EXHIBIT 10.28
PURCHASE AND SALE AGREEMENT
This Purchase and Sale Agreement ("Agreement") made this 1st day of June,
1999, is by and between ST. XXXX XXXX & EXPLORATION COMPANY, a Delaware
corporation ("St. Xxxx") and XXXXXX X. XXXXXX ("Xxxxxx"), acting in his capacity
as a limited partner in Quanterra Alpha Limited Partnership. Xxxxxx owns a 49.5%
limited partnership interest in Quanterra Alpha Limited Partnership, a Montana
limited partnership ("Quanterra Partnership").
WHEREAS, St. Xxxx desires to acquire all of the limited partnership
interest of Xxxxxx in the Quanterra Partnership in exchange for shares of the
common stock, par value of $0.01 per share, of St. Xxxx ("St. Xxxx Stock") as
hereinafter provided, and Xxxxxx desires to effect such exchange.
NOW, THEREFORE, in consideration of the covenants and agreements contained
herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound hereby, agree as follows:
ARTICLE 1
DEFINITIONS; HEADINGS
1.01 Defined Terms. As used in this Agreement, terms defined in the
preamble and recitals of this Agreement have the meanings set forth therein, and
the following terms have the meanings set forth below:
(1) "Closing" has the meaning ascribed to such term in Section 2.02.
(2) "Code" means the Internal Revenue Code of 1986, as amended.
(3) "Consideration" means those shares of St. Xxxx Stock set forth
on Schedule 1.01(3) which have been calculated in accordance with the
methodology set forth in that certain letter dated March 2, 1999, from St.
Xxxx to Xxxxxx X. Xxxxx, as amended by oral understanding which provides
for the use of a five year NYMEX strip pricing run as opposed to the two
year NYMEX price strip stated in the letter. This letter provides that the
number of shares of St. Xxxx Stock that Xxxxxx shall receive is based on a
proportionate net asset value comparison of St. Xxxx with Xxxxxx'x
interest in
Quanterra Partnership. This comparison is expressed by using a formula
wherein X (the number of shares of St. Xxxx Stock that Xxxxxx is to
receive) is the numerator of a fraction and the number of shares of St.
Xxxx Stock issued and outstanding is the denominator of the fraction, and
such fraction equals a fraction in which the numerator is the net asset
value of Xxxxxx'x interest in Quanterra Partnership and the denominator is
the net asset value of St. Xxxx. Net asset value has been determined in
accordance with the above referenced letter subject to the referenced
amended hydrocarbon pricing.
(4) "Environmental Laws" mean all federal, state and local rules and
regulations relating to pollution or protection of human health or the
environment (including, without limitation, ambient air, surface water,
groundwater, land surface or subsurface strata), including, without
limitation, laws and regulations relating to Releases or threatened
Releases of Hazardous Materials, or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport or
handling of Hazardous Materials.
(5) "GAAP" means generally accepted accounting principles
consistently applied.
(6) "Governmental Authority" means any federal, state, or local
court, arbitration tribunal or governmental department, board, commission,
bureau, agency, authority or instrumentality.
(7) "Hazardous Materials" mean (a) any petroleum or petroleum
products, radioactive materials, asbestos in any form that is friable,
urea-formaldehyde foam insulation, and transformers or other equipment
that contain dielectric fluid containing polychlorinated biphenyls (PCBs);
(b) any chemicals, materials or substances which are now defined as or
included in the definition of "hazardous substances," "hazardous wastes,"
"hazardous materials," "extremely hazardous wastes," "restricted hazardous
wastes," "toxic substances," "toxic pollutants," or words of similar
import, under any Environmental Law; (c) naturally occurring radioactive
material (NORM); and (d) any other chemical, material, substance or waste,
exposure to which is prohibited, limited or regulated by any Governmental
Authority in a jurisdiction in which Quanterra Partnership operates.
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(8) "Knowledge" as used (i) with respect to St. Xxxx shall mean
those facts that are actually known or should reasonably have been or
become known in the ordinary course of business by the officers of St.
Xxxx, taking into account the scope and nature of such officers'
responsibilities, and (ii) with respect to Xxxxxx shall mean facts that
are actually known to Xxxxxx in the ordinary course of business, taking
into account the scope and nature of Xxxxxx'x involvement in the operation
of Quanterra Partnership.
(9) "Laws" mean all (i) federal, state, or local or foreign laws,
rules and regulations, (ii) orders, (iii) Permits, and (iv) agreements
with federal, state, local, or foreign regulatory authorities to which
Xxxxxx, Quanterra Partnership, or St. Xxxx, as the case may be, is a party
or by which any of them or their property is bound.
(10) "Liens" mean all liens, liabilities, claims, security
interests, mortgages, pledges, agreements, obligations, restrictions, or
other encumbrances of any nature whatsoever, whether absolute, legal,
equitable, accrued, contingent or otherwise, including, without
limitation, any rights of first refusal.
(11) "1933 Act" means the Securities Act of 1933, as amended.
(12) "1934 Act" means the Securities Exchange Act of 1934, as
amended.
(13) "Quanterra Partnership Financial Statements" mean the unaudited
financial statements of Quanterra Partnership for each of its past two
fiscal years, December 31, 1997 and December 31, 1998.
(14) "NASDAQ" means National Association of Securities Dealers
Automated Quotations System.
(15) "Permits" mean all permits, licenses, franchises, orders,
certificates and approvals.
(16) "Quanterra Partnership" means Quanterra Alpha Limited
Partnership of which Quanterra Energy Corporation is the
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general partner and Xxxxx Petroleum Corporation and Xxxxxx X. Xxxxxx are
the limited partners.
(17) "Release" means any spilling, leaking, pumping, pouring,
emitting, emptying, discharging, injecting, escaping, leaching, dumping,
or disposing into the environment.
(18) "SEC" means the United States Securities and Exchange
Commission.
(19) "SEC Documents" mean all registration statements, proxy
statements, periodic reports and schedules filed by St.
Xxxx with the SEC under the Securities Laws.
(20) "Securities Laws" mean the 1933 Act, the 1934 Act, the
Investment Company of Act of 1940, as amended, the Trust Indenture Act of
1939, as amended, and the rules and regulations of the SEC promulgated
thereunder.
(21) "Taxes" mean any taxes or other governmental charges or
assessments of whatever kind or nature imposed by the United States, by
any other nation or by any state, county, municipality or governmental
subdivision, including without limitation, any income, franchise or any
other similar taxes based on or measured by income or otherwise, any sales
or use taxes, property, employment and employer withholdings,
unemployment, social security, occupational, customs, excise or other
taxes, together with any interest or penalties relating thereto.
(22) "Tax Reports" mean all returns or reports required to be filed
relating to the federal and state income tax filings of Quanterra
Partnership.
1.02 Other Definitional Provisions. Wherever the context so requires,
words used herein in the masculine gender shall be deemed to include the
feminine and neuter. A definition of any term shall be equally applicable to
both the singular and plural forms of the term defined.
1.03 Titles; Headings. All titles and headings appearing in this Agreement
are for identification only and are not to be used for interpretive purposes.
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ARTICLE 2
ACQUISITION; CLOSING
2.01 Acquisition of Xxxxxx Partnership Interest in Quanterra Partnership.
Subject to the terms and conditions herein stated, Xxxxxx agrees to assign,
transfer and deliver to St. Xxxx or in accordance with St. Mary's directions to
a subsidiary of St. Xxxx at Closing, and St. Xxxx agrees to acquire from Xxxxxx
at Closing, all of his limited partnership interest in Quanterra Partnership.
These interests shall be assigned to St. Xxxx or in accordance with St. Mary's
directions to a subsidiary of St. Xxxx using the form of assignment attached
hereto as Schedule 2.01. At Closing, Xxxxxx shall execute and deliver this
assignment of his entire limited partnership interest in Quanterra Partnership
in exchange for certificates of St. Xxxx Stock issued in the name of Xxxxxx in
the amount of the Consideration.
2.02 Closing. The closing of the transaction provided for herein (the
"Closing") shall take place at the offices of Xxxxx Petroleum Corporation on
June 1, 1999, at 10:00 a.m., local time.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES
OF XXXXXX
Xxxxxx represents and warrants to St. Xxxx as follows:
3.01 Ownership of Limited Partnership Interest in Quanterra Partnership.
Xxxxxx is the lawful owner, beneficially and of record, of a limited partnership
interest representing 49.5% of Quanterra Partnership and such interest is free
and clear of all Liens.
3.02 Xxxxxx'x Due Execution, Enforceability Against Xxxxxx. This Agreement
has been duly executed and delivered by Xxxxxx and is a valid and binding
obligation of him, enforceable in accordance with its terms, except as limited
by applicable bankruptcy, insolvency, reorganization, moratorium or other laws
of general application referring to or affecting enforcement of creditors'
rights and general principles of equity. The execution, delivery and performance
of this Agreement by Xxxxxx will not violate or conflict with any agreement,
instrument, judgment or decree to which Xxxxxx is a party or is subject.
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3.03 Xxxxxx'x Capacity. Xxxxxx has full legal right, power, authority and
capacity to execute, deliver and perform his obligations under this Agreement to
consummate the transactions contemplated hereunder.
3.04 Organization Existence. Quanterra Partnership is a limited
partnership duly organized and validly existing under the laws of Montana with
all requisite power and authority to own, operate and lease its properties and
assets and to carry on its business as is now being conducted. Quanterra
Partnership is duly qualified to do business and is in good standing in each
jurisdiction where the conduct of its business or the ownership of its property
requires such qualification. The jurisdictions in which Quanterra Partnership is
qualified to do business, and the names and addresses of Quanterra Partnership's
registered agent in such jurisdictions, are set forth on Schedule 3.04 hereto.
Schedule 3.04 hereto sets forth all names under which Quanterra Partnership has
conducted or purported to conduct business since the date of its inception.
3.05 No Restrictions Against Performance. Neither the execution, delivery
nor performance of this Agreement, nor the consummation of the transactions
contemplated in this Agreement will, with or without the giving of notice or the
passage of time, or both, violate any provisions of, conflict with, result in a
breach of, constitute a default under, or result in the creation or imposition
of any Lien or adverse condition under:
(a) the Limited Partnership Agreement of Quanterra Partnership;
(b) any Law which is applicable to Quanterra Partnership or any of
its properties or assets;
(c) any contract, indenture, instrument, agreement, mortgage, lease,
right, or other obligation or restriction to which Quanterra Partnership is a
party or by which Quanterra Partnership or any of its properties or assets is or
may be bound; or
(d) any order, judgment, writ, injunction, decree, license,
franchise, permit or other authorization of any Governmental Authority by which
either Quanterra Partnership or any of its properties or assets is or may be
bound or by which Xxxxxx is or may be bound.
3.06 Historical Financial Information. The Quanterra Partnership Financial
Statements, true and complete copies of which have been previously delivered to
St. Xxxx present fairly the financial position, assets and liabilities of
Quanterra Partnership as of the dates thereof and the revenues, expenses,
results of
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operations and cash flows of Quanterra Partnership for the periods covered
thereby, on a tax basis with adjustments made in accordance with GAAP so that
the net asset value of Quanterra Partnership can be determined and reasonably
compared with the net asset value of St. Xxxx. The Quanterra Partnership
Financial Statements are in accordance with the books and records of Quanterra
Partnership and do not reflect any transactions which are not bona fide
transactions. The books and records of Quanterra Partnership have been
maintained in accordance with applicable laws, rules and regulations, and in the
ordinary course of business. To the best of Xxxxxx'x Knowledge, the accounts and
notes receivable of Quanterra Partnership reflected in the Quanterra Partnership
Financial Statements are valid, existing and genuine and represent sales
actually made or services actually delivered by Quanterra Partnership in bona
fide transactions in the ordinary course of business consistent with past
practice and there is no material right of setoff or counterclaim or threat
thereof that would jeopardize the collectability of such accounts and notes
receivable at the aggregate recorded amounts thereof. Xxxxxx has no Knowledge of
any material difference that would arise if the Quanterra Partnership Financial
Statements were prepared in accordance with GAAP as opposed to being prepared on
a tax basis with the GAAP-type adjustments that have been made.
3.07 No Undisclosed Liabilities. To the best of Xxxxxx'x Knowledge, no
basis exists on the date hereof for assertions against Quanterra Partnership of
any material claim or liability of any nature other than (i) those which have
been disclosed in the Quanterra Partnership Financial Statements, or (ii) have
been incurred in the ordinary course of the business of Quanterra Partnership
since December 31, 1998 and which do not constitute a breach of the
representation and warranty set forth in Section 3.08. For purposes of this
Section 3.07, a claim or liability shall be deemed to be "material" if it
involves an amount in excess of $25,000, individually or in the aggregate, as
the context requires.
3.08 No Adverse Effects or Changes. Since December 31, 1998, Xxxxxx is not
aware of any event involving Quanterra Partnership that has had a material
adverse effect on its business or its assets. Except as listed on Schedule 3.08,
since December 31, 1998, Quanterra Partnership has not:
(a) made any existing unsatisfied capital call on Xxxxxx;
(b) borrowed or agreed to borrow any funds, guaranteed the repayment
of any indebtedness or incurred any other contingent financial obligations,
except borrowings incurred in the ordinary course of its business in accordance
with its past practices;
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(c) satisfied any obligation or liability (absolute or contingent),
other than obligations and liabilities incurred in the ordinary course of its
business in accordance with its past practices;
(d) declared or made, or agreed to declare or make, any payments or
distributions of cash or any other assets of any kind whatsoever in respect of
its capital accounts;
(e) except as set forth on Schedule 3.08(e), sold, transferred or
otherwise disposed of, or agreed to sell transfer or otherwise dispose of, any
material assets, properties or rights, except inventory and equipment in the
ordinary course of its business in accordance with its past practices, or
canceled or otherwise terminated, or agreed to cancel or otherwise terminate,
any debts or claims other than accounts receivable write-offs and writedowns in
the ordinary course of its business in accordance with its past practices;
(f) other than in the ordinary course of business in accordance with
its past practices, entered, or agreed to enter, into any agreement or
arrangements to sell any of its assets, properties or rights, including
inventories and equipment;
(g) made or permitted any amendment or termination of any material
contract, agreement, Permit or license to which it is a party or by which it or
any of its properties are bound;
(h) except as set forth on Schedule 3.08(h), made, directly or
indirectly, any accrual or arrangement for or payment of any bonuses or special
compensation of any kind or any severance or termination pay to any present or
former partner or employee;
(i) incurred, or become subject to, any uninsured claim or liability
for any material damages for any negligence or other tort or breach of contract;
(j) made any capital expenditures (or commitments therefor) which in
the aggregate exceed $25,000;
(k) suffered any damages, destruction or casualty losses in excess
of $10,000 as to any single occurrence or $25,000 in the aggregate;
(l) entered into any other material transaction other than in the
ordinary course of its business in accordance with its past practices; or
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(m) suffered any material adverse change in condition of or title to
any of its assets except depletion through normal production within authorized
allowables, ordinary changes in rates of production, and depreciation of
equipment through ordinary wear and tear.
3.09 Third-Party and Governmental Consents. Except as set forth in
Schedule 3.09 hereto, no approval, consent, waiver, order or authorization of,
or registration, qualification, declaration, or filing with, or notice to, any
Governmental Authority or other third party is required on the part of Xxxxxx or
Quanterra Partnership in connection with the execution and delivery of this
Agreement by Xxxxxx or the consummation of the transactions contemplated hereby.
All of the consents and approvals set forth on Schedule 3.09 have been obtained.
3.10 Real and Personal Property
(a) Oil and Gas Leases and Xxxxx in Which Quanterra Partnership is a
Party. Schedule 3.10(a) sets forth a true, correct and complete list of all oil
and gas leases and xxxxx in which Quanterra Partnership is a party, whether as
lessor, lessee, or the owner of any non-cost bearing interest. The interests of
Quanterra Partnership in all leases listed on such Schedule are valid and
subsisting and in full force and effect, and all rentals and other payments now
due have been paid. Quanterra Partnership enjoys and is in peaceful and
undisturbed possession as to its respective ownership share under each lease so
listed in which it is a lessee. Quanterra Partnership has not received any
notice of, and to the Knowledge of the Xxxxxx, there does not exist, any event
of default or event, occurrence or act which, with the giving of notice or the
lapse of time or both, would become a default under any such lease, and
Quanterra Partnership has not violated any of the terms or conditions under any
such lease in any material respect. The real property under the leases referred
to in Schedule 3.10(a) is free from material physical defects. Such real
property and the fixtures, equipment, and other property attached, situated or
appurtenant thereto are in good operating condition and repair, in compliance
with all applicable Laws and are adequate and suitable for the purposes for
which they are presently being used, except for such matters which in the
aggregate would not have a material adverse effect on the business of Quanterra
Partnership.
(b) Personal Property. Except as otherwise identified on Schedule
3.10(b) hereto, Quanterra Partnership has good, valid, marketable, legal and
beneficial title to all of its personal property, free and clear of all Liens.
There are no outstanding options, warrants, commitments, agreements or any other
rights of any character entitling any person or entity, other than St. Xxxx, to
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acquire any interest in all or any part of the personal property of Quanterra
Partnership.
3.11 Accounts and Notes Receivable. Schedule 3.11 sets forth a list as of
December 31, 1998, of all accounts and notes receivable of Quanterra Partnership
together with:
(a) an aging schedule setting forth all such accounts receivable
(other than intercompany receivables)
(b) the identity of any asset in which Quanterra Partnership holds a
security interest to secure payment of the underlying indebtedness;
(c) a description of the nature and amount of any lien on or
security interest in such accounts and notes receivable; and
(d) an identification of the accounts receivable on this Schedule
3.11 which have been collected in their entirety since December 31, 1998.
Except as specifically identified on Schedule 3.11, Xxxxxx believes to the best
of his Knowledge that the accounts and notes receivable itemized are collectible
in the ordinary course of Quanterra Partnership's businesses.
3.12 Accounts Payables and Promissory Notes. Schedule 3.12 sets forth a
list of:
(a) all accounts payable of Quanterra Partnership as of December 31,
1998, together with an appropriate aging schedule;
(b) all long-term and short-term promissory notes, installment
contracts, loan agreements and credit agreements to which Quanterra Partnership
is a party or to which any of its properties are subject;
(c) all indentures, mortgages, security agreements, pledges, and any
other agreements, pledges, and any other agreements of Quanterra Partnership
relating thereto or with respect to collateral securing the same; and
(d) an identification of the accounts payable on Schedule 3.12 that
have been fully or partially paid since December 31, 1998.
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3.13 Insurance and Bonds.
(a) Schedule 3.13 sets forth a list of all insurance policies and
bonds held by Quanterra Partnership including those covering its properties,
buildings, equipment, fixtures, employees, and operations. Such list specifies
with respect to each such policy:
(i) the insurer and agent;
(ii) the amount of coverage;
(iii) the dates of premiums or payments due thereunder; and
(b) the expiration date, as applicable.
Each such policy identified is currently in full force and effect. All insurance
premiums due according to the applicable payment schedules reflected in such
policies have been timely paid. Except as set forth on Schedule 3.13, Xxxxxx has
no Knowledge of any facts or circumstances under which any claims for uninsured
losses or damages are likely to be asserted against Quanterra Partnership in an
amount in excess of $10,000 nor are there any such claims pending against
Quanterra Partnership;
(c) Xxxxxx believes the insurance policies currently maintained by
Quanterra Partnership provide coverage adequate for its properties, assets,
products and operations;
(d) Quanterra Partnership has not requested cancellation of any
material policy of insurance at any time during the previous two years;
(e) Quanterra Partnership has not sought and been denied any
insurance coverage during the two-year period prior to Closing. All bonds issued
to secure performance of or payment by Quanterra Partnership under any material
contract in progress or yet to be completed, including those contracts
identified in Schedule 3.13, are in force and effect and are identified on
Schedule 3.13. Neither Quanterra Partnership nor Xxxxxx have made any
representations or undertaken any other act which would give rise to a viable
claim that any such existing bond is invalid or unenforceable. There are no
facts or circumstances under which the validity or enforceability by Quanterra
Partnership of any such existing bond could be successfully challenged; and
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(f) the transactions contemplated by this Agreement will have no
adverse effect on any such existing bond.
3.14 Bank Accounts. Schedule 3.14 sets forth a list of (i) the name of
each bank or other financial institution in which Quanterra Partnership has an
account or safe deposit box; (ii) the names of all person authorized to draw
thereon or to have access thereto; and (iii) the names of all persons other than
the partners of Quanterra Partnership who are authorized to incur liabilities on
behalf of Quanterra Partnership for borrowed funds.
3.15 Compliance with Laws. To the best of Xxxxxx'x Knowledge, Quanterra
Partnership has complied with and is not in default under any Laws the violation
of which could have a material adverse effect on its business, properties or
assets.
3.16 Litigation. There is no judicial or administrative claim, action,
suit or proceeding pending or, to the Knowledge of Xxxxxx, threatened against or
relating to Xxxxxx, Quanterra Partnership or the partners of Quanterra
Partnership, the business, properties or assets of Quanterra Partnership or the
transactions contemplated by this Agreement, including, but not limited to,
actions or proceedings alleging any violation of any Environmental Law, before
any federal, state, or local court, arbitration tribunal or Governmental
Authority, which would, individually or in the aggregate, materially adversely
affect Xxxxxx, the business, properties or assets of Quanterra Partnership, or
the transactions contemplated by this Agreement and to the Knowledge of Xxxxxx
there does not exist any valid basis for any such claim, action, suit or
proceeding. There are no claims, actions, suits, proceedings or investigations
pending or, to the Knowledge of Xxxxxx, threatened by or against Xxxxxx or
Quanterra Partnership with respect to this Agreement, or in connection with the
transactions contemplated hereby and Xxxxxx has no reason to believe there
exists a valid basis for any such claim, action, suit, proceeding or
investigation.
3.17 Permits. Schedule 3.17 hereto sets forth a true, correct and complete
list of all Permits of any federal, state or local regulatory or Governmental
Authority relating to the business properties or assets of Quanterra
Partnership. The Permits constitute all permits, licenses, franchises, orders,
certificates and approvals which are required for the lawful operation of the
business, properties and assets of Quanterra Partnership. Further, Quanterra
Partnership is in compliance in all material respects with all such Permits and
owns or has owned or had valid Permits to use all properties, tangible or
intangible, necessary for the conduct of its business and the operation
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of its properties and assets in the manner in which they are now conducted and
operated.
3.18 Taxes.
(a) All Tax Reports required to be filed by Xxxxxx or Quanterra
Partnership that are required to be filed on or prior to the Closing have been
duly filed and are true, complete and accurate in all material respects. All
Taxes owed with respect to the periods covered by such Tax Reports have been
duly paid. Xxxxxx and Quanterra Partnership have complied with all applicable
laws, rules and regulations relating to the withholding and payment of Taxes and
have timely withheld and paid to the proper governmental authorities all amounts
required to have been withheld and paid in connection with amounts paid or owing
to any employee, independent contractor, creditor or partner.
(b) There are no agreements, waivers or other arrangements providing
for extension of time with respect to the assessment or collection of any Tax on
Xxxxxx or Quanterra Partnership. There are not any actions, suits, proceedings,
investigations or claims now pending against Xxxxxx or Quanterra Partnership in
respect of unpaid Taxes, and there are no matters under discussion with any
federal, state, county or local Governmental Authority relating to any amount of
unpaid Taxes. Except as otherwise set forth on Schedule 3.18, the Tax Reports of
Xxxxxx or Quanterra Partnership have not been audited and are not in the process
of being audited by the applicable taxing authorities, and there is no Tax
deficiency outstanding, proposed or assessed against Xxxxxx or Quanterra
Partnership, and neither Xxxxxx nor Quanterra Partnership is a party to any Tax
allocation or Tax sharing agreement.
3.19 Employee Benefit Plans and Employment Agreement. Quanterra
Partnership has not entered into any employee benefit plan within the meaning of
Section 3(3) of ERISA or any written or oral employment or consulting agreement,
severance pay plan or agreement, employee relations policy (or practice,
agreement, or arrangement), agreements with respect to leased or temporary
employees, vacation plan or arrangement, sick pay plan, stock purchase plan,
stock option plan, fringe benefit plan, incentive plan, bonus plan, cafeteria or
flexible spending accounting plan or any deferred compensation agreement with
any present or former employee of Quanterra Partnership. Further, there are
currently no employees of Quanterra Partnership.
3.20 Material Contracts. Quanterra Partnership has made available all
contracts and arrangements, written, electronic, oral, or otherwise to which
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Quanterra Partnership is a party or by which it is bound, or to which any of its
assets or properties is subject.
3.21 Environmental Matters. Except as set forth in Schedule 3.21:
(a) Quanterra Partnership is currently in compliance in all material
respects with all applicable Environmental Laws, has cured any past violations
or alleged violations of Environmental Laws to the satisfaction of Governmental
Authorities, is not currently in receipt of any notice of violation, is not
currently in receipt of any notice of any potential liability for cleanup of
Hazardous Materials and is not now subject to any investigation or information
request by a Governmental Authority concerning Hazardous Materials or any
Environmental Laws. To the Knowledge of Xxxxxx, Quanterra Partnership holds and
is in compliance with all governmental permits, licenses, and authorizations
necessary to operate those aspects of its business that relate to siting,
wetlands, coastal zone management, air emission, discharges to surface or ground
water, discharges to any sewer or septic system, noise emissions, solid waste
disposal or the generation, use, transportation or other management of Hazardous
Materials. Quanterra Partnership has never generated, manufactured, refined,
recycled, discharged, emitted, released, buried, processed, produced, reclaimed,
stored, treated, transported, or disposed of any Hazardous Materials except in
compliance with all applicable Laws, including applicable Permit requirements;
(b) No assets of Quanterra Partnership are subject to any Lien in
favor of any person as a result of any Hazardous Material or response thereto;
(c) To the Knowledge of Xxxxxx, all facilities where any person has
treated, stored, disposed of, reclaimed, or recycled any Hazardous Material on
behalf of Quanterra Partnership are in compliance with Environmental Laws.
3.22 Broker's Fees. No agent, broker or other person is or may be entitled
to a commission or finder's fee in connection with the transactions contemplated
by this Agreement, or is or may be entitled to make any claim against Quanterra
Partnership or against St. Xxxx as a result of any actions by Xxxxxx or
Quanterra Partnership. Xxxxxx shall indemnify St. Xxxx against any claim for any
such commission or finder's fee made by any agent, broker or other person as a
result of any actions by Xxxxxx or Quanterra Partnership.
3.23 Investment Representation. Xxxxxx acknowledges that the issuance to
him by St. Xxxx of the shares of St. Xxxx Stock constituting the Consideration
pursuant to this Agreement has not been registered under the 1933 Act or any
state securities law, and that such St. Xxxx Stock may not be sold or
transferred
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other than pursuant to an effective registration statement under the 1933 Act or
pursuant to an available exemption from such registration, and further
acknowledges that the certificates representing the St. Xxxx Stock will bear a
restrictive legend to the foregoing effect. Xxxxxx is acquiring the St. Xxxx
Stock for investment purposes only, for his own account (and not for the
account(s) of others) and not with a view to the distribution thereof. Xxxxxx
confirms that (i) he is familiar with the business of St. Xxxx and has had the
opportunity to ask questions of appropriate executive officers of St. Xxxx (and
that he has received responses thereto to his satisfaction) and to obtain such
information about the business and financial condition of St. Xxxx as he has
reasonably requested, and (ii) he has such knowledge and experience in financial
and business matters that he is capable of evaluating and accepting the merits
and risks of an investment in St. Xxxx Stock.
3.24 Questionable Payments. Neither Xxxxxx nor Quanterra Partnership has
made, directly or indirectly, any (a) bribes, kickbacks or illegal payments, (b)
payments that were falsely recorded on the books and records of Quanterra
Partnership, or (c) payments to governmental officials for improper purposes.
3.25 Tax Reports. Schedule 3.25 contains true and correct copies of the
Tax Reports filed by Quanterra Partnership for the past two tax years including
tax year 1998.
3.26 Joint Operating Agreements. Quanterra Partnership has not entered
into any joint operating agreement regarding any of the leases or xxxxx affected
by this Agreement that contains terms or conditions which impose duties or
obligations on Quanterra Partnership beyond those customarily contained or
created by joint operating agreements executed in the ordinary course of
conducting an oil and gas business.
3.27 No Misstatements or Omissions. No representation or warranty made in
this Agreement or on any Schedule hereto by Xxxxxx is false or misleading as to
any material fact or omits to state a material fact required to make any of such
information not misleading in any material respect. In addition, all other
information made available by Quanterra Partnership to St. Xxxx, whether in
oral, written, or any other form, is true and correct to the Knowledge of
Xxxxxx, and such information is not false or misleading as to any material fact.
To the Knowledge of Xxxxxx, the foregoing representations, warranties, schedules
and information constitute full disclosure of all material facts with respect to
the business, assets and liabilities of Quanterra Partnership.
15
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF ST. XXXX
St. Xxxx represents and warrants to Xxxxxx as follows:
4.01 Organization; Good Standing. St. Xxxx is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware with all requisite corporate power and authority and legal right to
own, operate and lease its properties and assets and to carry on its business as
now being conducted and to enter into this Agreement and perform its obligations
hereunder, and is duly qualified to do business and is in good standing as a
foreign corporation in each jurisdiction where the conduct of its business or
the ownership of its property requires such qualification.
4.02 Authority. St. Xxxx has the corporate power and authority to execute,
deliver, and perform its obligations under this Agreement to which it is a party
and to consummate the transactions contemplated hereby, and has taken all
necessary corporate action to authorize the execution, delivery and performance
of this Agreement. St. Xxxx has the power and authority to deliver the
Consideration, and all necessary corporate action to authorize the delivery of
the Consideration has been taken.
4.03 Due Execution and Enforceability. This Agreement is a valid and
binding obligation of St. Xxxx, enforceable in accordance with its terms, except
as limited by applicable bankruptcy, insolvency, reorganization, moratorium or
other laws of general application referring to or affecting enforcement of
creditors' rights and general principles of equity.
4.04 No Restrictions Against Performance. Neither the execution, delivery,
authorization or performance of this Agreement, nor the consummation of the
transactions contemplated hereby will, with or without the giving of notice or
the passage of time, or both, violate any provisions of, conflict with, result
in a breach of, constitute a default under, or result in the creation or
imposition of any Lien or adverse condition under (i) the Certificate of
Incorporation or By-Laws of St. Xxxx; (ii) any federal, state or local Law,
which is applicable to St. Xxxx; (iii) any contract, indenture, instrument,
agreement, mortgage, lease, right or other obligation or restriction to which
St. Xxxx is a party or by which it is bound; or (iv) any order, judgment, writ,
injunction, decree, license, franchise, permit or other authorization of any
Governmental Authority by which St. Xxxx is bound.
4.05 Capital Stock of St. Xxxx. The authorized capital stock of St. Xxxx
consists of 50,000,000 shares of common stock of which 10,827,067 are issued
16
and outstanding. All of the issued and outstanding shares of St. Xxxx Stock are,
and all of the shares of St. Xxxx Stock, when issued in accordance with the
terms of this Agreement are or will be, duly and validly authorized and issued
and outstanding, fully paid and nonassessable. None of the outstanding shares of
St. Xxxx Stock to be issued pursuant to this Agreement will be issued in
violation of any preemptive rights of the current or past holders of St. Xxxx
Stock. Except as disclosed on Schedule 4.05 hereto, as of the date of this
Agreement, there are no other equity securities of St. Xxxx outstanding and no
outstanding options, warrants, rights, calls, commitments, conversion rights,
rights of exchange, plans or other agreements of any character provided for the
purchase, issuance or sale of any shares of the capital stock of St. Xxxx, other
than as contemplated by this Agreement.
4.06 SEC Filings; Financial Statements of St. Xxxx. St. Xxxx has timely
filed and made available to the Stockholders all SEC Documents required to be
filed by St. Xxxx during calendar year 1998 and since December 31, 1998 . The
SEC Documents (i) at the time filed, complied in all material respects with the
applicable requirements of the Securities Laws and other applicable Laws, and
(ii) did not, at the time they were filed (or, if amended, or superseded by a
filing prior to the date of this Agreement, then on the date of such filing),
contain any untrue statement of a material fact or omit to state a material fact
required to be stated in the SEC Documents or necessary in order to make the
statements in the SEC Documents in light of the circumstances under which they
were made, not misleading. Each of the St. Xxxx financial statements (including,
in each case, any related notes) contained in the SEC Documents complied as to
form in all material respects with the applicable published rules and
regulations of the SEC with respect thereto, was prepared in accordance with
GAAP (except to the extent required by changes in GAAP, as may be indicated in
the notes to such financial statements or, in the case of unaudited interim
statements, as permitted by Form 10-Q under the 1934 Act, as amended), and
fairly presented in all material respects the consolidated financial positions
of St. Xxxx and its subsidiaries as at the respective dates and the consolidated
results of operations and cash flows of the periods indicated, except that the
unaudited interim financial statements were or are subject to normal and
recurring year-end adjustments which were not or are not expected to be material
in amount or effect.
4.07 Materially Adverse Change of Condition. St. Xxxx has no Knowledge of
any material adverse change in the condition of or title to its assets which
have occurred subsequent to December 31, 1998, except depletion through normal
production within authorized allowables, ordinary changes and
17
rates of production, and depreciation of equipment through ordinary wear and
tear.
4.08 Third-Party and Governmental Consents. Except as set forth on
Schedule 4.08 hereto, and those customarily obtained after Closing, no approval,
consent, waiver, order or authorization of, or registration, qualification,
declaration or filings with, or notice to, any Governmental Authority or other
third party is required on the part of St. Xxxx in connection with the execution
of this Agreement, or the consummation of the transactions contemplated hereby
or thereby. All of the consents and approvals set forth on Schedule 4.08 have
been obtained.
4.09 Litigation. There are no claims, actions, suits, proceedings or
investigations pending or, to the Knowledge of St. Xxxx, threatened, by or
against St. Xxxx with respect to this Agreement, or in connection with the
transactions contemplated hereby and St. Xxxx has no reason to believe there
exists a valid basis for any such claim, action, suit, proceeding, or
investigation.
4.10 Broker's Fees. No agent, broker or other person is or may be entitled
to a commission or finder's fee in connection with the transactions contemplated
by this Agreement, or is or may be entitled to make any claim against Xxxxxx or
Quanterra Partnership or against St. Xxxx or any of its subsidiaries or
affiliates as a result of any actions by St. Xxxx. St. Xxxx shall indemnify
Xxxxxx against any claim for any such commission or finder's fee made by any
agent, broker or other person as a result of any actions by St. Xxxx.
4.11 No Misstatements or Omissions. No representation or warranty made in
this Agreement by St. Xxxx is false or misleading as to any material fact or
omits to state a material fact required to make any of such information not
misleading in any material respect. In addition, all other information made
available by St. Xxxx to Xxxxxx, whether in oral, written or any other form, is
true and correct to the Knowledge of St. Xxxx, and such information is not false
or misleading as to any material fact. To the knowledge of St. Xxxx, the
foregoing representations, warranties and information, together with the SEC
Documents, constitute full disclosure of all material facts with respect to the
business, assets and liabilities of St. Xxxx.
18
ARTICLE 5
DELIVERIES
5.01 Deliveries by Xxxxxx. At the Closing, in addition to any other
documents required to be delivered under the terms of this Agreement, Xxxxxx
shall deliver the following:
(a) A certificate of Xxxxxx dated as of Closing, certifying that any
consents and approvals referred to in Section 3.09, which are obtainable prior
to Closing, have been obtained, together with copies of such consents and
approvals.
(b) A copy of the Quanterra Partnership Limited Partnership
Agreement and Limited Partnership Certificate.
(c) If available, a certificate dated not earlier than seven
calendar days prior to Closing of the Secretary of State of Montana as to the
valid existence of Quanterra Partnership.
(d) If available, certificates of authority dated during 1999 of the
Secretary of State of each of the states in which Quanterra Partnership is
qualified to do business, as to the due qualification or license of Quanterra
Partnership as a foreign limited partnership in such state.
(e) The opinion of Xxxxxxx, Haughey, Hanson, Toole & Xxxxxxxx, PLLP,
counsel to Quanterra Partnership and Xxxxxx, substantially in the form of
Exhibit 5.01(e) hereto.
(f) Xxxxxx shall deliver to St. Xxxx Uniform Commercial Code
financing statement searches for the State of Montana and any other state in
which Quanterra Partnership does business, dated within 15 calendar days prior
to the date of Closing, showing that there are no security interests, judgments,
taxes, other liens or encumbrances outstanding against Quanterra Partnership or
its assets, or against Xxxxxx.
5.02 Deliveries by St. Xxxx. At the Closing, in addition to any other
documents required to be delivered under the terms of this Agreement, St. Xxxx
shall have delivered or will deliver the following:
(a) A certificate of the President or a Vice President of St. Xxxx,
dated as of Closing, certifying that any consents and approvals referred to in
19
Section 4.08 have been obtained, together with copies of such consents and
approvals.
(b) A copy of the Certificate of Incorporation of St. Xxxx,
certified as of a recent date by the Secretary of State of Delaware.
(c) A copy of the By-Laws of St. Xxxx, including all amendments
thereto, certified by the Secretary or an Assistant Secretary of St. Xxxx.
(d) A Certificate, dated as of a recent date of the Secretary of
State of Delaware as to the valid existence and good standing of St. Xxxx.
(e) Resolutions adopted by the Board of Directors of St. Xxxx
authorizing this Agreement and the transactions contemplated hereby, certified
by the Secretary or an Assistant Secretary of St. Xxxx.
(f) The opinion of the law firm Xxxxxxx Xxxxx Xxxxxxx & Xxxxxxxxx,
LLP, counsel to St. Xxxx, substantially in the form of Exhibit 5.02(f) hereto.
ARTICLE 6
INDEMNIFICATION
6.01 Survival of Representations, Warranties and Covenants. Without
affecting the validity or applicability of the indemnification provisions set
forth in Sections 6.02 and 6.03 of this Agreement, the representations,
warranties, and covenants of Xxxxxx and St. Xxxx contained in this Agreement
shall survive the Closing and remain in full force and effect until one year
after the Closing except that such representations and warranties shall remain
in full force and effect until two years after the Closing with respect to any
breach thereof resulting in or otherwise involving a claim by a third party
against St. Mary, Hanley, or Quanterra Partnership (a "Third Party Claim").
6.02 Indemnification By and On Behalf of Xxxxxx. Subject to the provisions
of Section 6.05, Xxxxxx agrees to defend, indemnify and hold St. Xxxx harmless
from and against any and all losses, liabilities, damages, costs or expenses
(including reasonable attorneys' fees, penalties, and interest) payable to or
for the benefit of, or asserted by, any party, resulting from, arising out of,
or incurred as a result of:
(a) the breach of any representation and/or warranty made by Xxxxxx
herein; or (b) any claim, whether made before or after the date of this
Agreement, or any litigation, proceeding or governmental investigation, whether
20
commenced before or after the date of this Agreement, arising out of the
businesses of Quanterra Partnership prior to the Closing, or otherwise arising
out of any act or occurrence prior to, or any condition or facts existing as of,
Closing, regardless of whether or not referred to on a Schedule to this
Agreement or otherwise disclosed or known to St. Xxxx as of Closing. No claim by
St. Xxxx for indemnification by Xxxxxx shall be made after one year has elapsed
following the Closing except that a claim for indemnification may be made by St.
Xxxx with respect to a Third Party Claim until two years has elapsed following
the Closing.
The indemnification obligation of Xxxxxx set forth above shall be limited
to 49.5% of any amounts attributable to Quanterra Partnership with respect to
interests or activities of it.
6.03 Indemnification by St. Xxxx. Subject to the provisions of Section
6.05, St. Xxxx agrees to defend, indemnify and hold Xxxxxx harmless from and
against any and all losses, liabilities, damages, costs, or expenses (including
reasonable attorneys' fees, penalties and interest) payable to or for the
benefit of, or asserted by, any party, resulting from, arising out of, or
incurred as a result of the breach of any representation and/or warranty made by
St. Xxxx herein or in accordance herewith. No claim by Xxxxxx for
indemnification by St. Xxxx shall be made after one year has elapsed following
the Closing except that a claim for indemnification may be made by Xxxxxx with
respect to a Third Party Claim until two years has elapsed following the
Closing.
6.04 Notice of Claims. Xxxxxx and St. Xxxx shall give prompt written
notice to each other of any claim by any party which might give rise to a claim
by Xxxxxx or St. Xxxx against the other based upon the indemnity provisions
contained herein, stating the nature and basis of the claim and the actual or
estimated amount thereof; provided, however, that failure to give such notice
will not affect the obligation of the indemnifying party to provide
indemnification in accordance with the provisions of this Article 6 unless, and
only to the extent that, such indemnifying party is actually prejudiced thereby.
In the event that any action, suit or proceeding is brought by a third party
against Xxxxxx or St. Xxxx with respect to which the other party may have
liability under the indemnification provisions contained herein, the
indemnifying party shall have the right, at its sole cost and expense, to defend
such action in the name or on behalf of the indemnified party and, in connection
with any such action, suit or proceeding, the parties hereto agree to render to
each other such assistance as may reasonably be required in order to ensure the
proper and adequate defense of any such action, suit or proceeding; provided
further, however, that an indemnified party shall have the right to retain its
own counsel, with the fees and expenses to be paid by the indemnifying party, if
representation of such indemnified party by the
21
counsel retained by the indemnifying party would be inappropriate because of
actual or potential differing interests between such indemnified party and any
other party represented by such counsel. Neither party hereto shall make any
settlement of any claim which might give rise to liability of the other party
under the indemnification provisions contained herein without the written
consent of such other party, which consent such other party covenants shall not
be unreasonably withheld.
6.05 Limitation of Liability. Notwithstanding the provisions of this
Article 6, neither Xxxxxx nor St. Xxxx shall have any liability to the other
with respect to any matter which liability does not exceed $50,000 as to any
single liability or $100,000 as to liabilities in the aggregate irrespective of
their single size except that such limitations shall not apply to any Third
Party Claim. In the event of any liability of Xxxxxx for indemnification, St.
Xxxx xxx elect to cause such liability to be satisfied in part or in whole by
reducing the St. Xxxx Stock issued to Xxxxxx by the number of shares (rounded to
the nearest whole number) equal to the amount of Xxxxxx'x liability based on the
published closing price for a share of St. Xxxx Stock on the day such liability
is quantified, and the certificates of St. Xxxx Stock issued to Xxxxxx shall
bear a legend to that effect.
ARTICLE 7
SHARE RESTRICTIONS
7.01 Restricted Shares. Xxxxxx hereby agrees that during the period
beginning on the Closing and, subject to Section 7.05, ending on the date which
is three years after the date hereof, Xxxxxx will not sell, assign, transfer,
pledge, hypothecate, encumber or otherwise dispose of ("Transfer") any shares of
St. Xxxx Stock received as part of the Consideration (the "Restricted Shares"),
other than in accordance with the terms of this Article 7 or as otherwise agreed
by St. Xxxx in writing in its sole discretion, and any such purported Transfer
shall be void, except that Xxxxxx may make a Permitted Transfer (as hereinafter
defined), if and only if the transferee in such Permitted Transfer ("Permitted
Transferee") executes and delivers a written agreement to the effect that the
Restricted Shares transferred to such Permitted Transferee shall be bound by the
terms of this Article 7 as if such Permitted Transferee were an original party
hereto.
7.02 Permitted Transfer. For purposes of this Article 7, a "Permitted
Transfer" of Restricted Shares by Xxxxxx is (i) any bona fide gift of such
Restricted Shares by Xxxxxx, including a charitable gift, (ii) any transfer of
such Restricted Shares by Xxxxxx to a trustee for the benefit of Xxxxxx or the
Xxxxxx'x ancestors, descendants or spouse, or (iii) any transfer of such
Restricted Shares
22
by Xxxxxx to the Xxxxxx'x executors, administrators or legal representatives,
heirs or devisees pursuant to the laws of descent and distribution.
7.03 Restrictive Legends; Stop Orders. The certificate or certificates
representing Restricted Shares issued to Xxxxxx or any Permitted Transferee
shall bear an appropriate legend referring to the restrictions on Transfer
contained in this Article 7 (together with the legends referred to in Section
3.23 and Section 6.05 hereof) shall be endorsed with substantially the following
legend in addition to any other legend which may appear on such certificate or
certificates:
THE SALE, ASSIGNMENT, TRANSFER, PLEDGE, HYPOTECATION, ENCUMBRANCE OR OTHER
DISPOSITION OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT
TO THE TERMS AND CONDITIONS OF A PURCHASE AND SALE AGREEMENT DATED JUNE 1,
0000, XXXXXXX XX. XXXX XXXX & EXPLORATION COMPANY AND XXXXXX X. XXXXXX.
COPIES OF SUCH AGREEMENT MAY BE OBTAINED AT NO COST BY WRITTEN REQUEST
MADE BY THE HOLDER OF THIS CERTIFICATE TO THE SECRETARY OF ST. XXXX XXXX &
EXPLORATION COMPANY.
To assure compliance with the terms of this Agreement, St. Xxxx shall also be
permitted to deliver appropriate "stop transfer" instructions covering
certificates representing Restricted Shares to any transfer agent or registrar
of the shares of St. Xxxx Stock.
7.04 Termination of Restrictions. Any provision of this Agreement to the
contrary notwithstanding, the restrictions on Transfer contained in this Article
7 shall expire three years after the date hereof. The restrictions contained
herein shall expire with respect to the Restricted Shares held by Xxxxxx in
proportion to his respective ownership of shares of St. Xxxx Stock on the date
hereof.
7.05 Removal of Legends. Whenever the restrictions imposed by this Article
7 shall terminate by reason of the passage of time and the Restricted Shares are
transferable pursuant to Rule 144(k) under the Securities Act or other available
exemption from the registration requirements of the Securities Act, each holder
of Restricted Shares shall be entitled to receive from St. Xxxx, without cost or
expense, a new certificate representing such Restricted Shares not bearing the
legends set forth in Section 7.03 and Section 3.23 upon receipt of an opinion of
counsel reasonably satisfactory to St. Xxxx that such restrictions have
terminated in accordance with their terms and that such Restricted Shares
23
are transferable without registration under the Securities Act pursuant to Rule
144(k) under the Securities Act or other available exemption from the
registration requirements of the Securities Act.
7.06 Voting Rights. The holder or holders of Restricted Shares shall
retain the full right to vote or to execute and deliver a proxy to vote
Restricted Shares on any matter submitted to holders of St. Xxxx Stock.
ARTICLE 8
GENERAL PROVISIONS
8.01 Expenses. Except as otherwise expressly provided herein, each party
to this Agreement shall pay its or his own expenses (including, without
limitation, the fees and expenses of its or his agents, representatives,
counsel, and accountants) incurred in connection with the negotiation, drafting,
execution, delivery and performance of this Agreement and the transactions
contemplated hereby.
8.02 Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of Xxxxxx and St. Xxxx and their respective heirs, personal
representatives, successors, representatives and assigns.
8.03 Waiver. No provision of this Agreement shall be deemed waived by
course of conduct, including the act of closing, unless such waiver is made in
writing signed by all then existing or surviving parties hereto, stating that it
is intended specifically to modify this Agreement, nor shall any course of
conduct operate or be construed as a waiver of any subsequent breach of this
Agreement, whether of a similar or dissimilar nature.
8.04 Entire Agreement. This Agreement (together with the Schedules and
Exhibits hereto) supersedes any other agreement, whether written or oral, that
may have been made or entered into by St. Xxxx or by Xxxxxx relating to the
matters contemplated hereby. This Agreement (together with the Schedules and
Exhibits hereto) constitutes the entire agreement between the parties and there
are no agreements or commitments except as expressly set forth herein.
8.05 Further Assurances. Each of the parties hereto agrees to execute all
further documents and instruments and to take or to cause to be taken all
reasonable actions which are necessary or appropriate to complete the
transactions contemplated by this Agreement.
24
8.06 Notices. All notices, demands, requests, and other communications
hereunder shall be in writing and shall be deemed to have been duly given and
shall be effective upon receipt if delivered by hand, or sent by certified or
registered United States mail, postage prepaid and return receipt requested, or
by prepaid overnight express service or facsimile transmission (with receipt
confirmed). Notices shall be sent to the parties to the following addresses (or
at such other addresses for a party as shall be specified by like notice;
provided that such notice shall be effective only upon receipt thereof):
If to Xxxxxx:
Xxxxxx X. Xxxxxx
000 X. 00xx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Telephone: 000-000-0000
Facsimile: 000-000-0000
with a copy (which shall not constitute notice) to:
Xxxxx X. Xxxxxx
Xxxxxxx Xxxxxxx Xxxxxx Xxxxx & Xxxxxxxx
000 Xxxxx 00xx Xxxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxxx 00000
Telephone: 000-000-0000
Facsimile: 000-000-0000
If to St. Xxxx:
St. Xxxx Xxxx & Exploration Company
0000 Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxx 00000
Telephone: 000-000-0000
Facsimile: 000-000-0000
Attention: Xxxxx Xxxxxxxx Xxxxx
8.07 Amendments, Supplements, Etc. This Agreement may be amended or
modified only by a written instrument executed by all parties hereto which
states specifically that it is intended to amend or modify this Agreement.
8.08 Severability. In the event that any provision contained in this
Agreement shall for any reason be held to be invalid, illegal or unenforceable
in any respect, such invalidity, illegality or unenforceability shall not affect
any other
25
provision hereof and this Agreement shall be construed as if such invalid,
illegal or unenforceable provisions had never been contained herein and, in lieu
of each such illegal, invalid or unenforceable provision, there shall be added
automatically as a part of this Agreement a provision as similar in terms to
such illegal, invalid or unenforceable provision as may be possible but still be
legal, valid and enforceable.
8.09 Governing Law. This Agreement and its interpretation shall be
governed by the laws of the State of Colorado.
8.10. Counterpart Execution. This Agreement may be executed in
counterparts and each counterpart shall constitute a binding agreement as if the
parties had executed a single document. The parties agree that such counterpart
execution may be evidenced by a facsimile transmission of the execution page for
each such party, and such facsimile execution shall constitute a binding
execution by such party. At or after Closing, the parties agree that a
sufficient number of original counterpart executions will be obtained and
affixed to this Agreement so that each party will have an originally executed
Agreement.
/s/ Xxxxxx X. Xxxxxx
----------------------------------------
Xxxxxx X. Xxxxxx
ST. XXXX XXXX & EXPLORATION COMPANY
By: /s/ Xxxx X. Xxxxxxxxxxx
-------------------------------------
Xxxx X. Xxxxxxxxxxx, President
26
LIST OF SCHEDULES
______ Schedule 1.01(3) - Consideration - Shares of St. Xxxx Stock used as
Consideration
_____ Schedule 2.01 - Acquisition of Xxxxxx Partnership Interest in
Quanterra Partnership - Assignment from Xxxxxx to St. Xxxx
_____ Schedule 3.04 - Organization Existence - Jurisdictions where
Quanterra Partnership is qualified to do business; names and
addresses of registered agents in such jurisdictions; and names
under which Quanterra Partnership has conducted or purported to
conduct business since date of incorporation
_____ Schedule 3.08 - No Adverse Effects or Changes - Quanterra
Partnership
_____ Schedule 3.08(e) - List, if any, of any disposition of
any material assets, properties or rights, or canceled
or terminated, or agreed to cancel or terminate any
debts or claims other accounts receivable write-offs and
writedowns in the ordinary course of business (since
December 31, 1998)
_____ Schedule 3.08(h) - List, if any, of any accrual or
arrangement for or payment of any bonus or special
compensation or severance or termination pay to any
present or former officer, director, or executive
employee (since December 31, 1998)
_____ Schedule 3.09 - Third Party and Governmental Consents - List, if
any, of the Third Party and Governmental Consents required on the
part of Xxxxxx or Panterra Partnership
_____ Schedule 3.10 - Real and Personal Property
_____ Schedule 3.10(a) - Oil and Gas Leases and Xxxxx List of
oil and gas leases in which Quanterra Partnership is a
party
_____ Schedule 3.10(b) - Personal Property - List, if any, of
any outstanding options, warrants, commitments,
27
agreements or any other right against any of the
personal property (other than St. Xxxx)
_____ Schedule 3.11 - Accounts and Notes Receivable - List of Quanterra
Partnership's accounts and notes receivables as of December 31, 1998
_____ Aging report setting forth all accounts receivables
(other than intercompany receivables)
_____ Identify any asset holding a security interest to secure
payment of the underlying indebtedness
_____ Description of the nature and amount of any lien on or
security interest in such accounts and notes receivable
_____ Identify accounts receivable on Schedule 3.13 which have
been collected in their entirety since December 31,
1998.
_____ Schedule 3.12 - Accounts Payables and Promissory Notes Quanterra
Partnership. List of:
_____ Accounts payable as of December 31, 1998 with
appropriate aging report
_____ Long-term and short-term promissory notes, installment
contracts, loan agreements, and credit agreements
_____ Indentures, mortgages, security agreements, pledges,
etc.
_____ Identify accounts payable on Schedule 3.13 which have
been fully or partially paid since December 31, 1998.
_____ Schedule 3.13 - Bonds and Insurance
_____ List of all insurance policies and bonds. List should
include (i) insurer and agent; (ii) amount of coverage;
(iii) premium dates; and (iv) expiration dates, if any.
28
_____ List, if any, of any facts or circumstances under which
claims for uninsured losses or damages are likely to be
asserted against Quanterra Partnership in excess of
$10,000 or pending claims against Quanterra Partnership
_____ Schedule 3.14 - Bank Accounts - List of (i) names of banks or
financial institutions where Quanterra Partnership has banks
accounts and safety deposit boxes (ii) names of persons authorized
to draw on account or access the safety deposit box; and (iii) names
of persons other than officers who are authorized to incur
liabilities for borrowed funds
_____ Schedule 3.17 - Permits - List of all federal, state or local
regulatory or governmental authority permits
_____ Schedule 3.18 - Taxes - List, if any, of audited Tax reports
_____ Schedule 3.21 - Environmental Matters
_____ Schedule 3.25 - Tax Reports - Copies of tax reports filed by
Quanterra Partnership for the past two years including 1998
_____ Schedule 4.05 - Capital Stock of St. Xxxx - List, if any, of
outstanding equity securities, options, warrants, rights, call,
commitments, conversion rights, rights of exchange, plans or other
agreements of any character provided for the purchase, issuance or
sale of any shares of capital stock of St. Xxxx (other than
contemplated in this Agreement)
_____ Schedule 4.08 - Third Party and Governmental Consents - List, if
any, of the Third Party and Governmental Consents required on the
part of St. Xxxx
_____ Exhibit 5.01(e) - Form opinion letter from Quanterra Partnership and
Xxxxxx counsel
_____ Exhibit 5.02(g) - Form opinion letter from St. Xxxx counsel
29
DELIVERIES BY ST. XXXX
_____ 1. A certificate from the President or a Vice President dated the
date of Closing, certifying that any third party or
governmental consents and approvals have been obtained,
together with copies of such consents and approvals.
_____ 2. A copy of STML&EC Certificate of Incorporation (recent date)
from Secretary of State of Delaware.
_____ 3. A copy of the By-Laws of St. Xxxx, including all amendments
thereto certified by the Secretary or an Assistant Secretary
of St. Xxxx.
_____ 4. A Certificate of Good Standing for STML&E (recent date) from
Secretary of State of Delaware
_____ 5. STML&EC Resolutions adopted by the Board of Directors of
authorizing transaction
_____ 6. Opinion letter from Xxxxxxx Xxxxx Xxxxxxx & Ingersoll, LLP
30
CONDITIONS BY QUANTERRA PARTNERSHIP
_____ 1. A certificate (dated as of Closing) regarding consents and
approvals, together with copies of such consents and approvals
_____ 2. Copy of Panterra Partnership Limited Partnership Agreement
_____ 3. Certificate from the Montana Secretary of State (dated within
seven calendar days prior to Closing) as to the valid
existence of Quanterra Partnership.
_____ 4. Certificates of Authority dated during 1999 from the Secretary
of State of each of the states in which Quanterra Partnership
is qualified to do business
_____ 5. Opinion letter from Xxxxxxx, Haughey, Hanson, Toole &
Xxxxxxxx, PLLP
_____ 6. Uniform Commercial Code financing statement searches for the
State of Montana and any other state in which Quanterra
Partnership or the Affiliate do business (dated within 15
calendar days prior to the date of the Closing)
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