Exhibit 2.1
INTEREST PURCHASE AGREEMENT
THIS INTEREST PURCHASE AGREEMENT (the "Agreement") is made and entered
into this 28th day of July, 2004, by and among SOUTH OIL, INC., a Texas
corporation (the "South Oil"), and MAVERICK OIL AND GAS, INC., a Nevada
corporation ("Maverick").
RECITALS
WHEREAS, the Board of Directors of South Oil and Maverick have
approved, and deem it advisable and in the best interests of their respective
companies and stockholders to consummate, the transactions contemplated hereby
upon the terms and subject to the conditions set forth in this Agreement; and
WHEREAS, Maverick Basin Exploration, LLC, has been duly organized as
limited liability company under the Delaware Limited Liability Company Act (the
"Company"); and
WHEREAS, South Oil owns all of the Company's issued and outstanding
Class A limited liability company membership interests (the "Class A
Interests"), representing a 74.25% ownership interest in the Company; and
WHEREAS, South Oil wishes to sell to Maverick, and Maverick wishes to
purchase from South Oil, all of the Class A Interests from South Oil.
NOW, THEREFORE, in consideration of the foregoing premises and
representations, warranties, covenants and agreements contained herein, and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, and intending to be legally bound hereby, the parties
hereto hereby agree as follows:
ARTICLE I
THE PURCHASE AND SALE
1.1 THE PURCHASE AND SALE.
Upon the terms and subject to the conditions set forth in this
Agreement, on the Closing Date, South Oil shall sell to Maverick, and Maverick
shall purchase from South Oil, one hundred percent (100%) of the Class A
Interests owned by South Oil, in consideration for which Maverick shall assume
all of the liabilities and obligations of South Oil as the sole Class A member
(the "Transaction").
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1.2 CLOSING DATE.
The closing of the Transactions (the "Closing") shall take
place at a time and on a date to be specified by the parties (the "Closing
Date") at the offices of Xxxxx Xxxxxx LLP, 00 Xxxxxxxxxxx Xxxx, Xxxxx 000,
Xxxxxx Xxxx, XX 00000, or at such other place as may be mutually agreed upon in
writing by the parties hereto. At the Closing: (i) South Oil shall deliver or
cause to be delivered to Maverick any and all documents necessary to effect the
transfer to Maverick of all of the Class A Interests owned by South Oil; (ii)
Maverick shall deliver or cause to be delivered to South Oil any and all
documents necessary to effect the assumption by Maverick of all of the
liabilities and obligations of South Oil as the sole Class A member of the
Company; and (iii) each of the parties to this Agreement shall have executed any
and all additional documents and agreements, provided any and all additional
consents and approvals, and taken all such other actions as are required under
this Agreement to complete the transactions contemplated hereby.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF SOUTH OIL
South Oil hereby makes the following representations and
warranties to Maverick:
2.1 ORGANIZATION AND QUALIFICATION.
South Oil and the Company are duly organized, validly
existing and in good standing under the laws of their respective jurisdictions
of organization, with the corporate power and authority to own and operate their
respective businesses as presently conducted, except where the failure to be or
have any of the foregoing would not have a Material Adverse Effect. South Oil
and the Company are duly qualified as foreign corporations to do business and
are in good standing in each jurisdiction where the character of their
respective properties owned or held under lease or the nature of their
respective activities makes such qualification necessary, except for such
failures to be so qualified or in good standing as would not, individually or in
the aggregate, have a Material Adverse Effect. A copy of the Company's Articles
of Organization and Operating Agreement have been provided to Maverick.
2.2 AUTHORIZATION; VALIDITY AND EFFECT OF AGREEMENT.
South Oil has the requisite corporate power and authority to
execute, deliver and perform its obligations under this Agreement and to
consummate the Transactions. The execution and delivery of this Agreement by
South Oil and the performance by South Oil of its obligations hereunder and the
consummation of the Transactions have been duly authorized by its board of
directors and all other necessary corporate action on the part of South Oil, and
no other corporate proceedings on the part of South Oil are necessary to
authorize this Agreement and the Transactions. This Agreement has been duly and
validly executed and delivered by South Oil and, assuming that it has been duly
authorized, executed and delivered by the other parties hereto, constitutes a
legal, valid and binding obligation of South Oil, enforceable against it in
accordance with its terms, subject to the effects of bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar laws
relating to or affecting creditors' rights generally, general equitable
principles (whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing.
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2.3 NO CONFLICT; REQUIRED FILINGS AND CONSENTS.
Neither the execution and delivery of this Agreement by South
Oil nor the performance by South Oil of its obligations hereunder, nor the
consummation of the Transactions, will: (i) conflict with South Oil's
certificate of incorporation or bylaws; (ii) violate any statute, law,
ordinance, rule or regulation applicable to South Oil or any of its properties
or assets; or (iii) violate, breach, be in conflict with or constitute a default
(or an event that, with notice or lapse of time or both, would constitute a
default) under, or permit the termination of any provision of, or result in the
termination of, the acceleration of the maturity of, or the acceleration of the
performance of any obligation of South Oil under, or result in the creation or
imposition of any Liens upon any properties, assets or business of South Oil
under, any material contract or any order, judgment or decree to which South Oil
is a party or by which South Oil or any of its assets or properties is bound or
encumbered except, in the case of clauses (ii) and (iii), for such violations,
breaches, conflicts, defaults or other occurrences that, individually or in the
aggregate, would not have a Material Adverse Effect.
2.4 TITLE TO THE INTERESTS.
South Oil has good and marketable title to the Class A
Interests, and the Class A Interests are owned of record and beneficially by
South Oil, free and clear of any Liens. Except for this Agreement, there are no
outstanding options, warrants, agreements, conversion rights, preemptive rights,
or other rights to subscribe for, purchase or otherwise acquire the Class A
Interests. There are no voting trusts or other agreements or understandings to
which South Oil or any of its subsidiaries is a party with respect to the voting
of the Class A Interests, and there is no indebtedness of South Oil or its
subsidiaries issued and outstanding that has general voting rights with respect
to the Class A Interests. Except for this Agreement, there are no outstanding
obligations of any Person to repurchase, redeem or otherwise acquire any of the
Class A Interests.
2.5 BROKERS AND FINDERS FEES.
Neither South Oil or any of its subsidiaries, nor any of their
respective officers, directors, employees or managers, has employed any broker
or finder or incurred any liability for any investment banking fees, brokerage
fees, commissions or finders fees in connection with the Transactions for which
South Oil or any of its subsidiaries has or could have any liability.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SOUTH OIL
Maverick hereby make the following representations and warranties to
South Oil:
3.1 ORGANIZATION AND QUALIFICATION.
Maverick is duly organized, validly existing and in good
standing under the laws of its jurisdiction of organization, with the corporate
power and authority to own and operate its business as presently conducted,
except where the failure to be or have any of the foregoing would not have a
Material Adverse Effect. Maverick is duly qualified as a foreign corporation to
do business and is in good standing in each jurisdiction where the character of
its properties owned or held under lease or the nature of its activities makes
such qualification necessary, except for such failures to be so qualified or in
good standing as would not, individually or in the aggregate, have a Material
Adverse Effect.
3.2 AUTHORIZATION; VALIDITY AND EFFECT OF AGREEMENT.
Maverick has the requisite corporate power and authority to
execute, deliver and perform its obligations under this Agreement and to
consummate the Transactions. The execution and delivery of this Agreement by
Maverick and the performance by Maverick of its obligations hereunder and to
consummate the Transactions have been duly authorized by its board of directors
and all other necessary corporate action on the part of Maverick, and no other
corporate proceedings on the part of Maverick is necessary to authorize this
Agreement and the Transactions. This Agreement has been duly and validly
executed and delivered by Maverick and, assuming that it has been duly
authorized, executed and delivered by the other parties hereto, constitutes a
legal, valid and binding obligation of Maverick, enforceable against it in
accordance with its terms, subject to the effects of bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar laws
relating to or affecting creditors' rights generally, general equitable
principles (whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing.
3.3 NO CONFLICT; REQUIRED FILINGS AND CONSENTS.
Neither the execution and delivery of this Agreement by
Maverick nor the performance by Maverick of its obligations hereunder, nor the
consummation of the Transactions, will: (i) conflict with Maverick's articles
of incorporation or bylaws; (ii) violate any statute, law, ordinance, rule or
regulation applicable to Maverick or any of its properties or assets; or (iii)
violate, breach, be in conflict with or constitute a default (or an event
that, with notice or lapse of time or both, would constitute a default) under,
or permit the termination of any provision of, or result in the termination
of, the acceleration of the maturity of, or the acceleration of the
performance of any obligation of Maverick under, or result in the creation or
imposition of any Liens upon any properties, assets or business of Maverick
under, any material contract or any order, judgment or decree to which
Maverick is a party or by which Maverick or any of its assets or properties is
bound or encumbered except, in the case of clauses (ii) and (iii), for such
violations, breaches, conflicts, defaults or other occurrences that,
individually or in the aggregate, would not have a Material Adverse Effect.
3.4 INVESTMENT INTENT.
The Class A Interests are being acquired for Maverick's own
account for investment purposes only and not with a view to, or with any present
intention of, distributing or reselling any of the Class A Interests. Maverick
acknowledges and agrees that the Class A Interests have not been registered
under the Securities Act or under any state securities laws, and that the Class
A Interests may not be, directly or indirectly, sold, transferred, offered for
sale, pledged, hypothecated or otherwise disposed of without registration under
the Securities Act and applicable state securities laws, except pursuant to an
available exemption from such registration. Maverick also acknowledges and
agrees that neither the SEC nor any securities commission or other Governmental
Authority has (a) approved the transfer of the Class A Interests or passed upon
or endorsed the merits of the transfer of the Class A Interests, this Agreement
or the Transactions; or (b) confirmed the accuracy of, determined the adequacy
of, or reviewed this Agreement. Maverick has such knowledge, sophistication and
experience in financial, tax and business matters in general, and investments in
securities in particular, that it is capable of evaluating the merits and risks
of this investment in the Class A Interests, and Maverick has made such
investigations in connection herewith as they deemed necessary or desirable so
as to make an informed investment decision without relying upon South Oil for
legal or tax advice related to this investment. Maverick is an "accredited
investor" within the meaning of Rule 501 promulgated under the Securities Act.
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3.5 BROKERS AND FINDERS.
Neither Maverick, nor any of its officers, directors,
employees or managers, has employed any broker or finder or incurred any
liability for any investment banking fees, brokerage fees, commissions or
finders' fees in connection with the Transactions for which Maverick has or
could have any liability.
ARTICLE IV
CERTAIN COVENANTS
4.1 CONFIDENTIALITY.
Each party shall hold, and shall cause its respective
Affiliates and representatives to hold, all Confidential Information made
available to it in connection with the Transactions in strict confidence, shall
not use such information except for the sole purpose of evaluating the
Transactions and shall not disseminate or disclose any of such information other
than to its directors, officers, managers, employees, shareholders, interest
holders, Affiliates, agents and representatives, as applicable, who need to know
such information for the sole purpose of evaluating the Transactions (each of
whom shall be informed in writing by the disclosing party of the confidential
nature of such information and directed by such party in writing to treat such
information confidentially). The above limitations on use, dissemination and
disclosure shall not apply to Confidential Information that: (i) is learned by
the disclosing party from a third party entitled to disclose it; (ii) becomes
known publicly other than through the disclosing party or any third party who
received the same from the disclosing party, provided that the disclosing party
had no knowledge that it was subject to an obligation of confidentiality at the
time it disclosed the information to the third party; (iii) is required by law
or court order to be disclosed by the parties; or (iv) is disclosed with the
express prior written consent thereto of the other party. The parties shall
undertake all necessary steps to ensure that the secrecy and confidentiality of
such information will be maintained in accordance with the provisions of this
Section 4.1. Notwithstanding anything contained herein to the contrary, in the
event a party is required by court order or subpoena to disclose information
that is otherwise deemed to be confidential or subject to the confidentiality
obligations hereunder, prior to such disclosure, the disclosing party shall: (i)
promptly notify the non-disclosing party and, if having received a court order
or subpoena, deliver a copy of the same to the non-disclosing party; (ii)
cooperate with the non-disclosing party, at the expense of the non-disclosing
party, in obtaining a protective or similar order with respect to such
information; and (iii) provide only that amount of information as the disclosing
party is advised by its counsel is necessary to strictly comply with such court
order or subpoena.
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4.2 PUBLIC ANNOUNCEMENTS.
South Oil and Maverick shall consult with each other before
issuing any press release or otherwise making any public statements with respect
to the Transactions or this Agreement, and shall not issue any other press
release or make any other public statement without prior consent of the other
parties, except (i) as may be required by law, or (ii) with respect to their
respective obligations pursuant to rules or regulations of the Exchange Act, the
Securities Act, any rule or regulation promulgated thereunder or any rule or
regulation of the National Association of Securities Dealers.
4.3 PROHIBITION ON TRADING IN SECURITIES.
South Oil and Maverick each hereby acknowledge that
information concerning the matters that are the subject matter of this Agreement
may constitute material non-public information under United States federal
securities laws, and that United States federal securities laws prohibit any
Person who has received material non-public information relating to South Oil or
Maverick from purchasing or selling securities of South Oil or Maverick, as the
case may be, or from communicating such information to any Person under
circumstances in which it is reasonably foreseeable that such Person is likely
to purchase or sell securities of South Oil or Maverick, as the case may be.
Accordingly, until such time as any such non-public information has been
adequately disseminated to the public, South Oil shall not purchase or sell any
securities of Maverick, or communicate such information to any other Person, and
Maverick shall not purchase or sell any securities of South Oil, or communicate
such information to any other Person.
4.4 FURTHER ASSURANCES.
Each of the parties hereto agrees to use its reasonable best
efforts to take or cause to be taken all action, to do or cause to be done, and
to assist and cooperate with the other party hereto in doing, all things
necessary, proper or advisable under applicable laws to consummate and make
effective, in the most expeditious manner practicable, the Transactions,
including, but not limited to: (i) the satisfaction of the conditions precedent
to the obligations of any of the parties hereto; (ii) the defending of any
lawsuits or other legal proceedings, whether judicial or administrative,
challenging this Agreement or the performance of the obligations hereunder; and
(iii) the execution and delivery of such instruments, and the taking of such
other actions, as the other party hereto may reasonably require in order to
carry out the intent of this Agreement.
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4.5 NOTIFICATION OF CERTAIN MATTERS.
Each party hereto shall promptly notify the other party in
writing of any events, facts or occurrences that would result in any breach of
any representation or warranty or breach of any covenant by such party contained
in this Agreement.
ARTICLE V
MISCELLANEOUS
5.1 ENTIRE AGREEMENT.
This Agreement and the schedules and exhibits hereto contain
the entire agreement between the parties and supercede all prior agreements and
understandings, both written and oral, between the parties with respect to the
subject matter hereof.
5.2 AMENDMENT AND MODIFICATIONS.
This Agreement may not be amended, modified or supplemented
except by an instrument or instruments in writing signed by the party against
whom enforcement of any such amendment, modification or supplement is sought.
5.3 SUCCESSORS AND ASSIGNS.
This Agreement shall be binding upon and inure to the benefit
of the parties hereto and their respective successors and assigns, provided,
however, that no party hereto may assign its rights or delegate its obligations
under this Agreement without the express prior written consent of the other
party hereto. Nothing in this Agreement is intended to confer upon any person
not a party hereto (and their successors and assigns) any rights, remedies,
obligations or liabilities under or by reason of this Agreement.
5.4 SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS.
The representations and warranties contained herein shall
survive the Closing and shall thereupon terminate eighteen (18) months after the
Closing, except that the representations contained in Sections 2.1, 2.2, 2.4,
3.1, 3.2 and 3.4 shall survive indefinitely. All covenants and agreements
contained herein which by their terms contemplate actions following the Closing
shall survive the Closing and remain in full force and effect in accordance with
their terms. All other covenants and agreements contained herein shall not
survive the Closing and shall thereupon terminate.
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5.5 HEADINGS; DEFINITIONS.
The Section and Article headings contained in this Agreement
are inserted for convenience of reference only and will not affect the meaning
or interpretation of this Agreement. All references to Sections or Articles
contained herein mean Sections or Articles of this Agreement unless otherwise
stated. All capitalized terms defined herein are equally applicable to both the
singular and plural forms of such terms.
5.6 SEVERABILITY.
If any provision of this Agreement or the application thereof
to any Person or circumstance is held to be invalid or unenforceable to any
extent, the remainder of this Agreement shall remain in full force and effect
and shall be reformed to render the Agreement valid and enforceable while
reflecting to the greatest extent permissible the intent of the parties.
5.7 EXPENSES.
Except as otherwise expressly set forth herein, all legal and
other costs and expenses incurred in connection with the Transactions shall be
paid by the party incurring such expenses.
5.8 NOTICES.
All notices hereunder shall be sufficiently given for all
purposes hereunder if in writing and delivered personally, sent by documented
overnight delivery service or, to the extent receipt is confirmed, telecopy,
telefax or other electronic transmission service to the appropriate address or
number of the party to whom the notice is being sent.
5.9 GOVERNING LAW.
This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware, without regard to the laws
that might otherwise govern under applicable principles of conflicts of laws
thereof, except to the extent that the Nevada General Corporation Law shall
apply to the internal corporate governance of Maverick.
5.10 ARBITRATION.
If a dispute arises as to the interpretation of this
Agreement, it shall be decided in an arbitration proceeding conforming to the
Rules of the American Arbitration Association applicable to commercial
arbitration then in effect at the time of the dispute. The arbitration shall
take place in the Commonwealth of Pennsylvania. The decision of the Arbitrators
shall be conclusively binding upon the parties and final, and such decision
shall be enforceable as a judgment in any court of competent jurisdiction. The
parties shall share equally the costs of the arbitration.
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5.11 COUNTERPARTS.
This Agreement may be executed in two or more counterparts,
each of which shall be deemed to be an original, but all of which together shall
constitute one and the same agreement.
5.12 CERTAIN DEFINITIONS.
As used herein:
(a) "Affiliate" shall have the meanings ascribed to such term
in Rule 12b-2 of the Exchange Act;
(b) "Confidential Information" shall mean the existence and
contents of this Agreement and any Schedules and Exhibits hereto, and all
proprietary technical, economic, environmental, operational, financial and/or
business information or material of one party which, prior to or following the
Closing Date, has been disclosed by South Oil, on the one hand, or the
Purchasers, on the other hand, in written, oral (including by recording),
electronic, or visual form to, or otherwise has come into the possession of, the
other;
(c) "Exchange Act" shall mean the Securities Exchange Act of
1934, as amended;
(d) "Governmental Authority" shall mean any nation or
government, any state, municipality or other political subdivision thereof and
any entity, body, agency, commission or court, whether domestic, foreign or
multinational, exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government and any executive
official thereof;
(e) "Liens" shall mean liens, pledges, charges, claims,
security interests, purchase agreements, options, title defects, restrictions on
transfer or other encumbrances, or any agreements (other than this Agreement or
the Company's Operating Agreement) to do any of the foregoing, of any nature
whatsoever, whether consensual, statutory or otherwise;
(f) "Material Adverse Effect" shall mean any adverse effect on
the business, condition (financial or otherwise) or results of operation of (i)
in the case of South Oil, South Oil and its subsidiaries, if any, that is
material to South Oil and its subsidiaries, if any, taken as a whole, or (ii) in
the case of Maverick, Maverick and its subsidiaries, if any, that is material to
Maverick and its subsidiaries, if any, taken as a whole;
(g) "Person" shall mean any individual, corporation,
partnership, association, trust or other entity or organization, including a
governmental or political subdivision or any agency or institution thereof;
(h) "SEC" shall mean the Securities and Exchange Commission;
and
(i) "Securities Act" shall mean the Securities Act of 1933, as
amended.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
SOUTH OIL, INC.
By: /s/ Xxxx X. Xxxx
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Xxxx X. Xxxx, President
MAVERICK OIL & GAS, INC.
By: /s/ Xxxxxxx Xxxxxxx
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Xxxxxxx Xxxxxxx, President
