AMENDED AND RESTATED PARTICIPATION AGREEMENT
Exhibit 10.7
AMENDED
AND RESTATED PARTICIPATION AGREEMENT
This
Amended and Restated Participation
Agreement (the “Agreement”) is made and entered into as of this 8th day of
December, 2006, by and between Ridgelake Energy, Inc., a
Louisiana corporation, whose mailing address is 0000 X. Xxxxxxxx Xxxx., Xxxxx
000, Xxxxxxxx, Xxxxxxxxx 00000-0000, sometimes hereinafter referred
to as “Ridgelake,” GulfX, LLC, a Delaware limited liability
company, whose mailing address is 00 Xxxxxx Xxxxxx, Xxxx Xxxxx, Xxxxxxx
Xxxxxxxxx 6005, Australia, sometimes hereinafter referred to as “GulfX,” and
South Xxxxx LLC, a Delaware limited liability company, whose
mailing address is 00 Xxxxxx Xxxxxx, Xxxx Xxxxx, Xxxxxxx Xxxxxxxxx 6005,
Australia, sometimes hereinafter referred to as “South Xxxxx.” GulfX
and South Xxxxx are sometimes individually referred to herein as a “Participant”
and collectively as the “Participants.” Ridgelake, GulfX, and South
Xxxxx are sometimes individually referred to herein as a “Party” or collectively
as the “Parties.”
WITNESSETH:
WHEREAS,
Ridgelake and GulfX entered into that certain Participation Agreement, dated
January 18, 2006 (the “Original GulfX Agreement”), pursuant to which Ridgelake
granted to GulfX the right to acquire an undivided twenty percent (20%) working
interest in the oil and gas leases more particularly described in Exhibit A
attached hereto, which cover the OCS Blocks set forth below (hereinafter jointly
referred to as the “Leases” or individually as the “Lease”), all subject to the
terms, conditions, reservations and limitations provided for in the Original
GulfX Agreement:
|
OCS
Lease No.:
|
OCS
Area Name/ Block:
|
|
OCS-G
26190
|
Viosca
Xxxxx Block 79 (“VK 79”)
|
|
OCS-G
26560
|
Xxxx
Xxxxxx Xxxx, Xxxx Xxxxxxxx, Xxxxx Xxxxxxxxx, Xxxxx A 307 (“HI
A-307”)
|
|
OCS-G
27078
|
Vermilion
Area, South Addition Block 317 (“VM 317”)
|
|
OCS-G
00000
|
Xxxxx
Xxxxx Xxxxxx, Xxxxx Addition Block 138 (“SMI 138”)
|
|
OCS-G
00000
|
Xxxxx
Xxxxx Xxxxxx, Xxxxx Addition Block 152 (“SMI
152”)
|
WHEREAS,
pursuant to that certain South Xxxxx Participation Agreement, dated February
7,
2006, between GulfX and South Xxxxx, GulfX assigned to South Xxxxx an undivided
37.5% of GulfX’s rights under the Original GulfX Agreement, insofar and only
insofar as the Original GulfX Agreement covers the Leases covering SMI 138
and
SMI 152 (collectively, the “SMI Leases”), so that, after giving effect to such
assignment (the “Partial Assignment”), GulfX had the right to acquire an
undivided 12.5% working interest in the SMI Leases, and South Xxxxx had the
right to acquire an undivided 7.5% working interest in the SMI Leases;
and
WHEREAS,
pursuant to that certain Participation Agreement, dated September 18, 0000,
xxxxxxx Xxxxx Xxxxx and Ridgelake (the “Original South Xxxxx Agreement”),
Ridgelake granted to South Xxxxx the right to acquire an undivided ten percent
(10%) working interest in the Leases covering VK 79, HI A 307, and VM 317 (the
Original GulfX Agreement and the Original South Xxxxx Agreement are collectively
referred to herein as the “Original Agreements”); and
WHEREAS,
GulfX desires to acquire from Ridgelake, and Ridgelake desires to grant to
GulfX, the right to acquire an additional undivided 3.75% working interest
in
the Lease covering SMI 138, and after giving effect to the Original GulfX
Agreement, the Partial Assignment, and such additional grant, it is the Parties’
intention that GulfX will have the right to acquire, in the aggregate, an
undivided 16.25% working interest in SMI 138, subject to and in accordance
with
the terms hereof; and
WHEREAS,
South Xxxxx desires to acquire from Ridgelake, and Ridgelake desires to grant
to
South Xxxxx, the right to acquire an additional undivided 3.75% working interest
in the Lease covering SMI 138, and after giving effect to the Partial Assignment
and such additional grant, it is the Parties’ intention that South Xxxxx will
have the right to acquire, in the
aggregate, an undivided 11.25% working interest in SMI 138, subject to and
in
accordance with the terms hereof; and
WHEREAS,
South Xxxxx desires to acquire from Ridgelake, and Ridgelake desires to grant
to
South Xxxxx, the right to acquire an additional undivided 7.50% working interest
in the Lease covering SMI 152, and after giving effect to the Partial Assignment
and such additional grant, it is the Parties’ intention that South Xxxxx will
have the right to acquire, in the aggregate, an undivided 15.00% working
interest in SMI 152, subject to and in accordance with the terms hereof;
and
WHEREAS,
the Parties desire to amend, restate and replace in their entirety the Original
Agreements in order to reflect (i) the partial assignment by GulfX to South
Xxxxx of an interest in the Original GulfX Agreement; and (ii) the rights to
acquire additional interests in the SMI Leases granted by Ridgelake to the
Participants.
NOW,
THEREFORE, for and in consideration of the recitals, covenants and agreements
contained herein, and for other good and valuable consideration, the Original
Agreements are hereby amended, restated and replaced in their entirety as
follows:
ARTICLE
I
PRICE
|
1.1
|
For
its interest in the Leases, each Participant shall pay its respective
“Cost Share” (as set forth in the table in Section 1.1.1 below) of (i) all
direct costs and expenses expended by Ridgelake (through the date
of
execution of this Agreement) in the acquisition, maintenance and
development of the Leases, including, but not limited to, lease bonus
costs, rentals, title examination fees and expenses, shallow hazard
survey
costs, and costs of acquisition and processing seismic data (collectively,
“Sunk Costs”); (ii) all direct costs and expenses expended by Ridgelake
(on a Lease-by-Lease basis until such time as Participant earns an
interest in a Lease) in the maintenance and development of the Leases,
including, but not limited to, rentals, shallow hazard survey costs,
and
the cost of acquisition and processing seismic data (collectively,
“Lease
Expenses”); and (iii) the cost of conducting the interest earning
operations on each lease, as specified on Exhibits “B-1” through “B-5”
attached hereto (hereinafter the
“Operations”).
|
|
|
1.1.1
|
Participants’
respective “Cost Shares” and “Earning Shares” in the Leases are as
follows:
|
|
GulfX
|
South
Marsh
|
|||
|
Cost
Share
|
Earning
Share
|
Cost
Share
|
Earning
Share
|
|
|
VK
79
|
26.67%
|
20.00%
|
13.34%
|
10.00%
|
|
HI
A 307
|
26.67%
|
20.00%
|
13.34%
|
10.00%
|
|
VM
317
|
26.67%
|
20.00%
|
13.34%
|
10.00%
|
|
SMI
138
|
21.67%
|
16.25%
|
15.00%
|
11.25%
|
|
SMI
152
|
16.67%
|
12.50%
|
20.00%
|
15.00%
|
|
|
1.1.2
|
Sunk
Costs as of December 4, 2006, are enumerated on Exhibit “C” attached
hereto. It is acknowledged that the Participants have paid
their respective Cost Shares of Sunk Costs in accordance with the
Original
Agreements and to the extent that Sunk Costs were enumerated on the
Exhibit “C” attached to the Original
Agreements.
|
Within
five (5) days after the execution of this Agreement, Ridgelake will present
to
the Participants a statement(s) reflecting the Participant’s Cost Share of Sunk
Costs as of December 4, 2006 (as such costs are shown on Exhibit “C” attached
hereto) less payments received to date. GulfX and South Xxxxx shall
remit the balance due to Ridgelake within five (5) days of receipt by
Participant of such statement(s).
|
|
1.1.3
|
The
Participants’ respective Cost Shares of Lease Expenses (i.e., the
respective Cost Shares set forth in the table Section 1.1.1 above)
shall
be periodically billed by Ridgelake as they arise and shall be paid
by
Participants in the time periods allowed for such payments under
the Joint
Operating Agreement referenced in Article III hereinbelow (hereinafter
the
“JOA”).
|
|
|
1.1.4
|
Each
Participant shall pay its proportionate share (i.e., the
respective Cost Shares set forth in the table in Section 1.1.1 above)
of
the estimated costs to conduct Operations on each lease thirty (30)
days
prior to the anticipated commencement date for such Operations, and
thereafter shall pay its respective Cost Share of all costs and expenses
for Operations on a Lease-by-Lease basis, until such Participant
has
earned an interest in a particular Lease in accordance with the terms
of
this Agreement.
|
|
1.2
|
Upon
execution of this Agreement, each Participant is obligated to pay
Ridgelake its respective Cost Share of the Sunk Costs and Lease Expenses
referenced in Article 1.1 above. Failure to timely remit such
payments to Ridgelake shall result in the immediate termination of
this
Agreement as to such Participant, and such Participant shall forfeit
any
and all Sunk Costs and Lease Expenses previously paid to
Ridgelake.
|
|
1.3
|
Participants
shall have no obligation to participate in any Operations on the
Leases;
provided, however, that if a Participant does not participate in
the
Operations on a particular Lease, then such Participant shall forfeit
its
right to earn an interest in such Lease and shall forfeit all Sunk
Costs
and Lease Expenses previously paid on the
Lease.
|
ARTICLE
II
ADDITIONAL
CONSIDERATION
(Note: In
this Article II, Capitalized terms not otherwise defined herein shall have
the
meanings assigned to them in Exhibit “E.”)
|
|
2.1
|
As
additional consideration for its participation in the prospects developed
by Ridgelake on the Leases, GulfX has procured the issuance to Ridgelake
and/or its designee(s) of Two Million Five Hundred Thousand (2,500,000)
Discovery Shares (the “GulfX Discovery Shares”) in GulfX Limited, an
Australia company (“GulfX Limited”), the terms of which are specified in
Exhibit “E-1” attached hereto.
|
Likewise,
as additional consideration for its participation in the prospects developed
by
Ridgelake on the Leases, South Xxxxx has procured the issuance to Ridgelake
and/or its designee(s) of (i) One Million (1,000,000) Discovery Shares (the
“Entek Discovery Shares”) in Entek Energy Ltd. (“Entek”), the terms of which are
specified in Exhibit “E-2” attached hereto; and (ii) Three Hundred Thousand
(300,000) options (the “Options”) in Entek or any successor by name change,
merger or other corporate action, the terms of which are specified in Exhibit
“E-3” attached hereto.
The
GulfX
Discovery Shares and Entek Discovery Shares are collectively referred to herein
as the “Discovery Shares.”
The
Discovery Shares and Options are subject to whatever restrictions that may
be
placed upon them under the rules and regulations of the Australian Stock
Exchange Ltd. (“ASX”). Each Participant shall use its best efforts to
ensure that the issuer of the Discovery Shares or Options, as applicable,
procured by it shall not impose or cause to be imposed restrictions on the
conversion of such Discovery Shares or the resale of the Shares in addition
to
those set forth (i) in this Agreement and the respective Exhibit “E-1,” “E-2,”
or “E-3,” as applicable or (ii) by operation of law under the rules and
regulations of the ASX.
|
|
2.2
|
Each
Discovery Share and each Option shall be convertible into one Share
as set
forth in the respective Exhibit “E-1,” “E-2,” or “E-3,” as
applicable. If, following the date of this Agreement, an issuer
of Discovery Shares or Options elects to undertake a consolidation
of share capital, then any Discovery Shares or Options issued to
Ridgelake
or its designee(s) shall be subject to consolidation at the same
ratio;
provided, however, that Ridgelake shall not suffer, as the result
of any
such consolidation, a dilution in the value of the Discovery Shares,
in
the value of the Options, or in the value of Shares to be issued
upon
conversion of the Options or Discovery Shares, as
applicable.
|
|
|
2.3
|
Each
Participant represents and warrants that at an Extraordinary General
Meeting (“EGM”) of the issuer of the Discovery Shares or Options procured
by such Participant, such issuer’s shareholders approved corporate
resolutions necessary to, among others, (i) change the nature of
the
issuer’s business direction to that of an oil and gas company, (ii) as to
issuers of Discovery Shares, amend the issuer’s constitution to create the
class of shares entitled “Discovery Shares” with terms and conditions as
set forth herein and in Exhibit E-1 or E-2, as applicable, (iii)
authorize
the issuer’s Board of Directors to issue Options and/or Discovery Shares
to Ridgelake (300,000 Options, 2,500,000 Discovery Shares in the
case of
the GulfX Discovery Shares, and 1,000,000 Discovery Shares in the
case of
the Entek Discovery Shares) and, (iv) authorize its Board of Directors
to
authorize Shares necessary to accommodate conversion of the Options
and/or
Discovery Shares, as applicable, and (v) authorize a consolidation
of
capital of the issuer.
|
|
|
2.4
|
Authorization
and Issuance. Each Participant shall use its best efforts
to ensure that upon issuance, the Options, Discovery Shares and the
Shares
procured by such Participant will have been duly authorized by the
Board
of Directors and shareholders of the issuer thereof and, when issued
in
accordance with the terms of this Agreement, will be fully paid,
non-assessable and validly issued.
|
|
|
2.5
|
Authority
of Participants. Each Participant represents that it has
full power, authority and legal capacity to execute, deliver and
perform
this Agreement, and that all corporate action necessary for such
Participant’s execution of this Agreement and its consummation of the
transactions contemplated by this Agreement will have been duly and
effectively taken upon execution.
|
|
|
2.6
|
Compliance
with Applicable Laws; Permits. Each Participant shall use
its best efforts to ensure that the issuer of the Options and/or
Discovery
Shares procured by it will comply in all material respects with the
Australian Corporations Act and all applicable laws, rules and regulations
enforced or promulgated by the ASX and the Australian Securities
and
Investments Commission (collectively, the “Regulator”). To the
knowledge of each Participant, the issuer of the Options and/or Discovery
Shares procured by it has not received any written notice, nor does
it
have knowledge that any investigation or review by any governmental
entity
or Regulator with respect to the Shares or any of its assets is pending
or
threatened or that any such investigation or review is
contemplated. To the knowledge of each Participant, none of the
reports, documents or materials filed with or furnished to the Regulator
or any governmental authority by the issuer of the Options and/or
Discovery Shares procured by such Participant, with respect to the
Discovery Shares, the Shares, or the business and operations of such
issuer, contains any untrue statement of a material fact or omits
any
statement of a material fact necessary to make the statements therein
not
misleading. Each Participant shall use its best efforts to
ensure that the issuer of the Options and/or Discovery Shares procured
by
such Participant discloses, to the extent required by applicable
law or
the rules and regulations of the Regulator, the terms and conditions
of
this Agreement and the terms and conditions of the issuance of the
Options
and/or the Discovery Shares, including the right to convert Options
and/or
Discovery Shares into Shares and the terms of such
conversion.
|
|
|
2.7
|
Advice
of Changes. Each Participant shall use its best efforts to
ensure that the issuer of the Options and/or Discovery Shares procured
by
it shall as promptly as possible advise Ridgelake in writing of any
change
or event having a material adverse effect, or that such Participant
or
such issuer believes would or would be reasonably likely to cause
or
constitute a material breach of any representations, warranties or
covenants of such Participant contained
herein.
|
|
|
2.8
|
Agreement
Valid and Binding. Each Participant represents and warrants
that this Agreement has been duly executed and delivered by such
Participant and this Agreement is the legal, valid and binding obligation
of such Participant, enforceable against such Participant in accordance
with its terms, except as enforcement thereof may be limited by laws
affecting the enforcement of creditors’ rights. Neither the
execution and delivery by such Participant of this Agreement, nor
the
consummation by such Participant of the transactions contemplated
hereby,
nor the compliance by such Participant with or fulfillment by such
Participant of the terms and provisions hereof will (i) with or without
the giving of notice or lapse of time or both, conflict with or result
in
a breach or violation of, or default under, or permit the acceleration
of
any obligation under any provision of any agreement or other instrument
or
restriction of any kind to which such Participant is a party or by
which
such Participant is otherwise bound or affected, or (ii) violate
any
judgment, order, writ, injunction, decree, statute, rule or regulation
applicable to such Participant, except in the case of the preceding
clauses, for those conflicts, breaches, violations, defaults or
accelerations that would not, individually or in the aggregate, have,
or
be reasonably likely to have, a material adverse effect on the ability
of
such Participant to perform its obligations under this Agreement
or to
consummate the transactions contemplated by this
Agreement.
|
|
|
2.9
|
Consents. Each
Participant shall use its best efforts to ensure that the issuer
of the
Options and/or Discovery Shares procured by it provides all consents,
approvals, waivers, orders, authorizations, registrations, declarations
or
filings with, or notices to, the Regulator and any governmental entity,
other regulator or other third party required for the issuance of
the
Options, the Discovery Shares and the Shares or the execution and
delivery
of this Agreement.
|
|
2.10
|
No
Misrepresentations. Each Participant represents and
warrants that the warranties, representations and covenants made
in this
Agreement by such Participant do not contain any untrue statement
of
material fact or omit to state any material fact required to be stated
herein or necessary to make the statements herein, in the context
in which
they were made, not misleading.
|
ARTICLE
III
INTEREST
EARNED
|
3.1
|
If
a Participant participates in and pays its respective Cost Share
(as set
forth in the table in Section 1.1.1 above) of all Operations relevant
to a
particular Lease, delivers appropriate Options and/or Discovery Shares
to
Ridgelake and/or its designee(s) in accordance with Article II above
and
if such Participant has paid its respective Cost Share of all Sunk
Costs
and Lease Expenses relevant to the Leases, then such Participant
shall
earn an undivided working interest in the Lease upon which such Operations
have been conducted equal to its respective “Earning Share,” as set forth
in the table in Section 1.1.1
above.
|
3.1.1
It is understood that any working interest earned by a Participant shall be
subject to and shall bear its proportionate share (i.e., its respective
Earning Share) of all burdens that attach to each Lease, including, but not
limited to, lessor’s royalty and overriding royalties that are applicable to
each Lease as of the effective date of this Agreement. (To the best
of Ridgelake’s knowledge, each Lease is burdened with a 16 2/3% Royalty to
Lessor and Overriding Royalties as follows: Viosca Xxxxx Block 79 –
4%; High Island Block A 307 – 4%; Vermilion Block 317 – 3 1/3%; South Xxxxx
Island Block 138 – 3 1/3%; and South Xxxxx Island Block 152 – 3
1/3%.)
|
3.2
|
Each
Participant may earn its respective Earning Share in each Lease that
is
subject to this Agreement on a Lease-by-Lease basis. However,
subject to and without waiver of the right to audit and dispute costs
and
expenses, should a Participant not timely pay all of its Cost Share
of all
costs and expenses of Operations on a Lease, then, if such Participant
fails to pay such costs and expenses within ten (10) days after receiving
a notice of default from Ridgelake, such Participant shall forfeit
its
right to earn a working
interest in the particular Lease and will have no right to a refund
of any
money previously paid to Ridgelake relevant to the particular
Lease.
|
ARTICLE
IV
OPERATOR
|
|
4.1
|
Ridgelake
shall be designated Operator for all xxxxx drilled pursuant to the
terms
of this Agreement and shall conduct and direct all operations on
the
Leases, as permitted and required pursuant to the terms of this Agreement
and the JOA attached hereto as Exhibit
“D”.
|
|
|
4.2
|
Notwithstanding
the terms of the JOA, the timing and order of Operations shall be
at
Ridgelake’s sole discretion, until such time as a Participant has earned a
working interest in a particular Lease. Once a Participant has
earned a working interest in a Lease, then, insofar and only insofar
as
said Lease is concerned, the terms of the JOA shall be applicable
to a
proposal by such Participant relevant to the drilling of xxxxx or
other
operations on the Lease.
|
|
4.2.1
|
It
is the intention of the Parties that a well shall be spudded on each
Lease
prior to the first day of the beginning of the last year of the primary
term of each Lease. However, it is understood and agreed that
for various reasons a well may not be spudded on each Lease as
anticipated. If a well is not so spudded on a particular Lease
before the first day of the beginning of the last year of the primary
term
for a particular Lease, then it is understood and agreed that a
Participant in such Lease may submit a proposal to Ridgelake for
the
drilling of a well on the particular Lease in accordance with the
terms of
the JOA attached hereto. If Ridgelake agrees to participate in
the well proposed by such Participant, then the well shall be drilled
in
accordance with the terms of this Agreement and the Participants
must
complete the interest earning operations in order to earn an interest
in
the Lease. However, if Ridgelake does not agree to proceed with
the well, then a Participant in the Lease may proceed to drill the
well
under the terms of the JOA attached hereto and, if the said well
is
completed by the Participant, then the Participants in such well
shall
earn their respective working interests in the Lease (as set forth
in
Section 3.1 above) and any penalties under the JOA shall be applicable
to
Ridgelake’s interest in the well. (It is recognized that other
parties may be participating in a particular Lease under agreements
that
are similar to this Agreement. Accordingly, any penalty
applicable to Ridgelake’s interest will be proportionately allocated to
those parties who have agreed to participate in the
well.)
|
|
4.2.2
|
If
no well is spudded on a particular Lease before expiration of the
Lease,
this Agreement shall no longer be applicable to the
Lease. However, it is understood and agreed that all money paid
to Ridgelake under the terms of this Agreement shall be retained
by
Ridgelake and that there shall be no refund of any money to
Participants.
|
|
|
4.3
|
Operator
shall conduct all Operations in a good an workmanlike manner, but
shall
have no liability as Operator for losses sustained or liabilities
incurred, except as may result from gross negligence or willful
misconduct.
|
|
|
4.4
|
The
number of employees used by Operator in conducting operations hereunder,
their selection, the hours of labor, and the compensation for services
performed, shall be determined by Operator, or its subcontractors,
and all
employees shall be the employees of Operator or its
subcontractor.
|
ARTICLE
V
EXPENDITURES
AND LIABILITY OF PARTIES
|
|
5.1
|
The
duties, obligations and liabilities of the Parties shall be several,
not
joint or collective. Each Party shall be solely responsible for
its own obligations and for all expenses incurred by it in connection
with
this Agreement (including without limitation fees and expenses of
its own
counsel and consultants), and shall be liable only for its proportionate
share of the costs of drilling and operating the well or xxxxx pursuant
to
the terms of this Agreement. It is not the intention of the
Parties to create, nor shall this Agreement be construed as creating,
an
association or trust, or to impose a partnership duty, obligation,
or
liability with regard to any one or more of the Parties
hereto. However, notwithstanding any provisions herein that the
rights and liabilities are several and not joint or collective, or
that
this Agreement and the Operations hereunder shall not constitute
a
partnership, each Party elects not to be excluded from the application
of
Subchapter K, Chapter 1, Subtitle A, Internal Revenue Code of 1986,
as
amended, and similar provisions of applicable state laws. The
tax partnership shall be governed by Exhibit “F” attached to the JOA that
is attached as Exhibit “D”.
|
|
|
5.2
|
All
costs and expenses hereunder, and the accounting with respect thereto,
shall be in accordance with the Accounting Procedure that is attached
to
the JOA; provided however, should any conflict exist between the
provisions in the body of this Agreement and the said Accounting
Procedure, the provisions in the body of this Agreement shall
prevail.
|
|
5.2.1
|
Ridgelake
shall keep an accurate record of the joint account hereunder, showing
expenses incurred and charges and credits made and returns made and
received. Such records shall be available at all reasonable
times for examination by a Participant or its authorized representatives,
as provided in the JOA.
|
|
|
5.3
|
Ridgelake
shall pay or cause to be paid all rentals, and minimum royalty payments
which may be required under the terms of the Leases; provided, however,
it
is understood and agreed that Ridgelake shall have no liability to
Participants for losses sustained or liabilities incurred for failure
to
so properly pay rents and/or minimum royalties or to otherwise maintain
such Leases.
|
ARTICLE
VI
MISCELLANEOUS
PROVISIONS
|
|
6.1
|
This
Agreement shall inure to the benefit of and be binding upon the successors
and assigns of the Parties; provided, however, it is understood and
agreed
that no Participant may sell, assign, transfer or otherwise dispose
of its
rights hereunder except as expressly provided in this
Agreement.
|
|
|
6.2
|
The
delay or failure on the part of any Party hereto to insist, in any
one
instance or more, upon the strict performance of any of the terms
or
conditions of this Agreement, or to exercise any right or privilege
herein
conferred shall not be construed as a waiver of any such terms,
conditions, rights or privileges but the same shall continue and
remain in
full force and effect. In addition, no waiver of any of the
provisions of this Agreement shall be deemed or shall constitute
a waiver
of any other provision hereof (whether or not similar), nor shall
such
waiver constitute a continuing waiver unless otherwise expressly
provided.
|
|
|
6.3
|
SHOULD
A PARTICIPANT EARN A WORKING INTEREST IN ANY LEASE PURSUANT TO THE
TERMS
OF THIS AGREEMENT, THE INTEREST EARNED BY PARTICIPANT IN SUCH LEASE
SHALL
BE ASSIGNED BY RIDGELAKE TO PARTICIPANT AS IS, AND RIDGELAKE MAKES
NO
WARRANTY OR REPRESENTATION, EXPRESS OR IMPLIED, IN FACT OR BY LAW,
WITH
RESPECT TO TITLE, CONDITION, FITNESS FOR PURPOSE OR OTHERWISE, EXCEPT
THAT
RIDGELAKE SHALL WARRANT ITS TITLE TO THE LEASES AGAINST ANYONE ASSERTING
AN ADVERSE CLAIM AGAINST THE INTEREST
CONVEYED WHICH IS CREATED BY, THROUGH OR UNDER RIDGELAKE, BUT NOT
OTHERWISE.
|
|
|
6.4
|
This
Agreement and all instruments executed in accordance with it shall
be
governed by and interpreted in accordance with the laws of the State
of
Louisiana, without regard to conflict of law rules that would direct
application of the laws of another jurisdiction, except to the extent
that
it is mandatory that the laws of some other jurisdiction, where the
Leases
are located, shall apply.
|
|
|
6.5
|
This
Agreement, including all exhibits and schedules attached hereto and
made a
part hereof constitutes the entire agreement between the Parties
with
respect to the subject matter hereof and supersedes all prior agreements,
understandings, negotiations and discussions. Without limiting
the generality of the foregoing, as between GulfX and South Xxxxx,
this
Agreement specifically supersedes and replaces the South Xxxxx
Participation Agreement, which, effective as of the date hereof,
shall be
of no further force or effect. No supplement, amendment,
alteration, modification, waiver or termination of this Agreement
shall be
binding unless executed in writing by the Parties
hereto.
|
|
|
6.6
|
Any
notice provided or permitted to be given under this Agreement shall
be in
writing, and may be served by personal delivery, facsimile transmission,
or be depositing same in the mail, addressed to the Party to be notified,
postage paid. Notices served in any manner shall be deemed to
have been given and received only if and when actually received by
the
addressee (except that notice given by telecopier shall be deemed
given
and received, other than during normal business hours, as of the
opening
of business on the next business day). For purposes of notice,
the addresses of the parties shall be as
follows:
|
Ridgelake
Energy, Inc.
0000
Xxxxx Xxxxxxxx Xxxx., Xxxxx 000
Xxxxxxxx,
XX 00000
Attention:
Xx. Xxxxxxx X. Xxxxx
Facsimile
No.: (000) 000-0000
GulfX,
LLC
00
Xxxxxx
Xxxxxx
Xxxx
Xxxxx
0000
Xxxxxxx Xxxxxxxxx, Xxxxxxxxx
Attention:
Mr. Xxxx Xxxxxx
Facsimile
No.: _____________
South
Xxxxx LLC
00
Xxxxxx
Xxxxxx
Xxxx
Xxxxx
0000
Xxxxxxx Xxxxxxxxx, Xxxxxxxxx
Attention:
Mr. Xxxx Xxxxxx
Facsimile
No.: _____________
Each
Party shall have the right, upon giving ten (10) days’ prior notice to the other
in the manner hereinabove provided, to change its address for the purposes
of
notice.
|
|
6.7
|
Each
Participant shall pay for all documentary, filing and recording fees
required with the filing and recording of any assignment or other
conveyance it may earn pursuant to this
Agreement.
|
|
|
6.8
|
If
any term or other provision of this Agreement is invalid, illegal
or
incapable of being enforced under any rule of law, all other conditions
and provisions of this Agreement shall nevertheless remain in full
force
and effect so long as the economic or legal substance of the transactions
contemplated hereby are not affected in a materially adverse manner
with
respect to any Party.
|
6.9 Except
as expressly provided herein, this Agreement is not intended to create, nor
shall it be construed to create, any rights in any third party under doctrines
concerning third party beneficiaries.
IN
WITNESS WHEREOF, the parties have executed this Agreement as of the day and
year
first set forth above.
RIDGELAKE
ENERGY, INC.
By:
/s/
Xxxxxxx X.
Xxxxx
Vice
President
GULFX,
LLC
By:
/s/
Xxxx
Xxxxxx
Xxxx
Xxxxxx
Vice
President
SOUTH
XXXXX LLC
By:
/s/
Xxxx
Xxxxxx
Xxxx
Xxxxxx
Vice
President
