Exhibit 2.4
PROJECT DEVELOPMENT AGREEMENT
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This Project Development Agreement (this "Agreement"), dated
January 7, 2005, is made and entered into by and between Sonerra
Resources Corporation ("Sonerra"), a Texas corporation, whose
address is P. O. Xxx 000000, Xxxxxxxxxxx, Xxxxx 00000-0000, and
Nacogdoches Gas, L.L.C. ("Nacogdoches Gas"), a New Hampshire
limited liability company, whose address is 0 Xxx Xxxxxxxxx
Xxxxxx, Xxxxx 000, Xxxxxxxxxx, XX 00000.
Sonerra currently owns and/or is acquiring from its
affiliate, Pinnacle Energy Group, L.C., a Texas limited liability
company ("Pinnacle"), and/or other third parties, certain
undivided leasehold working interests in and to oil, gas and
mineral leases and will continue to acquire oil, gas and mineral
leases within the area outlined and shaded in yellow on Exhibit
"A" attached hereto (the "Project Area") which Sonerra has
identified as being prospective for hydrocarbon production. The
Project Area may be expanded or otherwise amended by written
consent of the parties hereto.
Sonerra and Nacogdoches Gas desire to set forth the terms
under which Nacogdoches Gas shall acquire undivided leasehold
working interests in oil, gas and mineral leases and participate
in the drilling and development of xxxxx on such leasehold
interests within the Project Area. The development by Sonerra
and Nacogdoches Gas shall include the drilling of three (3)
prospect xxxxx, within the Project Area (the "Phase I Xxxxx") and
options for the drilling of up to five (5) separate sets of three
(3) prospect xxxxx each, within the Project Area (the "Optional
Xxxxx"), in accordance with the terms and conditions set forth
herein. Each of the separate Phase I Xxxxx and Optional Xxxxx
(if any) are sometimes hereinafter referred to as a "Project
Well".
NOW THEREFORE, in consideration of the mutual covenants and
agreements hereinafter set forth, it is agreed by the parties as
follows, to wit:
I. PROJECT RESPONSIBILITIES.
A. Sonerra shall act as operator of both the Phase I Xxxxx and
the Optional Xxxxx. As operator, Sonerra shall be responsible for
(i) acquiring the oil and gas leases within the Project Area,
(ii) conducting such geological and geophysical analysis of the
Project Area as may be required to identify various drilling
prospects that are to be explored and developed and the
corresponding location and objective(s) of each Project Well to
be drilled in the Project Area, (iii) conducting all drilling,
completion and producing operations and (iv) installing, managing
and operating the gas gathering, transportation and marketing
facilities, in the Project Area.
B. Nacogdoches Gas shall provide financing for the Allocated
Funding Percentage (as hereinafter defined) of the Total Prospect
Costs (as hereinafter defined) for each Project Well. For the
purposes of this agreement, the term "Total Prospect Costs" shall
be defined as (i) the reasonable Acreage Consideration and G&G
costs (each as defined or set forth in the Participation
Agreement (hereinafter described) pertaining to each specific
Project Well), and (ii) the actual costs of all drilling,
testing, completing and equipping (including the costs of
installing any gas gathering facilities and the wellhead
production meter) of or for a Project Well.
C. The specific rights and obligations of Sonerra, as
operator, and Nacogdoches Gas, as participant, for each
Project Well (including applicable standards of
conduct) shall be set forth in the Participation
Agreement that is executed for each such respective
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Project Well. The terms of the Participation Agreement
for each Project Well shall grant Nacogdoches Gas the
right, subject, however, to the specific limitations
and conditions contained therein, to participate in the
in-field development drilling of the proven undeveloped
locations ("PUDs") relative to any such Project Well.
The Participation Agreement for each Project Well shall
be substantially similar in form and content to the
terms of the exemplar Participation Agreement attached
hereto as Exhibit B. This Agreement and the agreements
contemplated herein include all horizons, intervals or
formations to the extent stated in the Participation
Agreement for each Project Well.
II. PHASE I XXXXX.
Sonerra agrees to drill and complete and Nacogdoches
Gas agrees to finance three (3) Phase I Xxxxx at
locations of Sonerra's choice within the Project Area
as follows:
1. Completion of Phase I Xxxxx. Sonerra shall make
good faith efforts to drill and complete the Phase
I Xxxxx not later than 120 days after the
Effective Date.
2. Allocated Funding Percentage. For each of the
Phase I Xxxxx, Nacogdoches Gas shall fund 100%
of the Total Prospect Costs for each Phase I Well,
less the total percentage funded by any current
Sonerra investors, if any (which, in the
aggregate, such funding by the current Sonerra
investors shall not exceed 25% of the Total
Prospect Costs of any Phase I Well). The resulting
total net percentage of the Total Prospect Costs
of each respective Phase I Well to be funded by
Nacogdoches Gas shall be defined as the "Allocated
Funding Percentage".
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3. Funding. Nacogdoches Gas shall provide the
Allocated Funding Percentage of the Estimated
Total Prospect Costs (hereinafter defined) for
each Phase I Well within fifteen (15) days of the
receipt from Sonerra of (i) notification of (a)
the Allocated Funding Percentage and (b) the
Estimated Total Prospect Costs, and (ii) the
Participation Agreement pertaining to each such
Phase I Well. As used herein, the term "Estimated
Total Prospect Costs" shall be defined as a
reasonable estimate of the ultimate actual Total
Prospect Costs to be determined by Sonerra for
each separate Project Well, prior to the actual
drilling of each such Project Well. If after the
drilling and completion of any Project Well, the
Estimated Total Prospect Costs (i) are found to be
in excess of the actual Total Prospect Costs or
(ii) are found to be less than the actual Total
Prospect Cost, the refund of excess funding by
Sonerra to Nacogdoches Gas or the funding of
additional costs to Sonerra by Nacogdoches Gas
relative to such Project Well, shall occur in
accordance with the terms contained within the
Participation Agreement pertaining to such
matters.
III. THE SUNSTONE INTERESTS. In addition to financing its
Allocated Funding Percentage of the Total Project Costs
of the Phase I Xxxxx, Nacogdoches Gas agrees to finance
100% of the purchase price, up to, but not exceeding
$3.45 million, for the acquisition by Sonerra of the oil
and gas interests, properties and assets within the
Project Area, currently owned by SunStone Corporation
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(the "SunStone Interests"), as more particularly
described in Exhibit "C" attached hereto. The terms of
financing and acquisition of the SunStone Interests shall
be definitively set forth in a separate written agreement
between the parties hereto.
IV. OPTIONAL XXXXX. Within two (2) years after the Effective
Date, Sonerra shall propose to Nacogdoches Gas, five (5)
separate sets containing three (3) Project Xxxxx each
("the Optional Well Sets"). Nacogdoches Gas shall have
the option (but not the obligation) to provide financing
for the Total Prospect Costs for all of the Project Xxxxx
contained within each of the Optional Well Sets upon the
same basis and subject to the same terms as provided for
and with respect to the Phase I Xxxxx, including, but not
limited to, Article II. 2. (Allocated Funding) and
Article II. 3. hereof (Funding), but exclusive, however,
of Article II. 1. hereof (Completion of Phase I Xxxxx).
Sonerra shall provide a written proposal to Nacogdoches
Gas for each Optional Well Set, which shall contain
sufficient information for Nacogdoches Gas to make an
informed decision regarding such proposal. In order to
exercise its option to participate in the drilling of and
provide financing for an Optional Well Set, Nacogdoches
Gas shall provide written notice that it will provide
financing for the Optional Well Set in accordance with
the terms hereof within twenty (20) days of receipt of
Sonerra's written proposal. Sonerra and Nacogdoches Gas
agree that the written proposals for the Optional Well
Sets shall be presented to Nacogdoches Gas separately and
sequentially to enable Nacogdoches Gas to exercise its
option with respect to each Optional Well Set. The
written proposal for an Optional Well Set will be
presented to Nacogdoches Gas after the completion of
drilling operations on the second well and prior to the
completion of the third well of the prior Optional Well
Set. Notwithstanding any of the foregoing, if
Nacogdoches Gas elects not or is deemed to have elected
not to exercise its option with respect to any Optional
Well
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Set, the rights of Nacogdoches Gas to participate in
future xxxxx shall automatically terminate and Sonerra
shall be relieved of its obligation to propose any
additional Optional Well Sets, provided, however, this
agreement shall remain in full force and effect with
respect to all Project Xxxxx previously financed by
Nacogdoches Gas. This Agreement may be extended by the
written agreement of the parties hereto for additional
Optional Well Sets.
V. BALANCE ACCOUNT. Sonerra shall maintain an account,
referred to herein as the "Balance Account", which shall
tabulate and track on a continuous basis the net balance
occurring as the difference between the (i) the
Cumulative Project Costs, hereinafter defined, and (ii)
the Cumulative Project Proceeds, as hereinafter defined,
until Project Payout, as hereinafter defined. Sonerra
shall furnish to Nacogdoches Gas a monthly Balance
Account statement, which shall reflect all activity
occurring in the Balance Account for the previous month
period and the current net balance.
A. Project Interests. The Project Interests shall include
(i) all Phase I Xxxxx, (ii) all Optional Xxxxx
(collectively with the Phase I Xxxxx, the "Project
Xxxxx"), and (iii) the SunStone Interests, which
together with the Project Xxxxx shall be referred to
herein as the "Project Interests".
B. Cumulative Project Costs. "Cumulative Project Costs"
are the sum of (i) the Allocated Funding Percentage of
the Total Prospect Costs for the aggregate of all
Project Xxxxx, (ii) the purchase price of the SunStone
Interests plus an amount equal to 10% of the actual
purchase price of the SunStone Interests, and (iii)
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all workover and/or recompletion costs paid by
Nacogdoches Gas prior to Project Payout (as hereinafter
defined), other than costs deducted from gross
proceeds. All costs and expenses of drilling,
completing, equipping, and operating (provided,
however, Operator's overhead rates or fees set forth in
the Participation Agreement or Operating Agreement
shall be at such designated rates) any Project Well
under this Agreement included in the Balance Account
shall be at Sonerra's actual cost.
C. Cumulative Project Proceeds. "Cumulative Project
Proceeds" are the sum of (i) the gross proceeds from
oil and gas production received by Nacogdoches Gas from
the Project Interests, after deducting (a) severance,
production, windfall profit, ad valorem and other
similar taxes payable on such production, (b) lessor's
royalties, overriding royalties and like burdens with
which the leasehold interests are burdened (provided
that Sonerra shall not reduce the net revenue interest
to less than the net revenue interest stated in the
Participation Agreement for each Project Well), (c)
Nacogdoches Gas' Ownership Interest (as hereinafter
defined) share of the cost of operating the Project
Xxxxx and Nacogdoches Gas' share of the cost of
operating the SunStone Interests during the period
prior to Project Payout and (ii) all other revenue or
proceeds (if any) received by Nacogdoches Gas and
attributable to its ownership of or otherwise in any
way relating to the Project Interests, including (a)
any excess funds reimbursed by Sonerra to Nacogdoches
Gas relative to the drilling, completion and
development of the Project Xxxxx and (b) any additional
cash payments made by Sonerra to Nacogdoches Gas
applied to and directed toward reducing the Balance
Account.
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D. Project Payout. The Cumulative Project Costs shall be
considered as a debit dollar amount in the Balance
Account and the Cumulative Project Proceeds shall be
considered as a credit dollar amount in the Balance
Account. Notwithstanding provisions contained within
any individual Participation Agreement which define
payout on a well-by-well basis, the term "Project
Payout" shall mean the point in time when Nacogdoches
Gas shall have recouped the Cumulative Project Costs
from the Cumulative Project Proceeds (i.e. The net
balance in the Balance Account reaches zero dollars).
E. Sales Prior to Project Payout. Prior to Project
Payout, all sales by either party to this Agreement of
any undivided leasehold interest or other interest or
asset financed by Nacogdoches Gas subject and pursuant
to the terms of this Agreement or any other relevant
Agreements shall require the written consent of both
Sonerra and Nacogdoches Gas. The proceeds received
from all such sales shall be allocated and distributed
90% to Nacogdoches Gas and 10% to Sonerra until such
point that Project Payout is achieved; at and after
such point that Project Payout is achieved, all such
proceeds shall be allocated and distributed 50% to
Nacogdoches Gas and 50% to Sonerra.
F. Cash Reduction of Balance Account. Sonerra shall have
the right to make any number of additional cash
payments to Nacogdoches Gas at any time(s) prior to
Project Payout to reduce the Balance Account to any
balance up to and including an amount that would effect
and result in Project Payout occurring, all without
penalty.
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G. Audit. Nacogdoches Gas has the right to audit the
Balance Account and the Total Prospect Costs and
operating costs of any Project Well or other costs
financed under and pursuant to the terms of this
Agreement, including those xxxxx and other assets
included within the SunStone Interests.
VI. OWNERSHIP INTERESTS.
A. Ownership Interests Prior to Project Payout. Prior to
Project Payout, Sonerra shall be carried by Nacogdoches
Gas for a working interest percentage equal to ten
percent (10.0%) of the Allocated Funding Percentage of
the Total Prospect Costs (the "Carried Interest") in
each Project Well (being the Carried Interest
percentage and as more particularly described in the
Participation Agreement relating to each such
particular Project Well). The Carried Interest shall
be free of the Allocated Funding Percentage of the
Total Prospect Costs of each Project Well and the cost
of plugging and abandoning each such well, it being
agreed that Nacogdoches Gas shall bear and pay its
Allocated Funding Percentage share of the Total
Prospect Costs incurred in connection with each Project
Well. The percentage in and relative to each Project
Well occurring as the difference between (a) the
Allocated Funding Percentage and (b) the Carried
Interest percentage, shall be referred to herein as the
"Ownership Interest" of Nacogdoches Gas in each such
Project Well. Sonerra shall own the Carried Interest
in and relative to each Project Well, which shall also
be considered as "Sonerra's Ownership Interest" in each
such Project Well. With respect to the Sunstone
Interests prior to Project Payout, Nacogdoches Gas'
Ownership Interest shall be ninety percent (90%) and
Sonerra's Ownership Interest shall be ten percent
(10%). Sonerra shall be
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responsible for paying its Carried Interest share of
the operating costs, and Nacogdoches Gas shall be
responsible for paying its Ownership Interest share of
the operating costs of the Project Interests occurring
prior to Project Payout.
B. Ownership Interests After Project Payout. At such time
as Project Payout occurs with respect to the Project
Interests, Nacogdoches Gas' Ownership Interest shall
reduce to (a) a percentage equal to fifty percent
(50.0%) of its Allocated Funding Percentage in each of
the Project Xxxxx and (b) fifty percent (50%) of the
SunStone Interests, and Sonerra's Ownership Interest
shall increase to (a) a percentage equal to fifty
percent (50.0%) of the Allocated Funding Percentage in
each of the Project Xxxxx and (b) fifty percent (50%)
of the SunStone Interests. Sonerra shall be responsible
for paying its Sonerra Ownership Interest share of the
operating costs, and Nacogdoches Gas shall be
responsible for paying its Ownership Interest share of
the operating costs of the Project Interests occurring
after Project Payout.
VII. PROSPECTS OTHER THAN OPTIONAL XXXXX. During the term of
this Agreement, Sonerra may on one or more occasions
present to Nacogdoches Gas a proposal for the drilling of
a well in the Project Area that, due to existing
contractual or other obligations, would result in
Nacogdoches Gas acquiring an Allocated Funding Percentage
of less than 75% in such well, and thereby not meet the
minimum criteria to be considered a Project Well (an
"Additional Well"). Nacogdoches Gas shall have the
option to fund the Allocated Funding
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Percentage of the Total Prospect Costs for and thereby
participate in the drilling and completion of each such
Additional Well. In the event that Nacogdoches Gas
elects to so participate in any such Additional Well,
such Additional Well shall be treated as if it is a
Project Well with respect and made subject to the
application of all terms hereof except for the conditions
set forth under Article II.2. hereof, provided however,
any such Additional Well shall not be considered an
Optional Well under the terms of Section IV "Optional
Xxxxx".
VIII. SUBSEQUENT DEVELOPMENT WITHIN A PRODUCING UNIT.
A. Reentry of Xxxxx. In the event that Sonerra proposes
to reenter the wellbore of a Project Well for the
purpose of re-completing such well in a different zone
or horizon than previously tested, produced, or
completed, Nacogdoches Gas shall have the option to
fund the percentage of the costs of such proposed re-
completion equal to its Ownership Percentage in
existence with respect to such well at the time such
well is re-completed. Each such re-completed Project
Well in which Nacogdoches Gas funded its then existing
Ownership Percentage of the re-completion costs shall
be considered as a Project Well and subject to the
applicable terms of this Agreement and the Operating
Agreement in effect and pertaining to such Project Well
immediately prior to its re-completion.
B. New Xxxxx. A well proposed to be drilled on lands included
within a producing unit previously established for a Project
Well, but targeting the testing of and completion in a horizon,
formation or interval other than that owned relative to the
Project Well shall be defined as a "New Well". After such time
that Nacogdoches Gas has funded twelve (12) or more Project
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Xxxxx, it shall have the option to participate in the
costs of the drilling and completion of a New Well for
the percentage equal to the Allocated Funding
Percentage determined in the manner described under
Section II.A.2., hereof. If a New Well is proposed
prior the completion of the fifth Optional Well Set,
such New Well shall be considered and count as an
Optional Well and accordingly, made subject to the
terms of this Agreement. If a New Well is proposed
after the completion of the fifth Optional Well Set but
before Project Payout, such New Well shall be
considered a Project Well and accordingly, made subject
to the applicable terms of this Agreement. After
receiving a written proposal from Sonerra regarding a
New Well, Nacogdoches Gas must exercise its option by
written notice to Sonerra within twenty (20) days of
receipt of the written proposal or it shall be deemed
to have elected not to exercise its option to
participate in such New Well. In any event(s) that
Nacogdoches Gas elects not to or is deemed to have
elected not to participate in any particular New Well,
it shall forfeit and relinquish all future rights to
participate in and Sonerra shall be relieved of its
obligation to offer or propose to Nacogdoches Gas, any
additional or subsequent New Xxxxx targeting the
testing, completion and/or development of the same
horizon, interval or formation for which such
particular New Well was proposed.
IX. NON-TRANSFERABILITY. During the term of this Agreement,
neither party may transfer to a third party any of its
rights or obligations under this Agreement without the
consent of the other party; provided that this
restriction will not apply to a merger, consolidation, or
transfer to an affiliate. In the event of a sale of all
or substantially all of the assets of a party accruing
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hereunder, either party may transfer to a third party any
of its rights or obligations under this Agreement,
provided, however, and notwithstanding the foregoing,
neither party hereto may transfer any of its rights or
obligations accruing and set forth hereunder under
Section IV. "Optional Xxxxx", Section VII "Prospects
Other Than Optional Xxxxx" and Section VIII. "Subsequent
Development Within a Producing Unit", without the written
consent of the other party hereto.
X. EFFECTIVE DATE. The Effective Date of this Agreement
shall be 7:00 a.m. on November 15, 2004.
XI. FORCE MAJEURE. In the event that Sonerra is prevented
from fulfilling any of its obligations or
responsibilities contemplated or required hereunder,
including, but not limited to, the proposal of any
Optional Xxxxx, by reason of lack of equipment, labor or
other materials, or by reason of fire, storm, flood, act
of God, or rebellion, insurrection or riot, or by reason
of differences with workmen or labor disputes, including
strikes or lockouts, or by reason of failure of carriers
to transport or to furnish facilities for transportation,
or by reason of any federal or state laws, or any order,
rule or regulation of government authority, or by reason
of lack of drilling permits, insufficient oil, gas or
mineral leases, or inability to secure a drilling rig or
other equipment necessary to drill and/or complete any
xxxxx, or by reason of any other cause or causes beyond
Sonerra's control, then, while so prevented, the period
for performance shall be extended while and so long as
Sonerra is prevented from fulfilling its obligations or
responsibilities occurring pursuant to the terms of this
Agreement.
XII. NOTICES. Any and all notices required to be given under
this Agreement shall be in writing, signed by the party
giving such
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notice and shall be delivered personally, telecopied, or
sent by certified mail or overnight delivery by
recognized courier service (such as Federal Express or
UPS) to the other party at the addresses set forth below
or at such other address as may be furnished in writing.
The date of personal delivery, telecopy, or two (2) days
after the date of mailing (or the next business day of
delivery to a courier service) shall be the date of such
notice. The addresses and representatives of the parties
hereto shall be as follows:
Nacogdoches Gas, L.L.C.
0 Xxx Xxxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxxxxxxxx
Telephone No. 000-000-0000
Facsimile No. 000-000-0000
E-mail: xxxxxxxxxxxxx@xxxxxxxxxxxxxxx.xxx
Sonerra Resources Corporation
P. O. Box 631627
Xxxxxxxxxxx, Xxxxx 00000-0000
Attn: Xxxxx Xxxxxxxxx
Telephone No. 000-000-0000
Facsimile No. 000-000-0000
XIII.COMPLETE AGREEMENT. This Agreement, the Exhibits hereto,
the Participation Agreement and Operating Agreement
relative to each Project Well, and the Agreement
contemplated under Article III hereof, if consummated,
constitute the entire agreement between Sonerra and
Nacogdoches Gas with respect to the matters covered
hereby. Should there be any conflict between the terms
of this Agreement and the terms of any other agreement
relating hereto, the terms of this Agreement shall take
precedence.
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XIV. MISCELLANEOUS.
A. Marketing of Production. Prior to Project Payout, the
parties shall mutually agree upon all matters relating
to the marketing of production from the Project
Interests. After Project Payout, Nacogdoches Gas
retains the option to take its share of production in
kind and to market its share of production from the
Project Interests.
B. Governing Law. This Agreement shall be construed and
governed by the laws of the State of Texas.
C. Information. Sonerra shall make available to
Nacogdoches Gas and provide copies (with the exception
of items 4 and 5 below), if requested, of the following
information and reports:
1. All easements, right-of-way agreements, licenses,
and contracts relating to the Project Interests.
2. Any natural gas purchase and sale agreements,
processing agreements, processing contracts,
gathering agreements, gathering contracts, and
other contracts, and agreements relating to the
Project Interests.
3. All purchase, sale, assignments, and
transportation agreements relating to the Project
Interests.
4. Sonerra's land and contract files pertaining to
the Project Interests.
5. Provided that Sonerra obtains ownership of the
Oakridge 3-D seismic data relative to and as
result of the acquisition of the SunStone
Interests, pursuant to any previous contractual
obligations, Nacogdoches Gas (its employees
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and/or consultants) shall be entitled to review
and evaluate the 3-D seismic and geological data
applicable to the Oakridge 3-D Seismic Area.
During this review, Sonerra shall provide
Nacogdoches Gas with reasonable access to
Sonerra's computer workstation in order for
Nacogdoches Gas to review and evaluate the 3-D
seismic and geological data. Nacogdoches Gas shall
not be entitled to copy, keep or otherwise remove
any such data, however, Nacogdoches Gas may make
any interpretations, drawings, maps or create
other work product from such 3-D seismic and
geological data.
D. Confidentiality. Nacogdoches Gas agrees to (i) keep
confidential and treat as proprietary, all materials
and data it receives from Sonerra, except as may be
required under federal securities or other applicable
laws or the regulations of any national securities
exchange or quotation system on which Nacogdoches Gas
or its affiliates are traded and (ii) not to compete
with Sonerra for the acquisition of any mineral
interest and/or in the development of any oil and gas
properties within or within a distance of ten (10)
miles of the Project Area. If requested by Sonerra,
Nacogdoches Gas agrees to require any of its
consultants or employees that it intends to employ or
involve on its behalf relative to matters relating
hereto, to execute a Non-Competition and
Confidentiality Agreement of reasonable form and
content acceptable to Sonerra.
E. Notice of Claims. Sonerra shall notify Nacogdoches Gas
in writing of any claim, threatened litigation, or
litigation related to any of the Project Interests.
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F. No Partnership. This Agreement does not create a
partnership, mining partnership, joint venture,
corporation, association for profit, or any other
business entity of any kind.
G. Successors and Assigns. This Agreement shall be
binding upon and inure to the benefit of each party's
respective successors, heirs, assigns, and legal
representatives.
H. Amendments and Waiver. This Agreement may be amended
only in writing by the mutual consent of all the
parties. No waiver of any provision of this Agreement
shall arise from any action or inaction of any party,
except by an instrument in writing expressly waiving
the provision executed by the party entitled to the
benefit of the provision.
I. Severability. If a court of competent jurisdiction
determines that any clause or provision of this
Agreement is void, illegal, or unenforceable, the other
clauses and provisions of this Agreement shall remain
in full force and effect and the clauses and provisions
which are determined to be void, illegal, or
unenforceable shall be limited so that they shall
remain in effect to the extent permissible by law.
J. Headings. The headings of any article and/or section
of this Agreement are for guidance and convenience of
reference only and shall not limit or otherwise affect
any of the terms or provisions of this Agreement.
K. Counterparts. This Agreement may be executed in
separate and/or multiple counterparts, which taken
together shall constitute the entire agreement. It
shall not be necessary that each party sign the same
counterpart of this Agreement, only that each party
sign at least one counterpart. Each of the executed
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counterparts of this Agreement may be placed together
so as to form one document and all taken together shall
constitute one document.
EXECUTED, AGREED TO and ACCEPTED as of the date first above
written.
SONERRA RESOURCES CORPORATION
By: /s/ W. Xxxxx Xxxxxxxxx
------------------------------
W. Xxxxx Xxxxxxxxx
President
NACOGDOCHES GAS, L.L.C.
By: /s/ Xxxxx X. Xxxxxx Xx.
------------------------------
Xxxxx X. Xxxxxx Xx.
Manager
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Project Development Agreement
dated
January 7, 2005
between
Sonerra Resources Corporation
and
Nacogdoches Gas, LLC
List of Exhibits(1)
------------------
Exhibit A Project Area Map
Exhibit B Sample Form of Participation
Agreement (with form exhibits)
Exhibit C The Sunstone Interests
----------------
(1) All disclosure schedules and exhibits have been omitted
pursuant to Item 601(b)(2) of Regulation S-K. The
Registrant will furnish supplementally a copy of any omitted
schedule or exhibit to the Securities and Exchange Commission
upon request.
