i) Buyer shall have delivered to Seller a favorable opinion
of Xxxxx Xxxx Xxxxx Constant & Xxxxxxxx, counsel to Buyer, dated the
Closing Date, substantially in the form of Exhibit "H" hereof.
ARTICLE VIII
OBLIGATIONS AFTER CLOSING
8.01 - POST-CLOSING ADJUSTMENTS.
(a) As soon as practicable after the Closing, but not later
than 60 days after the Closing, Seller shall prepare and deliver to
Buyer, in accordance with this Agreement and generally accepted
accounting principles, a statement ("Seller's Final Settlement
Statement" ) setting forth each adjustment to Purchase Price that was
not finally determined as of the Closing and showing the calculation of
such adjustments. As soon as practicable after receipt of Seller's
Final Settlement Statement, and no later than 90 days after the Closing
Date, Buyer shall deliver to the Seller a written report containing any
changes that Buyer proposes be made to Seller's Final Settlement
Statement. The parties shall undertake to agree with respect to the
amounts due pursuant to such Post-Closing adjustment not later than 135
days after the Closing Date. If Buyer fails to propose any
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changes to the accounting set forth in the Seller's Final Settlement
Statement, it shall be deemed that Buyer agrees with Seller's Final
Settlement Statement. The final agreed price paid by Buyer to Seller
for the Properties after all adjustments is hereinafter referred to as
the "Final Purchase Price." The date upon which such agreement is
reached or upon which the Final Purchase Price is established, shall be
herein called the "Final Settlement Date".
(b) If Seller and Buyer are unable to agree upon the Final
Sales Price within 135 days from the Closing Date, Price Waterhouse,
independent public accountants, is designated to act as an arbitrator
and to decide all points of disagreement with respect to the Final
Sales Price, such decision to be binding upon both parties. If such
firm is unwilling or unable to serve in such capacity, Seller and Buyer
shall attempt to, in good faith, designate another acceptable person as
the sole arbitrator under this Section . If the parties are unable to
agree upon the designation of a person as substitute arbitrator, then
Seller or Buyer, or both of them, may in writing request the American
Arbitration Association to appoint the substitute arbitrator. The
arbitration shall be conducted under the Texas General Arbitration Act
and the rules of the American Arbitration Association to the extent
such rules do not conflict with the terms of such Act and terms hereof.
The costs and expenses of the arbitrator, whether the firm designated
above, or a third party appointed pursuant to the preceding sentence
shall be shared equally by Seller and Buyer. Within five (5) days after
the decision of the arbitrator, the Buyer or Seller, as the case may
be, shall promptly make a cash payment to the other equal to the sum as
may be found to be due as the Final Sales Price. Notwithstanding the
foregoing provisions of this Section 8.01(b), any questions with
respect to a Defective Interest or Defect Value shall be resolved
pursuant to the terms of Article V hereof.
8.02 - SALES TAXES AND RECORDING FEES. Buyer shall pay all sales taxes
occasioned by the sale of the Properties and all documentary, filing and
recording fees required in connection with the filing and recording of any
assignments.
8.03 - FURTHER ASSURANCES. After Closing, Seller and Buyer shall
execute, acknowledge and deliver or cause to be executed, acknowledged and
delivered such instruments and take such other action including payment of
monies as may be necessary or advisable to carry out their obligations under
this Agreement and under any document, certificate or other instrument delivered
pursuant hereto or required by law.
8.04 - BUYER'S POST-CLOSING OBLIGATIONS.
(a) If at any time subsequent to the Closing, Buyer comes into
possession of money or property belonging to the Seller that was not
previously accounted for by credit or adjustment according to this
Agreement such money or other property shall be promptly delivered to
the Seller.
(b) Buyer assumes all liabilities attributable to the
Properties arising from,
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attributable to, or alleged to be arising from or attributable to a
violation of, or the failure to perform any obligation imposed by any
and all laws, statutes, ordinances, rules, regulations, orders or
determinations of any governmental authority pertaining to health or
environment in effect where the Properties are located, regardless of
when such violation or failure to perform occurred or is deemed to have
occurred, EXCEPT THAT Buyer does not assume, and Seller shall retain
any liability attributable to compliance with, violation of, or the
failure to perform any obligation with respect to the Properties
imposed by any Environmental Laws (as defined below) provided that such
liability, when added to any liability of Cometra Energy, L.P. and
Cometra Production Company, L.P. under the Producing Properties
Agreement for the violation of, or the failure to perform any
obligation imposed by any Environmental Law with respect to the assets
covered by the Producing Properties Agreement, shall not exceed
$8,000,000 in the aggregate (the "Aggregate Liability Amount"), if and
only if (i) such liability or obligation occurred prior to the
Effective Time, and (ii) Buyer has provided written notice of such
liability or obligation specifying the location and nature of the such
liability within 180 days from the Closing Date ("Environmental
Liability"). Buyer does assume any liability attributable to compliance
with, violation of, or the failure to perform any obligation with
respect to the Properties imposed by, any Environmental Laws which
occurred prior to the Effective Time and which is in excess of the
Aggregate Liability Amount. In connection with this assumption of
liability by Buyer, Buyer agrees that prior to Closing it will conduct
such inspections of the properties as deemed necessary by it to fully
evaluate the condition of the Properties. As used in this Agreement
"Environmental Laws" means all laws, as they exist on the date hereof,
relating to (a) the control of any pollutant or potential pollutant or
protection of the air, water, land or the environment, (b) solid,
gaseous or liquid waste generation, handling, treatment, storage,
disposal or transportation, or (c) exposure to hazardous, toxic,
explosive, corrosive or other substances alleged to be harmful.
"Environmental Laws" shall include, but not be limited to, the Clean
Air Act, 42 U.S.C. Section 7401 et seq., the Clean Water Act 33 U.S.C.
Section 1251 et seq., the Resource Conservation Recovery Act, 42 U.S.C.
Section 6901 et seq., the Superfund Amendments and Reauthorization Act,
42 U.S.C. Section 11001 et seq., the Water Pollution Control Act, 33
U.S.C. Section 1251 et seq., the Safe Drinking Water Act, 42 U.S.C.
Section 300f et seq., and the Comprehensive Environmental Response,
Compensation and Liability Act, 42 U.S.C. Section 9601 et seq.
(c) Except with respect to Environmental Liabilities defined
in Section 8.04(b). Buyer assumes all duties and obligations of the
owner of the Properties which accrue or arise from and after the
Effective Time. Without limitation of the foregoing, Buyer assumes (i)
all obligations of Seller under the Easements, System Contracts and
Permits arising after the Effective Time, (ii) all accounts payable and
contractual obligations incurred by Seller in accordance with this
Agreement with respect to the Properties attributable to periods on or
after the Effective Time, (iii) the obligation to make proper
distribution of any suspense accounts transferred to Buyer in
accordance with standard industry practice, regardless of whether the
suspence funds accrued prior or subsequent to the Effective Time, (iv)
all obligations to properly remove all pipe and equipment now located
on the land subject to the Easements or hereafter placed on the
Easements by
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Buyer, its successors and assigns, and cleanup and restore any property
included in or affected by the Properties, and (v) all liabilities and
obligations resulting from injury or death to persons and damage to
property which occur after the Closing Date.
(d) If, pursuant to Section 4.01(d), Seller does not provide
notice to any third parties under preferential rights to purchase
provisions requesting waiver of such provisions, or if such request for
waiver is made by Seller prior to Closing, but the third party's waiver
of or election to exercise the preferential right is not due under the
applicable agreement until after Closing, the affected Property shall
be conveyed to and purchased by Buyer at Closing pursuant to the terms
of this Agreement subject to the terms of the applicable preferential
right to purchase. After Closing, Buyer shall, if necessary, provide
notice to the appropriate third parties requesting waiver of the
applicable preferential rights to purchase and/or comply with the terms
of the preferential rights to purchase that are properly exercised
after Closing, with Buyer receiving all consideration payable upon the
exercise of such preferential rights to purchase.
(e) For a period of one (1) year after the Closing Date,
Buyer, or its successor who expressly assumes its obligations and
liabilities hereunder, shall maintain its corporate or other legal
status and shall at all times own assets having a value net of
liabilities of not less than $50,000,000.
(f) BUYER AGREES TO INDEMNIFY, RELEASE, DEFEND AND HOLD
HARMLESS SELLER, ITS OFFICERS, DIRECTORS, EMPLOYEES, AGENTS,
REPRESENTATIVES, AFFILIATES, SUBSIDIARIES, SUCCESSORS AND ASSIGNS FROM
AND AGAINST ANY CLAIMS, LIABILITIES, LOSSES, DAMAGES, COSTS AND
EXPENSES (INCLUDING WITHOUT LIMITATION, DAMAGE TO PROPERTY, OR INJURY
OR DEATH OF PERSONS, COURT COSTS, REASONABLE ATTORNEY'S FEES AND
EXPENSES OF EXPERTS) CAUSED BY, ARISING FROM OR ATTRIBUTABLE TO THE
BREACH BY BUYER OF ANY OF ITS OBLIGATIONS UNDER THIS AGREEMENT OR THE
OWNERSHIP OR OPERATION OF THE PROPERTIES AFTER THE EFFECTIVE TIME,
REGARDLESS OF WHETHER SUCH CLAIMS, LIABILITIES, LOSSES, DAMAGES, COSTS
OR EXPENSES ARE DUE IN WHOLE OR IN PART TO THE NEGLIGENCE OF SELLER.
8.05 - SELLER'S POST-CLOSING OBLIGATIONS.
(a) If at any time subsequent to the Closing, Seller comes
into possession of money or property belonging to the Buyer that was
not previously accounted for by credit or adjustment according to this
Agreement such money or other property shall be promptly delivered to
the Buyer.
(b) Except for the obligations assumed by Buyer pursuant to
Section 8.04 hereof, Seller shall be responsible for and discharge (i)
Environmental Liabilities as defined
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in Section 8.04(b) hereof, and in connection therewith, Buyer shall
allow Seller reasonable access to the Properties effected by the
Environmental Liabilities to conduct clean-up and remedial operations,
and (ii) all other claims, costs, expenses and liabilities with respect
to the Properties which accrue or relate to the times prior to the
Effective Time.
(c) For a period of one (1) year after the Closing Date,
Seller, Cometra Energy, L.P., and Cometra Production Company, L.P. or
any of their respective successors who expressly assumes its
obligations and liabilities hereunder, shall maintain their partnership
or other legal status and shall at all times collectively own assets
having a value net of liabilities of not less than $50,000,000.
(d) After the Closing, Seller shall use its best efforts, but
without any obligation to incur any costs or expenses by Seller, to
cause the Grantors under the Plant Lease to confirm in writing that the
Plant Lease is in full force and effect as of the Closing Date and that
Seller is not in breach of any provision of the Plant Lease as of the
Closing Date. Unless and until Seller has obtained and delivered such
confirmation to Seller, SELLER AGREES TO INDEMNIFY, RELEASE, DEFEND AND
HOLD HARMLESS BUYER, ITS SUCCESSORS AND ASSIGNS, FROM AND AGAINST ANY
LOSSES, DAMAGES, COSTS AND EXPENSES CAUSED BY, ARISING FROM OR
ATTRIBUTABLE TO SELLER'S BREACH OF THE SURFACE LEASE PRIOR TO THE
EFFECTIVE TIME.
(e) SELLER AGREES TO INDEMNIFY, RELEASE, DEFEND AND HOLD
HARMLESS BUYER, ITS OFFICERS, DIRECTORS, EMPLOYEES, AGENTS,
REPRESENTATIVES, AFFILIATES, SUBSIDIARIES, SUCCESSORS AND ASSIGNS FROM
AND AGAINST ANY CLAIMS, LIABILITIES, LOSSES, DAMAGES, COSTS AND
EXPENSES (INCLUDING WITHOUT LIMITATION, DAMAGE TO PROPERTY, OR INJURY
OR DEATH OF PERSONS, COURT COSTS, REASONABLE ATTORNEY'S FEES AND
EXPENSES OF EXPERTS) CAUSED BY, ARISING FROM OR ATTRIBUTABLE TO THE
ENVIRONMENTAL LIABILITIES AS DEFINED IN SECTION 8.04(B), THE BREACH BY
SELLER OF ANY OF ITS OBLIGATIONS UNDER THIS AGREEMENT OR THE OWNERSHIP
OR OPERATION OF THE PROPERTIES PRIOR TO THE EFFECTIVE TIME (EXCEPT WITH
RESPECT TO LIABILITIES EXPRESSLY ASSUMED BY BUYER UNDER THIS
AGREEMENT).
8.06 - FILES AND XXXXXXX.Xx soon as practicable after Closing, Buyer
and Seller shall arrange for the delivery of the Records to Buyer. For a period
of two years after the Closing Date Buyer shall allow Seller access to the
Records during Buyer's normal business hours after Closing for the purpose of
filing or amending a tax return or for any other legitimate business purpose;
provided that any copies of Records made by Seller shall be at the sole expense
of Seller.
8.07 - DISCLAIMERS OF REPRESENTATIONS AND WARRANTIES. The express
representation
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and warranties of Seller contained in this Agreement are exclusive and are in
lieu of all other representations and warranties, express, implied or statutory.
BUYER ACKNOWLEDGES THAT, EXCEPT FOR SELLER'S EXPRESS REPRESENTATIONS, WARRANTIES
AND AGREEMENTS CONTAINED HEREIN, SELLER HAS NOT MADE, AND SELLER HEREBY
EXPRESSLY DISCLAIMS AND NEGATES, AND BUYER HEREBY EXPRESSLY WAIVES ANY
REPRESENTATION OR WARRANTY, EXPRESS, IMPLIED, AT COMMON LAW, BY STATUTE OR
OTHERWISE RELATING TO (I) THE ENVIRONMENTAL CONDITION OF THE ASSETS, (II) ANY
IMPLIED OR EXPRESS WARRANTY OF MERCHANTABILITY, (III) ANY IMPLIED OR EXPRESS
WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE, (IV) ANY IMPLIED OR EXPRESS
WARRANTY OF CONFORMITY TO MODELS OR SAMPLES OF MATERIALS, (V) ANY RIGHTS OF
PURCHASERS UNDER APPROPRIATE STATUTES TO CLAIM DIMINUTION OF CONSIDERATION, AND
(VI) ANY AND ALL IMPLIED WARRANTIES EXISTING UNDER APPLICABLE LAW; IT BEING THE
EXPRESS INTENTION OF BOTH BUYER AND SELLER THAT THE PERSONAL PROPERTY, EQUIPMENT
AND FIXTURES INCLUDED WITHIN THE ASSETS ARE TO BE CONVEYED TO BUYER IN THEIR
PRESENT CONDITION AND STATE OF REPAIR, "AS IS" AND "WHERE IS" WITH ALL FAULTS,
AND THAT BUYER HAS MADE OR CAUSED TO BE MADE SUCH INSPECTIONS AS BUYER DEEMS
APPROPRIATE. SELLER AND BUYER AGREE THAT, TO THE EXTENT REQUIRED BY APPLICABLE
LAW TO BE EFFECTIVE, THE DISCLAIMERS OF CERTAIN WARRANTIES CONTAINED IN THIS
SECTION ARE "CONSPICUOUS" DISCLAIMERS FOR THE PURPOSES OF ANY APPLICABLE LAW,
RULE OR ORDER.
8.08 - WAIVER OF DTPA. It is the intent of the parties that Buyer's
rights and remedies with respect to this transaction and with respect to all
acts or practices of Seller, past, present or future, in connection with this
transaction shall be governed by legal principles other than the Texas Deceptive
Trade Practices - Consumer Protection Act, Tex. Bus. & Xxx. Section 17.41 et
seq. (Xxxxxx 1987 and Supp. 1994) (the "DTPA") or any similar statute of any
jurisdiction that may be applicable to the transactions contemplated hereby. As
such, Buyer hereby waives the applicability of the DTPA or any similar statute
to this transaction and any and all duties, rights or remedies that might be
imposed by the DTPA or any similar statute; provided, however, Buyer does not
waive Section 17.555 of the DTPA. Buyer acknowledges, represents and warrants
that it is purchasing the assets covered by this Agreement for commercial or
business matters; that it is able to evaluate the merits and risks of a
transaction such as this; and that it is not in a significantly disparate
bargaining position with Seller. Buyer expressly recognizes that the price for
which Seller has agreed to sell the assets and perform its obligations under
this Agreement has been predicated upon the inapplicability of the DTPA or any
similar statute and this waiver of the DTPA and any similar statute. Buyer
further recognizes that Seller, in determining to proceed with the entering into
of this Agreement has expressly relied on the provisions of this Section 8.08.
8.09 - SURVIVAL. The representations, warranties, covenants, agreements
and indemnities
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included or provided in Article III, in Article IV in Section 5.03(f), this
Article VIII, in Article X, in Article XI, in Article XII, and in the
assignments and agreements to be delivered at the Closing shall survive the
Closing for a period of one (1) year after the Closing Date. All other
representations, warranties, covenants, certificates, instruments and agreements
contained in or referred to in this Agreement shall terminate at Closing.
ARTICLE IX
TERMINATION OF AGREEMENT
9.01 - TERMINATION. This Agreement and the transactions contemplated
hereby may be terminated in the following instances:
(a) By Seller if the conditions set forth in Section 6.01 are
not satisfied in all material respects or waived prior to the Closing
Date;
(b) By Buyer if the conditions set forth in Section 6.02 are
not satisfied in all material respects or waived prior to the Closing
Date;
(c) By Seller if pursuant to Section 5.04 hereof Buyer gives
Seller notice of Defective Interests having a Defect Value equal to or
greater than ten percent (10%) of the Purchase Price and Buyer asserts
a reduction to the Purchase Price according to Section 2.02(b)(iv)
hereof that is in excess of ten percent (10%) of the Purchase Price;
(d) By Seller if Buyer does not deposit all of the Xxxxxxx
Money with the Escrow Agent before 2:00 p.m. on January 2, 1997;
(e) By Seller if Buyer does not provide to Seller by 5:00 p.m.
on January 2, 1997, a letter from a reputable financial institution
that such financial institution is highly confident that Buyer can
obtain financing for the Purchase Price at or prior to the Closing; or
(f) At any time by the mutual written agreement of Buyer and
Seller.
9.02 - LIABILITIES. Nothing contained in this Agreement shall limit
Seller's or Buyer's legal or equitable remedies including, without limitation,
damages for the breach or failure of any representation, warranty, covenant or
agreement contained herein and the right to enforce specific performance of this
Agreement; provided however, (i) neither party hereto shall be liable to the
other for consequential damages; (ii) if all conditions precedent to the
obligation of Buyer to close have been satisfied, but Buyer refuses to close,
Seller shall have the option to either pursue specific performance, receive the
Xxxxxxx Money as liquidated damages and terminate this Agreement or pursue its
actual damages, and if Seller receives the Xxxxxxx Money as liquidated
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damages pursuant to Article X hereof, then Seller shall have no further recourse
against Buyer; (iii) if all conditions precedent to the obligation of Seller to
close have been satisfied, but Seller refuses to close, Buyer shall have the
option to either pursue specific performance, receive the Xxxxxxx Money as
liquidated damages and terminate this Agreement or pursue its actual damages,
and if Buyer receives the Xxxxxxx Money as liquidated damages pursuant to
Article X hereof, then Buyer shall have no further recourse against Seller and
(iv) Seller shall have no liability to Buyer if Buyer terminates this Agreement
because any representation or warranty made by Seller herein is incorrect.
ARTICLE X
XXXXXXX MONEY
Upon the execution of this Agreement, Buyer has deposited into escrow
with Bank One,Texas, N.A. in Fort Worth, Texas (the "Escrow Agent"), the sum of
money equal to Five Million and No/100 Dollars ($5,000,000) (the "Xxxxxxx
Money"). At Closing, the Xxxxxxx Money, less any costs or fees incurred, plus
any interest earned thereon shall be applied against the Purchase Price. If this
transaction fails to close due to any breach by Buyer of the terms, conditions,
representations and warranties found in this Agreement, then at the election of
Seller, the Xxxxxxx Money and all interest earned thereon may be delivered to
Seller as liquidated damages. If this transaction fails to close, due to any
breach by Seller of the terms, conditions, representations and warranties found
in this Agreement, then the Xxxxxxx Money and all interest earned thereon shall
be delivered to Buyer. If this transaction fails to close for any other reason
whatsoever, then the Xxxxxxx Money and all interest earned thereon shall be
delivered to Buyer. Seller and Buyer agree to give the Escrow Agent joint
instructions for the delivery of the Xxxxxxx Money, together with any interest
earned thereon, in accordance with the terms of this Agreement
ARTICLE XI
INDEMNIFICATION
11.01 - RIGHT TO EMPLOY COUNSEL.
(a) When any claim, action, or suit shall be filed or asserted
in writing against any party which is indemnifiable under the terms of
this Agreement, the indemnified party shall promptly notify the
indemnifying party of the same in writing, specifying in detail the
basis of such claim and the facts pertaining thereto, and the
indemnifying party shall, at its option, have the right to assume the
defense thereof or participate in the defense thereof and to employ its
own legal counsel in connection with such defense. Failure of the
indemnified party to notify the indemnifying party of such claim,
action, or suit within twenty (20) calendar days after notice to the
indemnified party of such claim, action, or suit shall constitute a
waiver of its rights under this Article, unless such failure to notify
within such time period shall not prejudice the rights of the
indemnifying party in respect of such claim, action or suit, in which
case prompt notification as provided above shall be sufficient.
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(b) The indemnified party shall have the right to employ
counsel separate from counsel employed by the indemnifying party in any
such action and to participate in the defense thereof, but the fees and
expenses of such counsel employed by the indemnified party shall be at
the sole expense of the indemnified party unless (i) the indemnifying
party shall have elected not or shall have failed to assume or
participate in the defense thereof, (ii) the employment thereof has
been specifically authorized by the indemnifying party in writing, or
(iii) the parties to any such action (including any impleaded parties)
include both the indemnifying and indemnified party, and the
indemnified party shall have been advised by its counsel that there may
be one or more legal defenses available to it which are different from
or additional to those available to the indemnifying party (in any
which case (i), (ii) or (iii) above the indemnifying party shall not
have the right to assume the defense of such action on behalf of the
indemnified party and the fees and expenses of such counsel employed by
the indemnified party shall be at the sole expense of the indemnifying
party).
(c) Prior to effectuating any settlement of any such action or
proceeding, the indemnified party shall furnish the indemnifying party
with written notice of any proposed settlement in sufficient time to
allow the indemnifying party to act thereon. The indemnifying party
shall not be liable for any settlement of any such action or proceeding
effected without the written consent of the indemnifying party. The
indemnifying party shall not effect a settlement of any claim without
the written consent of the indemnified party unless the indemnifying
party secures the complete release of the indemnified party as a part
of such settlement.
11.02 - CLAIM REIMBURSEMENT AND REDUCTION.
(a) Should the indemnified party realize any benefit,
including any tax benefit, resulting from any loss, liability, cost or
damage for which such indemnified party has been indemnified under this
Article, such indemnified party shall reimburse the indemnifying party,
at the time such benefit is realized, an amount equal to the dollar
amount of such benefit so realized.
(b) Any claim shall be reduced to the extent of any third
party insurance or condemnation payment actually received by the
indemnified party or, alternatively, at the option of the indemnified
party, the rights of the indemnified party against any insurer or
governmental unit with respect to such claim shall be assigned to the
indemnifying party.
ARTICLE XII
GENERAL
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12.01 - EXHIBITS. All Exhibits are hereby incorporated in this
Agreement by reference and constitute a part of this Agreement. Each party to
this Agreement and its counsel has received a complete set of Exhibits prior to
and as of the execution of this Agreement.
12.02 - EXPENSES. All fees, costs and expenses incurred by Buyer or
Seller in negotiating this Agreement or in consummating the transactions
contemplated by this Agreement shall be paid by the party incurring the same
including, without limitation, legal and accounting fees, costs and expenses.
12.03 - NOTICES. All notices or communications required or permitted
under this Agreement shall be in writing, and any notices or communications
hereunder shall be deemed to have been duly made if delivered by (i) hand, (ii)
overnight delivery service, (iii) telecopy, or (iv) three days after being
placed in first class certified mail, postage prepaid, with return receipt
requested to the following addresses:
All notices to Seller shall be delivered to:
Rockland, L.P.
000 Xxxxxxxxxxxx, Xxxxx 0000
Xxxx Xxxxx, Xxxxx 00000
Telecopy: 817/877-4464
All notices to Buyer shall be delivered to:
Lomak Petroleum, Inc.
000 Xxxxxxxxxxxx, Xxxxx 0000
Xxxx Xxxxx, Xxxxx 00000
Telecopy: 817/870-2316
The address at which any party hereto is to receive notice may be changed from
time to time by such party by giving notice of the new address to all other
parties hereto. Any notice or communication given by telecopy shall be promptly
confirmed by delivery of a copy of such notice or communication by hand or
overnight delivery service.
12.04 - AMENDMENTS. This Agreement may not be amended nor any rights
hereunder waived except by an instrument in writing signed by the party to be
charged with such amendment or waiver and delivered by such party to the party
claiming the benefit of such amendment or waiver.
12.05 - HEADINGS. The headings of the articles and sections of this
Agreement are for guidance and convenience of reference only and shall not limit
or otherwise affect any of the terms or provisions of this Agreement.
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12.06 - COUNTERPARTS. This Agreement may be executed by Buyer and
Seller in any number of counterparts, each of which shall be deemed an original
instrument, but all of which together shall constitute but one and the same
instrument.
12.07 - REFERENCES. References made in this Agreement, including use of
a pronoun, shall be deemed to include where applicable, masculine, feminine,
singular or plural, individuals, partnerships or corporations. As used in this
Agreement, "person" shall mean any natural person, corporation, partnership,
trust, estate or other entity.
12.08 - GOVERNING LAW. This Agreement and the transactions contemplated
hereby shall be construed in accordance with, and governed by, the laws of the
State of Texas.
12.09 - ENTIRE AGREEMENT. This Agreement (including the Exhibits
hereto) constitutes the entire understanding among the parties with respect to
the subject matter hereof, superseding all negotiations, prior discussions and
prior agreements and understandings relating to such subject matter.
12.10 - PARTIES IN INTEREST. This Agreement shall be binding upon and
shall inure to the benefit of, the parties hereto and, except as otherwise
prohibited, their respective successors and assigns; and except as otherwise
stated herein, nothing contained in this Agreement, or implied herefrom, is
intended to confer upon any other person or entity any benefits, rights or
remedies.
12.11 - ASSIGNMENTS. Neither Buyer nor Seller may assign all or any
portion of their respective rights or delegate any portion of their duties
hereunder without the prior written consent of the other, which consent shall
not be unreasonably withheld. Provided, however, that Buyer may assign this
Agreement and its rights and duties hereunder to a wholly owned limited
partnership, limited liability company or corporation.
12.12 - PUBLIC ANNOUNCEMENTS. The parties hereto agree that prior to
making any public announcement or statement with respect to the transactions
contemplated by this Agreement, the party desiring to make such public
announcement or statement shall consult with the other party hereto and exercise
their best efforts to agree upon the text of a joint public announcement or
statement to be made solely by Seller or Buyer, as the case may be; provided,
however, if Seller or Buyer is required by law to make such public announcement
or statement, then the same may be made without the approval of the other party.
The opinion of counsel of either party shall be conclusive evidence of such
requirement by law.
12.13 - NOTICES AFTER CLOSING. Buyer and Seller hereby agree that each
party shall notify the other of its receipt, after the Closing Date, of any
instrument, notification or other document affecting the Properties while owned
by such other party.
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12.14 - SEVERABILITY. If a court of competent jurisdiction determines
that any clause or provision of this agreement is void, illegal or
unenforceable, the other clauses and provisions of the Agreement shall remain in
full force and effect and the clauses and provisions that are determined to be
void, illegal or unenforceable shall be limited so that they shall remain in
effect to the extent permissible by law.
12.15 - TIME IS OF THE ESSENCE. It is understood and agreed that time
is of the essence in this Agreement.
IN WITNESS WHEREOF, the parties have executed or caused the Agreement
to be executed as of the day and year first above written.
ROCKLAND, L.P., a Texas limited partnership
By: XXXXXXXXX PIPELINE, INC., a Delaware
corporation
By:
---------------------------------------
Xxxx X. Xxxxx, President
SELLER
LOMAK PETROLEUM, INC., a Delaware
corporation
By:
---------------------------------------
Xxxx Xxxxxxxxx, President
BUYER
