PETROLEUM, NATURAL GAS AND GENERAL RIGHTS CONVEYANCE
EXHIBIT
10.8
PETROLEUM,
NATURAL GAS AND
GENERAL RIGHTS CONVEYANCE
THIS
AGREEMENT is dated this 2nd
day of
March, 2007
BETWEEN:
1304146
ALBERTA LTD. a
body
corporate, having an office in the City of Calgary, in the Province of Alberta
(the "Purchaser")
-
and
-
PEACE
OIL CORP.,
a body
corporate, having an office in the City of Calgary, in the Province of Alberta
(the "Vendor")
-
and
-
COLD
FLOW ENERGY ULC,
a body
corporate, having an office
in
the
City of San Diego, in the State of California ("Cold Flow")
-
and
-
SURGE
GLOBAL ENERGY, INC.,
a body
corporate, having an office
in
the
City of San Diego, in the State of California ("Surge")
WHEREAS
the Vendor has agreed to sell the Assets to the Purchaser and the Purchaser
has
agreed to purchase the Assets from the Vendor subject to the terms of this
Agreement;
NOW
THEREFORE THIS AGREEMENT WITNESSETH that in consideration of the Purchase Price
(as defined below), all applicable taxes, and for other good and valuable
consideration, the receipt and sufficiency of which is acknowledged by each
of
the Parties hereto, the Parties agree as follows:
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1.
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Definitions
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Capitalized
terms used herein and not otherwise defined shall have the meaning ascribed
thereto in the Stock Purchase Agreement and in addition, the following terms
shall have the following meanings:
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(a)
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"Agreement"
means this petroleum, natural gas and general rights conveyance,
including
the recitals and schedules hereto and all instruments supplemental
to it
or in amendment or confirmation of it;
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(b)
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"Assets"
means the Petroleum and Natural Gas Rights, the Tangibles and the
Miscellaneous Interests;
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(c)
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"Claims"
means any claim, lien, charge, pledge, hypothecation, mortgage, title
retention agreement, security agreement, option or encumbrance of
any
nature or kind whatsoever;
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(d)
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"Default"
means any default by Vendor in its obligation to the Purchaser under
this
Agreement;
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(e)
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"Guaranteed
Obligations"
shall have the meaning ascribed to such term in Section 4(a);
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(f)
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"Lands"
means the lands set out in Schedule "A" under the heading
"Lands";
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(g)
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"Leased
Substances"
means all Petroleum Substances, rights to or in respect of which
are
granted, reserved or otherwise conferred by or under the Title Documents
(but only to the extent that the Title Documents pertain to the
Lands);
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(h)
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"Miscellaneous
Interests"
means, subject to any and all limitations and exclusions provided
for in
this definition, all property, assets, interests and rights pertaining
to
the Petroleum and Natural Gas Rights and the Tangibles, or either
of them,
but only to the extent that such property, assets, interests and
rights
pertain to the Petroleum and Natural Gas Rights and the Tangibles,
or
either of them, including without limitation any and all of the
following:
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(i)
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contracts
and agreements relating to the Petroleum and Natural Gas Rights and
the
Tangibles, or either of them, including without limitation gas purchase
contracts, processing, joint operating agreements, transportation
agreements and agreements for the construction, ownership and operation
of
facilities, but excluding production sales contracts pertaining to
the
Leased Substances or any of them that cannot be terminated on notice
of 31
days or less (without an early termination penalty or other cost),
gas
balancing or similar agreements pertaining to the Leased Substances
or any
of them, agreements for the transportation, processing or disposal
of the
Leased Substances or any of them or substances produced in connection
with
the Leased Substances or any of them, agreements for the contract
operation by a Third Party of the Assets or any of them and agreements
to
provide transportation, processing or disposal capacity or service
to any
Third Party,
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(ii)
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fee
simple rights to, and rights to enter upon, use or occupy, the surface
of
any lands which are or may be used to gain access to or otherwise
use the
Petroleum and Natural Gas Rights and the Tangibles, or either of
them,
excluding any such rights that pertain only to a well or xxxxx other
than
the Well,
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(iii)
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all
records, books, documents, licences, reports and data which relate
to the
Petroleum and Natural Gas Rights and the Tangibles, or either of
them,
including any of the foregoing that pertain to geological or geophysical
matters, and
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(iv)
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the
Xxxxx, including the wellbores and any and all casing;
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(i)
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"Parties"
means the Vendor and the Purchaser, collectively, and "Party"
means any one of them;
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(j)
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"Person"
means any individual, corporation, partnership, incorporated syndicate,
unincorporated organization, trust, trustee, executor, administrator
or
other legal representative;
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(k)
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"Permitted
Encumbrances"
means:
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(i)
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liens
for taxes, assessments and governmental charges which are not due
or the
validity of which is being diligently contested in good faith by
or on
behalf of Vendor,
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(ii)
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liens
incurred or created in the ordinary course of business as security
in
favour of the person who is conducting the development or operation
of the
property to which such liens relate for Vendor's proportionate share
of
the costs and expenses of such development or operation,
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(iii)
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mechanics',
builders' and materialmen's liens in respect of services rendered
or goods
supplied for which payment is not due,
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(iv)
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easements,
rights of way, servitudes and other similar rights in land (including
without limitation rights of way and servitudes for highways and
other
roads, railways, sewers, drains, gas and oil pipelines, gas and water
mains, electric light, power, telephone, telegraph and cable television
conduits, poles, wires and cables) which do not materially impair
the use
of the Assets affected thereby,
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(v)
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the
right reserved to or vested in any municipality or government or
other
public authority by the terms of any lease, licence, franchise, grant
or
permit or by any statutory provision, to terminate any such lease,
licence, franchise, grant or permit or to require annual or other
periodic
payments as a condition of the continuance thereof,
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(vi)
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rights
of general application reserved to or vested in any governmental
authority
to levy taxes on the Leased Substances or any of them or the income
therefrom, and governmental requirements and limitations of general
application as to production rates on the operations of any
property,
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(vii)
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statutory
exceptions to title, and the reservations, limitations, provisos
and
conditions in any original grants from the Crown of any of the mines
and
minerals within, upon or under the Lands, and
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(viii)
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all
encumbrances and other claims set out in Schedule "B";
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(l)
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"Petroleum
and Natural Gas Rights"
means all rights to the Leased Substances and the Title Documents
(but
only to the extent that the Title Documents pertain to the Lands),
including without limitation the interests set out in Schedule
"A";
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(m)
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"Petroleum
Substances"
means any of crude oil, crude bitumen and products derived therefrom,
synthetic crude oil, petroleum, natural gas, natural gas liquids,
and any
and all other substances related to any of the foregoing, whether
liquid,
solid or gaseous, and whether hydrocarbons or not, including without
limitation sulphur;
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(n)
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"Purchase
Price"
has the meaning ascribed thereto in Paragraph 3(b) hereof;
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(o)
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"Stock
Purchase Agreement"
means that certain stock purchase agreement dated November 30, 2006,
as
amended, among Cold Flow, Surge, Vendor, and the shareholders of
the
Vendor, as set forth on Schedule "I" thereto;
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(p)
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"Tangibles"
means any and all tangible depreciable property and assets, which
are
located within, upon or in the vicinity of the Lands and which are
used or
are intended to be used to produce, process, gather, treat, measure,
make
marketable or inject the Leased Substances or any of them or in connection
with water injection or removal operations that pertain to the Petroleum
and Natural Gas Rights, including without limitation any and all
gas
plants, oil batteries, buildings, production equipment, pipelines,
pipeline connections, meters, generators, motors, compressors, treaters,
dehydrators, scrubbers, separators, pumps, tanks, boilers and
communication equipment;
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(q)
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"Third
Party"
means any individual or entity other than Vendor and Purchaser, including
without limitation any partnersh1`ip, corporation, trust, unincorporated
organization, union, government and any department and agency thereof
and
any heir, executor, administrator or other legal representative of
an
individual;
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(r)
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"Title
Documents"
means, collectively, any and all certificates of title, leases,
reservations, permits, licences, assignments, trust declarations,
operating agreements, royalty agreements, gross overriding royalty
agreements, participation agreements, farm-in agreements, sale and
purchase agreements, pooling agreements and any other documents and
agreements granting, reserving or otherwise conferring rights to
(i) explore
for, drill for, produce, take, use or market Petroleum Substances,
(ii) share
in the production of Petroleum Substances, (iii) share
in the proceeds from, or measured or calculated by reference to the
value
or quantity of, Petroleum Substances which are produced, and (iv) rights
to acquire any of the rights described in items (i)
to
(iii)
of
this definition; but only if the foregoing pertain in whole or in
part to
Petroleum Substances within, upon or under the Lands; and
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(s)
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"Xxxxx"
means all xxxxx (including without limitation producing, shut-in,
abandoned,
water source, water disposal and water injection xxxxx) located on
the
Lands or lands pooled or unitized therewith.
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2.
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Schedules
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The
following schedules are attached hereto and form part of this
Agreement:
Schedule
"A" - Title Documents, Lands and Encumbrances
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3.
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Purchase
and Sale
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(a)
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Purchase
and Sale
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Subject
to the terms of this Agreement, Vendor hereby sells, assigns, transfers,
conveys and sets over unto Purchaser, its entire right, title, interest
and estate in and to the Assets, free and clear of all Claims except
the
Permitted Encumbrances, TO HAVE AND TO HOLD the same unto Purchaser,
together with all benefit and advantage to be derived therefrom,
absolutely, and Purchaser hereby purchases the same.
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(b)
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Purchase
Price
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The
purchase price for the Assets is One Dollars ($1.00) (the "Purchase
Price") and Vendor acknowledges receipt of the Purchase Price from
the
Purchaser.
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4.
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Guarantee
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(a)
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Cold
Flow and Surge, jointly and severally, hereby irrevocably and
unconditionally guarantee to and in favour of Purchaser the due and
punctual performance by Vendor to Purchaser of all indebtedness,
liabilities and obligations, direct or indirect, absolute or contingent,
present or future, matured or not matured, of Vendor to Purchaser
under
this Agreement, (the "Guaranteed Obligations").
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(b)
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Cold
Flow and Surge guarantee that the Guaranteed Obligations will be
paid or
performed, as the case may be, strictly in accordance with the terms
of
this Agreement regardless of any law, rule, regulation or order now
or
hereafter in effect in any jurisdiction affecting any of such terms
or the
rights of Purchaser with respect thereto and regardless of any defence,
counterclaim, right of set-off or equities which either Cold Flow
or Surge
may have. Neither Cold Flow nor Surge shall be released from any
of its
obligations under this Agreement as a consequence of, and this Agreement
shall be effective and binding on Cold Flow and Surge
notwithstanding:
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(i)
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any
lack of or limitation on the status or power of the Vendor or the
directors or agents thereof;
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(ii)
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any
lack of validity or enforceability of this Agreement, the Stock Purchase
Agreement or any other agreement among Cold Flow, Surge, Vendor,
and the
shareholders of the Vendor (as set forth in the Stock Purchase Agreement)
or any provision thereof, or of any other document or instrument
relating
thereto or hereto;
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(iii)
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any
change in the time, manner or place of payment of, or in any other
term of
any of the Guaranteed Obligations, or any other amendment or waiver
of, or
any consent to or departure from any of the terms of the Guaranteed
Obligations, the Agreement, or of any other document or instrument
relating thereto or hereto, or any indulgence which Purchaser may
from
time to time grant to the Vendor, Cold Flow, Surge or any other
Person;
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(iv)
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any
exchange or release of, or any failure to perfect or otherwise protect
any
interest in, any collateral held by Purchaser as security for any
of the
Guaranteed Obligations;
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(v)
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any
limitation at any time upon any remedy available to Purchaser under
this
Agreement, the Stock Purchase Agreement or any other document relating
thereto;
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(vi)
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any
irregularity, defect or informality in this Agreement, the Stock
Purchase
Agreement, or any other document relating thereto;
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(vii)
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the
lack of validity or enforceability or the avoidance or subordination
of
all or any part of the Guaranteed Obligations;
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(viii)
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any
winding-up, dissolution, receivership or bankruptcy of Surge, Cold
Flow,
Vendor or any other Person, any amalgamation, merger, reorganization
or
fundamental corporate change (including any change of name) affecting
Surge, Cold Flow, Vendor or any other Person, any reorganization
of any or
all of the obligations of Surge, Cold Flow, Vendor or any other Person,
or
any transaction including any amalgamation, merger, consolidation,
arrangement, transfer, sale, lease or other disposition, whereby
all or
any part of the undertaking, property and assets of Surge, Cold Flow,
Vendor or any other Person become the property of any other Person
or
Persons; and
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(ix)
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any
other circumstance which might otherwise constitute a defence available
to, or a discharge of, Surge, Cold Flow, Vendor or any other Person
in
respect of the Guaranteed Obligations, this Agreement, the Stock
Purchase
Agreement or any documents relating thereto.
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(c)
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Cold
Flow and Surge each hereby waive presentment, protest, promptness,
diligence, notice of acceptance and, except as otherwise expressly
provided herein, any other notice or demand with respect to any of
the
Guaranteed Obligations and acknowledges that Purchaser shall be entitled
without in any way prejudicing or affecting any of its rights hereunder
and without in any way limiting or lessening the liability of Cold
Flow or
Surge under this Agreement to, without limitation:
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(i)
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give
up, vary, exchange, release, discharge or otherwise deal with or
fail to
deal with any security (including any other guarantee) relating to
the
Guaranteed Obligations, this Agreement or the Stock Purchase Agreement,
all as Purchaser considers appropriate;
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(ii)
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grant
time for payment or any other indulgence in respect of the Guaranteed
Obligations, this Agreement or the Stock Purchase Agreement or any
other
obligation or guarantee relating thereto or arising
thereunder;
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(iii)
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accept
or make any compositions, arrangements or plans of reorganization
with any
Person as Purchaser considers appropriate;
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(iv)
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agree
to any change in, amendment to, waiver of, or departure from, any
term of
the Guaranteed Obligations, this Agreement or the Stock Purchase
Agreement
including, without limitation, any renewal, extension, release, discharge,
compromise or settlement of any of the foregoing; and
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(v)
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abstain
from taking, protecting, securing, registering, filing, recording,
renewing, perfecting, insuring or realizing upon any security or
other
guarantee, exercising any remedy or pursuing or exhausting any other
right, action or recourse against the Vendor, any other Person or
any
security or other guarantee before exercising its rights under this
Agreement; and no loss in respect of any security received or held
for and
on behalf of Purchaser, whether occasioned by fault, omission or
negligence of any kind, whether of Purchaser or any other Person,
shall in
any way limit or lessen the liability of Cold Flow or Surge under
this
Agreement.
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(d)
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Purchaser
shall not be bound to exhaust its recourse against the Vendor or
any other
Person or any security it may at any time hold before being entitled
to
payment from either Cold Flow or Surge of the Guaranteed Obligations.
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(e)
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Any
release, discharge or settlement between the Surge, Cold Flow and
Purchaser shall be conditional upon no security, disposition or payment
to
Purchaser by the Vendor or any other Person being void, set aside
or
ordered to be refunded pursuant to any enactment or law relating
to
bankruptcy, liquidation, administration or insolvency or for any
other
reason whatsoever and if such condition shall not be fulfilled Purchaser
shall be entitled to enforce this Agreement subsequently as if such
release, discharge or settlement had not occurred and any such payment
had
not been made.
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(f)
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If
a Default has occurred and is continuing Purchaser may make a demand
upon
Cold Flow or Surge, or both, for the payment in full of the Guaranteed
Obligations and Cold Flow or Surge, or both shall pay such amount
to
Purchaser forthwith in full, without any set-off or counterclaim
whatsoever and free and clear of any deductions or withholdings,
in
immediately available funds, to Purchaser in Calgary, Alberta or
such
other place as Purchaser may designate by notice to Surge or Cold
Flow.
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(g)
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After
the making of a demand pursuant to Section 4(f) and the failure of
either
Cold Flow or Surge, or both to make payment forthwith, Purchaser
may
proceed directly and at once, without further notice, against Surge
or
Cold Flow to collect and recover the full amount, or any portion
of, the
Guaranteed Obligations. Purchaser shall have the exclusive right
to
determine the application of payments and credits, if any, from Surge
and
Cold Flow or from any other Person on account of the Guaranteed
Obligations.
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(h)
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No
failure on the part of Purchaser to exercise and no delay in exercising
any right hereunder shall operate as a waiver thereof, nor shall
any
single or partial exercise of any right hereunder preclude any other
or
further exercise thereof or the exercise of any other right.
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(i)
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This
Agreement shall:
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(i)
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remain
in full force and effect until the earlier of payment in full of
the
Guaranteed Obligations and all other amounts payable
hereunder;
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(ii)
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be
binding upon Cold Flow, Surge and its respective successors and assigns;
and
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(iii)
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enure,
together with the rights and remedies of Purchaser hereunder, to
the
benefit of and be enforceable by Purchaser and its successors and
assigns.
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(j)
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This
Agreement is in addition to and not in substitute for any other guarantee
of the Guaranteed Obligations or any other security by whomsoever
given or
at any time held by Purchaser in respect of the Guaranteed Obligations
and
Purchaser shall at all times have the right to proceed against or
realize
upon all or any portion of any other guarantees or security or any
other
moneys or assets to which Purchaser may become entitled or have a
claim in
such order and in such manner as Purchaser in its sole discretion
may deem
fit, all without any obligation to xxxxxxxx any of such
securities.
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(k)
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Possession
of this Agreement by Purchaser shall be conclusive evidence against
Cold
Flow and Surge that this Guarantee was not delivered in escrow or
pursuant
to any agreement that it should not be effective until any conditions
precedent or subsequent had been complied with.
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5.
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Representations
and Warranties
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(a)
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Vendor'
Representations and Warranties
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Vendor
makes the following representations and warranties to Purchaser:
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(i)
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Vendor
is a corporation duly incorporated pursuant to the laws of the province
of
Alberta;
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(ii)
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Vendor
has all necessary corporate power, authority and capacity to enter
into
this Agreement and to perform its obligations under this
Agreement;
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(iii)
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the
execution and delivery of this Agreement and the consummation of
the
transaction contemplated under it have been duly authorized by all
necessary corporate action on the part of Vendor;
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(iv)
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this
Agreement constitutes a valid and binding obligation of Vendor enforceable
against it in accordance with its terms, subject, however, to limitations
with respect to enforcement imposed by law in connection with bankruptcy,
insolvency or similar proceedings relating to creditor's rights generally
and to the extent that equitable remedies such as specific performance
and
injunction are in the discretion of a court of competent
jurisdiction;
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(v)
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except
as expressly set forth in this Agreement, Vendor does not warrant
title to
the Assets but does warrant that, except for Permitted Encumbrances,
the
Assets are now free and clear of all Claims, options, net profit
interests, mortgages, royalties and adverse claims or other burdens
created by, through or under it or of which it is otherwise actually
aware;
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(vi)
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The
interests of Vendor in the Assets are not subject either to reduction,
by
reference to payout of a well or otherwise, or to change to an interest
of
any other size or nature whatsoever by virtue of any right or interest
granted by, through or under it or of which it is otherwise actually
aware, except for the Permitted Encumbrances and any such rights
and
interests identified Schedule "A" and it has not alienated or encumbered
the Assets or any part or portions thereof and it is not aware of
there
having been committed any act or omission whereby the right of it
in any
of the Assets may be cancelled or determined;
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(vii)
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Except
for the Permitted Encumbrances, there are no unsatisfied judgments
and no
claims, proceedings, actions, governmental investigations or lawsuits
in
existence, and to the Vendor's knowledge, contemplated or threatened
against or with respect to the Assets or the interests of it therein
which
might result in impairment or loss of the interest of it in and to
the
Assets or which might otherwise adversely affect the Assets, and
to it’s
knowledge there exists no particular circumstance which will give
rise to
such a claim, proceeding, action, governmental investigation or lawsuit;
and
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(viii)
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Subject
to the rents, covenants, conditions and stipulations in the Title
Documents and Permitted Encumbrances, Purchaser is entitled to hold
and
enjoy the interests attributed to it in the schedules hereto for
Purchaser's own use and benefit without any interruption of or by
it or
any Third Party claiming by, through or under it.
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(b)
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Cold
Flow and Surge's Representations and Warranties
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Cold
Flow
and Surge each make the following representations and warranties to
Purchaser:
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(i)
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Cold
Flow is a corporation duly incorporated pursuant to the laws of the
province of Alberta;
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(ii)
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Surge
is a corporation duly incorporated pursuant to the laws of the state
of
Delaware;
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(iii)
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Cold
Flow and Surge each have all necessary corporate power, authority
and
capacity to enter into this Agreement and to perform its obligations
under
this Agreement;
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(iv)
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the
execution and delivery of this Agreement and the consummation of
the
transaction contemplated under it have been duly authorized by all
necessary corporate action on the part of each of Cold Flow and
Surge;
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(v)
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this
Agreement constitutes a valid and binding obligation of Cold Flow
and
Surge, enforceable against each of them in accordance with its terms,
subject, however, to limitations with respect to enforcement imposed
by
law in connection with bankruptcy, insolvency or similar proceedings
relating to creditor's rights generally and to the extent that equitable
remedies such as specific performance and injunction are in the discretion
of a court of competent
jurisdiction;
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(c)
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Purchaser's
Representations and Warranties
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The
Purchaser makes the following representations and warranties to Vendor:
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(i)
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The
Purchaser is a corporation duly incorporated pursuant to the laws
of the
province of Alberta;
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(ii)
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the
Purchaser has all necessary power, authority and capacity to own
the
Assets;
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(iii)
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the
Purchaser has all necessary corporate power, authority and capacity
to
enter into this Agreement and to perform its obligations under this
Agreement;
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(iv)
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the
execution and delivery of this Agreement and the consummation of
the
transaction contemplated under it have been duly authorized by all
necessary corporate action on the part of the Purchaser; and
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(v)
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this
Agreement constitutes a valid and binding obligation of the Purchaser
enforceable against it in accordance with its terms, subject, however,
to
limitations with respect to enforcement imposed by law in connection
with
bankruptcy, insolvency or similar proceedings relating to creditor's
rights generally and to the extent that equitable remedies such as
specific performance and injunction are in the discretion of a court
of
competent jurisdiction.
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(d)
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Limitations
on Vendor's Representations and Warranties
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The
Purchaser acknowledges and agrees that the Assets are being sold and purchased
on an "as is, where is" basis and, except for the express representations and
warranties given in Paragraph 5(a), no representation or warranty either
expressed or implied has been or is given by the Vendor concerning the Assets.
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6.
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Indemnities
for Breach of Representations and
Warranties
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(a)
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Indemnity
for Breach of Vendor's Representations and Warranties
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Vendor,
Surge and Cold Flow shall each be jointly and severally liable to Purchaser
for
and shall, in addition, indemnify Purchaser from and against, all losses, costs,
claims, damages, expenses and liabilities suffered, sustained, paid or incurred
by Purchaser which would not have been suffered, sustained, paid or incurred
had
all of the representations and warranties contained in Paragraph 5(a) been
accurate and truthful, provided however that nothing in this Paragraph 6(a)
shall be construed so as to cause Vendor to be liable to or indemnify Purchaser
in connection with any representation or warranty contained in Paragraph 5(c)
if
and to the extent that Purchaser did not rely upon such representation or
warranty
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(b)
|
Indemnity
for Breach of Purchaser's Representations and Warranties
|
Purchaser
shall be liable to Vendor for and shall, in addition, indemnify Vendor from
and
against, all losses, costs, claims, damages, expenses and liabilities suffered,
sustained, paid or incurred by Vendor which would not have been suffered,
sustained, paid or incurred had all of the representations and warranties
contained in Paragraph 5(c) been accurate and truthful, provided however that
nothing in this Paragraph 6(b) shall be construed so as to cause Purchaser
to be
liable to or indemnify Vendor in connection with any representation or warranty
contained in Paragraph 5(a) if and to the extent that Vendor did not rely upon
such representation or warranty.
|
(c)
|
The
maximum cumulative liability of Vendor, Cold Flow and Surge for the
indemnities pursuant to paragraph 6(a) shall not exceed $16,350,000.00
less any amounts paid to the Shareholders under the Notes and less
the
cash portion of the Purchase Price paid to Shareholders at
Closing.
|
|
7.
|
General
|
|
(a)
|
Time
|
|
Time
shall be of the essence.
|
|
|
(b)
|
Notices
|
Any
notice or other writing required or permitted to be given under this Agreement
or for the purposes of it to any Party, shall be sufficiently given if delivered
personally, or if sent by prepaid registered mail or if transmitted by telex,
telefax or other form of recorded communication to that Party:
|
Vendor, Cold Flow or Surge:
|
|
|
Surge
Global Energy Inc.
|
|
|
00000
Xx Xxxxxx Xxxx, Xxxxx 000
|
|
|
Xxx
Xxxxx, XX 00000
|
|
|
Fax:
(000)
000-0000
|
|
|
The
Purchaser:
|
|
|
1304146
Alberta Ltd.
|
|
|
x/x
Xxxxxxxx Xxxxxx XXX
|
|
|
0000,
000 - 0xx
Xxxxxx X.X.
|
|
|
Xxxxxxx,
Xxxxxxx
|
|
|
X0X
0X0
|
|
|
Fax:
(000) 000-0000
|
|
-10-
or
at any
other address as the Party to whom the writing is to be given shall have last
notified the other Party. Any notice delivered to the Party to whom it is
addressed shall be deemed to have been given and received on the day it is
delivered at that address, provided that if that day is not a business day
then
the notice shall be deemed to have been given and received on the first business
day next following that day. Any notice mailed shall be deemed to have been
given and received on the third business day next following the date of its
mailing. Any notice transmitted by telex, telefax or other form of recorded
communication shall be deemed given and received on the first business day
after
its transmission.
|
(c)
|
Assignment
|
Neither
this Agreement nor any rights, remedies, liabilities or obligations arising
under it or by reason of it shall be assignable by any Party without the prior
written consent of the other Party. Subject thereto, this Agreement shall enure
to the benefit of and be binding on the Parties and their respective heirs,
executors, administrators, personal representatives, successors and permitted
assigns.
|
(d)
|
Further
Assurances
|
The
Parties shall with reasonable diligence do all things and provide all reasonable
assurances as may be required to consummate the transactions contemplated by
this Agreement, and each Party shall provide further documents or instruments
required by any other Party as may be reasonably necessary or desirable to
effect the purpose of this Agreement and to carry out its
provisions.
|
(e)
|
Entire
Agreement
|
The
Agreement constitutes the entire agreement between the Parties and except as
stated in it and in the instruments and documents to be executed and delivered,
contains all the representations and warranties of the respective Parties.
There
are no oral representations or warranties or collateral agreements between
the
Parties of any kind relating to the subject-matter herein. This Agreement may
not be amended or modified in any respect except by written instrument signed
by
both Parties.
|
(f)
|
Applicable
Law
|
This
Agreement shall be interpreted in accordance with the laws of the Province
of
Alberta and the laws of Canada applicable therein, excluding any choice or
conflict of law provision (whether of Alberta, Canada or any other
jurisdiction), that would permit or cause the application of the laws of any
other jurisdiction. The parties irrevocably attorn to the exclusive jurisdiction
of the courts of the Province of Alberta.
|
(g)
|
Counterpart
and Facsimile Execution
|
This
Agreement may be executed in any number of counterparts and each such
counterpart shall be deemed to be an original instrument but all such
counterparts together shall constitute one agreement. The Parties hereto shall
be entitled to rely upon delivery of an executed facsimile copy of this
Agreement and such facsimile copy shall be legally effective to create a valid
and binding agreement among the Parties hereto.
-11-
|
8.
|
Release
|
In
the
event that pursuant to this Agreement, the Purchaser becomes the sole owner
of
the Assets, any other remedies which the Purchaser has against any of the
Vendor, Cold Flow or Surge for non-payment of accounts owing to the Purchaser
shall become null and void and have no further force and effect including the
Promissory Notes, the Share Pledge, the Debentures and the Guarantees. In
addition, the Purchaser covenants to discharge all security registrations
against any of Callco, Cold Flow or Surge.
IN
WITNESS WHEREOF the Parties have executed this Agreement as of the date first
written above.
|
1304146
ALBERTA LTD.
|
PEACE
OIL CORP.
|
|
|
Per:
/s/ Xxxx Xxxxxx
|
Per:
/s/ Xxxxx Xxxxx
|
|
|
|
COLD
FLOW ENERGY ULC
|
|
|
Per:
/s/ Xxxxx Xxxxx
|
Per:
/s/ Xxxxx Xxxxx
|
-12-
THIS
IS SCHEDULE "A" ATTACHED TO AND FORMING PART OF A PETROLEUM, NATURAL GAS AND
GENERAL RIGHTS CONVEYANCE MADE AS OF THE 2ND
DAY
OF MARCH, 2007 BETWEEN 1304146 ALBERTA LTD., PEACE OIL CORP., COLD FLOW ENERGY
ULC AND SURGE GLOBAL ENERGY, INC.
SCHEDULE
“A”
JV
LANDS
|
OIL
SANDS LEASE
|
LANDS
|
PEACE
WORKING INTEREST
|
|
OS7405120334
|
Xxx
00, Xxx 0 X0
Xxxxxxxx
0-0, 00-00
|
30.0%
|
|
OS7405120335
|
Xxx
00, Xxx 0 X0
Xxxxxxxx
0-0, 00-00
|
30.0%
|
|
OS7405120336
|
Xxx
00, Xxx 0 X0
Xxxxxxxx
00-00, 00-00
|
30.0%
|
|
OS7405120337
|
Xxx
00, Xxx 0 X0
Xxxxxxxx
00-00, 00-00
|
30.0%
|
|
OS0000000000
|
Xxx
00, Xxx 00 X0
Xxxxxxxx
0-0, 00-00
|
30.0%
|
|
OS7405120340
|
Xxx
00, Xxx 00 W5
Sections
22-27, 34-36
|
30.0%
|
|
OS0000000000
|
Xxx
00, Xxx 00 W5
Sections
04-09, 16-18
|
30.0%
|
|
OS7406020463
|
Xxx
00, Xxx 00, X0
Xxxxxxxx
00-00, 00-00
|
30.0%
|
|
OS7406020464
|
Xxx
00, Xxx 00 W5
Sections
01-03, 10-15
|
30.0%
|
|
OS7406020467
|
Xxx
00, Xxx 00 W5
Sections
22-27, 34-36
|
30.0%
|
|
OS7406020465
|
Xxx
00, Xxx 00 W5
Sections
04-09, 16-18
|
30.0%
|
|
OS7406030666
|
Xxx
00, Xxx 00 W5
Sections
22-27, 34-36
|
30.0%
|
|
OS7406030667
|
Xxx
00, Xxx 00 W5
Sections
01-03, 10-15
|
30.0%
|
|
OS7406030668
|
Xxx
00, Xxx 00 W5
Sections
04-09, 16-18
|
30.0%
|
|
OS0000000000
|
Xxx
00, Xxx 00 W5
Sections
19-21, 28-33
|
30.0%
|
-13-
THIS
IS SCHEDULE "B" ATTACHED TO AND FORMING PART OF A PETROLEUM, NATURAL GAS AND
GENERAL RIGHTS CONVEYANCE MADE AS OF THE 2ND
DAY
OF MARCH, 2007 BETWEEN 1304146 ALBERTA LTD., PEACE OIL CORP., COLD FLOW ENERGY
ULC AND SURGE GLOBAL ENERGY, INC.
SCHEDULE
“B”
PERMITTED
ENCUMBRANCES
All
encumbrances, liens, charges, Claims, royalties, easements, proceedings, claims,
rights, options, net profit interests, mortgages or any other adverse claims
or
rights without limitation existing, arising or accruing on or prior to the
effective time of the purchase by Cold Flow Energy ULC of 800 Class “A” Shares
and 6,333,332 Class “I” Shares of the Vendor pursuant to the that certain Stock
Purchase Agreement among the Purchaser, Surge, the Vendor and the shareholders
of the Vendor dated as of November 30, 2006, as amended.
-14-
