Exhibit 10.2(B)
EXHIBIT A
November 30, 1998
Horizontal Ventures, Inc.
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
Attn: Xx. Xxxxxxx X. Xxxxxx, President
Re: Common Stock Purchase Agreement (the "Purchase Agreement") Dated October
_____, 1998 Between Saba Petroleum Company, a Delaware corporation (the
"Company"), and Horizontal Ventures, Inc., a Colorado corporation ("HVI")
Dear Xx. Xxxxxx:
I am General Counsel to the Company and as such I have
represented the Company in connection with the Purchase Agreement, pursuant to
which the Company has agreed to sell and issue to HVI an aggregate of 2,500,000
shares of its $.001 par value common stock (the "Common Stock"). In connection
with the foregoing, HVI has requested my legal opinion hereinafter set forth.
In rendering this opinion, I have reviewed the Purchase
Agreement, examined originals or copies certified to my satisfaction of all
corporate records of the Company and examined such other agreements and
documents relating to the Company and certificates of officers of the Company
and matters of law that I have deemed necessary as a basis for the opinion
hereafter expressed. Further, I have assumed the genuineness of all signatures
or documents not signed in my presence and the authenticity of all documents
submitted to me as originals and the conformity with the originals of all
documents submitted to me as copies. As to all matters of fact, I have relied
exclusively on the certificate attached hereto and upon written or oral advices
of public officials. This opinion is rendered pursuant to Section 4.1(2) of the
Purchase Agreement. All capitalized terms used but not defined herein shall have
the meanings ascribed to them in the Purchase Agreement.
Based upon and subject to the foregoing, I am of the opinion
that:
Horizontal Ventures, Inc.
November 30, 1998
Page 26
1. The Company is a corporation duly organized and validly
existing and in good standing other than with respect to its non-payment of
Franchise Tax, under the laws of the State of Delaware. It has all requisite
corporate power and authority to carry on its business as now being conducted,
to enter into the Purchase Agreement and to carry out and perform the terms and
provisions of the Purchase Agreement. The Company is duly qualified to do
business and is in good standing in each jurisdiction in which the failure to be
so qualified would have a material adverse effect on the condition (financial or
otherwise), business, net worth, assets (including intangible assets),
properties or operations ("Material Adverse Effect") of the Company.
2. The Company is duly and lawfully authorized by its
Certificate of Incorporation, as amended, to issue 150 million Shares of Common
Stock, of which _____________ Shares are issued and outstanding. Additionally,
the Company is authorized to issue 50 million shares of preferred stock of which
8,000 shares are designated Series A Convertible Preferred Stock and are issued
and outstanding. The Company has no treasury stock and no other authorized
series or class of stock. All the outstanding shares of Common Stock and Series
A Convertible Preferred Stock have been duly authorized and validly issued and
are fully paid and nonassessable and, subject to the qualification noted in the
Company's Report on Form 10-K for the year 1996, free of preemptive rights.
Except as listed on Schedule 3.1(2)(a) attached to the Purchase Agreement, the
Company is not obligated to issue any additional common or preferred stock as a
result of any options, warrants, rights, conversion rights, obligations upon
default, subscription agreements or other obligations of any kind. All Shares to
be issued pursuant to the Purchase Agreement to HVI have been duly authorized by
all other necessary corporate action, validly issued, fully paid, nonassessable,
issued in compliance with state and federal securities laws and based upon the
representations of HVI in the Purchase Agreement in compliance with the
exemptions promulgated under the Securities Act of 1933, as amended.
3. The execution, delivery, and performance of the Purchase
Agreement has been duly authorized by all requisite corporate action. The
Purchase Agreement constitutes a valid and binding obligation of the Company
enforceable in accordance with its terms (except as limited by bankruptcy,
insolvency, other laws affecting the enforcement of creditors' rights and
matters of public policy). The execution, delivery and performance of the
Purchase Agreement will not conflict with any provision of the Certificate of
Incorporation and any amendments thereto, Bylaws and any amendments thereto, or
any contract of which I am aware to which the Company is a party or otherwise
bound.
4. Except as disclosed in the Financial Statements or in
Schedule 3 attached to the Purchase Agreement, there are no legal actions,
suits, arbitrations, or other legal or administrative proceedings pending or
threatened in writing of which I have knowledge against the Company which would
reasonably be expected to have a material adverse effect upon it, its
properties, assets, or business..
This is a legal opinion. I am relying on the factual
representations made by officers of the Company and representations of the
Company contained in the Purchase Agreement, and I make no representation of
fact herein. This opinion is solely for the benefit of HVI in connection with
the transactions referred to herein and may not be relied on by, in whole or in
part, nor may copies be delivered to, any other person or entity without my
prior written consent.
The opinions expressed herein are qualified by the matters disclosed in
the Company's publicly filed reports. Knowledge as I have used the term herein,
means actual knowledge of the fact or circumstance imparted to me in writing.
This opinion is limited to matters occurring up to the date hereof. I undertake
no obligation to supplement this opinion for matters occurring after the date
hereof.
Very truly yours,
