1. INDEX OIL AND GAS INC
2. XXXXXX GROUP INC
3. XXXXXX XXXX AND OTHERS
================================================================================
ACQUISITION AGREEMENT
relating to shares and warrants in Index Oil & Gas Limited
================================================================================
THIS DOCUMENT IS FOR DISTRIBUTION IN THE UNITED KINGDOM ONLY TO PERSONS HOLDING
SHARES IN INDEX OIL & GAS LIMITED. THIS DOCUMENT IS NOT A PROSPECTUS PURSUANT TO
SECTION 85 OF THE FINANCIAL SERVICES AND MARKETS XXX 0000. FOR THE PURPOSES OF
SECTION 21 OF THE FINANCIAL SERVICES AND MARKETS XXX 0000, THIS DOCUMENT IS A
COMMUNICATION WHICH FALLS WITHIN THE SCOPE OF THE SALE OF BODY CORPORATE
EXEMPTION PURSUANT TO REGULATION 62 OF THE FINANCIAL SERVICES AND MARKETS ACT
(FINANCIAL PROMOTION) ORDER 2005
THIS AGREEMENT is made on 2 January 2006
BETWEEN
1. XXXXXX GROUP INC. a corporation with an address for notice and
delivery at Suite 000 - 000 Xxxx Xxxxxxxx Xxxxxx, Xxxxxxxxx, XX X0X 0X
("BG") and;
2. INDEX OIL AND GAS INC. a corporation incorporated and registered in
accordance with the laws of the State of Nevada, USA and having its
principal office at 000 Xxxxx Xxxxxx Xxxxxx, Xxxxxx 00000, XXX ("the
"Purchaser") and;
3. THE PERSONS WHOSE NAMES AND ADDRESSES are set out in the first column
of Schedule 1 ("the A Group Shareholders").
WHEREAS:-
A. The Purchaser and the A Group Shareholders have agreed terms for
the transfer by the A Group Shareholders to the Purchaser of their
respective holdings of the Shares and the Warrants for Consideration
Shares and Consideration Warrants (as defined below) on the terms of
this Agreement.
B. BG has agreed to enter into this Agreement for the purposes,
inter alia, of giving certain warranties and undertakings in favour of
the Shareholders (as defined below).
NOW, THEREFORE, IT IS AGREED AS FOLLOWS:
THE AGREEMENT
1. Definitions and Interpretations
-----------------------------------
1.1 In this Agreement:
"AGREEMENT" means this agreement;
" A Group Shareholders" means the persons whose names and addresses
are set out in the first column of Schedule 1 who
have agreed to provide certain warranties in
favour of the Purchaser in relation to the
business, assets and liabilities of the Company;
"Purchaser Warranties" means the warranties on the part of BG and
the Purchaser set out in Clause 10.3 and Part II
of Schedule 2;
"BG Disclosure Letter" means the letter from BG to the A Group
Shareholders with the same date as this Agreement
and described as the BG disclosure letter;
"Claim" means a claim under the A Group Warranties
and/or the Purchaser Warranties, as the context
may admit;
"Company" means Index Oil & Gas Limited a company
incorporated and registered in England under
registered number 4674411 and having its
registered office at Xxxxxxxx Xxxxx, Xxxxx Xxxxxxx
Xxxx, Xxxx, XX0 0XX Xxxxxxx;
"Completion" means the completion of the sale and purchase
of the Shares and the Warrants pursuant to Clause
9;
"Completion Date" means the date of this agreement;
"the Consideration Shares" means the 8,796,997 shares of common stock in
the capital of the Purchaser to be issued and
allotted to the A Group Shareholders pursuant to
Clause 3;
"the Consideration Warrants" means the 503,164 warrants to subscribe for
shares of common stock in the capital of the
Purchaser to be issued and allotted to the A Group
Shareholders pursuant to Clause 3, such warrants
to be constituted pursuant to a deed poll of the
Purchaser in the agreed form;
"Disclosed" means fairly disclosed in or under the A
Group Disclosure Letter or the BG Disclosure
Letter as the case may be;
"A Group Disclosure Letter" means the letter from the A Group Shareholders to
the Purchaser with the same date as this Agreement
and described as the A Group disclosure letter;
"Encumbrance" any interest or equity of any person (including
any right to acquire, option or right of pre-
emption) or any mortgage, charge, pledge, lien,
assignment, hypothecation, security, interest,
title retention or any other security agreement or
arrangement;
"Market Orderliness" means the principle that a private or a
public institution will ensure the proper
regulation of net flows into and out of the
market;
"NASDAQ OTC Bulletin
Board" and "NASDAQ" means the National Association of Securities
Dealers Automated Quotation system and all
references to this market shall include all other
such markets that the Stock Units are traded on
from time to time;
"Party" and " Parties" means all or any of the parties to this Agreement
as the context requires;
"Restriction Provisions" means in the case of the A Group Shareholders,
the restriction provisions on the sale and
transfer of the Consideration Shares set out in
Clause 4 and in the case of the Shareholders
(excluding the A Group Shareholders) the
restriction provisions on the sale and transfer of
Stock Units set out in the relevant Shareholder
Agreement;
"Private Placing" means the private placing of 8,533,333 Stock
Units in the Purchaser at US$0.60 per share to
placees pursuant to a subscription agreement in
the agreed form and as referred to in Clause 7;
"Shareholder Agreements" means agreements executed separately from this
Agreement between the Purchaser and shareholders
of the Company excluding the A Group
Shareholders for the transfer of their individual
holdings of shares and warrants in the Company to
the Purchaser in exchange for Stock Units;
"the Shares" means the 3,079,225 ordinary shares of 10p
each in the capital of the Company beneficially
owned by and registered in the names of the A
Group Shareholders in the proportions set out in
Schedule 1;
"Shareholders" means all the registered holders of ordinary
shares of 10p each in the capital of the Company
on the date of this Agreement, including the A
Group Shareholders;
"Stock Units" means the units of capital or shares of
common stock of US$0.001 each of the Purchaser;
"Subsidiaries" mean the wholly owned subsidiary undertakings
of the Company, details of which are contained in
Schedule 3;
"the Warrants" means the 176,117 warrants to subscribe for
ordinary shares of 10p each in the capital of the
Company beneficially owned by and registered in
the names of the A Group Shareholders as set out
in Schedule 1, such warrants being constituted
pursuant to a deed poll of the Company dated 9
September 2005;
"Warranties" means the warranties extended by the Parties
to each other set out in Clause 10 of and Schedule
2 to this Agreement.
1.2 Any reference, express or implied, to an enactment includes
references to:
(a) that enactment as amended, extended or applied by or under any
other enactment before or after this Agreement; and;
(b) any enactment which that enactment re-enacts (with or without
modification; and;
(c) any subordinate legislation made (before or after this Agreement)
under any enactment, including one within (a) or (b) above;
except to the extent that any legislation or subordinate legislation
made or enacted after the date of this Agreement would create or increase a
liability of the Shareholders under this agreement.
1.3 Words denoting persons shall include bodies corporate and
unincorporated associations of persons.
1.4 The headings in this Agreement do not affect its
interpretation
1.5 A reference to a document being in the agreed form is to a
document initialled by or on behalf of the Parties for the purposes of
identification.
1.6 Save where specifically provided otherwise all obligations
undertaken by more than one Party to this Agreement are undertaken
severally.
2. The Exchange of Shares in the Company for Stock Units of the Purchaser
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2.1 On the terms of this agreement, each of the A Group Shareholders
shall sell, and the Purchaser shall buy, the numbers of the Shares and
the Warrants set out opposite the respective names of the A Group
Shareholders in Schedule 1 with full title guarantee,
free from all Encumbrances and together with all rights that
attach (or may in the future attach) to them including, in the case of
the Shares, the right to receive all dividends and distributions
declared, made or paid on them on or after the date of this Agreement
2.2 Each of the A Group Shareholders waives any right of pre-emption
or other restriction on transfer in respect of the Shares and the
Warrants or any of them conferred on him under the articles of
association of the Company or otherwise .
2.3 The Purchaser shall not be obliged to complete the purchase of
any of the Shares and the Warrants unless the purchase of all the Shares
and the Warrants is completed simultaneously.
3. The Consideration
------------------
3.1 The aggregate consideration for the Shares and the Warrants
shall be the issue and allotment to the A Group Shareholders on
Completion of the numbers of Consideration Shares and Consideration
Warrants set out opposite their respective names in Schedule 1.
3.2 The Consideration Shares shall be issued by the Purchaser
credited as fully paid and non-. assessable and shall rank pari passu in
all respects with the existing issued shares of common stock in the
capital of the Purchaser in issue at Completion.
4. Restriction Provisions on Transfer/Sale of the Stock Units
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4.1 Each A Group Shareholder agrees not to dispose of any of the
Consideration Shares before 20 January 2007, save pursuant to an offer
made to all the holders of Stock Units in the Purchaser and thereafter
only to dispose of Consideration Shares in accordance with the
provisions of this Clause 4.
4.2 Between 20 July 2007 and 20 January 2008 each A Group
Shareholder will (subject to such restrictions as shall apply under US
Securities Laws) be permitted to sell a proportion of their holding of
Consideration Shares. The proportion of Consideration SharP3 permitted
to be sold by each A Group Shareholder will be based upon the average
price of a Stock Unit on the NASDAQ OTC Bulletin Board for the five
dealing days preceding 20 July 2007 as follows:
4.2.1 If the average price of a Stock Unit is US$0.79 or less,
each A Group Shareholder shall be entitled to sell their entire
holding of Consideration Shares; or;
4.2.2 If the average price of a Stock Unit is between US$0.80
and US$0.99, each A Group Shareholder shall be entitled to sell
up to 25% of their holding of Consideration Shares .
4.2.3 If the average price of a Stock Unit is between US$1.00
and US$1.49, each A Group Shareholder shall be entitled to sell
up 20% of their holding of Consideration Shares.
4.2.4 If the average price of a Stock Unit is greater than
US$1.50, each Shareholder shall be entitled to sell up to 15% of
their holding of Consideration Shares
4.3 After 20 January 2008, each A Group Shareholder will be able to
dispose of their Consideration Shares free of any restrictions imposed
by this Agreement, but subject to such restrictions as shall apply under
US Securities Laws.
4.4 Each A Group Shareholder undertakes not to dispose of any
Consideration Shares in the period from 20 July 2007 to 20 January 2008
without the prior approval by a majority of the board of the Purchaser
and subject to such conditions as may be determined by the board of the
Purchaser to ensure such disposal is made in accordance with the
principle of Market Orderliness.
4.5 Each of the A Group Shareholders undertakes so far as he is able
by the exercise of his rights as a director of the Purchaser and the
holder of Stock Units to ensure that the Purchaser does not agree to the
release of any Shareholder from their obligations to comply with the
Restriction Provisions and to procure that the Purchaser enforces the
Restriction Provisions by which each Shareholder is bound
5. The Escrow
-----------
During the 12 month period from the Completion Date, BG agrees that the voting
rights attached to 5,047,130 of its holding of Stock Units shall be exclusively
exercised in accordance with the directions of a majority of the A Group
Shareholders given in writing.
6. The Stock Option Plan
------------------------
6.1 The Company shall adopt the share option plan in the agreed form
prior to Completion. The Parties shall procure the adoption of such
share option plan by the Purchaser on Completion .
6.2 Pursuant to the share option plan, the Purchaser shall set aside
options to purchase up to 5,225,000 Stock Units in the Purchaser at an
option price of 0.20 per share for 7 years from the date of grant.
6.3 Following Completion, the Purchaser will file the share option
plan with the Securities and Exchange Commission pursuant to
registration requirements set out in S8 of the United States Securities
Xxx 0000.
7. The Private Planing and Investor Relations
------------------------------------------------
7.1 BG warrants that it has completed the provisional sale of
8,533,333 Stock Units in the Purchaser by way of the Private Placing,
which Stock Units have been fully subscribed subject only to Completion.
Immediately following Completion, BG will hold on trust for the benefit
of and shall, when requested, transfer to the Purchaser the proceeds of
the Private Placing amounting to US$5,120,000.
7.2 BG warrants to the Shareholders that the Purchaser has not, and
is not subject to, any liabilities with regard to its business
whatsoever whether known, actual, or contingent and BG shall pay to the
Purchaser an amount equal to any liability of the Purchaser to any other
person.
7.3 The A Group Shareholders and BG agree that following Completion,
the Purchaser shall spend US$240,000 of the monies raised pursuant to
Clause 71 on Investor Relations provided that the A Group Shareholders
shall not be in breach of this Clause 7.3 to the extent that the board
of directors of the Purchaser determine that such expenditure would not
be in the best interests of the Purchaser.
8. Directors
---------
8.1 Upon Completion, BG will procure the resignation of Xxxx Xxxxxx
as the sole director of the Purchaser and the appointment of each of the
A Group Shareholders as directors of the Purchaser.
8.2 BG will have the right to nominate a director of the Purchaser
for a 12 month period from the Completion Date. During the 12 month
period, each of the A Group Shareholders agrees to exercise all votes
exercisable by him as a director and/or shareholder of the Purchaser in
favor of the appointment as a director of the Purchaser of such person
as shall be nominated by BG in writing
9. Completion
----------
9.1 Completion shall take place immediately following the signing of
this Agreement at the offices of Faegre & Xxxxxx LLP, 0 Xxxxxxx Xxxxxx,
Xxxxxx XX0X 0XX.
9.2 On the Completion each of the A Group Shareholders shall deliver
or cause to be delivered to the Purchaser the following:
9.2.1 signed stock transfer forms into the name of the
Purchaser representing the Shares and the Warrants set out
opposite his name in Schedule 1; and
9.2.2 the share and warrant certificates for the Shares and
the Warrants set out opposite his name in Schedule 1.
9.3 On Completion, the Purchaser shall deliver to each of the A
Group Shareholders:
9.3.1 Stock certificates in respect of the Consideration
Shares to which such A Group Shareholder is entitled; and
9.3.2 Warrants certificates in respect of the Consideration
Warrants to which such A Group Shareholder is entitled;
9.3.3 a certified copy of the resolution of the Purchaser
authorising the allotment and issue of the Consideration Shares
and the creation and issue of the Consideration Warrants
pursuant to the deed poll of the Purchaser in the agreed form;
and
9.4 The A Group Shareholders shall procure that a meeting of the
directors of the Company is held on the Completion Date or as soon as
reasonably practicable following Completion and in any event within 7
days of the Completion Date at which the directors shall approve for
registration the transfers of the Shares and the Warrants to the
Purchaser made in exchange for the shares and warrants in the Purchaser.
9.5 On and from Completion each of the Parties shall comply with its
obligations under Clauses 5, 6, 7 and 8 of this Agreement.
10. Warranties
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10.1 The A Group Shareholders warrant to the Purchaser that save as
Disclosed each of the statements set out in Part 1 of Schedule 2 is true
and accurate in all material respects.
10.2 Liability for the A Group Warranties on the part of the A Group
Shareholders shall be joint and several subject to the limitations set
out in Clause 11 below,
10.3 Each of BG and the Purchaser warrants to the Shareholders that
save as disclosed in the BG Disclosure Letter each of the statements set
out in Part 2 of Schedule 2 is true and accurate in all material
respects.
11. Limitations on Warranty Claims
-------------------------------
11.1 The Purchaser acknowledges and agrees with the A Group
Shareholders that;
11.1.1 the A Group Warranties are the only warranties of any
kind given by the A Group Shareholders upon which the Purchaser'
may rely pursuant to this Agreement; and;
11.1.3 at the time of entering in this agreement neither the
Purchaser nor BG is aware of any matter or thing which is
inconsistent with the A Group Warranties or constitutes a breach
of any of them.
11.2 The liability of the A Group Shareholder's under or in respect
of the A Group Warranties shall be limited as follows:
11.2.1 the A Group Shareholders shall not be liable in respect
of any Claim unless the amount of the Claim (or a series of
Connected Claims) exceeds US$10,000 and for the purposes of this
Clause 11 a Claim is connected with another Claim if they all
arise out of the occurrence of the same event or relate to the
same subject matter;
11.2.2 the A Group Shareholders shall not be liable in respect
of any Claim unless the amount of all Claims that are not
excluded under Clause 11.2.1 when taken together exceeds
US$50,000, and the A Group Shareholders shall be liable for the
full amount recoverable subject to the limitations of this
Clause;
11.2.3 the maximum aggregate liability of the A Group
Shareholder's for any Claims shall not exceed US$500,000;
11.2.4 the maximum aggregate liability of each of the A Group
Shareholders in respect of all and any Claims shall not exceed
the amount set out their respective name below:
Xxxxxx Xxxx US$100,000
Xxxxxxx Xxxxxxxx US$100,000
Xxxxx Xxxxxxx US$100,000
Xxxxxx Xxxxxxx US$100,000
Xxxxxx Xxxxxx US$100,000
11.3 Except for Claims arising out of matters relating to taxes the A
Group Shareholders shall cease to have any liability under or in respect
of the A Group Warranties on the date which is 18 calendar months after
the date of this Agreement, except in respect of a Claim of which the
Purchaser has given written notice to the A Group Shareholders before
such date. The liability of the A Group Shareholders in respect of any
Claim of which notice is given by the Purchaser pursuant to this Clause
shall terminate absolutely if proceedings in respect of the Claim have
not been commenced within six months of date of service of the notice of
that Claim under' this Clause. In the case of Claims relating to taxes,
the A Group Shareholders shall cease to have any liability under or in
respect of the A Group Warranties on the date which is 7 years after the
date of this Agreement, except in respect of a Claim of which the
Purchaser has given written notice to the A Group Shareholders before
such date. The liability of the A Group Shareholders in respect of any
Claim relating to taxes of
which notice is given by the Purchaser pursuant to this Clause
shall terminate absolutely if proceedings in respect of the Claim have
not been commenced within six months of date of service of the notice of
that Claim under this Clause.
11.4 If, in respect of any matter which would otherwise give rise to
a breach of the A Group Warranties, the Purchaser and/or the Company
and/or any of its Subsidiaries is entitled to make a claim under any
policy of insurance, the amount of insurance monies to which the
Purchaser and or the Company shall be entitled shall reduce pro tanto or
shall extinguish the claim for breach of the A Group Warranties.
11.5 The limitations on Claims as set out in this Clause 11.1, 11.2
(excluding sub-Clause 11.2.4), 11.3 and the offset applied by 11.4 above
shall apply equally to any Claims made by any Shareholder against BG
and/or the Purchaser and such Clauses shall apply mutatis mutandis to
any such Claims. For the avoidance of doubt, any such Claims against BG
and/or the Purchaser would be limited to a maximum liability of
US$500,000.
11.6 The A Group Shareholders expressly acknowledge that neither BG
nor the Purchaser nor the Purchaser's officers or agents has agreed,
warranted or represented or provided any assurance to them with respect
to the tax implications of the transactions which are the subject of
this Agreement or arising out of implementation of this Agreement.
11.7 Each of the A Group Shareholders agrees with the Purchaser and
BG that whilst he remains a director of the Purchaser responsibility for
all matters relating to any Claim by the Purchaser under the A Group
Warranties shall be delegated to a committee of the board of the
Purchaser comprising exclusively of independent directors (not being a
member of the family of any A Group Shareholder) of the Purchaser and in
the absence of any independent director of the Purchaser conduct of the
enforcement of such Claim will be delegated to BG.
12. US Security Act Provisions,
-------------------------------
12.1 All Parties have agreed that the Stock Units transferred and/or
allotted to the A Group Shareholders or issued pursuant to the exercise
of Warrants are not transferred or allotted with the present view
towards the distribution thereof. The A Group Shareholders covenant with
BG and the Purchaser that they will not dispose of Stock Units in the
Purchaser except:
12.1.1 pursuant to an effective registration statement under
the Securities Act of 1933, as amended; and/or;
12.1.2 in any other transaction which is exempt from
registration under the Securities Act of 1933, as amended, and
complies with the rules and regulations of the Securities and
Exchange Commission.
12.2 In order to implement and enforce the above covenant an
appropriate endorsement will be placed upon each of the
certificates of Stock Units at the time of distribution of those
certificates and stop transfer instructions shall be placed with
the transfer agent for the Stock Units.
12.3 Each A Group Shareholder acknowledges that it is aware that
Stock Units in the Purchaser transferred or allotted will not have been
registered pursuant to the Securities Act of 1933, as amended; and,
therefore, under current interpretations and applicable rules, each A
Group Shareholder will probably have to retain such Stock Units for a
period of at least one year and at the expiration of the one year period
sales may be confined to brokerage transactions of limited amounts
requiring certain notification filings with the Securities and Exchange
Commission.
12.4 Each A Group Shareholder acknowledges that it is aware the
common shares issued upon the exercise of the warrants issued by the
Purchaser will be subject to the resale restrictions under Rule 144 of
United States Securities Act of 1933. As the common shares issued upon
the exercise of warrants will not be issued pursuant to a registration
statement the certificates representing the common shares will be
stamped with a legend placing certain restrictions on transfer. The
Stock Units will be deemed restricted and cannot be resold for at least
one year from the date of issue. Thereafter, sales of such common shares
will generally not be permitted unless:
12.4.1 a public trading market then exists for the Stock Units
of the Purchaser; and;
12.4.2 adequate information concerning the Purchaser is then
available to the public; and;
12.4.3 the proposed disposition does not exceed more than 1% of
the outstanding common shares of the Purchaser in any 90 days
period.
12.5 To the extent that the restrictions set out in Clause 4 cease to
apply to any Consideration Shares and provided the above conditions for
sale are met, an A Group Shareholder may contact the board of the
Purchaser, and the Purchaser and its solicitor will arrange to have the
restrictive legend removed for the amount of shares they are permitted
to sell pursuant to the restrictions on sale provided in this Agreement,
provided that the Purchaser may, in the opinion of the solicitor to the
Purchaser, lawfully remove such legend.
13. Taxation
--------
13.1 The Parties intend that the acquisition of the Shares and
Warrants in exchange for the Consideration Shares and the Consideration
Warrants shall be a "tax free" exchange transaction pursuant to Section
368 (a)(i)(b) of the Internal Revenue code of the United States of
America.
13.2 The Parties acknowledge that stamp duty of 0.5% will be payable
on the stock transfer forms transferring the Shares and the Warrants to
the Purchaser and that such stamp duty will be payable by the Purchaser.
14. Termination
-----------
14.1 If the A Group Shareholders or the Purchaser fail to carry out
any of their obligations or to deliver any of the documents which they
respectively agree to deliver on Completion either party shall be
entitled to terminate this Agreement by service of a notice in writing
on the other before Completion but not otherwise.
15. Whole Agreement
---------------
15.1 This Agreement and the documents referred to in it contain the
whole agreement between the Parties relating to the transactions
contemplated by this Agreement and supersede all previous agreements
between the Parties relating to those transactions.
15.2 Each of the Parties acknowledges that, in agreeing to enter into
this Agreement, it has not relied on any representation, warranty,
undertaking or other assurance except those set out in this Agreement,
16. Third Party Rights
------------------
16.1 Subject to Clause 17.2, this Agreement and the documents
referred to in it are made for the benefit of the Parties and their
successors and permitted assigns and are not intended to benefit, or be
enforceable by, anyone else.
16.2 The provisions of Clause 7 and 10.3 are intended to benefit all
Shareholders, including the A Group Shareholders and shall be
enforceable by them to the fullest extent permitted by law provided that
no Shareholder other than an A Group Shareholder shall be permitted to
bring any Claim against BG and/or the Purchaser in respect of Clause 7
or Clause 10.3 without the written consent of a majority of the A Group
Shareholders.
17. Notices
-------
17.1 Any notice or other document to be served under this Agreement
may be delivered or set by first class recorded delivery post or telex
or facsimile process to the Party to be served at its address appearing
in this Agreement or at such other address as it may have notified to
the other Parties in accordance with this clause.
17.2 In proving service of a notice or document it shall be
sufficient to prove that delivery was made or that the envelope
containing the notice or document was properly addressed and posted as a
prepaid first class recorded delivery letter or that the telex or
facsimile message was properly addressed and despatched and the correct
answerback or identity code is received as the case may be.
18. General
-------
18.1 Each of the obligations and undertakings set out in this
Agreement which is not fully performed at Completion will continue in
force after Completion.
18.2 None of the Parties shall be entitled to assign or transfer its
rights or obligations under this Agreement without the prior written
consent of the other Parties.
18.3 Any announcements concerning the transaction provided for in
this Agreement by or on behalf of BG, the A Group Shareholders, the
Purchaser or the Company shall be subject to the approval of the others
except that the approval of the A Group Shareholders shall not be
required as to any statements or information which the Purchaser submits
to its stockholders.
19, Governing Law and Jurisdiction
------------------------------
19.1 This Agreement is governed by, and shall be construed in
accordance with the laws of England. The Parties acknowledge that
matters of corporate law and governance may be subject to application of
the laws of the state of Nevada USA and/or US federal state laws or
regulations governing securities transactions, Any such issues in
relation to Nevada/US law arising in disputes between the Parties shall
be determined by the English courts based on expert evidence.
19.2 BG and the Purchaser submits to the exclusive jurisdiction of
the English courts for. all purposes relating to this Agreement.
AS WITNESS WHEREOF this Agreement has been signed by and on behalf of the
Parties the day and year first before written
Signed by XXXXX XXXXXXX ) /s/ XXXXX XXXXXXX
in the prince of )
WITNESS SIGNATURE: /s/ Xxxxxx Xxxxxxx
WITNESS NAME: Xxxxxx Xxxxxxx
WITNESS ADDRESS: 00000 Xxxxx Xxxx XX, Xxxxxxx Xxxxx 00000
Signed by XXXX XXXXXXXX )/s/ XXXX XXXXXXXX
in the presence of )
WITNESS SIGNATURE: /s/ Xxxxxxx Xxxxxx
WITNESS NAME: Xxxxxxx Xxxxxx
WITNESS ADDRESS: 7 Dilynn, London EU GLB
Signed by XXXXXX XXXX ) /s/ XXXXXX XXXX
in the presence of )
WITNESS SIGNATURE: /s/ Xxxxxxx Xxxxxx
WITNESS NAME: Xxxxxxx Xxxxxx
WITNESS ADDRESS: 7 Dilynn, London EU GLB
Signed by XXXXXX XXXXXXX )/s/ XXXXXX XXXXXXX
in the presence of )
WITNESS SIGNATURE: /s/ Xxxxxxx Xxxxxx
WITNESS NAME: Xxxxxxx Xxxxxx
WITNESS ADDRESS: 7 Dilynn, London EU GLB
Signed by XXXXXX XXXXXX )/s/ XXXXXX XXXXXX
in the presence of )
WITNESS SIGNATURE: /s/ Xxxxxxx Xxxxxx
WITNESS NAME: Xxxxxxx Xxxxxx
WITNESS ADDRESS: 7 Dilynn, London EU GLB
Signed by
for and on behalf of /s/ Xxxx Xxxxxx
XXXXXX GROUP INC
in the presence of )
WITNESS SIGNATURE: /s/ Xxxxxx Xxxxxx
WITNESS NAME: Xxxxxx Xxxxxx
WITNESS ADDRESS: 0000 Xxxxxxx XX. xXXXXXXXX , XX X0X0X0
Signed by
for and on behalf of /s/ Xxxx Xxxxxx
INDEX OIL AND GAS INC.
in the presence of )
WITNESS SIGNATURE: /s/ Xxxxxx Xxxxxx
WITNESS NAME: Xxxxxx Xxxxxx
WITNESS ADDRESS: 0000 Xxxxxxx XX. xXXXXXXXX , XX X0X0X0
The Group A Shareholders
Shares & Warrants
Consideration Shares and Consideration Warrants
Name No of No of Consideration Consideration
Shares Warrants Shares Warrants
Xxxxxx Xxxx 1,383,142 93,238 3,951,442 266,380
Xxxxxxxx Xxxx,
Xxxxxx Xxxxxx,
Xxxxxxxx,
Xxxxxxxxxxxxxxx,
XX00 0XX
Xxxxxxx Xxxxxxxx 858,507 11,584 2,452,634 33,095
00 Xxxxxx Xxxxx,
Xxxx,
Xxxxxxxxxxxx,
XX00 0XX
Xxxxx Xxxxxxx 346,294 4,389 989,313 12,539
00000 Xxxxx Xxxx
Xxxxx,
Xxxxxxx,
Xxxxx 00000,
XXX
Xxxxxx Xxxxxxx 361,312 43,573 1,032,217 124,482
00 Xxxxxxx Xxxxx,
Xx Xxxxxx,
Xxxxxxxxxxxxx,
XX0 0XX
Xxxxxx Xxxxxx 130,000 23,333 371,391 66,662
New Hextalls West,
Hextalls Lane,
Bletchingley,
Surrey Ml 4OT
1. A Group Warranties
1.1 The Company is a company validly existing under the laws of England with
full power to conduct its business as presently conducted and is duly
entitled either directly or through the Subsidiaries to conduct its
business in any jurisdiction or locality in which it currently operates.
1.2 The issued and allotted share capital of the Company comprises 7,916,232
ordinary shares of lop each. The Company has issued and there remain
outstanding 333,923 warrants of the Company, each of which entitles the
holder to subscribe for one ordinary share of 10p each in the capital of
the Company, such warrants being constituted pursuant to the deed poll
of the Company dated 9 September 2005, a copy of which is Disclosed.
1.3 The statutory books of the Company contain a list of the current
directors, secretaries and shareholders of the Company and have been
kept up to date and maintained in accordance with the requirements of
English law and all statutory filings have been made on time and without
penalty.
1.4 The Subsidiaries are wholly owned subsidiary undertakings of the Company
and there are no other companies in which the Company has an interest.
1.5 The execution and delivery of this Agreement by the A Group Shareholders
does not contravene any provision of the Company's Memorandum and
Articles of Association or any provision thereof, or result in the
acceleration of any obligation under, any mortgage, lien, lease,
agreement, instrument, court order, arbitration award, judgement or
decree to which the Company is a party, or by which it is bound, and so
far as the A Group Shareholders are aware will not contravene any other
restriction of any kind or character to which the Company is subject.
1.6 The management accounts of the Company which are Disclosed (the
"Management Accounts") were prepared on a basis consistent with those
adopted in the preparation of the audited financial statements of the
Company for the period ended 31 March 2004 and in accordance with UK
Generally Accepted Accounting Principles and fairly present the assets
and liabilities and the profits and losses of the Company as at and for
the period to 30 September 2005 (the "Management Accounts Date") .
1.7 All accounts receivable (net of reserves for doubtful payments if any)
as shown in the Management Accounts and any such accounts receivable
becoming due since the Management Accounts Date are collectable in the
normal course of business.
1.8 The Company has good and marketable title to all of its assets, business
and properties including, without limitation, all such properties
reflected in the balance sheet as of the Statement Date (except as
disposed of in the normal course of business since the Statement Date)
free and clear of any mortgage, lien, pledge, charge, claim or
encumbrance, except as shown on the balance sheet as of the Statement
Date and, in the case of real properties except for rights of way and
easements which do not adversely affect the use of such property.
1.9 The Company is either the owner of or' entitled to the benefit of the
oil and gas leases, contracts, agreements and licences and/or other
arrangements more particularly set out in Schedule A to a Letter of
Intent dated 22"d November 2005 entered into between the Company and BG.
1.10 There are no material liabilities of the Company, whether accrued,
absolute, contingent or otherwise, which arose before, or relate to any
transaction of the Company occurring prior to, the Management Accounts
Date, which are not disclosed by or reflected in the Management
Accounts, There are no such liabilities of the Company which have arisen
or relate to any transaction of the Company occurring since the
Management Accounts Date, other than normal liabilities incurred in the
normal conduct of the business of the Company, and none of which have a
material adverse effect on the business or financial condition of the
Company
1.11 Since the Statement Date:-
1.11.1 there have been no material and adverse change in the financial
or trading position of the Company;
1.11.2 the business of the Company has been carried on in the ordinary
course;
1.11.3 no dividend or other distribution has been declared, paid or
made by the Company;
1.11.4 no loans or extensions to existing loans have been incurred;
1.11.5 no material changes have been made to the emoluments of
employment of any employees or fees paid to directors;
1.11.6 no capital commitments have been entered into by the Company to
spend monies in excess of US$50,000.
1.11.7 The Company has submitted all returns and supplied all
information and given all notices to the Inland Revenue and HM
Customs and Excise and all other relevant taxation or excise
authorities whether of the United Kingdom or any other
jurisdiction as reasonably required by law and none of such
returns are, so far as the A Group Shareholders are aware, the
subject of any material despite nor so far as the A Group
Shareholders are aware are likely to become the subject of any
material dispute. All corporation tax, capital gains tax, income
tax deductions, national insurance contributions and all foreign
taxes contributions and levies properly due and payable have
been fully paid and discharged and there are no unpaid taxes
and/or contributions which are or which could become a charge on
the Company's assets except as provided in the Management
Accounts.
1.12 So far as the A Group Shareholders are aware, the Company has obtained
all material licences, permissions, authorisations and consents required
for the carrying on of the business now carried on by the Company in the
places and in the manner in which the business is now carried on.
1.13 The Company has not received notice that it is in default under any
material licence, permission, authorisation or consent.
1.14 The Company has not received notice that it is in violation of, or in
default with respect to any statute, regulation, order, decree or
judgement of any court or any governmental agency of the jurisdiction in
which it is incorporated which could have a material and adverse effect
upon its assets or its business.
1.15 The Company has not received any written notice that it is in violation
of any environmental law in any jurisdiction in which it operates and
the Company is not the subject of any litigation concerning
environmental law nor has it received any correspondence whatsoever'
that it reasonably believes might precede such litigation.
1.16 The Company is either the owner of or in possession of duly executed and
enforceable licences in respect of all intellectual property which it
uses in the course of its business and no notice has been received that
the Company or its operations are in breach of any third party
intellectual property rights.
2. The Purchaser Warranties
2.1 The Purchaser is a corporation duly organised, validly existing and in
good standing under the laws of the State of Nevada, USA with full power
and authority to enter into and perform the transactions contemplated by
this Agreement, and with all requisite corporate power and authority to
own, operate and lease its properties and to carry on its business, and
is not subject to any agreement, commitment or understanding which
restricts or may restrict the conduct of its business in any
jurisdiction or location.
2.2 The Purchaser is listed and registered as a company on the NASDAQ OTC
Bulletin Board and is compliant with all rules and regulations issued by
relevant regulatory authorities.
2.3 The outstanding shares of the Purchaser are legally and validly issued,
fully paid and non-assessable. Save pursuant to the Private Placing, no
right has been granted to any person to require the Purchaser to issue
any share or loan capital and no Encumbrance has been created in favour
of any person affecting any unissued shares or debentures or other
unissued securities of the Purchaser.
2.4 The minute book of the Purchaser contains complete and accurate records
of all meetings and other corporate actions of the shareholders and the
board of directors (and any committee thereof) of the Purchaser. The
books and records of the Purchaser required to be maintained by it have
been kept up to date and maintained in accordance with the requirements
of all applicable laws and all filings required to be made by the
Purchaser under all applicable laws have been made on time and without
penalty.
2.5 The shares of common stock of the Purchaser when allotted to the
Shareholders will have been duly and validly authorised and issued by
the Purchaser and will be fully paid and non assessable.
2.6 The minute book contains a list of the officers, directors and
shareholder's of the Purchaser and copies of the articles of
incorporation and by-laws currently in effect of the Purchaser have been
delivered to the Purchaser and are Disclosed.
2.7 The execution and delivery of this Agreement does not, and the
consummation of the transaction contemplated hereby will not violate any
provision of the articles of incorporation or' byelaws of the Purchaser,
or any provisions thereof, or result in the acceleration of any
obligation under, any mortgage, lien, lease, agreement, instrument,
court order, arbitration award, judgment or' decree to which the
Purchaser
is a party, or by which it is bound, and will not violate any other
restriction of any kind or character to which it is subject..
2.8 The authorised capital stock of the Purchaser is 75,000,000 units of
stock of US$0.001 each, of which 23,092,000 shares of such stock are
issued and outstanding and beneficially owned and registered in the name
of BG.
2.9 On Completion the Purchaser will have no debts or other liabilities of
whatsoever nature.
2.10 Purchaser has taken all necessary steps to comply with all applicable
state and federal securities laws and regulations and to the best of
BG's and the Purchaser's knowledge there is no litigation, arbitration,
governmental or other proceeding (formal or informal) claim or
investigation pending or threatened, with respect to the Purchasers
compliance with any and all applicable securities laws and regulations.
The Purchaser has in the conduct of its business and (without limiting
the foregoing) in effecting the Private Placing complied with all
applicable laws, regulations and codes of conduct (whether statutory or
otherwise) of all relevant jurisdictions and no governmental or official
investigation or enquiry concerning the Purchaser is in progress or
threatened and there are no circumstances which are likely to give rise
to any such investigation or enquiry.
2.11 The execution and performance of this Agreement and the issuance of
stock contemplated hereby, including stock that may be issued upon the
exercise of any option agreements, has been authorised by the board of
directors of Purchaser.
2.12 The Shareholders have been provided with statements concerning the
financial position of the Purchaser. Since the date of the Management
Accounts, except as disclosed in writing, there has not been any
material change in the financial position or assets of the Purchaser.
2.13 The information contained in all announcements made by or on behalf of
the Purchaser since 22 November 2005 is true complete and accurate in
all material respects_
2.14 The Purchaser has no employees.
Schedule 3
List of Subsidiaries
Index Investments North America Inc
Index Oil & Gas (USA), LLC
Index Offshore, LLC
All with a business address of 00,000 Xxxxxxxx Xxxxx, Xxxxx 000, Xxxxxxx, Xxxxx
00000, XXX
-18-
Schedule 4
Warrant Instrument
