EXHIBIT 99.7
SALE AND CONVEYANCE AGREEMENT
(Area: Altares, British Columbia)
THIS AGREEMENT made the 12th day of September, 2001.
BETWEEN:
WESTLINKS RESOURCES LTD., a body corporate, having an
office at the City of Calgary, in the Province of
Alberta (hereinafter referred to as the "Vendor")
- and -
NUWAY RESOURCES OF CANADA, LTD., a body corporate,
having an office at the City of Calgary, in the
Province of Alberta (hereinafter referred to as the
"Purchaser")
WHEREAS Vendor has agreed to sell and convey, and Purchaser
has agreed to purchase and accept, on the terms and conditions hereinafter set
forth, the Assets;
NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration
of the premises, mutual covenants, agreements and warranties hereinafter set
forth and contained, the parties hereto respectively covenant and agree as
follows:
ARTICLE 1
INTERPRETATION
1.1 Definitions
-----------
In this agreement, including the recitals, this clause and the
Schedules, the following capitalized words and phrases shall have the following
meanings:
(a) "Adjustment Date" means 8:00 a.m. Calgary time on July 18,
2001;
(b) "AFE's" means authority for expenditure, unit budget, mail
ballot or cash call or any other approval given by the holder
of working interest in the Lands or related tangible property
to conduct an operation, create or incur a financial
obligation or accept a risk;
(c) "Assets" means the Petroleum and Natural Gas Rights, the
Miscellaneous Interests and the Tangibles;
(d) "Business Day" means any day upon which the parties hereto are
open for normal business in Calgary, Alberta;
(e) "Closing Date" means the 12th day of September, 2001 or such
other date which the parties hereto may agree to;
(f) "Combined Lands" means the Lands and the Farmout Lands;
(g) "Dollar" and "$" mean a dollar of lawful money of Canada;
(h) "Environmental Liabilities" means any and all environmental
damage, contamination or other environmental problem
pertaining to the Assets, whether or not caused by a breach of
applicable governmental regulations, including, without
limitation, any matters related to surface, underground, air,
groundwater or surface water contamination, the abandonment or
plugging of any Well or Xxxxx, the restoration or reclamation
of any part of the Assets, or the removal of or failure to
remove any foundations, structures or equipment from the
Combined Lands;
(i) "Farmout Agreement" means the Farmout Agreement dated February
8, 2001 made between Northstar Energy, as Farmor, and
Westlinks Resources Ltd., as Farmee;
(j) "Farmout Lands" means the lands set forth and described under
the title "Farmout Lands" in Schedule "B" attached hereto and
as described in the Farmout Agreement attached as Schedule "B"
to the Participation Agreement and includes the Petroleum
Substances underlying such lands subject to such limitations
as to geological formations and Petroleum Substances as may
appear in Schedule "B";
(k) "GST" means the goods and services tax administered pursuant
to the Excise Tax Act (Canada);
(l) "Lands" means the lands set forth and described under the
title "Lands" in Schedule "A" and includes the Petroleum
Substances underlying such lands subject to such limitations
as to geological formations and Petroleum Substances as may
appear in Schedule "A";
(m) "Leases" means collectively the leases, reservations, permits,
licenses or other documents of title set forth and described
under the title "Leases" in Schedules "A" and "B" by virtue of
which the holder thereof is entitled to explore for, drill
for, win, take or remove the Petroleum Substances within, upon
or under the Combined Lands (or any replacement thereof or
renewals thereof or leases derived therefrom), but only
insofar as the same relate to the Combined Lands;
(n) "Miscellaneous Interests" means an undivided twenty (20.0%)
percent interest held by Vendor in and to all property, assets
and rights (other than the Petroleum and Natural Gas Rights
and the Tangibles) pertaining to, but only to the extent they
pertain to, the Petroleum and Natural Gas Rights, the
Tangibles or any lands with which the Combined Lands have been
pooled or unitized, including, without limitation, the
interest in the following:
(i) all contracts, agreements, books, records and
documents relating directly to the Petroleum and
Natural Gas Rights and the Tangibles and any rights
in relation thereto;
(ii) all subsisting rights to enter upon, use and occupy
the surface of any of the Combined Lands or any lands
upon which the Tangibles are located or lands which
are used to gain access to any of the foregoing;
(iii) all subsisting rights to carry out operations
relating to the Combined Lands or the Tangibles and,
without limitation, all easements and Well, pipeline
and other permits, licences and authorizations; and
(iv) all geological, engineering and other reports
prepared for the joint account, i.e., prepared for
all working interest owners, but not any other
reports or interpretations or any other geophysical
or geological data;
(o) "Notice" has the meaning ascribed to it in subclause 6.5(b);
(p) "Participation Agreement" means the Participation Agreement
dated July 17, 2001 made between Westlinks Resources Ltd.,
Sentra Resources Corporation and Canadian Superior Energy Inc.
(q) "Permitted Encumbrances" means:
(i) 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 or cable television
conduits, poles, towers, wires and cables;
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(ii) the right reserved to or vested in any government or
other public authority by the terms of any grant,
permit or statutory provision to terminate any Leases
or to require annual or other periodic payments as a
condition of the continuance thereof;
(iii) liens imposed by statute securing the payment of
taxes or assessments which are not due or the
validity of which is being contested in good faith by
Vendor;
(iv) taxes on Petroleum Substances (excluding income taxes
and goods and services taxes) or the revenue
therefrom and requirements imposed by statutes or
governmental boards, tribunals or authorities
concerning rates of production from operations on any
of the Combined Lands or otherwise affecting
recoverability of Petroleum Substances from the
Combined Lands and which are generally applicable to
the oil and gas industry in British Columbia;
(v) rights reserved to or vested in any municipality or
governmental, statutory or public authority to
control or regulate any of the Assets in any manner;
(vi) undetermined or inchoate liens (including, without
limitation, processors', operators' and similar
liens) incurred or created as security in favour of
the person conducting the operation of any of the
Assets arising in the ordinary course of business for
Vendor's proportionate share of the costs and
expenses of such operations in respect of such costs
which are not due or delinquent at the relevant time;
(vii) mechanics', builders' or materialmans liens in
respect of services rendered or goods supplied, but
only insofar as such liens relate to goods or
services for which payment is not due or the validity
of which is being diligently contested by or on
behalf of Vendor;
(ix) the reservations, limitations, provisos and
conditions in any original grants from the Crown of
any of the Combined Lands or interests therein and
statutory exceptions to title;
(ix) penalties which have arisen under operating
procedures or similar agreements as a consequence of
elections by Vendor at the relevant time not to
participate in operations on the Combined Lands to
which the penalty applies;
(xii) liens or security incurred, created or granted in the
ordinary course of business to a public utility,
municipality or governmental authority in connection
with operations pertaining to the Assets; and
(xiii) all royalty burdens (including lessor's royalties),
liens, adverse claims and encumbrances described in
Schedule "A" and "B";
(r) "Petroleum and Natural Gas Rights" means an undivided twenty
percent (20%) right, title, estate and interest held by Vendor
in respect of the Leases and the Combined Lands (including
working interests, royalty interests or any other interests of
the Vendor);
(s) "Petroleum Substances" means petroleum, natural gas and all
related hydrocarbons, including, without limitation, all
liquid hydrocarbons, and all other substances, whether
liquids, gases or solids and whether hydrocarbon or not
(except coal but including sulphur), produced in association
with such petroleum, natural gas or related hydrocarbons, the
rights which are granted by the Leases;
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(t) "Prime Rate" means a rate of interest per annum equal to the
annual rate of interest which is announced from time to time
by the Alberta Treasury Branches, Calgary, Alberta, as a
reference rate used for determining interest rates on Canadian
dollar loans to its most credit worthy customers;
(u) "Production Sales Contracts" means those contracts for the
sale of Petroleum Substances produced from the Combined Lands,
or lands with which the Combined Lands have been pooled or
unitized, not terminable on thirty (30) days notice or less as
set forth on Schedule "A";
(v) "Purchase and Option Agreement" means the Letter of Agreement
dated December 6, 2000 made between Alsask Energy Services
Inc. and Westlinks Resources Ltd., as amended by an agreement
dated February 21, 2001;
(w) "Rights of First Refusal" means a right of first refusal,
pre-emptive right of purchase or similar right whereby any
party has the right to acquire or purchase all or a portion of
the Assets as a consequence of this agreement or the
transactions set forth herein;
(x) "Security Interest" means any assignment by way of security,
mortgage, pledge, charge, lien or other security interest
whatsoever, however created or arising, whether absolute,
contingent, fixed or floating, perfected or not;
(y) Take or Pay Obligations" means the outstanding obligations of
Vendor arising in connection with payments made to Vendor, or
its predecessors in interest, under or in respect of gas
purchase contracts or other contracts for the sale of
Petroleum Substances, which payments were made in lieu of or
in consequence of the buyers under such contracts not taking
delivery of Petroleum Substances or in consideration of future
deliveries of Petroleum Substances and which obligations
include obligations to deliver Petroleum Substances after the
Closing Date or to repay such payments after the Closing date;
(z) "Tangibles" means an undivided twenty percent (20.0%) interest
held by Vendor in and to:
(i) all tangible depreciable property and assets which
are situate in, on or about the Combined Lands, or
lands with which the Combined Lands have been pooled
or unitized, or appurtenant thereto and which are
used in connection with production, gathering,
processing, injection, removal, transmission or
treatment of Petroleum Substances or operations
thereon or relative thereto or appurtenant to or used
in connection with the Xxxxx, but excluding equipment
beyond the point of entry into a gathering system,
plant or other facility; and
(iii) all Xxxxx; and
(aa) "Xxxxx" means all producing, shut-in, suspended, abandoned,
water source or injection xxxxx located on the Combined Lands
or any lands which have been pooled or unitized therewith,
including the wellbores and casing therein, as provided on
Schedule "A".
1.2 Schedules and Exhibits
----------------------
The following schedules (the "Schedules") are attached to, form part
of, and are incorporated in this agreement:
Schedule "A" - Lands, Leases, Permitted Encumbrances, Xxxxx and AFE's; and
Schedule "B" - Farmout Lands.
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1.3 Headings
--------
The headings of the clauses of this agreement and the Schedules are
inserted for convenience of reference only and shall not affect the meaning,
interpretation or construction thereof.
1.4 Included Words
--------------
In this agreement, words importing the singular include the plural and
vice versa, and words importing one gender include other genders and words
importing individuals shall also include firms and corporations and vice versa,
as the context may require.
1.5 References
----------
Except as otherwise provided for herein, "this agreement", "hereto",
"herein", "hereof", "hereby", "hereunder" and similar expressions refer to this
agreement in its entirety and not to any particular clause, subclause, paragraph
or other portion thereof. Unless otherwise specified herein, reference to a
clause, subclause or a paragraph refer to a clause, subclause or paragraph of
the body of this agreement.
1.6 Conflicts
---------
Whenever any term or condition, whether express or implied, of any
Schedule conflicts with or is at variance with any term or condition of the body
of this agreement, the latter shall prevail.
1.7 Statutory References
--------------------
Any reference herein to a statute shall include and shall be deemed to
be a reference to such statute and to the regulations made pursuant thereto, and
all amendments made thereto and in force from time to time, and to any statute
or regulation that may be passed which has the effect of supplementing or
superseding the statute so referred to or the regulations made pursuant thereto.
1.8 Invalidity of Provisions
------------------------
If any of the provisions of this agreement should be determined to be
invalid, illegal or unenforceable in any respect, the validity, legality or
enforceability of the remaining provisions herein shall not in any way be
affected or impaired thereby.
1.9 Knowledge or Awareness
----------------------
Where in this agreement a representation, warranty or certificate is
made on the basis of knowledge or awareness of a party hereto, such knowledge or
awareness consists only of the actual knowledge or awareness, as the case may
be, of the officers and employees of such party (after having made reasonable
enquiry of such party's files relating to the Assets), and does not include
knowledge and awareness of any other person or persons.
ARTICLE 2
SALE AND CONVEYANCE
-------------------
2.1 Sale and Conveyance
-------------------
In consideration of the payment to Vendor by Purchaser of the Purchase
Price, Vendor hereby sells, assigns, transfers, conveys and sets over unto
Purchaser the Assets, and Purchaser hereby purchases and accepts directly from
Vendor, the Assets, to have and hold the same, together with all benefit and
advantage to be derived therefrom, subject to and in accordance with the terms
of this agreement. Subject to all other provisions of this agreement, title to,
possession of beneficial ownership of and risk in respect of the Assets shall be
passed to the Purchaser on the date hereof.
2.2 Purchase Price
--------------
The purchase price paid by Purchaser to Vendor for the Assets shall be,
subject to adjustments as herein provided, Four Hundred Thousand Dollars
($400,000.00) in the form of a bank draft or certified cheque in Canadian
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Dollars (the "Purchase Price"). Vendor hereby acknowledges receipt of the
Purchase Price. If required, the Vendor shall remit the Goods and Service Tax
("GST") to the appropriate governmental agency. The GST registration number of
Vendor is R892642893.
The Purchaser shall pay to Vendor, interest, if any, which has accrued
on any amount of the Purchase Price not paid on the Closing Date from the
Closing Date at the Prime Rate plus 1%, to and including the day on which Vendor
receives complete payment of the Purchase Price.
2.3 Allocation of Purchase Price
----------------------------
The Purchase Price shall be paid, allocated and attributed by Vendor
and Purchaser as follows:
(a) to the Petroleum and Natural Gas Rights $399,999.00
(b) to the Miscellaneous Interests $ 1.00
-----------
$400,000.00
===========
2.6 Payment of AFE's
----------------
The Purchaser hereby agrees to pay to Vendor its proportionate share of
the capital expenditures (the "Additional Amounts") associated with Westlinks
AFE No. 30011 for the drilling of the well 200/B-045-J/094-B-08/00. The
Purchasers net share of the Additional Amounts is $340,000.00. The Additional
Amounts will be booked as a drilling expense subject to Canadian Exploration
Expense for the Vendor and Purchaser and the Purchaser will receive its
proportionate share of any cost overruns or underruns.
Vendor hereby acknowledges receipt of the Additional Amounts.
2.7 Further Drilling
----------------
The Purchaser agrees to participate, as to its undivided twenty percent
(20%) share, with Vendor in the drilling of the second test well as set forth
and described in the Farmout Agreement attached to and forming part of the
Participation Agreement.
2.6 In addition, Purchaser agrees to participate as to its undivided twenty
percent (20.0%) share with Vendor in the Purchase and Option Agreement.
ARTICLE 3
APPORTIONMENTS
--------------
3.1 Apportionments
--------------
(a) Except as provided below in this clause 3.1 the net amount of
all benefits and obligations of every kind and nature relating
to the operation of the Assets and accruing in respect of the
Assets including, without limitation, mineral and surface
lease rentals, property taxes, maintenance, development,
capital and operating costs, the proceeds from the sale of
production, royalties and revenues from processing and
transportation fees charged to third parties (other than
income taxes), shall be apportioned between Vendor and
Purchaser as of the Adjustment Date on an accrual basis using
generally accepted accounting principles.
(b) Proceeds (net of royalties) from the sale of Petroleum
Substances attributable to the Petroleum and Natural Gas
Rights produced between the Adjustment Date and the Closing
Date shall be for the account of Purchaser. Purchaser shall be
obligated to pay royalties on all Petroleum Substances which
are not beyond the wellhead on the Closing Date.
(c) No later than two days before the Closing Date the Vendor
shall deliver to the Purchaser a written interim statement of
all adjustments and payments to be made pursuant to the
provisions of the Agreement and shall make available to
representatives of the Purchaser all information necessary for
such representatives to understand and confirm the
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calculations in such statement. The Vendor and the Purchaser
shall co-operate in settling and agreeing to the amounts of
the adjustments and payments to be made pursuant to the
provisions hereof on an interim basis and the amounts so
agreed shall be employed for the purposes of Closing.
(d) To the extent reasonably possible, a final accounting of all
apportionments pursuant to this clause 3.1 shall be carried
out within one hundred and twenty (120) days following the
Closing Date. Purchaser shall pay to Vendor, or Vendor shall
pay to Purchaser, as the case may be, the net cash amount
owing in respect of the apportionments under this clause 3.1
as specified in the final accounting within thirty (30) days
of completion of the accounting. Any apportionments occurring
more than one hundred and twenty (120) days after the Closing
Date which may become necessary shall be apportioned as they
occur and payment shall be made with respect thereto within
thirty (30) days of each such apportionment being agreed upon.
All overdue payments hereunder shall be payable with interest
calculated at the Prime Rate plus one percent (1.0%).
(e) The parties to the agreement foresee that certain adjustments
will be necessary from time to time after the one hundred and
twenty (120) day period referred to in subclause 3.1(d) of
this Appendix. Subject to subclause 3.1(f), these adjustments
shall not be made without a party hereto giving written
notice, but no later than one (1) year after Closing Date, to
the other party hereto requesting an adjustment. Each of the
parties hereto agrees to co-operate in calculating and
confirming the amount of any payment as may be necessary as a
result thereof and agrees to make payment in the event of
becoming obliged thereby to make payment.
(f) Adjustments resulting from joint venture audits, royalty
audits or thirteen (13) month adjustments which are
outstanding at Closing Date or that occur after Closing Date
shall be made as they occur in accordance with the provisions
of the governing agreements or existing legislation. Such
adjustments shall be received or paid by the party entitled
thereto or obliged thereby.
(g) GST shall be to other apportionments where required by law and
paid accordingly by the applicable party hereto.
(h) If the parties cannot agree as to the accounting provided for
in this Article, the matter may be referred to arbitration by
either party for determination in accordance with the
Arbitration Act of Alberta, except that the arbitration shall
not be limited to the schedule of fees provided therein.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES
4.1 Representations and Warranties of Vendor
----------------------------------------
Vendor hereby represents and warrants to Purchaser that:
(a) Corporate Standing: it is a corporation duly organized,
validly subsisting and in good standing under the laws of its
jurisdiction of incorporation and is authorized to carry on
business in the Province of British Columbia;
(b) Corporate Authority: it has all requisite power and authority
to enter into this agreement and to perform its obligations
under this agreement;
(c) Execution and Enforceability of Documents: this agreement has
been duly authorized by any and all requisite corporate,
shareholders' and directors' actions, has been duly executed
and delivered by Vendor and constitutes a legal, valid,
binding and enforceable obligation of Vendor;
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(d) No Conflicts: the consummation by Vendor of the transactions
contemplated herein will not, in any material respects,
violate or conflict with any of the constating documents,
by-laws or governing documents of Vendor or any provision of
any material agreement or instrument to which Vendor is party
or by which Vendor or the Assets is bound, or any judgment,
decree, order, statute, rule or regulation applicable to
Vendor or the Assets;
(e) Canadian Resident: it is not a non-resident of Canada within
the meaning of the Income Tax Act (Canada);
(f) Title: although it does not warrant title to the Assets and
except for Permitted Encumbrances:
(i) it has done no act or thing and is aware of no
circumstance, matter or thing whereby any of the
Assets may be cancelled or determined and the Assets
are free and clear of any and all encumbrances and
Security Interests;
(ii) none of the Petroleum and Natural Gas Rights are
subject to reduction or conversion by reference to
payout of any well or otherwise; and
(iii) subject to the rents, covenants, conditions and
stipulations in the Leases and any other agreements
pertaining to the Assets and on the lessee's or
holder's part thereunder to be paid, performed and
observed, Purchaser may enter into and upon, hold and
enjoy the Assets for the residue of the respective
terms of the Leases, such other agreement relating to
the Assets and all renewals or extensions thereof as
to the interests hereunder assigned for Purchaser's
own use and benefit without any interruption of or by
Vendor or any other person whomsoever claiming by,
through or under Vendor;
(g) No Knowledge of Defaults: after having made due inquiry, it
has no knowledge of, nor has it been informed of, any default
or notice of default relating to the Assets;
(h) Finders' Fees: Vendor has not incurred any obligation or
liability, contingent or otherwise, for brokers' or finders'
fees in respect of this transaction for which Purchaser shall
have any obligation or liability;
(i) No Lawsuits or Claims: there are no claims, proceedings,
actions, lawsuits, administrative proceedings or governmental
investigations in existence, contemplated or threatened
against or with respect to the Assets;
(j) Payment of Taxes: to the best of Vendor's knowledge, after due
inquiry, all rentals, royalties and all ad valorem, property,
production, severance and similar taxes and assessments based
on or measured by the ownership of the Assets or the
production of Petroleum Substances from the Combined Lands or
the receipt of proceeds therefrom payable by Vendor prior to
the Adjustment Date and for all prior years have been properly
paid and discharged;
(k) Compliance: Vendor has complied with, performed, observed and
satisfied all material terms, conditions, obligations and
liabilities which have heretofore arisen and were the
obligations of Vendor under any of the provisions of any
agreement affecting the Assets or any then existing statute,
order, writ, injunction or decree of any governmental agency
or court relating to the Assets;
(l) Documents: it has made all reasonable inquiries and searches
for material documents and information, it has delivered or
made available to Purchaser all documents, instruments,
records and books relevant to Vendor's title to the Combined
Lands and the Leases and in its possession or to which it has
reasonable access;
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(m) Worker's Compensation: the Workers' Compensation Board of
British Columbia does not possess and is not entitled to a
charge on or a lien against the Assets or any of them created
directly by Vendor;
(n) AFEs: there are no authorizations for expenditure or other
financial commitments with respect to the Assets except as set
forth on Schedule "A";
(o) Production Sales Contracts: there are no Production Sales
Contracts for the sale of Petroleum Substances produced from
the Lands not terminable on thirty (30) days notice or less;
(p) Operations: all operations relating to the Assets have been
conducted in accordance with good oilfield practice and all
then existing laws, regulations and directives and to the best
of Vendor's knowledge, it has not received any notice of the
occurrence of a material violation, and is not aware, after
having made due inquiry, that any material violation is
occurring or has occurred, in respect of operations relating
to the Assets;
(q) Environmental: to the best of Vendor's knowledge, after having
made due inquiry, it is not aware of and has not received:
(iii) any claims, orders or directives which relate to
environmental matters or Environmental Liabilities
and which require any work, repairs, construction or
capital expenditures with respect to the Assets,
where such orders or directives have not been
complied with in all material respects; or
(iv) any claim, demand or notice issued with respect to
the breach of any environmental, health or safety law
applicable to the Assets, including without
limitation, respecting the use, storage, treatment,
transportation or disposition of environmental
contaminants, which demand or notice remains
outstanding on the date hereof;
(r) Area of Mutual Interest: the Assets are not subject to an
agreement which provides for an area of mutual interest;
(s) Take or Pay Obligations: the Assets are not subject to any
outstanding Take or Pay Obligations; and
(t) Rights of First Refusal: as of the Closing Date there are no
rights of first refusal relating to the Assets.
4.2 Limitation of Representations and Warranties
--------------------------------------------
(a) Vendor makes no representations or warranties except as
expressly set forth in clause 4.1 and in particular, and
without limiting the generality of the foregoing, Vendor
hereby negates any representations or warranties, whether
contained in any information memorandum or otherwise, except
for those set forth above in this clause, with respect to:
(iv) the quality, quantity or recoverability of Petroleum
Substances within or under the Combined Lands or any
lands pooled therewith;
(v) the value of the Assets or the future cash flow
therefrom; and
(vi) the quality, condition, fitness or merchantability of
any tangible, depreciable equipment or property,
interests in which are comprised in the Assets.
(b) Except to the extent that it has relied upon the
representations and warranties contained in clause 4.1,
Purchaser acknowledges and confirms that it has performed its
own due diligence and it has not relied on any data,
information or advice from the Vendor, its officers,
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directors, agents, consultants and advisors with respect to
any or all of the matters specifically enumerated in subclause
4.2(a) in connection with the purchase of the Assets pursuant
hereto.
4.3 Representations and Warranties of Purchaser
-------------------------------------------
Purchaser hereby represents and warrants to Vendor that:
(a) Corporate Standing: Purchaser is a body corporate duly
organized and validly existing under the laws of the
jurisdiction of its formation, is authorized or is taking
steps to be authorized to carry on business in all
jurisdictions in which the Assets are located and has good
right, full power and absolute authority to purchase the
interest of Vendor in and to the Assets according to the true
intent and meaning of this agreement;
(b) Corporate Authority: Purchaser has taken all necessary
corporate actions and has all requisite power and authority to
enter into this agreement and to purchase and pay for the
Assets on the terms described herein and to perform all other
obligations of Purchaser under this agreement;
(c) No Conflicts: the consummation by Purchaser of the
transactions contemplated by this agreement will not, in any
material respect, violate or conflict with, any of the
constating documents, by-laws or governing documents of
Purchaser or any provision of any material agreement or
instrument to which Purchaser is a party or is bound, or any
judgment, decree, order, statute, rule or regulation
applicable to Purchaser;
(d) Execution and Enforceability of Documents: this agreement has
been duly executed and delivered by Purchaser and it
constitutes a legal, valid, binding and enforceable obligation
of Purchaser;
(e) Finders' Fees: it has not incurred any liability, contingent
or otherwise, for brokers' or finders' fees in respect of this
transaction for which the Vendor shall have any
responsibility; and
(f) Investment Canada: the Purchaser is a "non-Canadian" under the
Investment Canada Act.
4.4 No Merger
---------
The representations and warranties set forth in clauses 4.1
and 4.3 shall be deemed to apply, as applicable, to all assignments,
conveyances, transfers and documents conveying the Assets from Vendor
to Purchaser and there shall not be any merger of any representation or
warranty in such assignments, transfers or documents notwithstanding
any rule of law, equity or statute to the contrary and all such rules
are hereby waived.
ARTICLE 5
INDEMNITY
---------
5.1 General Indemnity
-----------------
Subject to clause 5.3, Vendor shall be liable for, and shall
indemnify Purchaser from and against, all actions, causes of action,
losses, costs, claims, damages, expenses or liabilities suffered,
sustained, paid or incurred by Purchaser pertaining to the Assets and
occurring or arising prior to the Closing Date and Purchaser shall be
liable for and shall indemnify Vendor from and against all actions,
causes of action, losses, costs, claims, damages, expenses or
liabilities suffered, sustained, paid or incurred by Vendor pertaining
to the Assets and occurring subsequent to the Closing Date, excepting,
in each case, to the extent that such liabilities are reimbursed by
insurance, are caused by the negligence or wilful misconduct of the
party claiming indemnity or are apportioned pursuant to clause 3.1.
Such indemnities shall be deemed to apply to all assignments,
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transfers, conveyances, novations and other documents conveying the
Assets from Vendor to Purchaser notwithstanding the actual terms
thereof. Such indemnities shall extend to reasonable legal costs on a
solicitor and client basis. Nothing contained in this clause shall:
(i) impose any liability on any party for damages for
consequential business loss or loss of value; or
(ii) impose any liability on any party for the income tax
liabilities of any other party.
5.2 Environmental Indemnity
-----------------------
Notwithstanding anything herein contained to the contrary, the
parties agree that Purchaser shall indemnify and hold Vendor harmless
from and against any claims, demands, actions or proceedings pertaining
to Environmental Liabilities brought by or on behalf of any person
against Vendor and applicable to the Assets, and for all losses,
damages, payments, costs and expenses (including but not limited to
reasonable legal costs on a solicitor and client basis) arising out of
or in any way pertaining to Environmental Liabilities and applicable to
the Assets, regardless of when the claim, demand, action or proceeding
(or if applicable the relevant cause of action) or such loss, damage,
payment, cost or expense arose, relates to or otherwise applies.
5.3 Limitation of Claims
--------------------
In the absence of fraud, no claim in respect of the covenants,
representations and warranties contained in this agreement shall be
made or be enforceable whether by legal proceedings, indemnification
pursuant to clause 5.1 or otherwise howsoever unless Notice of such
claim is given by the claimant to the other party within the period of
one (1) year from the Closing Date and unless the claimant relied upon
the particular covenants, representation and warranties outlined in the
claim.
5.4 Notice of Claims
----------------
If, after the Closing Date, a claim is asserted in
circumstances which do or may give rise to an indemnity under this
Article 5, the party against whom the claim is asserted shall forthwith
give Notice thereof to the party required to indemnify and such parties
shall consult and cooperate in respect thereof and in determining
whether the claim and any legal proceedings relating thereto should be
resisted, compromised or settled. Each party shall make available to
the other all information in its possession or to which it has access
which is or may be relevant to the particular claim. Purchaser shall
provide Vendor with reasonable access to the Lands and Tangibles to
which the claim relates to the extent reasonably necessary in
connection with the claim. No such claim shall be settled or
compromised without the written consent of the indemnifying party
hereunder, which consent shall not be unreasonably withheld. If any
such claim relates exclusively to a period prior to or after the
Closing Date, as the case may be, Vendor or Purchaser respectively
shall have exclusive conduct of the claim and all legal proceedings
relating thereto, unless otherwise agreed to in writing.
ARTICLE 6
GENERAL
-------
6.1 Further Assurances
------------------
Hereafter as may be necessary and without further
consideration, the parties hereto shall execute, acknowledge and
deliver such other documents, novations, instruments and agreements and
shall do such other things as may be necessary to carry out their
respective obligations under this agreement or the laws and regulations
11
applicable to the transaction contemplated herein. Without limiting the
generality of the foregoing, the Purchaser covenants that it shall
comply with the requirements of the Investment Canada Act.
6.2 Subordination of Ancillary Documents
------------------------------------
All documents executed by the Parties and delivered pursuant
to the provisions of this Agreement are subordinate to the provisions
hereof and the provisions hereof shall govern and prevail in the event
of conflict.
6.3 Governing Law
-------------
This agreement shall, in all respects, be subject to and be
interpreted, construed and enforced in accordance with the laws in
effect in the Province of Alberta. Each party hereto accepts the
jurisdiction of the courts of the Province of Alberta and all courts of
appeal therefrom.
6.4 Time
----
Time shall be of the essence in this agreement.
6.5 Addresses
---------
(a) The address for Notices of each of the parties hereto shall be
as follows:
Vendor: WESTLINKS RESOURCES LTD.
0000, 000 - 0xx Xxxxxx XX
Xxxxxxx, Xxxxxxx X0X 0X0
Attention: President
--------------------
Fax : (000) 000-0000
Purchaser: NUWAY RESOURCES OF CANADA, LTD.
c/o Xxxxxxx Xxxxx LLP
Barristers & Solicitors
0000, 000 - 0xx Xxxxxx XX
Xxxxxxx, Xxxxxxx X0X 0X0
Attention : Xxxx Xxx XxXxxxxx
-----------------------------
Fax : (000) 000-0000
(b) All notices, communications and statements (hereinafter called
"Notices") required, permitted or contemplated hereunder shall
be in writing, and shall be deemed to be sufficiently given
and received if:
(i) personally served on the other party by delivery during
the normal business hours of the recipient at the
addresses set forth above (personally served Notices
shall be deemed received by the addressee when actually
delivered); or
(ii) by telefax (or by any other like method by which a
written or recorded message may be sent) directed to
the party on whom they are to be served at that party's
fax number set forth above and such Notices so served
shall be deemed to have been received by the addressee
thereof when actually received by it if received within
the normal working hours of a Business Day, or, if
received outside the normal working hours of a Business
Day, at the commencement of the next ensuing Business
Day following transmission thereof.
(c) Either of the parties hereto may from time to time change its
address for service herein by giving Notice to the other.
12
6.6 Prior Agreements and Amendments
-------------------------------
This agreement supersedes and replaces any and all prior
agreements between the parties hereto relating to the sale and purchase
of the Assets and may be amended only by written instrument signed by
the parties hereto.
6.7 Entire Agreement
----------------
This instrument states the entire agreement between the parties hereto.
6.8 Enurement
---------
This agreement shall be binding upon and shall enure to the
benefit of the parties hereto and their respective trustees, receivers,
receiver-managers, successors and permitted assigns.
6.9 Waivers
-------
No waiver by any party hereto shall be effective unless in
writing and a waiver shall only affect the matter, and the occurrence
thereof, specifically identified in the writing granting such waiver
and shall not extend to any other matter or occurrence.
6.10 Substitution and Subrogation
----------------------------
To the extent that the same is possible, the Vendor shall
convey the Assets to the Purchaser with full right of substitution and
subrogation of the Purchaser in and to all covenants, representations
and warranties by others heretofore given or made in respect of the
Assets or any part thereof.
6.11 Counterpart Execution
---------------------
This agreement may be executed in as many counterparts as are
necessary and all executed counterparts together shall constitute one
agreement. A valid and binding contract shall arise if and when
counterpart execution pages are executed and delivered by each of the
parties to the other. Delivery may occur via facsimile with the
original counterpart execution page being delivered by each party to
the other immediately following closing.
IN WITNESS WHEREOF the parties hereto have executed this agreement as
of the date first written above.
WESTLINKS RESOURCES LTD.
Per:
-----------------------------
Per:
-----------------------------
NUWAY RESOURCES OF CANADA, LTD.
Per:
--------------------------------
Per:
--------------------------------
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SCHEDULE "A"
This is Schedule "A" to a Sale and Conveyance Agreement made the 12th day of
September 2001 between Westlinks Resources Ltd., as Vendor, and NuWay Resources
of Canada, Ltd., as Purchaser.
Area: Altares, British Columbia
Lands, Leases and Permitted Encumbrance(s)
Lands Leases Permitted
(Rights Held) (File No.) Encumbrance(s)
------------- ---------- --------------
NTS 094-A-05, Blk. D, Xxxxx 00, 00, 00, 00, XX Drilling Licence No. 51915 Crown Sliding Scale
60, 70, 80, 90 (M578)
NTS 094-B-08, Blk. A, Units 11-13, 21-23,
31-33, 41-43
NTS 094-B-08, Blk. A, Xxxxx 00-00, 00-00,
00, 00
(Xxx XXX)
NTS 094-B-08, Blk. A, Xxxxx 00, 00, 00, 00
(Xxx XXX excl. NG in Bluesky)
Xxxxx
- Nil -
AFE's
AFE Number Total AFE Amount Description
---------- ---------------- -----------
30011 dated August 13, 2001 $ 1,698,000.00 To drill an exploratory
well at B-045-J/094-B-08
SCHEDULE "B"
This is Schedule "B" to a Sale and Conveyance Agreement made the 12th day of
September 2001 between Westlinks Resources Ltd., as Vendor, and NuWay Resources
of Canada, Ltd., as Purchaser.
Farmout Lands
14
