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EXHIBIT 10.2
December 31, 1999
Anadarko Petroleum Corporation
00000 Xxxxxxxxxx Xx.
Xxxxxxx, Xxxxx 00000
Attn: Xx. Xxxxx X. Xxxx, Xx.
Re: Amendments to: (i) Purchase, Sale and Exchange
Agreement dated as of December 17, 1999, between EXCO
Resources, Inc., as Seller, and Anadarko Petroleum
Corporation ("Anadarko"), as Buyer (the "EXCO PSA")
and (ii) Purchase and Sale Agreement dated December
17, 1999 between Venus Exploration, Inc., as Seller,
and Anadarko as Buyer (the "Venus PSA")
Gentlemen:
By the EXCO PSA and Venus PSA (collectively the "Agreements"), EXCO
Resources, Inc. ("EXCO") and Venus Exploration, Inc. ("Venus") agreed to sell to
Anadarko certain properties located in Xxxxxxx Parish, Louisiana. Reference to
the Agreements is hereby made for all purposes. Unless otherwise stated, words
beginning with capital letters in this Agreement shall have the same meaning
ascribed thereto in the Agreements. The Closing Date specified in the Agreements
is December 31, 1999. Because of potential problems in arranging for the wire
transfer of money as a result of the "Y2K" phenomenon, and other matters, EXCO,
Venus and Anadarko have concluded that it is in everyone's best interest to
modify the closing as set forth below, including deferring the actual cash
transfer of the adjusted Purchase Price until a few days after the first of
January, 2000 as set forth hereinbelow. Such deferral necessitates an amendment
to the Agreements. This letter, when accepted by you in the manner hereinafter
set forth, shall constitute the agreement of EXCO, Venus and Anadarko to amend
the Agreements as follows:
1. The method and date of Closing as set forth in the Agreements
is hereby changed as follows:
1.1 On December 31, 1999, the following documents (the
"Escrow Documents") which are contemplated by the
Agreements, will be fully executed and delivered to
American Escrow Company:
(1) The Assignment and Xxxx of Sale attached as:
(a) Exhibit D to the EXCO PSA, (b) Exhibit B
to the Venus PSA, and (c) Exhibit D to the
Exchange Agreement between Anadarko and
EXCO;
(2) The escrow agreement attached hereto as
Addendum "A" (the "Escrow Agreement");
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December 31, 1999
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(3) The letters-in-lieu of transfer orders
described in the Agreements;
(4) The affidavit of non-foreign status
contemplated by the Agreements;
(5) The Exchange Agreement between Anadarko and
EXCO; and
(6) The Assignment and Xxxx of Sale conveying
from EXUS Energy LLC ("EXUS") to EXCO and
Venus the properties subject to the
Agreements.
1.2 Provided that all of the conditions to payment set
forth in the Escrow Agreement and the Agreements have
been satisfied, on January 6, 2000 (the "Initial
Escrow Payment Date"), Anadarko will make the payment
of the Purchase Price adjusted as provided for in the
Agreements as follows, which payments, subject to the
next sentence of this section, shall not be less
than:
(a) $16,848,307 under the EXCO PSA ("Initial
EXCO PSA Payment"); and
(b) $17,104,571 under the Venus PSA ("Initial
Venus PSA Payment", collectively the
"Initial Escrow Payment").
Title defects which may be cured by obtaining a
corrective assignment from Apache representing a
Title Defect Amount of $919,188 as to the EXCO Assets
and $887,710 as to the Venus Assets is anticipated to
be received by Anadarko prior to the Initial Escrow
Payment Date. In the event such assignment is not
received, then the Initial EXCO PSA Payment shall be
reduced by $919,188 and the Initial Venus PSA
Agreement shall be reduced by $887,710.
A. Payments attributable to the EXCO PSA shall be made
to Texas Escrow Company, Inc. to the following
account:
Bank One Texas
ABA No. 000000000
For Credit to Texas Escrow Company, Inc.
Account No. 189 234 8820
Re: GF No. 99S12314 SJ1E
Notify Xxxxx Xxxxxxxx at (000) 000-0000
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December 31, 1999
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B. Payments attributable to the Venus PSA shall be made
to American Escrow Company to the following account:
Bank One Dallas, Texas
ABA No. 000000000
For Credit to American Escrow Company
Account No. 1825159336
Re: GF No. 99S13498 SJ1
Notify Xxxxxxx Xxxxxxxx at (000) 000-0000
Distributions of the Initial Escrow Payment and any subsequent payments from
Anadarko by Texas Escrow Company, Inc. and American Escrow Company shall be made
as set forth in the Escrow Agreement.
2. Section 3.5 of each of the Agreements provides that Buyer
(Anadarko) may elect to treat unsatisfied consent requirements
and preferential purchase right requirements as Title Defects
by giving Seller (EXCO and Venus) notice of such treatment no
later than one business day prior to the Closing Date. Section
3.5 of the Agreements is hereby amended to permit Buyer to
treat such unsatisfied consent and preferential purchase
rights as Title Defects by giving Seller notice no later than
January 5, 2000, at 5:00 p.m. In the event (i) Anadarko treats
unsatisfied consent requirements and/or preferential purchase
right requirements as a Title Defect; (ii) makes adjustments
to the Purchase Price on account thereof; (iii) such consent
requirements remain unsatisfied as of March 31, 2000; and (iv)
Anadarko does not waive all or any portion of such unsatisfied
consent requirements and/or preferential purchase rights by
making additional payments attributable to EXCO's Assets to
Texas Escrow Company, Inc. and additional payments
attributable to Venus' Assets to American Escrow Company in an
amount equal to the adjustments to the Purchase Price made on
account thereof, then and in such event, Anadarko agrees that
it shall reconvey unto EXCO and Venus, all of the Assets
attributable to such unsatisfied consent requirements,
effective as of October 1, 1999. In the event of such
reconveyance, the parties shall make adjustment of the type
contemplated by the Agreements as if such Property had never
been conveyed to Anadarko with EXCO and Venus being: (a)
responsible for all reasonable costs and expenses of every
nature incurred by Anadarko arising out of or related to the
reconveyed Property; and (b) entitled to net proceeds
attributable to production from the reconveyed Property
received by Anadarko. As Title Defects with respect to a
Property are cured to Anadarko's satisfaction, Anadarko shall
make additional payments to the escrow account which are equal
to the Title Defect Amount for which Anadarko received a
reduction in the Purchase Price.
3. Notwithstanding anything contained in the Agreements to the
contrary, upon receipt of the Assignment and Xxxx of Sale as
to a particular property, Anadarko, its
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December 31, 1999
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successors and assigns, shall not thereafter be required
to obtain from EXUS, EXCO, Venus or their successors or
assigns any consent to assign any of the Properties or
interests described in such Assignment and Xxxx of Sale.
4. EXCO, Venus and Anadarko have reached an agreement regarding
Title Defect Amount attributable to the Properties. The total
Title Defect Amount under both of the Agreements is
$5,414,020. The allocation of the Title Defect Amount amongst
the Properties and the Agreements is set forth on Addendum "B"
hereto. EXCO and Venus shall have the right to cure the Title
Defects which comprise the Title Defect Amount for a period up
to and including March 31, 2000. If the total Title Defect
Amount still outstanding as of March 31, 2000 is less than the
Title Defect Amount set forth on Addendum "B" hereto but is
equal to or greater than at least $300,000.00, and Anadarko
shall have reduced the initial payment to the escrow agent by
at least $300,000, then Anadarko shall, except for Title
Defect Amounts for Property it reconveys to EXCO or Venus, pay
to EXCO and Venus, in equal proportions, the difference
between the Title Defect Amount set forth on Addendum "B"
hereto and the Title Defect Amount outstanding as of March 31,
2000. If the total Title Defect Amount still outstanding as of
March 31, 2000 is less than $300,000.00, and Anadarko shall
have reduced the initial payment to the escrow agent by
$300,000, then Anadarko shall, except for Title Defect Amounts
for Property it reconveys to EXCO or Venus, pay to EXCO and
Venus the entire Title Defect Amount.
5. Title Defect number 108 described on Addendum "B" hereto
pertains to the drilling and production unit known as the
"Lower Cotton Valley Reservoir A SUA", or "LCV RA SUA". Such
unit includes the Xxxxx Bros. H-1 and K-1 xxxxx. In the event
the Title Defect set forth on Addendum "B" hereto which
pertains to such unit is cured prior to March 31, 1999 by
obtaining a lease or a ratification of a lease from mineral
owners in such unit, any payments made to such mineral owners
by Anadarko in order to secure such lease or ratification
shall be added to the Title Defect Amount in determining
whether the Title Defect Amount is lesser or greater than
$300,000 pursuant to paragraph 4, above.
6. All representations, warranties and covenants of the Parties
and other conditions set forth in the Agreements as being
applicable on or extending through the Closing Date shall be
applicable as of the Initial Escrow Payment Date.
7. Operation of the properties shall be transferred to Buyer at
1:00 p.m. on December 31, 1999, and Anadarko shall assume risk
of loss to the Properties attributable to its operations
commencing with its assumption of operations. Anadarko agrees
to defend, indemnify and hold harmless Venus and EXCO from all
Liabilities arising
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out of or related to operations conducted by Anadarko on the
Properties including, without limitation, Liabilities
attributable to operations on the Louisiana Minerals 15-1
Alternate well.
8. The number of days after the Closing Date in which Seller
shall provide a statement to Buyer, as set forth in Section
8.4(b) of the Agreements, setting forth the final calculation
of the Adjusted Purchase Price shall be 90 days, instead of 60
days, and the parties shall undertake to agree on the final
statement within 180 days after the Closing Date, instead of
150 days after the Closing Date.
9. The place of Closing as set forth in Section 8.1(a) of the
Agreements shall be Anadarko's office at 00000 Xxxxxxxxxx
Xxxxx, Xxxxxxx, Xxxxx.
10. Sections 9.1 and 9.2 of the Agreements shall be deleted in
their entirety and the following substituted in lieu thereof:
Section 9.1 Termination
This Agreement may be terminated at any time prior to
the Initial Escrow Payment Date if either party has failed to
perform or observe in any material respect its covenants and
agreements hereunder. In the event this Agreement terminates
because a party has failed to perform or observe in any
material respect any of its agreements or covenants contained
herein which are to be performed at or prior to the Initial
Escrow Payment Date, then the other party shall be entitled to
all remedies available at law or in equity and shall be
entitled to recover attorneys' fees in addition to any other
relief to which such party may be entitled.
11. Except as amended hereby, the Agreements shall remain in full
force and effect in accordance with their original terms.
If the foregoing correctly sets forth your understanding of our
agreement, please indicate your acceptance hereof by executing three copies of
this agreement in the space provided below and by returning two copies to the
undersigned at the address set forth above.
EXCO Resources, Inc.
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December 31, 1999
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By: /s/ X. X. XXXXXX
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X. X. Xxxxxx, President
Accepted and agreed to this 31st
day of December, 1999.
Venus Exploration, Inc.
By: /s/ XXXX X. XXXX
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Xxxx X. Xxxx, President
Accepted and agreed to this 31st
day of December, 1999.
Anadarko Petroleum Corporation
By: /s/ XXXXX X. XXXXXX
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Xxxxx X. Xxxxxx, Vice President
Worldwide Business Development
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LIST OF ADDENDUMS
ADDENDUM A ESCROW AGREEMENT FOR CLOSING FUNDS
AND CLOSING DOCUMENTS
ADDENDUM B EXCO RESOURCES, INC. AND ANADARKO
PETROLEUM CORPORATION'S AGREED TO
TITLE DEFECTS
Addendums for this Exhibit 10.2 have not been filed herewith. These addendums
will be filed if requested by the Securities and Exchange Commission.
