EXHIBIT 10.35
Option Agreement
between
Harken Energy Corporation
and
HBK MASTER FUND L.P.
March 18, 2003
This Option Agreement is entered into this 18th day of March 2003 between:
(1) HARKEN ENERGY CORPORATION ("HEC") of 000 XxxxXxxx Xxxx Xxxxxxxxx,
Xxxxx 000, Xxxxxxx, Xxxxx 00000, Xxxxxx Xxxxxx of America; and
(2) HBK MASTER FUND L.P ("HBK") of c/o HBK Investments L.P., 000 Xxxxxxxx
Xxxxx, Xxxxx 000, Xxxxxx, Xxxxx 00000, United Stated of America.
WHEREAS, HBK holds $4.93 million nominal of Harken Energy Corporation 5% Senior
Convertible Notes due 2003 (the "2003 Notes").
NOW, for full and valuable consideration which the parties hereto acknowledge,
HEC and HBK agree as follows:
1 Definitions
In this Agreement, unless the context otherwise requires, the
following expressions have the following meanings:
(A) "business day" means each Monday, Tuesday, Wednesday, Thursday,
and Friday which is a day on which banking institutions in the
City of New York, Houston Texas, and London England are not
obligated or authorized by law, regulation or executive order to
close;
(B) "the Call Option" means the option granted in accordance with
Section 2;
(C) "the Call Option Period" means the period beginning on the date
hereof and ending on 30 April 2003;
(D) "the Option Price" means the price, payable in cash, of 60% of
nominal value of the 2003 Notes to be purchased by HEC pursuant
to the Put Option or Call Option;
(E) "the Put Option" means the option granted in accordance with
Section 3; and
(F) "the Put Option Period" means the period beginning on 1 May 2003
and ending on 26 May 2003;
2 Grant and Exercise of the Call Option
(A) In consideration of these presents, HBK hereby grants to HEC the
right and option during the Call Option Period to purchase from
it, and it shall be obliged to sell, up to $4,930,000 nominal of
2003 Notes at the Option Price on the terms of this Agreement.
(B) Notice of exercise of the Call Option may be given at any time
and from time to time to HBK during the Call Option Period in
respect of any multiple of $10,000 in aggregate principal amount
of 2003 Notes.
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Such notice shall be given in writing specifying a date for
completion which date shall be not more than 5 business days nor
less than 3 business days after the date of service of the
notice.
3 Grant and Exercise of the Put Option
(A) In consideration of these presents, HEC grants to HBK the right
and option to sell to HEC, and HEC shall be obliged to purchase
from HBK, at the Option Price such nominal amount of 2003 Notes
which shall equal, when aggregated with the 2003 Notes purchased
by HEC from HBK pursuant to the Call Option by the end of the
Call Option Period, $3,700,000 nominal of 2003 Notes.
(B) Notice of the exercise of the Put Option may be given by HBK at
any time and from time to time to HEC during the Put Option
Period in respect of any multiples of $10,000 of 2003 Notes. Such
notice shall be in writing and specify a date for completion
which date shall be not more than 5 business days nor fewer than
3 business days after the date of service of the notice.
4 Non-Assignability
The Put Option and the Call Option may not be assigned in whole or in
part.
5 Notices
Any notice to be given by HEC hereunder shall be deemed served if
faxed to HBK at facsimile number (000) 000-0000 with a telephone
confirmation from HBK of receipt or if delivered to HBK at (214)
758-6132. Any notice to be given by HBK hereunder shall be given by
HBK and shall be deemed served if faxed to HEC at facsimile number 001
000 000 0000 (Attention A. Xxxxx Xxxxxxxx, Senior Vice
President-Finance and Secretary) with a telephone confirmation from
HEC of receipt or if delivered to HEC at its address set out in this
Agreement.
6 Counterparts
This Agreement may be executed in any number of counterparts, all of
which taken together shall constitute one and the same instrument.
Either party may enter into this Agreement by executing any such
counterpart.
7 Choice of law / Arbitration
With respect to any matters under this Agreement that are governed by
state law, but excluding the next paragraph of this Section 7, which
shall be governed by the United States Federal Arbitration Act, the
parties agree that this Agreement shall be construed and governed by
the laws of the State of Texas.
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Any dispute between HBK and HEC as to a violation or alleged violation
of any provision of this Agreement shall be resolved by final and
binding arbitration, which arbitration shall be conducted in
accordance with the rules of the American Arbitration Association
insofar as said rules are not in conflict with the provisions of this
Agreement, with such arbitration hearing to be conducted in Houston,
Texas. The arbitration provisions of this Paragraph shall be governed
by the United States Federal Arbitration Act. THE PARTIES UNDERSTAND
AND AGREE THAT THIS SECTION CONSTITUTES A WAIVER OF THEIR RIGHT TO A
TRIAL BY JURY OF ANY CLAIMS OR CONTROVERSIES COVERED BY THIS
AGREEMENT, AND THAT NONE OF THOSE CLAIMS OR CONTROVERSIES SHALL BE
RESOLVED BY A JURY TRIAL.
The arbitration provided for in this Agreement shall be final and
binding and enforceable in any court of competent jurisdiction, and
such arbitration shall be the sole method of resolving disputes
between the parties with respect hereto.
8 Miscellaneous
Any facsimile signature of any person on a document required or
permitted pursuant to this Agreement shall constitute a legal, valid
and binding execution thereof by such person.
IN WITNESS whereof, this Agreement has been entered into as of the day and year
first above written.
HARKEN ENERGY CORPORATION HBK MASTER FUND L.P
By: /s/ Xxxxx X. Xxxx By: HBK Investments L.P.
-----------------------
Name: Xxxxx X. Xxxx Its: Investment Manager
Title: President and Chief Operating Officer
By: /s/ Xxxxx X'Xxxx
-----------------------
Name: Xxxxx X'Xxxx
Title: Authorized Signatory
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