EXHIBIT 10.34
PURCHASE AND SALE AGREEMENT
This Purchase and Sale Agreement (this "Agreement") is entered into this
9th day of July, 1999, by and between SOUTHERN MINERAL CORPORATION, a Nevada
corporation, and AMERAC ENERGY CORPORATION, a Delaware corporation
(collectively, the "Seller") and ANR PRODUCTION COMPANY, a Delaware
corporation, ("Buyer"). Buyer and Seller are collectively referred to herein
as the "Parties" and sometimes individually referred to as a "Party."
WITNESSETH:
In consideration of the mutual agreements contained in this Agreement,
Buyer and Seller agree as follows:
0.XXXX AND PURCHASE OF THE ASSETS.
1.1Acquired Assets. Subject to the terms and conditions of this
Agreement, Seller agrees to sell, convey and deliver to Buyer and Buyer
agrees to purchase and acquire from Seller all of Seller's right, title and
interest in and to the following, to the extent attributable to the period
of time after the Effective Time (collectively, the "Assets"):
(A) All of Seller's oil and gas and associated hydrocarbons ("Oil
and Gas") and related rights, titles and interests, including,
but not limited to, leasehold interests, royalty interests,
overriding royalty interests, payments out of production,
reversionary rights, and contractual rights to production in and
to (i) those interests described in the leases, subleases,
assignments and other instruments described in Exhibit A
(collectively "Leases"); (ii) those xxxxx described in Exhibit A
(the "Xxxxx"); (iii) all easements, rights of way, and other
rights, privileges, benefits and powers with respect to the use
and occupation of the surface of, and the subsurface depths
under, the land covered by the Leases; (iv) all rights in
respect of any pooled or unitized acreage located in whole or in
part within each Lease, including all production from the pool
or unit allocated to any such Lease and all interests in any
xxxxx within the unit or pool associated with such Lease,
regardless of whether such unit or pool production comes from
xxxxx located within or without the Leases;
(B) All licenses, servitudes, gas purchase and sale contracts
(including interests and rights, if any, with respect to any
prepayments, take-or-pay, buydown and buyout agreements)to the
extent that the same pertain or relate to periods after the
Effective Time, as hereinafter defined, crude purchase and sale
agreements, farmin agreements, farmout agreements, bottom hole
agreements, acreage contribution agreements, operating
agreements, unit agreements, processing agreements, options,
leases of equipment or facilities, joint venture agreements,
pooling agreements, transportation agreements, rights-of-way and
other contracts, agreements and rights, which are owned by
Seller, in whole or in part, and are (i) appurtenant to the
Leases, or (ii) used or held for use in connection with the
ownership or operation of the Leases, or the sale, distribution
or disposal of oil and gas or water, (collectively, the
"Contracts");
(C) All of the real, personal and mixed property and facilities
located in, on or adjacent to the Leases or used in the
operation thereof (whether located on or off such Leases), which
is owned by Seller, in whole or in part, including, without
limitation, well equipment; casing; tanks; crude oil, natural
gas, condensate or products in storage severed after the
Effective Time; tubing; compressors; pumps; motors; fixtures;
machinery and other equipment; pipelines; field processing
equipment; inventory and all other improvements used or useful
in the operation thereof (the "Related Assets");
(D) All governmental permits, licenses and authorizations including
environmental permits, licenses and authorizations, as well as
any applications for the same, related to the Leases or the use
thereof;
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(E) All of the files, records and data relating to the items
described in subsections (A), (B), (C), and (D) above,
including, without limitation, title records (title curative
documents); surveys, maps and drawings; contracts;
correspondence; Federal Energy Regulation Commission files;
microfiche lists; geological, geophysical and seismic records,
data and information; production records, electric logs, core
data, pressure data, decline curves, graphical production
curves and all related matters and construction documents
(except to the extent the delivery or copying of such records
may be restricted by contract with a third party, in which
event Seller shall cooperate with Buyer in efforts to provide
on site access to such records until a release from such
restriction may be obtained) (the "Records");
(F) To the extent assignable, all rights of Seller in or under any
warranty or indemnification contained in any agreement relating
to the Assets which Seller obtained on or after it acquired the
Assets; and
(G) Any and all other assets of Seller appurtenant or related to or
used or useful in connection with the Leases.
1.2Contracts and Records. Seller shall deliver to Buyer within ten (10)
days after Closing all of the Contracts and Records. Seller shall have the
right to make and retain copies of the Contracts and Records as Seller may
desire prior to the delivery of the Contracts and Records to Buyer. Buyer,
for a period of seven years after the Closing, defined below, shall make
available to Seller (at the location of such Contracts and Records in
Buyer's organization) access to such copies of the Contracts and Records as
Buyer may have in its possession (or to which it may have access) upon
written request of Seller, during normal business hours; provided, however,
that Buyer shall not be liable to Seller for the loss of any Contracts or
Records by reason of clerical error or inadvertent loss or destruction of
Contracts or Records.
2.PURCHASE PRICE.
2.1Purchase Price. The purchase price for the Assets is Sixteen Million
Two Hundred Eighty Thousand Dollars ($16,280,000.00), subject to the
adjustments provided for herein (the "Purchase Price").
2.2Payment. The Purchase Price shall be paid by Buyer to Seller, by wire
transfer of readily available funds on the Closing Date (hereinafter
defined).
2.3Allocation. The Purchase Price shall be allocated to the Assets in
accordance with the schedule set forth in Exhibit B. Seller and Buyer
covenant and agree that the values allocated to various portions of the
Assets, which are set forth on Exhibit B (singularly with respect to each
item, the Allocated Value and, collectively, the Allocated Values), shall
be binding on Seller and Buyer for purposes of adjusting the Purchase Price
pursuant to Section 7.6 hereof (relating to Title Failures).
3.EFFECTIVE TIME AND CLOSING DATE.
3.1Closing. Subject to Conditions Precedent set forth at Articles 12 and
13 and any termination pursuant to Article 14 or Section 15.1, the sale and
purchase of the Assets ("Closing") shall be held on or before August 6,
1999 ("Closing Date"). The Closing will take place at the offices of Buyer
at 0 Xxxxxxxx Xxxxx, Xxxxxxx, Xxxxx, or at such other place as mutually
agreed upon by Seller and Buyer.
3.2Effective Time. The sale shall be effective as of 7:00 A.M., local
time of the location of the Assets on May 1, 1999 ("Effective Time").
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3.3Ownership Prior to Effective Time. Seller shall be entitled to all of
the rights and incidents of ownership generated from or attributable to the
Assets prior to the Effective Time, including the right to all Oil and Gas
produced from or attributable to the Assets prior to the Effective Time.
Seller shall bear and be responsible for the duties, liabilities, costs,
expenses and obligations of ownership attributable to ordinary operation of
the Assets prior to the Effective Time, except as may be otherwise provided
herein, including, but not limited to, the indemnification provided for in
Article 4.
3.4Ownership After Effective Time. Buyer shall be entitled to all of the
rights and incidents of ownership generated from or attributable to the
Assets after the Effective Time, including the right to all Oil and Gas
thereafter produced from or attributable to the Assets after the Effective
Time. Buyer shall bear and be responsible for the duties, liabilities,
costs, expenses and obligations of ownership attributable to ordinary
operation of the Assets from and after the Effective Time, except as may be
otherwise provided herein, including, but not limited to, the
indemnification provided for in Article 4.
4.INDEMNIFICATION/ASSUMED OBLIGATIONS.
4.1 Assumed Obligations. Buyer shall not assume, be obligated to or be
liable for any liabilities of Seller, whether known or unknown, absolute or
contingent, including, without limitation, any claims, demands, obligations
or expenses of any kind whatsoever occurring, arising out of or relating to
Seller's (or Seller's predecessors in title) interest in the Assets prior
to the Closing Date including, but not limited to, Environmental Laws
(defined below), tax, securities law, personal injury, and royalty and
other contractual liabilities, except for those arising out of Buyer's
gross negligence or willful misconduct.
"Environmental Laws" means all applicable local, state, and federal
laws, rules, regulations, and orders regulating or otherwise pertaining to
(a) the use, generation, migration, storage, removal, treatment, remedy,
discharge, release, transportation, disposal, or cleanup of pollutants,
contamination, hazardous wastes, hazardous substances, hazardous materials,
toxic substances or toxic pollutants, (b) surface waters, ground waters,
ambient air and any other environmental medium on or off any Lease or (c)
the environment or health and safety-related matters; including the
following as from time to time amended and all others whether similar or
dissimilar: the Comprehensive Environmental Response, Compensation, and
Liability Act of 1980, as amended by the Superfund Amendments and
Reauthorization Act of 1986, the Resource Conservation and Recovery Act of
1976, as amended by the Used Oil Recycling Act of 1980, the Solid Waste
Disposal Act Amendments of 1980, and the Hazardous and Solid Waste
Amendments of 1984, the Hazardous Materials Transportation Act, as amended,
the Toxic Substance Control Act, as amended, the Clean Air Act, as amended,
the Clean Water Act, as amended, and all regulations promulgated pursuant
thereto.
4.2SELLER'S INDEMNIFICATION. SELLER AGREES TO DEFEND, INDEMNIFY AND HOLD
BUYER HARMLESS FROM AND AGAINST ANY AND ALL CLAIMS, DEMANDS, LOSSES,
DAMAGES, LIABILITIES, JUDGMENTS, CAUSES OF ACTION, REASONABLE COSTS OR
EXPENSES (INCLUDING, WITHOUT LIMITATION, ANY AND ALL REASONABLE COSTS,
EXPENSES, ATTORNEYS' FEES, CONSEQUENTIAL DAMAGES AND OTHER COSTS INCURRED
IN DEFENSE OF ANY CLAIM OR LAWSUIT ARISING THEREFROM), OF WHATSOEVER NATURE
ARISING OUT OF OR RELATING TO SELLER'S OWNERSHIP, OPERATION OR
ADMINISTRATION OF THE ASSETS ON OR PRIOR TO THE CLOSING DATE, INCLUDING,
WITHOUT LIMITATION, (I) DAMAGES TO PERSONS OR PROPERTY, (II) FINES,
PENALTIES, MONETARY SANCTIONS OR OTHER AMOUNTS PAYABLE FOR FAILURE TO
COMPLY WITH THE REQUIREMENTS OF APPLICABLE ENVIRONMENTAL, SECURITIES,
SAFETY OR HEALTH LAWS (WHETHER FEDERAL, STATE OR LOCAL), (III) THE
VIOLATION BY SELLER OF ANY LAW OR REGULATION OR THE TERMS OF ANY AGREEMENT
BINDING UPON THE SELLER, (IV) CLAIMS OF SELLER'S CO-OWNERS, PARTNERS, JOINT
VENTURERS AND OTHER PARTICIPANTS; (V) CLAIMS ARISING OUT OF ANY TAX AUDITS;
AND (VI) THE
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IMPROPER PAYMENT OF ROYALTIES UNDER THE LEASES, EXCEPT IN EACH CASE FOR
THOSE ARISING OUT OF BUYER'S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT. In no
event will Seller's liability to Buyer pursuant to the indemnification
provisions of this Section 4.2 ever exceed the aggregate sum of the
Purchase Price. Seller's liability under this Section 4.2 shall be limited
to claims as to which Seller is given notice on or prior to the date which
is thirty (30) months from the Closing.
4.3BUYER'S INDEMNIFICATION. BUYER AGREES TO DEFEND, INDEMNIFY AND HOLD
SELLER HARMLESS FROM AND AGAINST ANY AND ALL CLAIMS, DEMANDS, LOSSES,
DAMAGES, LIABILITIES, JUDGMENTS, CAUSES OF ACTION, REASONABLE COSTS OR
EXPENSES (INCLUDING, WITHOUT LIMITATION, ANY AND ALL REASONABLE COSTS,
EXPENSES, ATTORNEYS' FEES, CONSEQUENTIAL DAMAGES AND OTHER COSTS INCURRED
IN DEFENSE OF ANY CLAIM OR LAWSUIT ARISING THEREFROM), OF WHATSOEVER NATURE
ARISING OUT OF OR RELATING TO BUYER'S OWNERSHIP, OPERATION OR
ADMINISTRATION OF THE ASSETS AFTER THE CLOSING DATE, INCLUDING, WITHOUT
LIMITATION; (I) DAMAGES TO PERSONS OR PROPERTY; (II) FINES, PENALTIES,
MONETARY SANCTIONS OR OTHER AMOUNTS PAYABLE FOR FAILURE TO COMPLY WITH THE
REQUIREMENTS OF APPLICABLE ENVIRONMENTAL, SECURITIES, SAFETY OR HEALTH LAWS
(WHETHER FEDERAL, STATE OR LOCAL); (III) THE VIOLATION BY BUYER OF ANY LAW
OR REGULATION OR THE TERMS OF ANY AGREEMENT BINDING UPON THE BUYER; (IV)
CLAIMS OF BUYER'S CO-OWNERS, JOINT VENTURERS AND OTHER PARTICIPANTS; (V)
CLAIMS ARISING OUT OF ANY TAX AUDITS; AND(VI) THE IMPROPER PAYMENT OF
ROYALTIES UNDER THE LEASES, EXCEPT IN EACH CASE FOR THOSE ARISING OUT OF
SELLER'S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT.
4.4Notification. As soon as reasonably practical after obtaining
knowledge thereof, the indemnified Party shall notify the indemnifying
Party of any claim or demand which the indemnified Party has determined has
given or could give rise to a claim for indemnification under this Article
4. Such notice shall specify the agreement, representation or warranty with
respect to which the claim is made, the facts giving rise to the claim and
the alleged basis for the claim, and the amount (to the extent then
determinable) of liability for which indemnity is asserted. In the event
any action, suit or proceeding is brought with respect to which a Party may
be liable under this Article 4, the defense of the action, suit or
proceeding (including all settlement negotiations and arbitration, trial,
appeal, or other proceeding) shall be at the discretion of and conducted by
the indemnifying Party. If an indemnified Party shall settle any such
action, suit or proceeding without the written consent of the indemnifying
Party (which consent shall not be unreasonably withheld), the right of the
indemnified Party to make any claim against the indemnifying Party on
account of such settlement shall be deemed conclusively denied. An
indemnified Party shall have the right to be represented by its own counsel
at its own expense in any such action, suit or proceeding, and if an
indemnified Party is named as the defendant in any action, suit or
proceeding, it shall be entitled to have its own counsel and defend such
action, suit or proceeding with respect to itself at its own expense.
Subject to the foregoing provisions of this Article 4, neither Party shall,
without the other Party's written consent, settle, compromise, confess
judgment or permit judgment by default in any action, suit or proceeding if
such action would create or attach liability or obligation to the other
Party. The Parties agree to make available to each other, and to their
respective counsel and accountants, all information and documents
reasonably available to them which relate to any action, suit or
proceeding, and the Parties agree to render to each other such assistance
as they may reasonably require of each other in order to ensure the proper
and adequate defense of any such action, suit or proceeding.
5.CLOSING.
5.1Delivery by Seller. At Closing, Seller shall deliver to Buyer, in the
form attached hereto as Exhibit C, an Assignment and Xxxx of Sale effecting
the sale, transfer, conveyance and assignment of the Assets.
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5.2Delivery by Buyer. At Closing, Buyer shall deliver to Seller the
Purchase Price, as adjusted.
5.3Further Cooperation. At the Closing and thereafter as may be
necessary, Seller and Buyer shall execute and deliver such other
instruments and documents and take such other actions as may be reasonably
necessary to evidence and effectuate the transactions contemplated by this
Agreement.
6.ACCOUNTING ADJUSTMENTS.
6.1Closing Adjustments. With respect to matters that can be determined
as of the Closing, Seller shall prepare, in accordance with the provisions
of this Article 6, a statement (the "Closing Adjustment Statement") with
relevant supporting information setting forth each adjustment to the
Purchase Price submitted by Seller. Seller shall submit the Closing
Adjustment Statement to Buyer, together with all records or data supporting
the calculation of amounts presented on the Closing Adjustment Statement,
no later than five (5) business days prior to the scheduled Closing Date.
Prior to the Closing, Buyer and Seller will review the adjustments proposed
by Seller in the Closing Adjustment Statement. Agreed upon adjustments
shall be taken into account in computing any adjustments to be made to the
Purchase Price at the Closing.
6.2Strapping and Gauging. The Oil and Gas in such storage facilities
above the pipeline connection or through the meters on the pipelines as of
the Effective Time shall belong to Seller, and the Oil and Gas placed in
such storage facilities after the Effective Time and production upstream of
the aforesaid meters shall belong to Buyer and become part of the Assets.
6.3Taxes. Ad valorem, property or similar taxes shall be prorated
between Buyer and Seller, using the Effective Time as the applicable
proration date, and the Purchase Price shall be adjusted accordingly. The
proration shall be based upon ad valorem, property or similar taxes
assessed against the Assets for the most recent year.
6.4Adjustments to Purchase Price. At Closing, appropriate adjustments to
the Purchase Price will be made as follows:
(A) The Purchase Price shall be adjusted upward by:
(i) any amounts determined to be due Seller pursuant to Sections
6.2 and 6.3 hereof; and
(ii) an amount equal to the costs and expenses paid by Seller in
accordance with this Agreement that are attributable to the
Assets for the period from the Effective Time to the
Closing Date (including, without limitation, applicable
general and administrative expense and overhead charges
attributable to the Assets pursuant to the terms of the
relevant joint operating agreements covering the Assets);
and
(iii) all amounts due or the market value of Oil and Gas owed to
Seller by third parties as of the Effective Time under the
Contracts with respect to any imbalances existing at the
Effective Time, such value to be determined by Seller and
Buyer, including any severances taxes and royalties paid
thereon, as of the Effective Time; and
(iv) any other amount agreed upon in writing by Seller and
Buyer.
(B) The Purchase Price shall be adjusted downward by:
(i) any amounts determined to be due Buyer pursuant to Sections
6.2 and 6.3 hereof; and
(ii) an amount equal to the amount of proceeds derived from the
sale of Oil and Gas, net of royalties and severance taxes
paid by Seller, received by Seller prior to the Closing and
attributable to the Xxxxx which proceeds are, in accordance
with generally accepted accounting procedures, attributable
to production of Oil and Gas after the Effective Time; and
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(iii) all amounts due or the market value of Oil and Gas owed by
Seller to third parties as of the Effective Time under the
Contracts with respect to any imbalances existing at the
Effective Time, such value to be determined by Seller and
Buyer, including any severance taxes and royalties paid
thereon, as of the Effective Time; and
(iv) an amount equal to all expenditures, liabilities and costs
relating to the Assets (including, without limitation, all
ad valorem, property, production, severance and similar
taxes) that are unpaid as of the Closing Date and assessed
for or attributable to periods of time prior to the
Effective Time regardless of how such taxes, expenditures,
liabilities and costs are calculated provided that to the
extent the actual amounts cannot be determined prior to the
agreement of Buyer and Seller with respect to the Closing
Adjustment Statement, a reasonable estimate of such taxes,
expenditures, liabilities and costs shall be used; and
(v) any other amount agreed upon in writing by Seller and Buyer.
6.5Actual Figures. When available, actual figures will be used for the
adjustments at Closing. To the extent actual figures are not available,
estimates will be used subject to final adjustments as described in Section
6.6 below.
6.6Post-Closing Adjustments. A post-closing adjustment statement (the
"Post-Closing Adjustment Statement") based on the actual income and
expenses shall be prepared and delivered by Seller to Buyer within one
hundred twenty (120) days after the Closing, proposing further adjustments
to the Purchase Price based on the information then available. Seller or
Buyer, as the case may be, shall be given access to and shall be entitled
to review and audit the other Party's records pertaining to the computation
of amounts claimed in such Post-Closing Adjustment Statement. Within sixty
(60) days after receipt of the Post-Closing Adjustment Statement, the
Parties hereto will use their best efforts to agree upon the proposed
adjustments and the Seller or Buyer, as the case may be, shall pay to the
other such sums as may be agreed to be due. Additional adjustments shall be
made from time to time as required to settle accounts between the Parties.
7.DUE DILIGENCE; TITLE MATTERS.
7.1General Access. Prior to Closing, Seller will:
(A) Give Buyer and its representatives, employees, consultants,
independent contractors, attorneys and other advisors full
access to the Assets at any reasonable time for any and all
inspections and investigations, including, but not limited to,
platform inspections and investigations for environmental and
other matters;
(B) Use its best efforts to obtain and submit to Buyer or its
representatives as promptly as practicable, copies of any
existing documents as Buyer may reasonably request; and
(C) Furnish to Buyer all other information with respect to the
Assets as Buyer may from time to time reasonably request,
unless Seller is prohibited therefrom by any agreement or
contract by which it is bound or by the necessity of any third
party approval; provided that, if requested by Buyer, Seller
shall use its best efforts to promptly obtain the waiver of any
such prohibition.
7.2Covenants Relating to Title. From and after the Effective Time,
Seller covenants and agrees to use commercially reasonable efforts to:
(A) Obtain all consents, approvals, waivers (including preferential
rights) and agreements of all other parties and governmental
authorities (other than approvals of the assignment of the
Leases which must be obtained after the Closing) which are
necessary to effect the transactions provided for herein,
including the assignment and transfer to Buyer of the ownership
of the Assets; and
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(B) Make all filings which must be made and record all instruments
that may be recorded to accurately reflect Seller's current
interests in the Assets.
7.3Seller's Title. In the documents to be executed and delivered by
Seller to Buyer transferring title to the Assets, Seller shall warrant and
defend the Assets unto Buyer against every person lawfully claiming the
Assets or any part thereof, by, through or under Seller, but not otherwise.
However, notwithstanding any other provisions of this Agreement to the
contrary all of Seller's interest in equipment and personal property is to
be sold AS IS AND WHERE IS AND WITHOUT WARRANTY OF MERCHANTABILITY,
CONDITION OR FITNESS FOR A PARTICULAR PURPOSE, EITHER EXPRESS OR IMPLIED.
7.4Good and Marketable Title. As used herein the term "good and
marketable title" shall mean:
(A) As to each of the Xxxxx, that record title of Seller which:
(i) entitles Seller to receive from each Well not less than the
interests shown in Exhibit A as the "Net Revenue Interest"
of all Oil and Gas produced, saved and marketed from each
Well and of all Oil and Gas produced, saved and marketed
from any unit of which each Well is a part and allocated to
such Well, all without reduction, suspension or termination
of the interests in each Well throughout the duration of the
Lease upon which such Well is located, except as stated in
such Exhibit; and
(ii) obligates Seller to bear a percentage of the costs and
expenses relating to the maintenance and development of,
and operations relating to, the Xxxxx not greater than the
"Working Interest" shown in Exhibit A, all without increase
of the interests in each Well throughout the duration of
such Well, except as stated in such Exhibit.
(B) That title of Seller to the Assets which:
(i) at or prior to Closing, is free and clear (except for
Permitted Encumbrances as defined in subsection (ii) below)
of liens and encumbrances and (a) with respect to real
property interests to be transferred to Buyer, real property
interests are of record in the relevant counties and
governmental offices; and (b) with respect to any Asset
subject to preferential rights, such rights have been waived
and consents obtained from all third parties, and
(ii) "Permitted Encumbrances" shall mean (i) lessor's royalties,
overriding royalties, reversionary interests and other
burdens on production that, in the aggregate, do not
operate to reduce the Net Revenue Interest of Seller in
each of the Xxxxx to an amount less than that shown on
Exhibit A; (ii) division orders, and sales contracts
covering hydrocarbons and associated products that are
terminable upon no more than thirty (30) days notice; (iii)
preferential purchase rights and required third party
consents to assignments and similar rights with respect to
which waivers or consents are obtained from the appropriate
parties or the appropriate time period for asserting such
rights has expired without an exercise thereof; (iv)
easements, rights-of-way, servitudes, permits, surface
leases and other rights in respect of surface operations,
pipelines, grazing, logging, canals, ditches, reservoirs,
or the like; use conditions, covenants or other
restrictions in the chain of title; (v) minor
irregularities in title which do not (a) materially
interfere with the occupation, use and enjoyment by Seller
of any of the Assets in the normal course of business as
presently conducted; or (b) materially impair the value
thereof for such Assets; (vi) all interests in the Assets
securing obligations owed to, or claimed by, any person
whether such interest is based on the common law, statute
or contract, and whether such interest includes liens or
security interests arising by virtue of mortgage,
encumbrance, pledge, security agreement, conditional sale
or trust receipt or lease, consignment or bailment for
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security purposes, so long as each said interest has been
expressly consented to by Buyer in writing or will be
released in full at or prior to the Closing; and (vii)
specific exceptions and encumbrances affecting each of the
Assets as described in Exhibit A INSOFAR ONLY as said
exceptions and encumbrances are valid and subsisting and are
enforceable against the particular Asset which is made
subject to said exceptions and encumbrances.
7.5Defect Letters.
(A) Buyer may from time to time prior to the date which is five (5)
days prior to the Closing Date notify Seller in writing (a
"Notice") of any liens, charges, contracts, agreements
obligations, encumbrances, defects and irregularities of title
which would cause title to all or part of the Assets not to be
good and marketable as defined in Section 7.4 hereof, or which
would cause a breach of a representation or warranty of Seller
("Title Defect").
(B) A Title Defect as set forth in a Notice, which is given to
Seller on or before the date which is five (5) days prior to
the Closing Date and is not cured on or before the Closing,
unless the time for cure is extended in writing by Buyer, shall
be a "Title Failure," unless waived by Buyer. Any Title Defect
waived by Buyer under this Section or any Title Defect for
which timely notice shall not have been given in accordance
with Section 7.5 (A) shall become a Permitted Encumbrance as
defined in Section 7.4(B)(ii) and Buyer shall have no claim or
other right against Seller with respect thereto.
7.6Effect of Title Failure. In the event of a Title Failure pursuant to
Section 7.5, the Buyer shall have the right not to accept the Asset(s) or
portion thereof to which such Title Failure relates and to an adjustment of
the Purchase Price in the amount of the Allocated Value(s) or portion
thereof attributable to such Title Failure. Buyer shall not be liable for
any portion of the cost of any title curative performed by Seller.
8.REPRESENTATIONS AND WARRANTIES OF SELLER.
8.1Seller's Representations and Warranties. Seller represents and
warrants (which representations and warranties shall survive the Closing
hereof) that as of the date hereof, and as of the Closing:
(A) Each Seller is a corporation duly incorporated, validly
existing and in good standing under the laws of the State
listed on the first page of this Agreement and is duly
qualified to do business and is in good standing with the
governmental agencies having jurisdiction over the Assets;
(B) Seller owns the Assets and has the requisite power and
authority to enter into this Agreement, to carry out the
transactions contemplated hereby, to transfer the Assets in the
manner contemplated by this Agreement, and to undertake all of
the obligations of Seller set forth in this Agreement;
(C) This Agreement and any documents or instruments delivered by
Seller at the Closing shall constitute legal, valid and binding
obligations of Seller, enforceable in accordance with their
terms;
(D) Seller has good and marketable title to the Assets and the
interests in the Leases are true, correct, complete and in full
force and effect;
(E) To the best of Seller's knowledge, the production data and
computer printouts or other data or documentation furnished by
Seller to Buyer, and any supplement thereto, is materially
complete and the information reported therein is materially
correct, in all respects, as of the date of such delivery,
except that no representation or warranty is made
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as to interpretive data included therein. From the date of this
Agreement until the Closing Date, should Seller become aware of
any material change in the matters reflected in such data and
documentation theretofore furnished by Seller to Buyer, Seller
shall promptly notify Buyer of such change;
(F) Seller has incurred no obligation or liability, contingent or
otherwise, for brokers' or finders' fees in respect of the
matters provided for in this Agreement, and, if any such
obligation or liability exists, it shall remain an obligation of
Seller, and Buyer shall have no responsibility therefor;
(G) To the best of Seller's knowledge, with respect to the Leases
and Contracts: (i) Seller has fulfilled all requirements for
filings, certificates, disclosures of parties in interest, and
other similar matters contained in (or otherwise applicable
thereto by law, rule or regulation) the Leases and Contracts and
is fully qualified to own and hold the Assets; (ii) there are no
express obligations to engage in continuous development
operations in order to maintain any Lease, except as reflected
in the Leases; (iii) there are no provisions applicable to such
Leases or other documents which increase the royalty share of
the lessor thereunder except as such increases are reflected in
the Leases; and (iv) each of the foregoing are valid and
subsisting and all rental payments, royalty payments, shut-in
payments, or other payments or commitments required thereunder
have been made and are current to date, and no default exists
with regard thereto;
(H) With respect to the joint, unit or other operating agreements
relating to the Assets, to the best of Seller's knowledge: (i)
there are no outstanding calls or payments under authorities for
expenditures for payments which are due or which Seller has
committed to make which have not been made; (ii) pursuant to
balancing arrangements contained therein, Seller does not have
obligations to other parties thereto which would operate to have
a portion of Seller's share of production from any Well
delivered after the Effective Time without receipt by Buyer of
that price which would have been received in the absence of such
arrangement or situation, except as set forth in Exhibit D;
(iii) Seller has informed Buyer of, or Exhibit A reflects, the
status of all operations by less than all parties; and (iv)
there are no operations under the operating agreements with
respect to which Seller has become a non-consenting party,
except as reflected on Exhibit A;
(I) Seller has not entered into any contracts for or received
prepayments, take-or-pay arrangements, buydowns, buyouts for Oil
and Gas, storage of the same, or other balancing arrangements
which Buyer will be obligated to honor and make deliveries of
Oil and Gas or refunds of amounts previously made under such
contracts or arrangements;
(J) To the best of Seller's knowledge, all of the Xxxxx have been
drilled and completed at legal locations within the boundaries
of the appropriate Lease; and all drilling and completion of the
Xxxxx and all development and operations of the Assets have been
conducted in all respects in compliance with all applicable
laws, ordinances, rules, regulations, permits, and judgments,
orders and decrees of any court or governmental body or agency,
including but not limited to Environmental Laws. To the best of
Seller's knowledge, no Well is subject to penalties on
allowables after the date hereof because of any overproduction
or violation of applicable laws, rules, regulations, permits or
judgments, orders or decrees of any court or governmental body
or agency which would prevent such Well from being entitled to
its full legal and regular allowance from and after the date
hereof as prescribed by any court or governmental body or
agency;
(K) To the best of Seller's knowledge, all personal property and
fixtures to be conveyed pursuant to this Agreement, including,
but not limited to, the Related Assets, have been maintained in
all respects in a state of repair so as to be adequate for
normal operations and are in all respects in good working order;
9
(L) There is no suit, action, claim, investigation or inquiry
pending or threatened arising out of or with respect to the
ownership, operation or environmental condition of the Assets;
(M) Seller is not aware of any facts relating to the condition of
the Assets which may result in a suit, action, claim,
investigation or inquiry with respect to Environmental Laws or
regulations or other legal requirements thereunder. To the best
of Seller's knowledge, the Assets have not been used by Seller
to generate, treat, transport or dispose of any hazardous
wastes, hazardous substances or any contaminant in violation of
any Environmental Law;
(N) To the best of Seller's knowledge, Seller has acquired all
permits, licenses, approvals and consents from appropriate
governmental bodies, authorities and agencies necessary to
conduct operations on the Assets in compliance with all
applicable laws, rules, regulations, ordinances and orders.
Seller is in compliance with all such permits, licenses,
approvals and consents and with all applicable Environmental
Laws. There are no proceedings pending or threatened
challenging, or seeking revocation or limitation of any such
permits, licenses, approvals and consents. All plans,
applications, reports, certificates and other instruments filed
with or furnished to any governmental body, authority or agency
do not (1) contain any untrue statement of fact or (2) omit any
statement of fact necessary to make the statements therein not
misleading;
(O) No person shall have any call upon, option to purchase, or
similar rights with respect to any portion of the production
from the Leases;
(P) Except for immaterial obligations incurred by Seller in normal
day-to-day operations of the Assets, there are no borrowings,
loan agreements, promissory notes, pledges, mortgages,
guaranties, liens and similar liabilities (direct and indirect)
which are secured by or constitute an encumbrance on the Assets
that will not be released as of the Closing;
(Q) There are no preferential rights providing a third party the
option to purchase any of the Assets;
(R) To the best of Sellers knowledge, the gas imbalances reflected
on Exhibit D are true and correct; and
(S) None of the Assets are involved in, covered by or included in
any tax partnerships.
9.REPRESENTATIONS AND WARRANTIES OF BUYER.
9.1Buyer's Representations and Warranties. Buyer represents and warrants
(which representations and warranties shall survive the Closing) that at
the date hereof and at Closing:
(A) Buyer is a corporation duly incorporated, validly existing and
in good standing under the laws of the State listed on the
first page of this Agreement;
(B) Buyer has the requisite power and authority to enter into this
Agreement, to carry out the transactions contemplated hereby
and to undertake all of the obligations of Buyer set out in
this Agreement;
(C) The consummation of the transactions contemplated by this
Agreement will not in any respect violate, nor be in conflict
with, any provision of Buyer's charter, by-laws or other
governing documents, or any agreement or instrument to which
Buyer is a party or is bound, or any judgment, decree, order,
statute, rule or regulation applicable to Buyer (subject to
governmental consents and approvals customarily obtained after
the Closing);
(D) This Agreement constitutes legal, valid and binding obligations
of Buyer, enforceable in accordance with its terms;
10
(E) Buyer has incurred no obligation or liability, contingent or
otherwise, for brokers' or finders' fees in respect of the
matters provided for in this Agreement, and, if any such
obligation or liability exists, it shall remain an obligation
of Buyer, and Seller shall have no responsibility therefor; and
(F) There is no suit, action, claim, investigation, administrative
proceeding or inquiry by any person, entity, administrative
agency or governmental body pending or, to Buyer's best
knowledge, threatened against Buyer or any affiliate of Buyer
which has or will affect Buyer's ability to consummate the
transactions contemplated herein.
10.CERTAIN AGREEMENTS OF SELLER. Seller agrees and covenants that, unless Buyer
shall have otherwise agreed in writing, the following provisions shall apply:
10.1Maintenance of Assets. From the Effective Time until Closing, Seller
agrees that it will:
(A) Administer and operate the Assets in good and workmanlike
manner, and conduct its business and operations in a prudent
manner, and in substantially the same manner as prior to the
date of this Agreement;
(B) Not introduce any new methods of management, operation or
accounting with respect to any or all of the Assets;
(C) Maintain and keep the Assets in good condition and working
order; preserve the Assets in full force and effect; and
fulfill all contractual or other covenants, obligations and
conditions imposed upon Seller with respect to the Assets,
including, but not limited, to payment of royalties, delay
rentals, shut-in gas royalties and any and all other required
payments;
(D) Operate or cause to be operated the Xxxxx in accordance with
generally accepted oil field practices and standards;
(E) Not enter into agreements to drill new xxxxx or to rework, plug
back, deepen, plug or abandon any Well, nor commence any
drilling, reworking or completing or other operations on the
Leases which requires an authority for expenditure (AFE) to be
issued under the terms of the operating agreement covering such
operations or make or authorize any expenditures for such
operations (except for emergency operations and operations
required under presently existing contractual obligations)
without obtaining the prior written consent of Buyer; provided
that the terms of this paragraph (E) shall not apply to any
expenditures of Seller which will not be charged to Buyer;
(F) Not voluntarily relinquish its position as operator to anyone
other than Buyer with respect to any of the Assets or abandon
any of the Assets;
(G) Not, without the prior written consent of Buyer, (i) enter into
any agreement or arrangement transferring, selling or
encumbering any of the Assets; (ii) grant any preferential or
other right to purchase or agree to require the consent of any
party to the transfer and assignment of the Assets to Buyer;
(iii) enter into any new sales contracts or supply contracts;
or (iv) incur or agree to incur any contractual obligation or
liability (absolute or contingent) with respect to the Assets
except as otherwise provided herein; and
(H) Promptly provide Buyer with written notice of (i) any claims,
demands, suits or actions made against Seller which affect the
Assets; or (ii) any proposal from a third party to engage in
any transaction (e.g., a farmout) with respect to the Assets.
10.2Consents. By Closing, Seller will obtain all such permissions,
approvals and consents by governmental authorities and others which are
obtainable by Closing and are required to vest good and
11
marketable title to the Assets in Buyer as provided in Article 7 hereof, or
as may be otherwise reasonably requested by Buyer. Seller will execute all
necessary or appropriate transfer orders (or letters in lieu thereof)
designating Buyer as the appropriate party for payment effective as of the
Closing Date.
10.3Cooperation. Seller will cooperate with Buyer to assist Buyer in
carrying out the agreements of Buyer.
11.CERTAIN AGREEMENTS OF BUYER. Buyer agrees and covenants that unless Seller
shall have consented otherwise in writing, the following provisions shall
apply:
11.1Cooperation. Buyer will cooperate with Seller to assist Seller in
carrying out the agreements of Seller.
11.2Disclosure. Until the Closing Date and to the extent not already
public, Buyer shall exercise all due diligence in safeguarding and
maintaining secure all engineering, geological and geophysical data,
reports and maps, and other data relating to the Assets in the possession
of Buyer.
12.CONDITIONS PRECEDENT TO OBLIGATIONS OF BUYER. All obligations of Buyer under
this Agreement are, at its election, subject to the fulfillment, prior to or at
the Closing, of each of the following conditions:
12.1No Litigation. At the Closing, no suit, action or other proceeding
shall be pending nor shall there be a substantial threat of such proceeding
before any court or governmental agency which attempts to prevent the
occurrence of the transactions contemplated by this Agreement.
12.2Representations, Warranties and Covenants. All representations and
warranties of Seller contained in this Agreement shall be true as of the
Closing as if such representations and warranties were made as of the
Closing Date in all respects, and Seller shall have performed and satisfied
all covenants and fulfilled all conditions required by this Agreement to be
performed and satisfied by Seller at or prior to the Closing in all
respects.
12.3Consents. All necessary permissions, approvals and consents of
federal authorities required pursuant to Section 10.2 hereof which are
obtainable by the Closing shall be in full force and effect.
12.4Board Approval. The Board of Directors of The Coastal Corporation
shall have approved the purchase of the Assets by Buyer as contemplated in
this Agreement.
13.CONDITIONS PRECEDENT TO THE OBLIGATIONS OF SELLER. All obligations of Seller
under this Agreement are, at Seller's election, subject to the fulfillment,
prior to or at the Closing, of each of the following conditions:
13.1No Litigation. At the Closing no suit, action or other proceeding
shall be pending nor shall there be a substantial threat of such proceeding
before any court or governmental agency which attempts to prevent the
occurrence of the transactions contemplated by this Agreement.
13.2Representations and Warranties. All representations and warranties
of Buyer contained in this Agreement shall be true as of the Closing, as if
such representations and warranties were made as of the date of Closing and
Buyer shall have performed and satisfied all covenants and fulfilled all
conditions required by this Agreement to be performed and satisfied by
Buyer at or prior to the Closing in all respects.
13.3Consents. All necessary consents from third parties, which are
identified on Exhibit E, shall have been obtained if the effect of Closing
in the absence of such consents would expose the Seller to any material
liability.
12
14.TERMINATION.
14.1Causes of Termination. This Agreement and the transactions
contemplated herein shall be completely terminated:
(A) At any time by mutual consent of the Parties;
(B) By either Party if the Closing shall not have occurred by
September 1, 1999, despite the good faith reasonable efforts of
the Parties, and if the Party desiring to terminate is not in
breach of this Agreement;
(C) By either Party at its election in the event of a Casualty Loss
pursuant to Section 15.1(B);
(D) By either Party if more than ten percent (10%) of the Allocated
Value of the Assets is subject to a Title Failure;
14.2Effect of Termination. In the event of the termination of this
Agreement pursuant to the provisions of this Article 14 or elsewhere in
this Agreement, this Agreement shall become void and have no further force
and effect and neither Party shall have any further right, duty or
liability to the other hereunder. Upon termination as provided in this
section, each Party agrees, upon request, to use its best efforts to return
to the other or destroy, all materials, documents and copies thereof
provided, obtained or discovered in the course of any due diligence
investigations.
15.MISCELLANEOUS.
15.1Casualty Loss.
(A) As used herein the term "Casualty" means an adverse change in
the Assets taken as a whole caused by an event of casualty,
including but not limited to, volcanic eruptions, acts of God,
fire, explosion, earthquake, wind storm, strike, lockout, labor
dispute, flood, drought, war, embargo, riot, condemnation, the
exercise of any right of eminent domain, confiscation, seizure,
activities of armed forces, blowout, casing collapse or other
event causing a Well failure, operation of laws, rules or
regulations (regardless of whether covered by insurance), but
excepting depletion due to normal production, depreciation of
equipment through ordinary wear and tear and transactions
permitted under this Agreement).
(B) If, prior to the Closing, a Casualty occurs (or Casualties
occur) which results in a reduction in the value of the Assets
("Casualty Loss") in excess of ten percent (10%) of the
Purchase Price, either Party may elect to terminate this
Agreement. If this Agreement is not so terminated, then this
Agreement shall remain in full force and effect notwithstanding
any such Casualty Loss, and, at the sole option of the Buyer,
(i) Seller may retain such Asset and such Asset shall be
subject to the adjustment of Purchase Price in the same manner
set forth in Section 7.6 hereof, or (ii) at the Closing Seller
shall pay to Buyer all sums paid to Seller by reason of such
Casualty Loss, provided however, that the Purchase Price shall
not be adjusted by reason of such payment, and Seller shall
assign, transfer and set over unto Buyer all of the right,
title and interest of Seller in and to such Asset and any
unpaid awards or other payments arising out of such Casualty
Loss. Seller shall not voluntarily compromise, settle or adjust
any amounts payable by reason of such Casualty Loss without
first obtaining the written consent of Buyer.
(C) For purposes of determining the value of a Casualty Loss, the
Parties shall use the same methodology as applied in
determining the value of a Title Failure as set forth in
Section 7.6.
13
15.2Non-Compete.
(A) The Parties agree that the area outlined on Exhibit F is
designated as a Non-Compete Area. For a period terminating on
the earlier of (i) two (2) years after Closing or (ii) the date
on which Buyer shall have conveyed to non-affiliated third
parties a substantial portion of the Assets, Seller agrees that
it will, either directly or indirectly, acquire any oil and gas
leases or oil and gas rights covering lands within the Non-
Compete Area;
(B) If Seller should acquire, either directly or indirectly, any
interest in any property or lease rights, either wholly or
partially within the Non-Compete Area, within the time period
referenced in Section 13.2 (A) Buyer shall have the right, but
not the obligation, to acquire from Seller, all of the interest
acquired by Seller. After receipt of written notice from Seller
of its acquisition, Buyer shall have thirty (30) days after
receipt of such notice to exercise its right to acquire such
interest from Seller by paying to Seller Seller's cost of such
acquisition; and
(C) This Non-Compete provision shall terminate and have no further
force or effect if Seller is merged or enters into a corporate
reorganization with an unrelated company or entity that already
owns oil and gas leases within the Non-Compete Area, or if
Seller makes an acquisition of oil and gas assets that
includes, in part, oil and gas leases within the Non-Compete
Area; provided that, in either case, the oil and gas leases
within the Non-Compete Area shall comprise no more than 25% of
the assets of the unrelated company or the oil and gas asset
acquisition, as applicable.
15.3Notice. Any notice, request, demand, or consent required or
permitted to be given hereunder shall be in writing and delivered in person
or by certified letter, with return receipt requested, by telecopy or pre-
paid telegram addressed to the party for whom intended at the following
addresses:
SELLER:
Southern Mineral Corporation
0000 Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000-0000
Attn: Xxxxxxx X. Xxxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
BUYER:
ANR Production Company
Nine Xxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxxxx Xxxxx, 00000
Attn: Xxx X. Xxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
or at such other address as any of the above shall specify by like notice
to the other.
15.4Survival of Representations and Warranties. All of the
representations, warranties, covenants, indemnities and agreements of or by
the Parties to this Agreement will survive the Closing, the execution and
delivery of the assignment documents and other instruments under this
Agreement, and the transfer of the Assets between the Parties; and they
shall not be merged into or superseded by the assignment documents or other
documents delivered at Closing. Notwithstanding the foregoing, Seller shall
not have any liability for the breach or inaccuracy of any representation,
warranty, covenant, indemnity or other agreement herein, unless notice of
the claim with respect thereto is given by Buyer to Seller prior to the
14
date which is thirty (30) months from the Closing Date; provided, however
that there shall be no time limitation for notice of claims pursuant to
Section 4.2(V) and (VI). Sellere's liability to Buyer under all of the
provisions of this agreement, in the aggregate, shall not exceed the amount
of the Purchase Price. THERE ARE NO WARRANTIES THAT EXTEND BEYOND THE FACE
OF THIS AGREEMENT OR THE CONVEYANCING DOCUMENTS DELIVERED PURSUANT TO THIS
AGREEMENT. THE EXPRESS REPRESENTATIONS AND WARRANTIES OF SELLER AND BUYER
CONTAINED IN THIS AGREEMENT ARE EXCLUSIVE AND ARE IN LIEU OF, AND SELLER
AND BUYER, AS APPLICABLE, EXPRESSLY DISCLAIM, NEGATE AND WAIVE, AS
APPLICABLE, ALL OTHER REPRESENTATIONS AND WARRANTIES, EXPRESS, IMPLIED,
STATUTORY OR OTHERWISE.
15.5COMPLIANCE WITH EXPRESS NEGLIGENCE TEST. THE PARTIES AGREE THAT THE
OBLIGATIONS OF THE INDEMNIFYING PARTY TO INDEMNIFY THE INDEMNIFIED PARTY
SHALL BE WITHOUT REGARD TO THE NEGLIGENCE OR STRICT LIABILITY OF THE
INDEMNIFIED PARTY, WHETHER THE NEGLIGENCE OR STRICT LIABILITY IS ACTIVE,
PASSIVE, JOINT, CONCURRENT OR SOLE.
15.6Public Announcements. Neither Party may make press releases or other
public announcements concerning this transaction without Buyer's and
Seller's written approval and agreement to the form of the announcements,
except as may be required by applicable laws or rules and regulations of
any governmental agency or stock exchange.
15.7Governing Law. This Agreement is governed by and must be construed
according to the laws of the State of Texas, excluding any conflicts-of-law
rule or principle that might apply the law of another jurisdiction. All
disputes related to this Agreement which are not subject to the binding
arbitration provisions hereof shall be submitted to the jurisdiction of the
courts of the State of Texas and venue shall be in the civil district
courts of Xxxxxx County, Texas.
15.8Exhibits. The Exhibits attached to this Agreement are incorporated
into and made a part of this Agreement for all purposes.
15.9Fees, Expenses and Taxes.
(A) Each Party shall be solely responsible for all expenses
incurred by it in connection with this transaction (including,
but not limited to fees and expenses of its counsel and
accountants) and shall not be entitled to any reimbursements
therefor from the other Party, except as otherwise provided in
this Agreement.
(B) Buyer shall pay any filing or recording fees required in
connection with the transactions contemplated by this
Agreement.
(C) Sales and use tax, or any other transfer tax, if any, due in
connection with the transactions represented by this Agreement
shall be paid by the Party upon which such tax is imposed by
law.
15.10Assignment. This Agreement or any part hereof may not be assigned
by either Party without the prior written consent of the other Party;
provided, however, upon notice to the other Party, either Party shall have
the right to assign all or part of its rights (but none of its obligations)
under this Agreement in order to qualify transfer of the Assets as a
"deferred exchange" for federal tax purposes. Subject to the foregoing,
this Agreement is binding upon the Parties hereto and their respective
successors and assigns.
15.11Entire Agreement. This Agreement constitutes the entire agreement
reached by the Parties with respect to the subject matter hereof,
superseding all prior negotiations, discussions, agreements and
understandings, whether oral or written, relating to such subject matter.
15
15.12Severability. In the event that any one or more covenants, clauses
or provisions of this Agreement shall be held invalid or illegal, such
invalidity or unenforceability shall not affect any other provisions of
this Agreement.
15.13Captions. The captions in this Agreement are for convenience only
and shall not be considered a part of or affect the construction or
interpretation of any provision of this Agreement.
15.14Confidentiality. Prior to Closing, to the extent not already
public, both Parties shall exercise all due diligence in safeguarding and
maintaining secure all engineering, geological and geophysical data,
seismic data, reports and maps and other data relating to the Assets
(collectively the "Confidential Information"). Both Parties acknowledge
that, prior to Closing, all Confidential Information shall be treated as
confidential and shall not be disclosed to third parties without the prior
written consent of the other Party.
(A) In the event of termination of this Agreement for any reason,
Buyer will not use or knowingly permit others to use such
Confidential Information in a manner detrimental to Seller, and
will not disclose any such Confidential Information to any
person, firm, corporation, association or other entity for any
reason or purpose whatsoever, except to Seller or to a
governmental agency pursuant to a valid subpoena or other order
or pursuant to applicable governmental regulations, rules or
statutes. The covenants of Buyer contained in this Section
shall survive any termination of this Agreement.
(B) After Closing, Seller shall not use or knowingly permit others
to use such Confidential Information in a manner detrimental to
Buyer, and will not disclose any such Confidential Information
to any person, firm, corporation, association or other entity
for any reason or purpose whatsoever, except to Buyer or to a
governmental agency pursuant to a valid subpoena or other order
or pursuant to applicable governmental regulations, rules or
statutes. The covenants of Seller contained in this Section
shall survive the Closing.
Executed as of the day and year first above written.
SELLER:
SOUTHERN MINERAL CORPORATION
/s/ Xxxxxxx X. Xxxxxxxx
By:__________________________________
Xxxxxxx X. Xxxxxxxx
Vice President and
Chief Operating Officer
AMERAC ENERGY CORPORATION
/s/ Xxxxxx X. Xxxxx
By:__________________________________
Xxxxxx X. Xxxxx
President
BUYER:
ANR PRODUCTION COMPANY
/s/ Xxxxxxx X. Xxxxxx
By:__________________________________
Xxxxxxx X. Xxxxxx
Senior Vice President
16
EXHIBIT "A"
Attached to and made a part of the Purchase and Sale Agreement between
Southern Mineral Corporation, Amerac Energy Corporation and ANR Production
Company.
Brushy Creek Field
Lavaca & Xxxxxx Counties, Texas
BPO APO
WI RI WI RI ORRI
---------- ---------- ---------- ---------- ----------
Xxxxxxx XxXxxxx #1....... 0.25000000 0.19500000 0.25000000 0.19500000 0.00150000
Xxxxxxx XxXxxxx #2....... 0.25000000 0.19500000 0.25000000 0.19500000 0.00150000
Xxxxxxx XxXxxxx #3....... 0.25000000 0.19500000 0.25000000 0.19500000 0.00150000
Xxxxxxx XxXxxxx #4....... 0.25000000 0.19500000 0.25000000 0.19500000 0.00150000
Xxxxxxx #1............... 0.28125000 0.22362847 0.27343750 0.21792540 0.00631050
Xxxxxxx Xxxxxx #1........ 0.30000000 0.24022072 0.30000000 0.24022072 0.00253673
Xxxxxxxxx Estate #1A*.... 0.30625000 0.24187850 0.29843750 0.23617540 0.00631050
--------
*2nd Reversion after 500% Payout WI = .2734375 and RI = .2179254
Texan Gardens Field
Xxxxxxx County, Texas
BPO APO
WI RI WI RI Royalty
---------- ---------- ---------- ---------- ----------
Xxxxxx #1................ 1.00000000 0.70328125 0.52507247 0.36215450 0.00023100
Hidalgo Willacy #1B...... 1.00000000 0.70328125 0.50038700 0.33858067 0.00023100
Xxxxxxx Willacy #2B...... 0.80012370 0.55537500 0.50038700 0.33858067 0.00023100
Xxxxxxx Willacy #3B...... 0.50038700 0.33858067 0.50038700 0.33858067 0.00023100
Xxxxxxx Willacy #4B...... 1.00000000 0.70328125 0.50038700 0.33858067 0.00023100
Xxxxxxx Willacy #5B...... 0.50038700 0.33858067 0.50038700 0.33858067 0.00023100
Xxxxxxx Willacy #6B...... 0.50038700 0.33858067 0.50038700 0.33858067 0.00023100
Xxxxxxx Willacy #7B...... 0.50038700 0.33858067 0.50038700 0.33858067 0.00023100
Xxxxxxx Willacy #8B...... 0.77512375 0.53729266 0.50038700 0.33858067 0.00023100
Xxxxxxx Willacy #9B...... 1.00000000 0.70328125 0.50038700 0.33858067 0.00023100
Xxxxxxx Willacy #10B..... 0.50038700 0.33858067 0.50038700 0.33858067 0.00023100
Xxxxxxx Willacy #11B..... 1.00000000 0.70328125 0.50038700 0.33858067 0.00023100
Xxxxxxx Willacy #12B..... 0.50038700 0.33858067 0.50038700 0.33858067 0.00023100
Xxxxxxx Willacy #13B..... 0.50038700 0.33858067 0.50038700 0.33858067 0.00023100
Xxxxxxx Willacy #14B..... 1.00000000 0.70328125 0.50038700 0.33858067 0.00023100
Xxxxxxx Willacy #15B..... 0.57187089 0.39219360 0.50038700 0.33858067 0.00023100
Xxxxxxx Willacy #17B..... 0.97500000 0.68453125 0.50038700 0.33858067 0.00023100
Lease Number Lessor Lessee Eff. Date Book/Page/Entry
------------ ------ ------ ---------- ---------------
B3DXT-LSE-002 XXXXXXX XXXXXX and wife Union Gas Corporation 02/23/1998 39/369/OFFICIAL PUBLIC
XXXXX
B3DXT-LSE-003 XXXXX XXXXX, XXXXXXXXX XXXX EXPLORATION 10/09/1997 29/427/OFFICIAL PUBLIC
XXXXXXX, & XXXXXX
XXXXXXX
B3DXT-LSE-004-01 XXXXX X. XXXXX Union Gas Corporation 06/09/1998 39/374/OFFICIAL PUBLIC
B3DXT-LSE-004-02 XXXXX XXXXX XXXXXX Union Gas Corporation 07/06/1998 42/135/OFFICIAL PUBLIC
B3DXT-LSE-005 XXXX XXX XXXXXXX Union Gas Corporation 02/23/1998 39/381/OFFICIAL PUBLIC
B3DXT-LSE-006 XXXXX X. XXXXXXXX Union Gas Corporation 05/30/1998 39/386/OFFICIAL PUBLIC
B3DXT-LSE-007 XXXXX X. XXXXXXX Union Gas Corporation 04/02/1998 41/586/OFFICIAL PUBLIC
B3DXT-LSE-008 XXXX XXX XXXXXXX Union Gas Corporation 04/02/1998 41/383/OFFICIAL PUBLIC
B3DXT-LSE-009-02 XXXXXXX X. XXXXX XXXXX Union Gas Corporation 07/07/1998 42/142/OFFICIAL PUBLIC
B3DXT-LSE-010 XXXXX XXXXXXXXX, XXXXXXX Union Gas Corporation 03/13/1998 39/392/OFFICIAL PUBLIC
XXXXXXXXX, & XXXXXX
XXXXXXXXX
B3DXT-LSE-013 XXXXX XXXXX XXXXXXX & Union Gas Corporation 03/11/1998 39/434/OFFICIAL PUBLIC
wife XXXXXXX XXXX
XXXXXXX
B3DXT-LSE-014 XXXX XXXXX XXXXX XXXXXX Union Gas Corporation 03/11/1998 39/440/OFFICIAL PUBLIC
B3DXT-LSE-016-01 XXXXXX XXXXXXXXX Union Gas Corporation 05/29/1998 39/446/OFFICIAL PUBLIC
X0XXX-XXX-000-00 XXXXXXX XXXXXXXXX & wife Union Gas Corporation 05/29/1998 39/451/OFFICIAL PUBLIC
XXXXXXX XXXXXXXXX
B3DXT-LSE-016-03 XXXXXXX XXXXXXXX Union Gas Corporation 05/29/1998 39/457/OFFICIAL PUBLIC
B3DXT-LSE-016-04 XXXXXXX XXXXX Union Gas Corporation 05/29/1998 39/462/OFFICIAL PUBLIC
B3DXT-LSE-016-05 XXX XXXXXX, Individually Union Gas Corporation 05/30/1998 39/468/OFFICIAL PUBLIC
and as Attorney-in-Fact
for XXXXXXX X. XXXXXX,
Trustee of the XXXXXXX
X. XXXXXX LIVING TRUST
B3DXT-LSE-016-06 XXXXX XXXXXXXXX, Union Gas Corporation 05/29/1998 40/637/OFFICIAL PUBLIC
Individually, XXXXX X.
XXXXXXXXX and XXXXXXX
XXXXXXXXX, Co-Executors
of the Estate of
Xxxxxxx Xxxxxxxxx
B3DXT-LSE-016-07 XXXX XXXXXXXX Union Gas Corporation 05/26/1998 40/648/OFFICIAL PUBLIC
B3DXT-LSE-016-08 XXXXXX XXXXXXXX Union Gas Corporation 05/29/1998 40/643/OFFICIAL PUBLIC
B3DXT-LSE-016-09 XXXXXXX X. XXXXXXXXX Union Gas Corporation 05/29/1998 44/658/OFFICIAL PUBLIC
Lease No. TX1-26033A...... Oil, Gas and Mineral Lease dated August 18, 1977,
between Xxxx Investment Company, an Iowa
corporation, as Lessor, and Xxxxxx Xxxxx, Trustee,
as Lessee, recorded in Volume 369, Page 837, Oil
and Gas Records, Xxxxxxx County, Texas, covering
699.495 acres, more or less.
Lease No. TX1-26033B...... Oil, Gas and Mineral Lease dated July 21, 1977,
between Hidalgo Willacy Oil Company, a Texas
corporation, as Lessor, and Xxxxxx Xxxxx, Trustee,
as Lessee, recorded in Volume 369, Page 104, Oil
and Gas Records, Xxxxxxx County, Texas, covering
699.495 acres, more or less.
Lease No. TX1-26033C...... Oil, Gas and Mineral Lease dated July 21, 1977,
between X. X. Xxxxxxx and X. X. Xxxxx, dba Xxxxxxx
and Cross, as Lessor, and Xxxxxx Xxxxx, Trustee,
as Lessee, recorded in Volume 369, Page 109, Oil
and Gas Records, Xxxxxxx County, Texas, covering
699.45 acres more or less.
Lease No. TX1-26033D...... Oil, Gas and Mineral Lease dated October 18, 1977,
between King Ranch, Inc., as Lessor, and Xxxxxx
Xxxxx, Trustee, as Lessee, recorded in Volume 371,
Page 3, Oil & Gas Records, Xxxxxxx County, Texas,
covering 366.612 acres, more or less.
Lease No. TX1-26033E...... Oil, Gas and Mineral Lease dated October 18, 1977,
between Corpus Christi National Bank, et al, as
Lessor, and Xxxxxx Xxxxx, Trustee, as Lessee,
recorded in counterparts in Volume 371, page 8,
Volume 371, Page 15, Volume 371, Page 24, and
Volume 371, Page 32, Oil & Gas Records, Xxxxxxx
County, Texas, covering 366.612 acres, more or
less.
Reference herein to the above leases shall also include all amendments or
ratifications of said leases as reflected by instruments duly recorded in the
office of the County Clerk of Xxxxxxx County, Texas.
Insofar and only insofar as the above described leases cover the subsurface
interval from the surface to a depth of 10,121 feet subsurface.
Subject to the Following
1) Operating Agreement dated September 1, 1986, between Xxxx Petroleum
Corporation, as Operator, and Xxxx Oil and Gas Corporation and Xxxxxxx
Energy Company, as Non-Operators, and Operating Agreement dated April
15, 1979, between Xxxx Petroleum Corporation, as Operator, and Xxxxxxx
Energy Company, as Non-Operator.
2) Pooling Designation dated July 12, 1979, by Xxxx Petroleum
Corporation, et al., recorded in Volume 383, Page 200, and Volume 383,
Page 193, Oil & Gas Records, Xxxxxxx County, Texas, as amended in
Volume 386, Page 443, Oil and Gas Records, Xxxxxxx County, Texas,
pursuant to which the 696-acre Xxxx Gas Unit was created to a depth of
10.121 feet subsurface.
3) Any Gas Purchase Contract or Transportation Agreement affecting the
assigned premises.
4) Any and all agreements of records.
Warranty Deed dated August 15, 1996 by and between L. B. Industries, Inc.
and Amerac Energy Corporation covering all of Lot Twenty-Three (23), Block Six
(6), save and except the fee surface estate in and to 2.34 acres of the West
340 feet of Xxx 00, Xxxxx Xxxxxxx subdivision of lands in Porciones 78, 79 and
80, Xxxxxxx County, Texas, as on the map and plat recorded in Volume 8, Page 57
and 58, Map Records, Xxxxxxx County, Texas.
Lease Number Lessor Lessee Eff. Date Book/Page/Entry
------------ ------ ------ --------- ---------------
BAR3D-LSE-001-01 Xxxxxx X. Xxxxxxx Union Gas Corporation 11/30/1997 139/655/ OFFICIAL
BAR3D-LSE-001-02 Xxxxxxxx Xxxxxx Union Gas Corporation 11/30/1997 139/665/ OFFICIAL
BAR3D-LSE-001-03 Xxxxx Xxx Xxxxxxx Xxxxx Union Gas Corporation 11/30/1997 139/675/ OFFICIAL
BAR3D-LSE-001-04 Xxxxxxx Xxxxx Xxxx Union Gas Corporation 11/30/1997 139/685/ OFFICIAL
XXX0X-XXX-000-00 Xxxxxxx Xxxxxx Union Gas Corporation 11/30/1997 139/695/ OFFICIAL
BAR3D-LSE-001-06 Xxxxxxxxx XxXxxxxx Union Gas Corporation 11/30/1997 139/705/ OFFICIAL
BAR3D-LSE-001-07 Xxxxxxx Xxxxx Xxxxxxx Union Gas Corporation 11/30/1997 139/715/ OFFICIAL
Xxxxxxxx Xxxxx Xxxx
BAR3D-LSE-001-08 Lindemon Union Gas Corporation 11/30/1997 139/725/ OFFICIAL
BAR3D-LSE-001-09 XXXX X. XXXXXXX AND WIFE
VIRGINIA Union Gas Corporation 10/09/1997 145/767/ OFFICIAL
XXX0X-XXX-000-00 Xxxxx Xxxxxxxx et al Union Gas Corporation 01/16/1998 36/538/OFFICIAL PUBLIC
BAR3D-LSE-002-02 XXXXXXX XXXXXXXX Union Gas Corporation 01/31/1998 36/545/OFFICIAL PUBLIC
XXXXXXX X. XXXXXX LIVING
BAR3D-LSE-002-03 TRUST Union Gas Corporation 03/11/1998 36/604/OFFICIAL PUBLIC
XXX0X-XXX-000-00 Xxxxx Xxxxxxxx et al Union Gas Corporation 01/31/1998 36/552/OFFICIAL PUBLIC
BAR3D-LSE-003-02 XXXXXX XXXXXXXX Union Gas Corporation 01/31/1998 36/559/OFFICIAL PUBLIC
XXXXXXX X. XXXXXX LIVING
BAR3D-LSE-003-03 TRUST Union Gas Corporation 03/11/1998 36/590/OFFICIAL PUBLIC
XXX0X-XXX-000-00 Xxxxx Xxxxxxxx et al Union Gas Corporation 01/31/1998 36/566/OFFICIAL PUBLIC
BAR3D-LSE-004-02 XXXXXX XXXXXXXX Union Gas Corporation 01/31/1998 36/597/OFFICIAL PUBLIC
XXXXXXX X. XXXXXX LIVING
BAR3D-LSE-004-03 TRUST Union Gas Corporation 03/11/1998 36/575/OFFICIAL PUBLIC
XXXXXXX X. XXXXXX LIVING
BAR3D-LSE-004-04 TRUST Union Gas Corporation 03/11/1998 36/582/OFFICIAL PUBLIC
BAR3D-LSE-005 XXXXXXXXX XXXXXX Union Gas Corporation 02/18/1998 34/614/OFFICIAL PUBLIC
XXXXXXXX XXXXXXX & WIFE
BAR3D-LSE-006-01 XXXXXXX Union Gas Corporation 02/14/1998 37/45/OFFICIAL PUBLIC
BAR3D-LSE-006-02 XXXXXXXX XXXXXXX Union Gas Corporation 07/14/1998 38/648/OFFICIAL PUBLIC
XXXXXXXXX X. XXXXX
BAR3D-LSE-006-03 XXXXXXXX Union Gas Corporation 05/18/1998 39/818/OFFICIAL PUBLIC
BAR3D-LSE-006-04 XXXXX X. XXXXXXX Union Gas Corporation 05/27/1998 39/816/OFFICIAL PUBLIC
BAR3D-LSE-006-05 XXXXX XXXXXX Union Gas Corporation 07/25/1998 39/357/OFFICIAL PUBLIC
BAR3D-LSE-006-06 XXXXX XXXXXX Union Gas Corporation 05/13/1998 40/231/OFFICIAL PUBLIC
BAR3D-LSE-006-07 XXXXX XXXXXXXXXXX Union Gas Corporation 05/27/1998 40/666/OFFICIAL PUBLIC
BAR3D-LSE-007 Xxxxx Xxxx Xxxxxx Union Gas Corporation 03/17/1998 36/642/OFFICIAL PUBLIC
BAR3D-LSE-008 Xxx Xxxxx Union Gas Corporation 03/15/1998 36/573/OFFICIAL PUBLIC
BAR3D-LSE-009 Xxxxxxx Xxxxxxxx Union Gas Corporation 03/15/1998 36/612/OFFICIAL PUBLIC
BAR3D-LSE-010 XXXXXXX X. XXXXXX & WIFE
XXXXXX Union Gas Corporation 12/05/1997 32/145/OFFICIAL PUBLIC
BAR3D-LSE-011 XXXXXX XXXXX XXXXXX Union Gas Corporation 01/09/1998 144/333/ OFFICIAL
BAR3D-LSE-012 XXXXX AND XXXXXX XXXXX Union Gas Corporation 03/13/1998 40/660/OFFICIAL PUBLIC
--------
*(1) Official Public Records refer to Documents recorded in XxXxxx County,
Texas.
*(2) Official Records refer to Documents recorded in Lavaca County, Texas.
Interests in the above leases are subject to 1) the terms and provisions of
the Prospect Agreement dated April 1, 1997 between 3DX Technologies, Inc. and
Union Gas Corporation, 2) the terms and provisions of the Partial Assignment of
Oil, Gas & Mineral Leases from Union Gas Corporation to 3DX Technologies, Inc.
dated October 14, 1998, which is recorded in Volume 46, Page 795 in the
Official Records of Xxxxxx County, Texas, 3) the terms and provisions of the
unrecorded Farmout Agreement dated May 21, 1998 between Southern Mineral
Corporation and 3DX Technologies, Inc., 4) the terms, provisions, exceptions,
reservations and other matters set out in the GRBP Assignment, 5) the terms and
provisions of the unrecorded Prospect Letter Agreement dated October 15, 1996
between Union Gas Corporation and Southern Mineral Corporation which provides
for the terms of the parties relationship in the development and operations of
the leases assigned herein, 6) the terms and provisions of the Joint Operating
Agreement dated September 30, 1996 naming Union Gas Operating Company as
Operator, and 7) the Gas Processing Contract between Union Gas Operating
Company et al and Shell Texas Gas Plants, L.P. dated January 18, 1998.
1. H-1013 Oil, Gas and Mineral Lease dated June 10, 1933, as amended,
between X.X. XxXxxxx, et ux, as Lessor, and Shell Petroleum
Corporation, as Lessee, recorded in Volume 9, Page 3, of the
Oil and Gas Records of XxXxxx County, Texas, and Book 17, Page
72 of the Lease Records of Lavaca County, Texas.
2. H-1017 Oil, Gas and Mineral Lease dated June 16, 1933, as amended,
between Xxxxxxx X. Xxxxxxx, et ux, as Lessor, and Shell
Petroleum Corporation, as Lessee, recorded in Volume 9,
Page 1, of the Oil and Gas Records of XxXxxx County, Texas, and
Book 17, Page 44 of the Lease Records of Lavaca County, Texas.
3. H-1019(a) Oil, Gas and Mineral Lease dated June 16, 1933, as amended,
between Xxxxx Xxxxxxxxx, et al., as lessors, and Shell
Petroleum Corporation, as Lessee, recorded in Volume 8, Page
633 of the Oil and Gas Records of XxXxxx County, Texas, and
Book 17, Page 97 of the Lease Records of Lavaca County,
Texas.
4. H-1019(b) Oil, Gas and Mineral Lease dated September 4, 1935, as
amended, between Xxxxxxx Xxxxxxxxx Xxxxxx et vir, as Lessor,
and Shell Petroleum Corporation, as Lessee, recorded in
Volume 10, Page 132, of the Oil and Gas Records of Xxxxxx
County, Texas, and in Box 23, Page 76 of the Lease Records
of Lavaca County, Texas.
Insofar and only insofar as the above described leases cover those depths
from the base of the Yegua formation, defined as 5,450 feet below the surface
on the log from Shell Oil Company XxXxxxx No. 2 Well, to a depth of 11,810
feet below the surface.
Interests in the above leases are subject to 1) the terms, provisions,
exceptions, reservations and other matters set out in the Xxxxxx X. Xxxxx
Partnership Assignment dated June 16, 1998 and recorded in Volume 40, Page 246
of the Official Public Records of Xxxxxx County, Texas and Volume 155, Page
256 of the Official Records of Lavaca County, Texas, and by its acceptance
hereof, Southern Mineral Corporation hereby assumes its proportionate share of
the obligations of Union Gas Corporation under the leases and the Xxxxxx X.
Xxxxx Partnership Assignment, 2) the terms and provisions of the unrecorded
Prospect Letter Agreement dated October 15, 1996 between Union Gas Corporation
and Southern Mineral Corporation which provides for the terms of the parties
relationship in the development and operations of the leases assigned herein,
3) the terms and provisions of the Joint Operating Agreement dated September
30, 1996 naming Union Gas Operating Company as Operator, and 4) the Gas
Processing contract between Union Gas Operating Company et al and Shell Texas
Gas Plants, L.P. dated January 18, 1998.
POTENTIAL ADDITIONAL INTEREST LEASES
OWNED BY SOUTHERN MINERAL CORPORATION
Eff.
UG Lease # Lessor Lessee Date Book Page Records
---------- ------ ---------- -------- ---- ---- --------
B3DXT-LSE-012-04 X. X. XXXXXXXX UNION GAS 09/23/98 45 809 OFFICIAL
B3DXT-LSE-012-05 XXXXXX XXXXXX, ET UX UNION GAS 09/17/98 45 811 OFFICIAL
B3DXT-LSE-012-06 XXXXXXX XXXXXX UNION GAS 09/17/98 UNK UNK OFFICIAL
B3DXT-LSE-012-09 XXXXX XXXXX XXXXXXXX UNION GAS 10/09/98 53 438 OFFICIAL
BAR3D-F/O-GBP-001 X. X. XXXXXXX, ET UX SHELL PET. 06/10/33 17 72 OFFICIAL
BAR3D-F/O-GBP-004 XXXXXXX X. XXXXXXX SHELL PET. 06/16/33 17 44 OFFICIAL
BAR3D-F/O-GBP-007-01 XXXXX XXXXXXXXX SHELL PET. 06/16/33 17 97 OFFICIAL
BAR3D-F/O-GBP-007-02 XXXXXXX XXXXXXXXX XXXXXX SHELL PET. 06/16/33 10 32 OFFICIAL
BAR3D-F/O-GBP-008 XXXXXX XXXXXXX SHELL PET. 06/12/33 16 586 OFFICIAL
BAR3D-LSE 006-08 XXXXXXX X. XXXXXXX, TR. UNION GAS 10/21/98 47 49 OFFICIAL
B3DXT-LSE 013-01 XXXXXX X. XXXXXXX UNION GAS 09/29/99 57 543 OFFICIAL
B3DXT-LSE 013-02 XXXXXXXXX X. XXXXXXX UNION GAS 09/29/99 57 542 OFFICIAL
B3DXT-LSE 013-03 XXXXX X. XXXXXXXX UNION GAS 10/09/98 53 434 OFFICIAL
XXXXXXXX X. XXXXXX, ET
B3DXT-LSE 013-04 AL UNION GAS 09/02/98 53 432 OFFICIAL
EXHIBIT "B"
Attached to and made a part of the Purchase and Sale Agreement between Southern
Mineral Corporation, Amerac Energy Corporation and ANR Production Company
BRUSHY CREEK FIELD/XXXXXXXX AREA
XXXXXX AND LAVACA COUNTIES, TEXAS
Allocated
Well Name Value ($)
--------- ---------
Xxxxxxxxx Estate #1A.................................................. 1,704,346
Xxxxxxx #1............................................................ 6,708,319
Western Extension
Xxxxxxx Xxxxxx #1..................................................... 36,319
Xxxxxx Xxxxx Foundation Farmout
Xxxxxxx XxXxxxx #0, #0, #3............................................ 5,957,567
Xxxxxxxxx-Xxxxxxx #1.................................................. 1,049,804
TEXAS GARDENS/TABASCO FIELDS
XXXXXXX COUNTY, TEXAS
Well Name
---------
Xxxxxx, E............................................................ 28,329
Xxxxxxx-Xxxxxxx #1B.................................................. 1,090
Xxxxxxx-Xxxxxxx #2B.................................................. 95,556
Xxxxxxx-Xxxxxxx #3B.................................................. 59,745
Xxxxxxx-Xxxxxxx #4B.................................................. 1,090
Xxxxxxx-Xxxxxxx #5B.................................................. 84,079
Xxxxxxx-Xxxxxxx #6B.................................................. 28,583
Xxxxxxx-Xxxxxxx #7B.................................................. 82,263
Xxxxxxx-Xxxxxxx #8B.................................................. 130,676
Xxxxxxx-Xxxxxxx #9B.................................................. 1,090
Xxxxxxx-Xxxxxxx #10B................................................. 64,757
Xxxxxxx-Xxxxxxx #11B................................................. 60,399
Xxxxxxx-Xxxxxxx #12BL................................................ 1,090
Xxxxxxx-Xxxxxxx #12BU................................................ 3,959
Xxxxxxx-Xxxxxxx #13B................................................. 81,391
Xxxxxxx-Xxxxxxx #14B................................................. 1,090
Xxxxxxx-Xxxxxxx #15B................................................. 97,372
Xxxxxxx-Xxxxxxx #17B................................................. 1,090
----------
Total............................................................ 16,280,000
==========
EXHIBIT "C"
Attached to and made a part of the Purchase and Sale Agreement between
Southern Mineral Corporation, Amerac Energy Corporation and ANR Production
Company.
ASSIGNMENT AND XXXX AND SALE
SOUTHERN MINERAL CORPORATION, a Nevada corporation, and AMERAC ENERGY
CORPORATION, a Delaware corporation, (herein collectively called "Grantor"),
for Ten Dollars and other good and valuable consideration (the receipt and
sufficiency of which are hereby acknowledged), does hereby GRANT, BARGAIN,
SELL, CONVEY, ASSIGN, TRANSFER, SET OVER, and DELIVER unto ANR PRODUCTION
COMPANY, a Delaware corporation (herein called "Grantee"), whose address is
Nine Xxxxxxxx Xxxxx, Xxxxxxx, Xxxxx 00000, all of Grantor's right, title and
interest in and to the following (collectively called the "Assets"):
(A) All of Grantor's oil and gas associated hydrocarbons ("Oil and Gas")
and related rights, titles and interests, including, but not limited
to, leasehold interests, royalty interests, overriding royalty
interests, payments out of production, reversionary rights, and
contractual rights to production in and to (i) those interests
described in the leases, subleases, assignments and other
instruments described in Exhibit A attached hereto and made part
hereof (collectively "Leases" and individually as "Lease"); (ii)
those xxxxx described in Exhibit A (the "Xxxxx"); (iii) all
easements, rights of way, and other rights, privileges, benefits and
powers with respect to the use and occupation of the surface of, and
the subsurface depths under, the land covered by the Leases; (iv)
all rights in respect of any pooled or unitized acreage located in
whole or in part within each Lease, including all production from
the pool or unit allocated to any such Lease and all interests in
any xxxxx within the unit or pool associated with such Lease,
regardless of whether such unit or pool production comes from xxxxx
located within or without the Leases;
(B) All licenses, servitudes, gas purchase and sale contracts (including
interests and rights, if any, with respect to any prepayments, take-
or-pay, buydown and buyout agreements), crude purchase and sale
agreements, farmin agreements, farmout agreements, bottom hole
agreements, acreage contribution agreements, operating agreements,
unit agreements, processing agreements, options, leases of equipment
or facilities, joint venture agreements, pooling agreements,
prospect agreements, transportation agreements, rights-of-way and
other contracts, agreements and rights, which are owned by Grantor,
in whole or in part, and are (i) appurtenant to the Leases, or (ii)
used or held for use in connection with the ownership or operation
of the Leases, or the sale, distribution or disposal of oil and gas
or water from the Xxxxx (collectively, the "Contracts");
(C) All of the real, personal and mixed property and facilities located
in, on or adjacent to the Leases or used in the operation thereof
(whether located on or off such Leases, but excluding equipment or
other personal property of Grantor located in Grantor's Houston
office), which is owned by Grantor, in whole or in part, including,
without limitation, well equipment; casing; tanks; crude oil,
natural gas, condensate or products in storage severed after the
Effective Time; tubing; compressors; pumps; motors; fixtures;
machinery and other equipment; pipelines; field processing
equipment; inventory and all other improvements used in the
operation thereof (the "Related Assets");
(D) All governmental permits, licenses and authorizations including
environmental permits, licenses and authorizations, as well as any
applications for the same, related to the Leases or the use thereof;
and
(E) All of the files, records and data relating to the items described
in subsections (A), (B), (C), and (D) above, including, without
limitation, title records (title curative documents); surveys, maps
and drawings; contracts; correspondence; Federal Energy Regulation
Commission files;
1
microfiche lists; geological, geophysical and seismic records, data
and information; production records, electric logs, core data,
pressure data, decline curves, graphical production curves and all
related matters and construction documents (except to the extent the
delivery or copying of such records may be restricted by contract
with a third party, in which event Seller shall cooperate with Buyer
in efforts to provide on site access to such records until a release
from such restriction may be obtained) (the "Records"); and
TO HAVE AND TO HOLD the Assets unto Grantee, its successors and assigns,
forever.
GRANTOR AGREES TO WARRANT AND DEFEND TITLE TO THE ASSETS TRANSFERRED AND
ASSIGNED BY GRANTOR UNTO GRANTEE, ITS SUCCESSORS AND ASSIGNS, AGAINST THE
CLAIMS AND DEMANDS OF ALL PERSONS CLAIMING, OR TO CLAIM THE SAME, OR ANY PART
THEREOF BY, THROUGH OR UNDER GRANTOR, BUT NOT OTHERWISE; HOWEVER, ALL OF
GRANTOR'S INTEREST IN THE EQUIPMENT AND PERSONAL PROPERTY IS SOLD "AS IS AND
WHERE IS," AND WITHOUT WARRANTY OF MERCHANTABILITY, CONDITION OR FITNESS FOR A
PARTICULAR PURPOSE, EITHER EXPRESS OR IMPLIED.
This Assignment and Xxxx of Sale is made subject to the Purchase and Sale
Agreement between Grantor and Grantee dated as of July 9, 1999 ("Purchase and
Sale Agreement").
Grantor agrees to execute and deliver to Grantee, from time to time, such
other and additional instruments, notices, division orders, transfer orders and
other documents, and to do all such other and further acts and things as may be
necessary to more fully and effectively grant, convey and assign to Grantee the
Assets in accordance with the provisions hereof and the Purchase and Sale
Agreement.
This Assignment and Xxxx of Sale is effective as of 7:00 a.m. local time at
the location of the Assets, respectively, on May 1, 1999 ("Effective Time").
IN WITNESS WHEREOF, Grantor and Grantee have executed this Assignment and
Xxxx of Sale on the date set forth in their respective acknowledgements below,
but effective for all purposes as of the Effective Time.
GRANTOR:
SOUTHERN MINERAL CORPORATION
By: ____________________________________
Title: _________________________________
AMERAC ENERGY CORPORATION
By: ____________________________________
Title: _________________________________
ANR PRODUCTION COMPANY
By: ____________________________________
Xxxxxxx X. Xxxxxx
Senior Vice President
2
STATE OF TEXAS
COUNTY OF XXXXXX
Before me, the undersigned authority, a Notary Public in and for the County
of Xxxxxx, State of Texas, on this day personally appeared , known
to me to be the person whose name is subscribed to the foregoing instrument and
acknowledged to me that he executed the same as the act and deed of SOUTHERN
MINERAL CORPORATION, a Nevada corporation, as the thereof, and for the
purposes and consideration therein expressed.
Given under my hand and seal of office day of July, 1999.
My Commission Expires:
-------------------------------------
Notary Public in and for
Xxxxxx County, Texas
STATE OF TEXAS
COUNTY OF XXXXXX
Before me, the undersigned authority, a Notary Public in and for the County
of Xxxxxx, State of Texas, on this day personally appeared , known
to me to be the person whose name is subscribed to the foregoing instrument and
acknowledged to me that he executed the same as the act and deed of AMERAC
ENERGY CORPORATION, a Delaware corporation, as the thereof, and for
the purposes and consideration therein expressed.
Given under my hand and seal of office day of July, 1999.
My Commission Expires:
-------------------------------------
Notary Public in and for
Xxxxxx County, Texas
STATE OF TEXAS
COUNTY OF XXXXXX
Before me, the undersigned authority, a Notary Public in and for the County
of Xxxxxx, State of Texas, on this day personally appeared Xxxxxxx X. Xxxxxx,
known to me to be the person whose name is subscribed to the foregoing
instrument and acknowledged to me that he executed the same as the act and deed
of ANR PRODUCTION COMPANY, a Delaware corporation, as the Senior Vice President
thereof, and for the purposes and consideration therein expressed.
Given under my hand and seal of office this day of July, 1999.
-------------------------------------
Notary Public in and for the
State of Texas
3
EXHIBIT "D"
Attached to and made part of the Purchase and Sale Agreement between
Southern Mineral Corporation, Amerac Energy Corporation and ANR Production
Company.
GAS IMBALANCES AS OF MAY 31, 1999
Imbalance
- Under produced
Field + Over produced
---------------------------------------------------------------------
Texan Gardens 11,801 MCF
Brushy Creek 0
EXHIBIT "E"
Attached to and made a part of the Purchase and Sale Agreement between
Southern Mineral Corporation, Amerac Energy Corporation and ANR Production
Company.
CONSENTS
None
EXHIBIT "F"
Attached to and made a part of the Purchase and Sale Agreement between
Southern Mineral Corporation, Amerac Energy Corporation and ANR Production
Company.
NON-COMPETE AREA
