BRIGHAM EXPLORATION COMPANY $35,000,000 9⅝% Senior Notes due 2014 PURCHASE AGREEMENT dated March 30, 2007 Banc of America Securities LLC Credit Suisse Securities (USA) LLC
Exhibit
10.1
EXECUTION
COPY
XXXXXXX
EXPLORATION COMPANY
$35,000,000
9⅝%
Senior Notes due 2014
dated
March 30, 0000
Xxxx
xx
Xxxxxxx Securities LLC
Credit
Suisse Securities (USA) LLC
Table
of
Contents
|
Section
1.
|
Representations
and Warranties
|
3
|
|
(a)
|
No
Registration Required
|
3
|
|
(b)
|
No
Integration of Offerings or General Solicitation
|
3
|
|
(c)
|
Eligibility
for Resale under Rule 144A
|
3
|
|
(d)
|
The
Offering Memorandum
|
4
|
|
(e)
|
4
|
|
|
(f)
|
The
Registration Rights Agreement
|
4
|
|
(g)
|
The
DTC Agreement
|
5
|
|
(h)
|
Authorization
of the Notes, the Exchange Notes and the Guarantees
|
5
|
|
(i)
|
Authorization
of the Indenture
|
5
|
|
(j)
|
Description
of the Securities and the Indenture
|
6
|
|
(k)
|
No
Material Adverse Change
|
6
|
|
(l)
|
Independent
Accountants
|
6
|
|
(m)
|
Independent
Petroleum Engineers
|
7
|
|
(n)
|
Preparation
of the Financial Statements
|
7
|
|
(o)
|
Incorporation
and Good Standing of the Company and its Subsidiaries
|
7
|
|
(p)
|
Capitalization
and Other Capital Stock Matters
|
8
|
|
(q)
|
NASDAQ
Listing
|
8
|
|
(r)
|
Non-Contravention
of Existing Instruments; No Further Authorizations or Approvals
Required
|
9
|
|
(s)
|
No
Material Actions or Proceedings
|
10
|
|
(t)
|
Intellectual
Property Rights
|
10
|
|
(u)
|
All
Necessary Permits, etc
|
10
|
|
(v)
|
Title
to Properties
|
11
|
|
(w)
|
Tax
Law Compliance
|
11
|
|
(x)
|
Not
an Investment Company
|
11
|
|
(y)
|
Insurance
|
11
|
|
(z)
|
No
Price Stabilization or Manipulation
|
12
|
|
(aa)
|
Solvency
|
12
|
|
(bb)
|
Compliance
with Xxxxxxxx-Xxxxx
|
12
|
|
(cc)
|
MD&A
|
12
|
|
(dd)
|
Company’s
Accounting System
|
13
|
|
(ee)
|
Disclosure
Controls and Procedures
|
13
|
|
(ff)
|
Compliance
with Environmental Laws
|
13
|
|
(gg)
|
Periodic
Review of Costs of Environmental Compliance
|
14
|
|
(hh)
|
ERISA
Compliance
|
15
|
|
(ii)
|
Compliance
with Labor Laws
|
15
|
|
(jj)
|
No
Unlawful Contributions or Other Payments
|
16
|
|
(kk)
|
Compliance
with Regulation S
|
16
|
|
(ll)
|
Taxes;
Fees
|
166
|
|
Section
2.
|
Purchase,
Sale and Delivery of the Securities
|
176
|
|
(a)
|
The
Securities
|
17
|
|
(b)
|
The
Closing Date
|
17
|
|
(c)
|
Delivery
of the Securities
|
17
|
|
(d)
|
Initial
Purchasers as Qualified Institutional Buyers
|
17
|
|
Section
3.
|
Additional
Covenants
|
17
|
|
(a)
|
Preparation
of Final Offering Memorandum; Initial Purchasers’ Review of Proposed
Amendments and Supplements
|
18
|
i
|
(b)
|
Amendments
and Supplements to the Final Offering Memorandum and Other Securities
Act
Matters
|
18
|
|
(c)
|
Copies
of the Offering Memorandum
|
19
|
|
(d)
|
BlueSky
Compliance
|
19
|
|
(e)
|
Use
of Proceeds
|
19
|
|
(f)
|
The
Depositary
|
19
|
|
(g)
|
Additional
Issuer Information
|
19
|
|
(h)
|
Agreement
Not To Offer or Sell Additional Securities
|
20
|
|
(i)
|
Future
Reports to the Initial Purchasers
|
20
|
|
(j)
|
No
Integration
|
20
|
|
(k)
|
No
Restricted Resales
|
21
|
|
(l)
|
Legended
Securities
|
21
|
|
(m)
|
PORTAL
|
21
|
|
Section
4.
|
Payment
of Expenses
|
21
|
|
Section
5.
|
Conditions
of the Obligations of the Initial Purchasers
|
22
|
|
(a)
|
Accountants’
Comfort Letter
|
22
|
|
(b)
|
No
Material Adverse Change or Ratings Agency Change
|
23
|
|
(c)
|
Opinion
of Counsel for the Company
|
23
|
|
(d)
|
Opinion
of Counsel for the Initial Purchasers
|
23
|
|
(e)
|
Officers’
Certificate
|
23
|
|
(f)
|
Engineers
Letter
|
24
|
|
(g)
|
PORTAL
Listing
|
24
|
|
(h)
|
Registration
Rights Agreement and Indenture
|
24
|
|
(i)
|
Additional
Documents
|
24
|
|
Section
6.
|
Reimbursement
of Initial Purchasers’ Expenses
|
24
|
|
Section
7.
|
Offer,
Sale and Resale Procedures
|
25
|
|
Section
8.
|
Indemnification.
|
26
|
|
(a)
|
Indemnification
of the Initial Purchasers
|
27
|
|
(b)
|
Indemnification
of the Company and the Guarantors
|
27
|
|
(c)
|
Notifications
and Other Indemnification Procedures
|
28
|
|
(d)
|
Settlements
|
29
|
|
Section
9.
|
Contribution
|
30
|
|
Section
10.
|
Termination
of this Agreement
|
31
|
|
Section
11.
|
Representations
and Indemnities to Survive Delivery
|
32
|
|
Section
12.
|
Notices
|
32
|
|
Section
13.
|
Successors
|
33
|
|
Section
14.
|
Partial
Unenforceability
|
33
|
|
Section
15.
|
Governing
Law Provisions
|
33
|
|
(a)
|
Consent
to Jurisdiction
|
33
|
|
Section
16.
|
Default
of One or More of the Several Initial Purchasers
|
34
|
|
Section
17.
|
No
Advisory or Fiduciary Responsibility
|
34
|
|
Section
18.
|
General
Provisions
|
35
|
ii
EXECUTION
COPY
March
30,
0000
XXXX
XX
XXXXXXX SECURITIES LLC
CREDIT
SUISSE SECURITIES (USA) LLC
As
Initial Purchasers
c/o
Banc
of America Securities LLC
0
Xxxx
00xx
Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Ladies
and Gentlemen:
Introductory.
Xxxxxxx
Exploration Company, a Delaware corporation (the “Company”), proposes to issue
and sell to the several initial purchasers named in Schedule A (the “Initial
Purchasers”), acting severally and not jointly, the respective amounts set forth
in such Schedule
A of
$35,000,000 aggregate principal amount of the Company’s 9 ⅝%
Senior Notes due 2014 (the “Notes”). Banc of America Securities LLC and Credit
Suisse Securities (USA) LLC have agreed to act as the several Initial Purchasers
in connection with the offering and sale of the Securities (as defined below).
The
Securities will be issued pursuant to an indenture, to be dated as of April
20,
2006 (the “Indenture”), among the Company, the Guarantors (as defined below),
and Xxxxx Fargo Bank, N.A., as trustee (the “Trustee”). Securities issued in
book-entry form will be issued in the name of Cede & Co., as nominee of The
Depository Trust Company (the “Depositary”) pursuant to a blanket issuer letter
of representations, to be dated on or before the Closing Date (as defined in
Section 2 hereof) (the “DTC Agreement”), among the Company and the Depositary.
The
holders of the Securities will be entitled to the benefits of a registration
rights agreement, to be dated as of April 9, 2007 (the “Registration Rights
Agreement”), among the Company, the Guarantors and the Initial Purchasers,
pursuant to which the Company and the Guarantors will agree to file with the
Commission (as defined below), under the circumstances set forth therein, (i)
a
registration statement under the Securities Act (as defined below) relating
to
another series of debt securities of the Company with terms substantially
identical to the Notes (the “Exchange Notes”) to be offered in exchange for the
Notes (the “Exchange Offer”) and (ii) to the extent required by the Registration
Rights Agreement, a shelf registration statement pursuant to Rule 415 of the
Securities Act relating to the resale by certain holders of the Notes, and
in
each case, to use its best efforts to cause such registration statements to
be
declared effective.
The
payment of principal of, premium, if any, and interest on the Notes will be
fully and unconditionally guaranteed on a senior unsecured basis, jointly and
severally, by Xxxxxxx, Inc., a Nevada corporation, and Xxxxxxx Oil & Gas,
L.P., a Delaware limited partnership, and any subsidiary of the Company that
executes an additional guarantee after the Closing Date in accordance with
the
terms of the Indenture, and their respective successors and assigns
(collectively, the “Guarantors”), pursuant to their guarantees (the
“Guarantees”). The Notes and the Guarantees attached thereto are herein
collectively referred to as the “Securities;” and the Exchange Notes and the
Guarantees attached thereto are herein collectively referred to as the “Exchange
Securities.”
The
Company understands that the Initial Purchasers propose to make an offering
of
the Securities on the terms and in the manner set forth herein and in the
Pricing Disclosure Package (as defined below) and agrees that the Initial
Purchasers may resell, subject to the conditions set forth herein, all or a
portion of the Securities to purchasers (the “Subsequent Purchasers”) at any
time after the time this Agreement is executed by the parties hereto (the “Time
of Execution”). The Securities are to be offered and sold to or through the
Initial Purchasers without being registered with the Securities and Exchange
Commission (the “Commission”) under the Securities Act of 1933 (as amended, the
“Securities Act,” which term, as used herein, includes the rules and regulations
of the Commission promulgated thereunder), in reliance upon exemptions
therefrom. Pursuant to the terms of the Securities and the Indenture, investors
who acquire Securities shall be deemed to have agreed that Securities may only
be resold or otherwise transferred, after the date hereof, if such Securities
are registered for sale under the Securities Act or if an exemption from the
registration requirements of the Securities Act is available (including the
exemptions afforded by Rule 144A under the Securities Act (“Rule 144A”) or
Regulation S under the Securities Act (“Regulation S”)).
The
Company has prepared and delivered to each Initial Purchaser copies of a
Preliminary Offering Memorandum, dated March 30, 2007 (the “Preliminary Offering
Memorandum”), and has prepared and delivered to each Initial Purchaser copies of
a Pricing Supplement, dated March 30, 2007 (the “Pricing Supplement”),
describing the terms of the Securities, each for use by such Initial Purchaser
in connection with its solicitation of offers to purchase the Securities. The
Preliminary Offering Memorandum and the Pricing Supplement are herein referred
to as the “Pricing Disclosure Package.” Promptly after the Time of Execution,
the Company will prepare and deliver to each Initial Purchaser a final offering
memorandum dated the date hereof (the “Final Offering Memorandum”).
All
references herein to the terms “Pricing Disclosure Package” and “Final Offering
Memorandum” shall be deemed to mean and include all information filed under the
Securities Exchange Act of 1934 (as amended, the “Exchange Act,” which term, as
used herein, includes the rules and regulations of the Commission promulgated
thereunder) prior to the Time of Execution and incorporated by reference in
the
Pricing Disclosure Package (including the Preliminary Offering Memorandum)
or
the Final Offering Memorandum (as the case may be).
The
Company hereby confirms its agreements with the Initial Purchasers as follows:
-
2 -
SECTION
1. Representations
and Warranties. Each
of
the Company and the Guarantors, jointly and severally, hereby represents,
warrants and covenants to each Initial Purchaser that, as of the date hereof
and
as of the Closing Date (references in this Section 1 to the “Offering
Memorandum” are to (x) the Pricing Disclosure Package in the case of
representations and warranties made as of the date hereof and (y) the Final
Offering Memorandum in the case of representations and warranties made as of
the
Closing Date):
(a) No
Registration Required.
Subject
to compliance by the Initial Purchasers with the representations and warranties
set forth in Section 2 hereof and with the procedures set forth in Section
7
hereof, it is not necessary in connection with the offer, sale and delivery
of
the Securities to the Initial Purchasers and to each Subsequent Purchaser in
the
manner contemplated by this Agreement and the Offering Memorandum to register
the Securities under the Securities Act or, until such time as the Exchange
Securities are issued pursuant to an effective registration statement, to
qualify the Indenture under the Trust Indenture Act of 1939 (the “Trust
Indenture Act,” which term, as used herein, includes the rules and regulations
of the Commission promulgated thereunder).
(b) No
Integration of Offerings or General Solicitation.
None of
the Company, the Guarantors or any of their respective subsidiaries, or its
affiliates (as such term is defined in Rule 501 under the Securities Act) (each,
an “Affiliate”), or any person acting on its or any of their behalf (other than
the Initial Purchasers, as to whom no representation or warranty is made) have,
directly or indirectly, solicited any offer to buy or offered to sell, or will,
directly or indirectly, solicit any offer to buy or offer to sell, in the United
States or to any United States citizen or resident, any security which is or
would be integrated with the sale of the Securities in a manner that would
require the Securities to be registered under the Securities Act. None of the
Company, the Guarantors, any of their subsidiaries or its Affiliates, or any
person acting on its or any of their behalf (other than the Initial Purchasers,
as to whom no representation or warranty is made) have engaged or will engage,
in connection with the offering of the Securities, in any form of general
solicitation or general advertising within the meaning of Rule 502 under the
Securities Act. With respect to those Securities sold in reliance upon
Regulation S, (i) none of the Company, the Guarantors, any of their subsidiaries
or Affiliates or any person acting on its or any of their behalf (other than
the
Initial Purchasers, as to whom no representation or warranty is made) has
engaged or will engage in any directed selling efforts within the meaning of
Regulation S and (ii) each of the Company, the Guarantors, any of their
subsidiaries or Affiliates and any person acting on its or their behalf (other
than the Initial Purchasers, as to whom no representation or warranty is made)
has complied and will comply with the offering restrictions set forth in
Regulation S.
(c) Eligibility
for Resale under Rule 144A.
The
Securities are eligible for resale pursuant to Rule 144A and will not be, at
the
Closing Date, of the same class as securities listed on a national securities
exchange registered under Section 6 of the Securities Exchange Act of 1934,
as
amended (the “Exchange Act”) or quoted in a U.S. automated interdealer quotation
system.
-
3 -
(d) The
Offering Memorandum.
Neither
the Pricing Disclosure Package, as of the Time of Execution, nor the Final
Offering Memorandum, as of its date or (as amended or supplemented in accordance
with Section 3(a), if applicable) as of the Closing Date, contains or represents
an untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided that this
representation, warranty and agreement shall not apply to statements in or
omissions from the Pricing Disclosure Package, the Final Offering Memorandum
or
any amendment or supplement thereto made in reliance upon and in conformity
with
information furnished to the Company in writing by any Initial Purchaser through
Banc of America Securities LLC expressly for use in the Pricing Disclosure
Package, the Final Offering Memorandum or amendment or supplement thereto,
as
the case may be. The Pricing Disclosure Package contains, and the Final Offering
Memorandum will contain, as of its date, all the information specified in,
and
meeting the requirements of, Rule 144A. The Company has not distributed and
will
not distribute, prior to the later of the Closing Date and the completion of
the
Initial Purchasers’ distribution of the Securities, any offering material in
connection with the offering and sale of the Securities other than the Pricing
Disclosure Package and the Final Offering Memorandum. The documents incorporated
or deemed to be incorporated by reference in the Offering Memorandum at the
time
they were or hereafter are filed with the Commission complied and will comply
in
all material respects with the requirements of the Exchange Act.
(e) The
Purchase Agreement.
This
Agreement has been duly authorized, executed and delivered by, and is a valid
and binding agreement of, the Company and each of the Guarantors, enforceable
against the Company and each of the Guarantors in accordance with its terms,
except as rights to indemnification hereunder may be limited by applicable
law
and except as the enforcement hereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or affecting the
rights and remedies of creditors or by general equitable
principles.
(f) The
Registration Rights Agreement.
The
Registration Rights Agreement has been duly authorized and, on the Closing
Date,
will have been duly executed and delivered by, and will constitute a valid
and
binding agreement of, the Company and the Guarantors, enforceable against the
Company and each of the Guarantors in accordance with its terms, except as
the
enforcement thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting the rights and
remedies of creditors or by general equitable principles and except as rights
to
indemnification under the Registration Rights Agreement may be limited by
applicable law.
-
4 -
(g) The
DTC Agreement.
The DTC
Agreement has been duly authorized and, on the Closing Date, will have been
duly
executed and delivered by, and (assuming the due authorization, execution and
delivery thereof by the other parties thereto) will constitute a valid and
binding agreement of, the Company, enforceable against the Company in accordance
with its terms, except as the enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws relating to or
affecting the rights and remedies of creditors or by general equitable
principles.
(h) Authorization
of the Notes, the Exchange Notes and the Guarantees.
(i) The
Notes to be purchased by the Initial Purchasers from the Company are in the
form
contemplated by the Indenture, have been duly authorized for issuance and sale
pursuant to this Agreement and the Indenture and, at the Closing Date, will
have
been duly executed by the Company and, when authenticated in the manner provided
for in the Indenture and delivered against payment of the purchase price
therefor, will constitute valid and binding agreements of the Company,
enforceable against the Company in accordance with their terms, except as the
enforcement thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting the rights and
remedies of creditors or by general equitable principles and will be entitled
to
the benefits of the Indenture. (ii) The Exchange Notes have been duly and
validly authorized for issuance by the Company, and when issued and
authenticated in accordance with the terms of the Indenture, the Registration
Rights Agreement and the Exchange Offer, will constitute valid and binding
obligations of the Company, enforceable against the Company in accordance with
their terms, except as the enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium, or similar laws relating to or affecting
enforcement of the rights and remedies of creditors or by general principles
of
equity and will be entitled to the benefits of the Indenture. (iii) The
Guarantees of the Notes and the Exchange Notes are in the respective forms
contemplated by the Indenture, have been duly authorized for issuance and sale
pursuant to this Agreement and the Indenture and, at the Closing Date, will
have
been duly executed by each of the Guarantors and, when the Notes and the
Exchange Notes have been authenticated in the manner provided for in the
Indenture and delivered against payment of the purchase price therefor, will
constitute valid and binding agreements of each such Guarantor, enforceable
against it in accordance with their terms, except as the enforcement thereof
may
be limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws relating to or affecting the rights and remedies of creditors
or by
general equitable principles and will be entitled to the benefits of the
Indenture.
(i) Authorization
of the Indenture.
The
Indenture has been duly authorized by the Company and the Guarantors and, at
the
Closing Date, will have been duly executed and delivered by, and will constitute
a valid and binding agreement of, the Company and the Guarantors, enforceable
against the Company and each of the Guarantors in accordance with its terms,
except as the enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or affecting the
rights and remedies of creditors or by general equitable principles.
-
5 -
(j) Description
of the Securities and the Indenture. The
Securities, the Exchange Securities and the Indenture conform, or will conform,
in all material respects to the respective statements relating thereto contained
in the Offering Memorandum.
(k) No
Material Adverse Change.
Except
as otherwise disclosed in the Offering Memorandum, subsequent to the respective
dates as of which information is given in the Offering Memorandum: (i) there
has
been no material adverse change, or any development that could reasonably be
expected to result in a material adverse change, in the condition, financial
or
otherwise, or in the earnings, business, operations or prospects, whether or
not
arising from transactions in the ordinary course of business, of the Company,
the Guarantors and their respective subsidiaries, considered as one entity
(any
such change or development is called a “Material Adverse Change”); (ii) the
Company, the Guarantors and their respective subsidiaries, considered as one
entity, have not incurred any material liability or obligation, indirect, direct
or contingent, not in the ordinary course of business, nor entered into any
material transaction or agreement not in the ordinary course of business and
(iii) there has been no dividend or distribution of any kind declared, paid
or
made by the Company, the Guarantors or their respective subsidiaries, on any
class of capital stock or other equity interest (other than cash dividends
with
respect to the Company’s Series A Preferred Stock, $0.01 par value, $20 stated
and redemption value, maturing on October 31, 2010, as disclosed in the Offering
Memorandum) or repurchase or redemption by the Company, the Guarantors or any
of
their respective subsidiaries of any class of capital stock or other equity
interest.
(l) Independent
Accountants.
KPMG
LLP, which expressed its opinion with respect to the Company’s fiscal 2006
financial statements (which term as used in this Agreement includes the related
notes thereto) of the Company and its subsidiaries filed with the Commission
and
included in the Offering Memorandum, are independent public or certified public
accountants within the meaning of Regulation S-X under the Securities Act and
the Exchange Act, and any non-audit services provided by KPMG LLP to the Company
or any of the Guarantors have been approved by the Audit Committee of the Board
of Directors of the Company.
-
6 -
PricewaterhouseCoopers
LLP, which expressed its opinion with respect to the Company’s fiscal 2004 and
2005 financial statements (which term as used in this Agreement includes the
related notes thereto) of the Company and its subsidiaries filed with the
Commission and included in the Offering Memorandum, are independent public
or
certified public accountants within the meaning of Regulation S-X under the
Securities Act and the Exchange Act, and any non-audit services provided by
PricewaterhouseCoopers LLP to the Company or any of the Guarantors have been
approved by the Audit Committee of the Board of Directors of the Company.
(m) Independent
Petroleum Engineers.
The
written engineering reports prepared by Xxxxxx, Xxxxxxxxx & Associates, Inc.
(“Xxxxxx, Xxxxxxxxx”), an oil and gas engineering consulting firm, as of
December 31, 2006, setting forth the engineering values attributable to the
oil
and gas properties of the Company and its subsidiaries accurately reflect in
all
material respects the ownership interests of the Company and its subsidiaries
in
the properties therein as of December 31, 2006, except as otherwise disclosed
in
the Offering Memorandum. The information furnished by the Company to Xxxxxx,
Xxxxxxxxx for purposes of preparing its report, including, without limitation,
production, costs of operation and development, agreements relating to current
and future operations and sales of production, was true, correct and complete
in
all material respects on the date supplied and was prepared in accordance with
customary industry practices. Cawley, Gillespie, independent petroleum
consultants, who prepared estimates of the extent and value of proved oil and
natural gas reserves, are independent with respect to the Company and its
subsidiaries.
(n) Preparation
of the Financial Statements.
The
financial statements, together with the related schedules and notes, included
in
the Offering Memorandum present fairly the consolidated financial position
of
the entities to which they relate as of and at the dates indicated and the
results of their operations and cash flows for the periods specified. Such
financial statements have been prepared in conformity with generally accepted
accounting principles applied on a consistent basis throughout the periods
involved, except as may be expressly stated in the related notes thereto. The
financial statements and the financial information included in the Offering
Memorandum comply as to form with the requirements applicable to registration
statements on Form S-1 under the Securities Act. The financial data set forth
in
“Item 6. Selected Consolidated Financial Data” of the Company’s Form 10-K for
the fiscal year ended December 31, 2006 (the “Form 10-K”) fairly present the
information set forth therein on a basis consistent with that of the audited
financial statements contained in the Form 10-K.
-
7 -
(o) Incorporation
and Good Standing of the Company and its Subsidiaries.
Each of
the Company and its subsidiaries has been duly incorporated or formed and is
validly existing as a corporation, limited partnership or limited liability
company, as the case may be, in good standing under the laws of the jurisdiction
of its incorporation or formation and has corporate, partnership or company,
as
the case may be, power and authority to own, lease and operate its properties
and to conduct its business as described in the Offering Memorandum and, in
the
case of the Company and the Guarantors, to enter into and perform its respective
obligations under each of this Agreement, the Registration Rights Agreement,
the
DTC Agreement, the Securities, the Exchange Securities and the Indenture, as
the
case may be, to which it is a party. Each of the Company and each subsidiary
is
duly qualified as a foreign corporation, limited partnership or limited
liability company, as the case may be, to transact business and is in good
standing or equivalent status in each jurisdiction in which such qualification
is required, whether by reason of the ownership or leasing of property or the
conduct of business, except for such jurisdictions where the failure to so
qualify or to be in good standing would not, individually or in the aggregate,
result in a Material Adverse Change. All of the issued and outstanding capital
stock of each subsidiary has been duly authorized and validly issued, is fully
paid and nonassessable and is owned by the Company, directly or through
subsidiaries, free and clear of any security interest, mortgage, pledge, lien,
encumbrance or claim (except as encumbered under the Company’s senior credit
agreement in effect on the date hereof). The Company does not own or control,
directly or indirectly, any corporation, association or other entity other
than
the subsidiaries listed in Exhibit
B hereto.
(p) Capitalization
and Other Capital Stock Matters.
At
December 31, 2006, on an actual basis, and on an as adjusted basis, after giving
pro forma effect to the issuance and sale of the Securities pursuant hereto,
the
Company would have an authorized and outstanding capitalization as set forth
in
the Offering Memorandum under the caption “Capitalization” (other than for
subsequent issuances of capital stock, if any, pursuant to employee benefit
plans described in the Offering Memorandum or upon exercise of outstanding
options or warrants described in the Offering Memorandum). All of the
outstanding shares of common stock of the Company (the “Common Stock”) have been
duly authorized and validly issued, are fully paid and nonassessable and have
been issued in compliance with federal and state securities laws. None of the
outstanding shares of Common Stock were issued in violation of any preemptive
rights, rights of first refusal or other similar rights to subscribe for or
purchase securities of the Company. There are no authorized or outstanding
options, warrants, preemptive rights, rights of first refusal or other rights
to
purchase, or equity or debt securities convertible into or exchangeable or
exercisable for, any capital stock of the Company or any of its subsidiaries
other than those accurately described in the Offering Memorandum. The
description of the options or other rights granted and/or exercised under the
Company’s stock option plans set forth in the Offering Memorandum accurately and
fairly describes such options and rights.
(q) NASDAQ
Listing.
The
Common Stock is registered pursuant to Section 12(b) of the Exchange Act and
is
listed on The NASDAQ Stock Market (“NASDAQ”), and the Company has taken no
action designed to, or likely to have the effect of, terminating the
registration of the Common Stock under the Exchange Act or delisting the Common
Stock from NASDAQ, nor has the Company received any notification that the
Commission or the NASD, Inc. (the “NASD”) is contemplating terminating such
registration or listing.
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8 -
(r) Non-Contravention
of Existing Instruments; No Further Authorizations or Approvals
Required.
None of
the Company, the Guarantors or any of their respective subsidiaries is in
violation of its charter, regulations, by-laws, partnership agreement, limited
liability company agreement or similar constitutive document or is in default
(or, with the giving of notice or lapse of time, would be in default)
(“Default”) under any indenture, mortgage, loan or credit agreement, note,
contract, franchise, lease, license or other instrument to which the Company,
any of the Guarantors or any of their respective subsidiaries is a party or
by
which it or any of them may be bound (including, without limitation, the
Company’s existing senior credit agreement and the Company’s existing
subordinated credit agreement) or to which any of the property or assets of
the
Company or any of the Guarantors or any of their respective subsidiaries is
subject (each, an “Existing Instrument”), except for such Defaults as would not,
individually or in the aggregate, result in a Material Adverse Change. The
execution, delivery and performance of this Agreement, the Registration Rights
Agreement, the DTC Agreement and the Indenture by the Company and each Guarantor
party thereto, and the issuance and delivery of the Securities and the Exchange
Securities, and consummation of the transactions contemplated hereby and thereby
and by the Offering Memorandum (i) have been duly authorized by all necessary
corporate, partnership or company, as the case may be, action and will not
result in any violation of the provisions of the charter, regulations, by-laws,
partnership agreement, operating agreement or other similar constitutive
document of the Company, any Guarantor or any of their respective subsidiaries,
(ii) will not conflict with or constitute a breach of, or Default or a Debt
Repayment Triggering Event (as defined below) under, or result in the creation
or imposition of any lien, charge or encumbrance upon any property or assets
of
the Company, any Guarantor or any of their respective subsidiaries pursuant
to,
or require the consent of any other party to, any Existing Instrument, except
for such conflicts, breaches, Defaults, liens, charges or encumbrances as would
not, individually or in the aggregate, result in a Material Adverse Change
and
such consents as have been obtained and are in full force and effect, and (iii)
will not result in any violation of any law, administrative regulation or
administrative or court decree applicable to the Company, any Guarantor or
any
of their respective subsidiaries. No consent, approval, authorization or other
order of, or registration or filing with, any court or other governmental or
regulatory authority or agency, is required for the Company’s and the
Guarantors’ execution, delivery and performance of this Agreement, the
Registration Rights Agreement, the DTC Agreement or the Indenture, to which
it
is a party, or the issuance and delivery of the Securities or the Exchange
Securities, or consummation of the transactions contemplated hereby and thereby
and by the Offering Memorandum, except such as have been obtained or made by
the
Company or the Guarantors and are in full force and effect under the Securities
Act, applicable securities laws of the several states of the United States
or
provinces of Canada and except such as may be required by the securities laws
of
the United States and the several states of the United States or provinces
of
Canada with respect to the Company’s obligations under the Registration Rights
Agreement. As used herein, a “Debt Repayment Triggering Event” means any event
or condition which gives, or with the giving of notice or lapse of time would
give, the holder of any note, debenture or other evidence of indebtedness (or
any person acting on such holder’s behalf) the right to require the repurchase,
redemption or repayment of all or a portion of such indebtedness by the Company,
the Guarantors or any of their respective subsidiaries.
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9 -
(s) No
Material Actions or Proceedings.
To the
best of the Company’s or any Guarantor’s knowledge, there are no legal or
governmental actions, suits, investigations or proceedings pending or threatened
(i) against or affecting the Company, any Guarantor or any of their respective
subsidiaries or (ii) which has as the subject thereof any property owned or
leased by, the Company, the Guarantors or any of their respective subsidiaries,
which (in any such case under (i) or (ii) above) action, suit, investigation
or
proceeding, if determined adversely to the Company, such Guarantor or such
subsidiary would result in a Material Adverse Change or adversely affect the
consummation of the transactions contemplated by this Agreement.
(t) Intellectual
Property Rights.
The
Company, the Guarantors and their respective subsidiaries own, possess or
license sufficient trademarks, trade names, patent rights, copyrights, licenses,
approvals, trade secrets and other similar rights (collectively, “Intellectual
Property Rights”) reasonably necessary to conduct their businesses as now
conducted; and the expected expiration of any such Intellectual Property Rights,
individually or in the aggregate, would not result in a Material Adverse Change.
None of the Company, the Guarantors or any of their respective subsidiaries
has
received any notice of infringement or conflict with asserted Intellectual
Property Rights of others, which infringement or conflict, if the subject of
an
unfavorable decision, ruling or filing would result in a Material Adverse
Change. None of the Company, the Guarantors or any of their respective
subsidiaries is in default under the terms of any license or similar agreement
related to any Intellectual Property Rights necessary to conduct their business
as now conducted or contemplated except as would not result in a Material
Adverse Change.
(u) All
Necessary Permits, etc.
Each of
the Company, the Guarantors and their respective subsidiaries possess such
valid
and current certificates, franchises, grants, authorizations, qualifications,
licenses, permits, easements, variances, exceptions, certifications,
registrations, consents, certificates or approvals issued by the appropriate
local, state, federal or foreign regulatory agencies or bodies necessary for
it
to own, lease and operate the assets and properties or to conduct their
respective businesses, and none of the Company, the Guarantors or any of their
respective subsidiaries has received any notice of proceedings relating to
the
revocation, cancellation or modification of, or non-compliance with, any such
certificate, authorization or permit which, either individually or in the
aggregate, if the subject of an unfavorable decision, ruling or finding, could
result in a Material Adverse Change.
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10 -
(v) Title
to Properties.
The
Company, the Guarantors and each of their respective subsidiaries have good
and
indefeasible title to (i) its oil and gas properties to the extent included
or
reflected in the reports of Xxxxxx, Xxxxxxxxx referenced in Section 1(m) above
and (ii) all of the other properties and assets reflected as owned in the
financial statements referred to in Section 1(n) hereof (or elsewhere in the
Offering Memorandum), in each case (except as encumbered under the Company’s
senior credit agreement in effect on the date hereof) free and clear of any
security interests, mortgages, liens, encumbrances, equities, claims and other
title defects, except such as do not materially and adversely affect the value
of such property and do not materially interfere with the use made or proposed
to be made of such property by the Company, such Guarantor or such subsidiary.
The real property, improvements, equipment and personal property held under
lease by the Company, any Guarantor or any subsidiary are held under valid
and
enforceable leases, with such exceptions as do not materially interfere with
the
use made or proposed to be made of such real property, improvements, equipment
or personal property by the Company, such Guarantor or such
subsidiary.
(w) Tax
Law Compliance.
The
Company, the Guarantors and their respective subsidiaries have filed all
necessary federal, state and foreign income and franchise tax returns and have
paid all taxes required to be paid by any of them and, if due and payable,
any
related or similar assessment, fine or penalty levied against any of them.
The
Company and each Guarantor have made, in all material respects, accurate
charges, accruals and reserves in the applicable financial statements referred
to in Section 1(n) hereof in respect of all federal, state and foreign income
and franchise taxes for all periods as to which the tax liability of the
Company, the Guarantors, or any of their respective subsidiaries has not been
finally determined.
(x) Not
an Investment Company.
The
Company and the Guarantors have been advised of the rules and requirements
under
the Investment Company Act of 1940, as amended (the “Investment Company Act,”
which term, as used herein, includes the rules and regulations of the Commission
promulgated thereunder). The Company and the Guarantors and their respective
subsidiaries are not, and after receipt of payment for the Securities will
not
be, an “investment company” within the meaning of Investment Company Act and
will each conduct their business in a manner so that they will not become
subject to the Investment Company Act.
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11 -
(y) Insurance.
Each of
the Company the Company and its subsidiaries are insured by recognized,
financially sound institutions with policies in such amounts and with such
deductibles and policy limits and covering such risks as are generally deemed
adequate, appropriate and customary for their businesses including, but not
limited to, policies covering professional liability, malpractice, product
liability, employee and customer health, workers’ compensation, general
liability, director and officer, business interruption, real and personal
property owned or leased by the Company and its subsidiaries against theft,
damage, destruction, acts of terrorism and vandalism and earthquakes. The
Company believes it has adequate, sufficient and appropriate coverage under
its
policies to cover all of its known litigation and the Company has sufficient
insurance against its litigation reserves therefor, so that it believes there
is
no need to take any additional reserve for any such litigation under generally
accepted accounting principles. The Company has no reason to believe that it
or
any of its subsidiaries will not be able (i) to renew its existing insurance
coverage as and when such policies expire or (ii) to obtain adequate and
comparable coverage from similar institutions as may be necessary or appropriate
to conduct its business as now conducted and at a cost that would not result
in
a Material Adverse Change. There are no claims by the Company or any of its
subsidiaries under any current insurance policy as to which any insurance
company or institution is denying, or will deny, liability or coverage or
defending under a reservation of rights clause.
(z) No
Price Stabilization or Manipulation.
None of
the Company, the Guarantors or any of their respective Affiliates has taken
or
will take, directly or indirectly, any action designed to or that might be
reasonably expected to cause or result in stabilization or manipulation of
the
price of any security of the Company to facilitate the sale or resale of the
Securities.
(aa) Solvency.
Each of
the Company and the Guarantors is, and immediately after the Closing Date will
be, Solvent. As used herein, the term “Solvent” means, with respect to any such
person on a particular date, that on such date (i) the fair market value of
the
assets of such person is greater than the total amount of liabilities (including
contingent liabilities) of such person, (ii) the present fair salable value
of
the assets of such person is greater than the amount that will be required
to
pay the probable liabilities of such person on its debts as they become absolute
and matured, (iii) such person is able to realize upon its assets and pay its
debts and other liabilities, including contingent obligations, as they mature
and (iv) such person does not have unreasonably small capital.
(bb) Compliance
with Xxxxxxxx-Xxxxx.
The
Company and its subsidiaries and their respective officers and directors are
in
compliance in all material respects with the applicable provisions of the
Xxxxxxxx-Xxxxx Act of 2002 (the “Xxxxxxxx-Xxxxx Act,” which term, as used
herein, includes the rules and regulations of the Commission promulgated
thereunder). The principal executive officer and the principal financial officer
of the Company have made all certifications required by the Xxxxxxxx-Xxxxx
Act,
and the statements contained in any such certification are complete and
correct.
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12 -
(cc) MD&A.
There
are no transactions, arrangements or other relationships, including but not
limited to off balance sheet transactions, which would be required to be
included in the Offering Memorandum if the Offering Memorandum were a
registration statement on Form S-1 by Item 303 of Regulation S-K under the
Securities Act which are not so described or described as required.
(dd) Company’s
Accounting System. The
Company and its subsidiaries maintain a system of accounting controls that
is in
compliance in all material respects with the Xxxxxxxx-Xxxxx Act and is
sufficient to provide reasonable assurances that: (i) transactions are executed
in accordance with management’s general or specific authorization; (ii)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles and
to
maintain accountability for assets; (iii) access to assets is permitted only
in
accordance with management’s general or specific authorization; and (iv) the
recorded accountability for assets is compared with existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
(ee) Disclosure
Controls and Procedures.
The
Company has established and maintains disclosure controls and procedures (as
such term is defined in Rules 13a-15 and 15d-14 under the Exchange Act); such
disclosure controls and procedures are designed to ensure that material
information relating to the Company and its subsidiaries is made known to the
chief executive officer and chief financial officer of the Company by others
within the Company or any of its subsidiaries, and such disclosure controls
and
procedures are reasonably effective to perform the functions for which they
were
established subject to the limitations of any such control system; the Company’s
auditors and the Audit Committee of the Board of Directors of the Company have
been advised of: (i) any significant deficiencies or material weaknesses in
the
design or operation of internal controls which could adversely affect the
Company’s ability to record, process, summarize, and report financial data; and
(ii) any fraud, whether or not material, that involves management or other
employees who have a role in the Company’s internal controls; and since the date
of the most recent evaluation of such disclosure controls and procedures, there
have been no significant changes in internal controls or in other factors that
could significantly affect internal controls, including any corrective actions
with regard to significant deficiencies and material weaknesses.
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13 -
(ff) Compliance
with Environmental Laws.
Except
as would not, individually or in the aggregate, result in a Material Adverse
Change: (i) the Company, the Guarantors and each of their respective
subsidiaries have all permits, authorizations and approvals required under
any
Environmental Laws (as defined below) and are in compliance with their
requirements, (ii) to the best of the Company’s and the Guarantors’ knowledge,
none of the Company, the Guarantors or any of their respective subsidiaries
is
in violation of any federal, state, local or foreign law or regulation relating
to pollution or protection of human health or the environment (including,
without limitation, ambient air, surface water, groundwater, land surface or
subsurface strata) or wildlife, including, without limitation, laws and
regulations relating to emissions, discharges, releases or threatened releases
of chemicals, pollutants, contaminants, wastes, toxic substances, hazardous
substances, petroleum and petroleum products (collectively, “Materials of
Environmental Concern”), or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of
Materials of Environmental Concern (collectively, “Environmental Laws”), which
violation includes, without limitation, noncompliance with any permits or other
governmental authorizations required for the operation of the business of the
Company, the Guarantors or any of their respective subsidiaries under applicable
Environmental Laws, or noncompliance with the terms and conditions thereof,
nor
have the Company, any Guarantor or any of their respective subsidiaries received
any written communication, whether from a governmental authority, citizens
group, employee or otherwise, that alleges that either the Company, any
Guarantor or any of their respective subsidiaries is in violation of any
Environmental Law; (iii) there is no claim, action or cause of action filed
with
a court or governmental authority, no investigation with respect to which the
Company has received written notice, and no written notice by any person or
entity alleging potential liability for investigatory costs, cleanup costs,
governmental responses costs, natural resources damages, property damages,
personal injuries, attorneys’ fees or penalties arising out of, based on or
resulting from the presence, or release into the environment, of any Material
of
Environmental Concern at any location owned, leased or operated by the Company,
any Guarantor or any of their respective subsidiaries, now or in the past
(collectively, “Environmental Claims”), pending or, to the best of the Company’s
and the Guarantors’ knowledge, threatened against the Company, any Guarantor or
any of their respective subsidiaries or any person or entity whose liability
for
any Environmental Claim the Company, any Guarantor or any of their respective
subsidiaries has retained or assumed either contractually or by operation of
law; and (iv) to the best of the Company’s and the Guarantors’ knowledge, there
are no past or present actions, activities, circumstances, conditions, events
or
incidents, including, without limitation, the release, emission, discharge,
presence or disposal of any Material of Environmental Concern, that could result
in a violation of any Environmental Law or form the basis of a potential
Environmental Claim against the Company, any Guarantor or any of their
respective subsidiaries or against any person or entity whose liability for
any
Environmental Claim the Company, any Guarantor or any of their respective
subsidiaries has retained or assumed either contractually or by operation of
law. Neither the Company nor any of its subsidiaries has been named as a
“potentially responsible party” under the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as amended.
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14 -
(gg) Periodic
Review of Costs of Environmental Compliance.
In the
ordinary course of its business, the Company conducts a periodic review of
the
effect of Environmental Laws on the business, operations and properties of
the
Company and its subsidiaries, in the course of which it identifies and evaluates
associated costs and liabilities (including, without limitation, any capital
or
operating expenditures required for clean-up, closure of properties or
compliance with Environmental Laws or any permit, license or approval, any
related constraints on operating activities and any potential liabilities to
third parties). On the basis of such review and the amount of its established
reserves, the Company has reasonably concluded that such associated costs and
liabilities would not, individually or in the aggregate, result in a Material
Adverse Change.
(hh) ERISA
Compliance.
The
Company and its subsidiaries and any “employee benefit plan,” as defined under
the Employee Retirement Income Security Act of 1974 (as amended, “ERISA,” which
term, as used herein, includes the regulations and published interpretations
thereunder), established or maintained by the Company, its subsidiaries or
their
“ERISA Affiliates” (as defined below) are in compliance in all material respects
with the applicable provisions of ERISA, or if not in material compliance such
noncompliance would not result in a Material Adverse Change. “ERISA Affiliate”
means, with respect to the Company or a subsidiary, any member of any group
of
organizations described in Section 414 of the Internal Revenue Code of 1986
(as
amended, the “Code,” which term, as used herein, includes the regulations and
published interpretations thereunder) of which the Company or such subsidiary
is
a member. No “reportable event” (as defined under ERISA) for which notice
requirements have not been waived has occurred or is reasonably expected to
occur with respect to any “employee benefit plan” established or maintained by
the Company, its subsidiaries or any of their ERISA Affiliates and which is
covered by Title IV of ERISA, except for such reportable events which would
not,
individually or in the aggregate, result in a Material Adverse Change. No
“employee benefit plan” established or maintained by the Company, its
subsidiaries or any of their ERISA Affiliates, if such “employee benefit plan”
were terminated as of the most recent annual valuation date for such plan,
would
have any “amount of unfunded benefit liabilities” (as defined under ERISA) that
would result in a Material Adverse Change. Neither the Company, its subsidiaries
nor any of their ERISA Affiliates has incurred or reasonably expects to incur
any liability under (i) Title IV of ERISA with respect to termination of, or
withdrawal from, any “employee benefit plan” or (ii) Sections 412, 4971, 4975 or
4980B of the Code. Each “employee benefit plan” established or maintained by the
Company, its subsidiaries or any of their ERISA Affiliates that is intended
to
be qualified under Section 401 of the Code is so qualified and nothing has
occurred, whether by action or failure to act, which would cause the loss of
such qualification. For the purposes of this section (hh), “subsidiaries” means
those companies listed on Exhibit
B hereto.
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15 -
(ii) Compliance
with Labor Laws.
Except
as would not, individually or in the aggregate, result in a Material Adverse
Change, (i) to the best of the Company’s and the Guarantors’ knowledge, there is
(A) no unfair labor practice complaint pending or threatened against the
Company, the Guarantors or any of their respective subsidiaries before the
National Labor Relations Board or any state or local labor relations board,
and
no grievance or arbitration proceeding arising out of or under collective
bargaining agreements pending or threatened, against the Company, the Guarantors
or any of their respective subsidiaries, (B) no strike, labor dispute, slowdown
or stoppage pending or threatened against the Company, the Guarantors or any
of
their respective subsidiaries and (C) no union representation question existing
with respect to the employees of the Company, the Guarantors or any of their
respective subsidiaries and no union organizing activities taking place, (ii)
there has been no violation of any federal, state or local law relating to
discrimination in hiring, promotion or pay of employees or of any applicable
wage or hour laws, and (iii) none of the Company or its subsidiaries is aware
of
any existing, threatened or imminent labor disturbance by the employees of
any
of its principal customers, suppliers or contractors.
(jj) No
Unlawful Contributions or Other Payments.
Except
as would not, individually or in the aggregate, result in a Material Adverse
Change, neither the Company, the Guarantors or any of their respective
subsidiaries nor, to the best of the Company’s and the Guarantors’ knowledge,
any director, officer, employee or agent of the Company, any Guarantor or any
of
their respective subsidiaries, has, directly or indirectly (i) made any
contribution or other payment to any official of, or candidate for, any federal,
state or foreign office in violation of any law of the character necessary
to be
disclosed in the Offering Memorandum in order to make the statements therein
not
misleading, (ii) used any corporate funds for unlawful contributions, gifts,
entertainment or other unlawful expenses relating to political activity; (iii)
violated any provision of the Foreign Corrupt Practices Act of 1977, as amended;
or (iv) made any other unlawful payment.
(kk) Compliance
with Regulation S.
The
Company, the Guarantors their respective affiliates and all persons acting
on
their behalf (other than the Initial Purchasers, as to whom the Company and
the
Guarantors make no representation) have complied with and will comply with
the
offering restrictions requirements of Regulation S in connection with the
offering of the Securities outside the United States and, in connection
therewith, the Offering Memorandum will contain the disclosure required by
Rule
902. The Company is a “reporting issuer,” as defined in Rule 902 under the
Securities Act.
(ll) Taxes;
Fees.
There
are no stamp or other issuance or transfer taxes or duties or other similar
fees
or charges required to be paid by the Company or the Guarantors in connection
with the execution and delivery of this Agreement or the issuance or sale by
the
Company and the Guarantors of the Securities or the Exchange Securities.
Any
certificate signed by an officer of the Company, any Guarantor or any of their
respective subsidiaries and delivered to the Initial Purchasers or to counsel
for the Initial Purchasers on the Closing Date shall be deemed to be a
representation and warranty by the Company, such Guarantor or such subsidiary
to
each Initial Purchaser as to the matters set forth therein.
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16 -
SECTION
2. Purchase,
Sale and Delivery of the Securities.
(a) The
Securities.
Each of
the Company and the Guarantors agrees to issue and sell to the Initial
Purchasers, severally and not jointly, all of the Securities, and the Initial
Purchasers agree, severally and not jointly, to purchase from the Company and
the Guarantors the aggregate principal amount of Securities set forth opposite
their names on Schedule
A,
at a
purchase price of 97.50% of the principal amount thereof payable on the Closing
Date, in each case, on the basis of the representations, warranties and
agreements herein contained, and upon the terms, subject to the conditions
thereto, herein set forth.
(b) The
Closing Date.
Delivery of certificates for the Securities in definitive form to be purchased
by the Initial Purchasers and payment therefor shall be made at the offices
of
Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx LLP, Xxx Xxx Xxxx Xxxxx, Xxx Xxxx,
Xxx Xxxx 00000 (or such other place as may be agreed to by the Company and
Banc
of America Securities LLC) at 9:00 a.m. New York City time, on April 9, 2007
or
such other time and date as Banc of America Securities LLC shall designate
by
notice to the Company (the time and date of such closing are called the “Closing
Date”). The Company hereby acknowledges that circumstances under which Banc of
America Securities LLC may provide notice to postpone the Closing Date as
originally scheduled include, but are in no way limited to, any determination
by
the Company or the Initial Purchasers to recirculate to investors copies of
an
amended or supplemented Offering Memorandum or a delay as contemplated by the
provisions of Section 16 hereof.
(c) Delivery
of the Securities.
The
Company shall deliver, or cause to be delivered, to Banc of America Securities
LLC for the accounts of the several Initial Purchasers certificates for the
Notes and the Guarantees at the Closing Date against the irrevocable release
of
a wire transfer of immediately available funds for the amount of the purchase
price therefor to an account or accounts specified by the Company. The
certificates for the Notes shall be in such denominations and registered in
the
name of Cede & Co., as nominee of the Depositary, pursuant to the DTC
Agreement, and shall be made available for inspection on the business day
preceding the Closing Date at a location in New York City, as Banc of America
Securities LLC may designate. Time shall be of the essence, and delivery at
the
time and place specified in this Agreement is a further condition to the
obligations of the Initial Purchasers.
(d) Initial
Purchasers as Qualified Institutional Buyers.
Each
Initial Purchaser severally and not jointly represents and warrants to, and
agrees with, the Company that it is a “qualified institutional buyer” within the
meaning of Rule 144A (a “Qualified Institutional Buyer”).
SECTION
3. Additional
Covenants. The
Company and the Guarantors, jointly and severally, further covenant and agree
with each Initial Purchaser as follows:
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17 -
(a) Preparation
of Final Offering Memorandum; Initial Purchasers’ Review of Proposed Amendments
and Supplements.
As
promptly as practicable following the Time of Execution and in any event not
later than the second business day following the date hereof, the Company will
prepare and deliver to the Initial Purchasers the Final Offering Memorandum,
which shall consist of the Preliminary Offering Memorandum as modified only
by
the information contained in the Pricing Supplement. The Company will not amend
or supplement the Preliminary Offering Memorandum or the Pricing Supplement.
The
Company will not amend or supplement the Final Offering Memorandum prior to
the
Closing Date unless the Initial Purchasers shall previously have been furnished
a copy of the proposed amendment or supplement at least two business days prior
to the proposed use or filing, and shall not have objected to such amendment
or
supplement.
(b) Amendments
and Supplements to the Final Offering Memorandum and Other Securities Act
Matters.
If,
prior to the later of (x) the Closing Date and (y) the completion of the
placement of the Securities by the Initial Purchasers with the Subsequent
Purchasers, any event shall occur or condition exist as a result of which it
is
necessary to amend or supplement the Final Offering Memorandum, as then amended
or supplemented, in order to make the statements therein, in the light of the
circumstances when the Final Offering Memorandum is delivered to a Subsequent
Purchaser, not misleading, or if in the judgment of the Initial Purchasers
or
counsel for the Initial Purchasers it is otherwise necessary to amend or
supplement the Final Offering Memorandum to comply with law, the Company agrees
to promptly prepare (subject to Section 3 hereof), and furnish at its own
expense to the Initial Purchasers, amendments or supplements to the Final
Offering Memorandum so that the statements in the Final Offering Memorandum
as
so amended or supplemented will not, in the light of the circumstances at the
Closing Date and at the time of sale of Securities, be misleading or so that
the
Final Offering Memorandum, as amended or supplemented, will comply with all
applicable law.
Following
the consummation of the Exchange Offer or the effectiveness of an applicable
shelf registration statement and for so long as the Securities are outstanding
if, in the judgment of the Initial Purchasers, the Initial Purchasers or any
of
their affiliates (as such term is defined in the Securities Act) are required
to
deliver a prospectus in connection with sales of, or market-making activities
with respect to, the Securities, to periodically amend the applicable
registration statement so that the information contained therein complies with
the requirements of Section 10 of the Securities Act, to amend the applicable
registration statement or supplement the related prospectus or the documents
incorporated therein when necessary to reflect any material changes in the
information provided therein so that the registration statement and the
prospectus will not contain any untrue statement of a material fact or omit
to
state any material fact necessary in order to make the statements therein,
in
the light of the circumstances existing as of the date the prospectus is so
delivered, not misleading and to provide the Initial Purchasers with copies
of
each amendment or supplement filed and such other documents as the Initial
Purchasers may reasonably request.
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The
Company and the Guarantors hereby expressly acknowledge that the indemnification
and contribution provisions of Sections 8 and 9 hereof are specifically
applicable and relate to each offering memorandum, registration statement,
prospectus, amendment or supplement referred to in this Section 3.
(c) Copies
of the Offering Memorandum.
The
Company agrees to furnish the Initial Purchasers, without charge, as many copies
of the Pricing Disclosure Package and the Final Offering Memorandum and any
amendments and supplements thereto as they shall have reasonably
requested.
(d) Blue
Sky Compliance.
Each of
the Company and the Guarantors shall cooperate with the Initial Purchasers
and
counsel for the Initial Purchasers to qualify or register (or to obtain
exemptions from qualifying or registering) all or any part of the Securities
for
offer and sale under the securities laws of the several states of the United
States, the provinces of Canada or any other jurisdictions designated by the
Initial Purchasers, shall comply with such laws and shall continue such
qualifications, registrations and exemptions in effect so long as required
for
the distribution of the Securities. None of the Company or any of the Guarantors
shall be required to qualify as a foreign corporation or to take any action
that
would subject it to general service of process in any such jurisdiction where
it
is not presently qualified or where it would be subject to taxation as a foreign
corporation. The Company will advise the Initial Purchasers promptly of the
suspension of the qualification or registration of (or any such exemption
relating to) the Securities for offering, sale or trading in any jurisdiction
or
any initiation or threat of any proceeding for any such purpose, and in the
event of the issuance of any order suspending such qualification, registration
or exemption, each of the Company and the Guarantors shall use its reasonable
best efforts to obtain the withdrawal thereof at the earliest possible
moment.
(e) Use
of Proceeds.
The
Company shall apply the net proceeds from the sale of the Securities sold by
it
in the manner described under the caption “The Offering -Use of Proceeds” in the
Pricing Disclosure Package.
(f) The
Depositary.
The
Company will cooperate with the Initial Purchasers and use its best efforts
to
permit the Securities to be eligible for clearance and settlement through the
facilities of the Depositary.
(g) Additional
Issuer Information.
Prior
to the completion of the placement of the Securities by the Initial Purchasers
with the Subsequent Purchasers, the Company shall file, on a timely basis,
with
the Commission and NASDAQ all reports and documents required to be filed under
Section 13 or 15 of the Exchange Act. Additionally, at any time when the Company
is not subject to Section 13 or 15 of the Exchange Act, for the benefit of
holders and beneficial owners from time to time of the Securities, the Company
shall furnish, at its expense, upon request, to holders and beneficial owners
of
Securities and prospective purchasers of Securities information (“Additional
Issuer Information”) satisfying the requirements of Rule 144A(d).
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19 -
(h) Agreement
Not To Offer or Sell Additional Securities.
During
the period of 180 days following the date hereof, the Company and each of the
Guarantors will not, without the prior written consent of Banc of America
Securities LLC (which consent may be withheld at the sole discretion of Banc
of
America Securities LLC), directly or indirectly, sell, offer, contract or grant
any option to sell, pledge, transfer or establish an open “put equivalent
position” within the meaning of Rule 16a-1 under the Exchange Act, or otherwise
dispose of or transfer, or announce the offering of, or file any registration
statement under the Securities Act in respect of, any debt securities of the
Company or any of the Guarantors or securities exchangeable for or convertible
into debt securities of the Company or any of the Guarantors (other than as
contemplated by this Agreement and to register the Exchange
Securities).
(i) Future
Reports to the Initial Purchasers.
At any
time when the Company is not subject to Section 13 or 15 of the Exchange Act
and
any Securities or Exchange Securities remain outstanding, the Company will
furnish to Banc of America Securities LLC: (i) as soon as practicable after
the
end of each fiscal year, copies of the Annual Report of the Company containing
the balance sheet of the Company as of the close of such fiscal year and
statements of income, stockholders’ equity and cash flows for the year then
ended and the opinion thereon of the Company’s independent public or certified
public accountants; (ii) as soon as practicable after the filing thereof, copies
of each proxy statement, Annual Report on Form 10-K, Quarterly Report on Form
10-Q, Current Report on Form 8-K or other report filed by the Company with
the
Commission, the NASD or any securities exchange; and (iii) as soon as available,
copies of any report or communication of the Company mailed generally to holders
of its capital stock or debt securities (including the holders of the
Securities), if, in each case, such documents are not filed with the Commission
within the time periods specified by the Commission’s rules and regulations
under Section 13 or 15 of the Exchange Act.
(j) No
Integration.
The
Company agrees that it will not, and will cause its Affiliates and subsidiaries
not to, make any offer or sale of securities of the Company of any class if,
as
a result of the doctrine of “integration” referred to in Rule 502 under the
Securities Act, such offer or sale would render invalid (for the purpose of
(i)
the sale of the Securities by the Company to the Initial Purchasers, (ii) the
resale of the Securities by the Initial Purchasers to Subsequent Purchasers
or
(iii) the resale of the Securities by such Subsequent Purchasers to others)
the
exemption from the registration requirements of the Securities Act regarding
the
Securities provided by Section 4(2) thereof or by Rule 144A or by Regulation
S
thereunder or otherwise.
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20 -
(k) No
Restricted Resales.
During
the period of two years after the Closing Date, the Company will not, and will
not permit any of its affiliates (as defined in Rule 144 under the Securities
Act) to resell any of the Notes which constitute “restricted securities” under
Rule 144 that have been reacquired by any of them.
(l) Legended
Securities.
Each
certificate for a Note will bear the legend contained in “Notice to Investors”
in the Preliminary Offering Memorandum for the time period and upon the other
terms stated in the Preliminary Offering Memorandum.
(m) PORTAL.
The
Company will use its reasonable best efforts to cause such Notes to be eligible
for the PORTAL Market.
Banc
of
America Securities LLC, on behalf of the several Initial Purchasers, may, in
its
sole discretion, waive in writing the performance by the Company or any
Guarantor of any one or more of the foregoing covenants or extend the time
for
their performance.
SECTION
4. Payment
of Expenses. Each
of
the Company and the Guarantors agrees to pay all costs, fees and expenses
incurred in connection with the performance of its obligations hereunder and
in
connection with the transactions contemplated hereby, including, without
limitation, (i) all expenses incident to the issuance and delivery of the
Securities (including all printing and engraving costs), (ii) all necessary
issue, transfer and other stamp taxes in connection with the issuance and sale
of the Securities to the Initial Purchasers, (iii) all fees and expenses of
the
Company’s and the Guarantors’ counsel, independent public or certified public
accountants and other advisors, (iv) all costs and expenses incurred in
connection with the preparation, printing, filing, shipping and distribution
of
the Pricing Disclosure Package and the Final Offering Memorandum (including
financial statements and exhibits), and all amendments and supplements thereto,
this Agreement, the Registration Rights Agreement, the Indenture, the DTC
Agreement and the Notes and Guarantees, (v) all filing fees, attorneys’ fees and
expenses incurred by the Company, the Guarantors or the Initial Purchasers
in
connection with qualifying or registering (or obtaining exemptions from the
qualification or registration of) all or any part of the Securities for offer
and sale under the securities laws of the several states of the United States,
the provinces of Canada or other jurisdictions designated by the Initial
Purchasers (including, without limitation, the cost of preparing, printing
and
mailing preliminary and final blue sky or legal investment memoranda and any
related supplements to the Pricing Disclosure Package or the Final Offering
Memorandum), (vi) the fees and expenses of the Trustee, including the reasonable
fees and disbursements of counsel for the Trustee in connection with the
Indenture, the Securities and the Exchange Securities, (vii) any fees payable
in
connection with the rating of the Securities or the Exchange Securities with
the
ratings agencies and the listing of the Securities with the PORTAL Market,
(viii) any filing fees incident to, and any reasonable fees and disbursements
of
counsel to the Initial Purchasers in connection with the review by the NASD,
if
any, of the terms of the sale of the Securities or the Exchange Securities,
(ix)
all fees and expenses (including reasonable fees and expenses of counsel) of
the
Company and the Guarantors in connection with approval of the Securities by
the
Depositary for “book-entry” transfer, and the performance by the Company and the
Guarantors of their respective other obligations under this Agreement, and
(x)
all of the Company’s expenses incident to the “road show” for the offering of
the Securities, including one-half of the cost of any chartered airplane or
other transportation. Except as provided in this Section 4 and Sections 6,
8 and
9 hereof, the Initial Purchasers shall pay their own expenses, including the
fees and disbursements of their counsel.
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SECTION
5. Conditions
of the Obligations of the Initial Purchasers. The
obligations of the several Initial Purchasers to purchase and pay for the
Securities as provided herein on the Closing Date shall be subject to the
accuracy of the representations and warranties on the part of the Company and
the Guarantors set forth in Section 1 hereof as of the date hereof and as of
the
Closing Date as though then made and to the timely performance by the Company
and the Guarantors of their covenants and other obligations hereunder, and
to
each of the following additional conditions:
(a) Accountants’
Comfort Letters.
(x) On
the date hereof, the Initial Purchasers shall have received from
PricewaterhouseCoopers LLP, the Company’s former independent public or certified
public accountants, a “comfort letter” dated the date hereof addressed to the
Initial Purchasers, in form and substance satisfactory to the Initial
Purchasers, covering certain financial information in the Preliminary Offering
Memorandum and the Pricing Supplement and other customary matters. In addition,
on the Closing Date, the Initial Purchasers shall have received from such
accountants, a “bring-down comfort letter” dated the Closing Date addressed to
the Initial Purchasers, in form and substance satisfactory to the Initial
Purchasers, in the form of the “comfort letter” delivered on the date hereof,
except that (i) it shall cover the financial information in the Final Offering
Memorandum and any amendment or supplement thereto and (ii) procedures shall
be
brought down to a date no more than three business days prior to the Closing
Date.
(y) On
the date
hereof, the Initial Purchasers shall have received from KPMG LLP, the Company’s
current independent public or certified public accountants, a “comfort letter”
dated the date hereof addressed to the Initial Purchasers, in form and substance
satisfactory to the Initial Purchasers, covering certain financial information
included in the Preliminary Offering Memorandum and the Pricing Supplement
and
other customary matters. In addition, on the Closing Date, the Initial
Purchasers shall have received from such accountants, a “bring-down comfort
letter” dated the Closing Date addressed to the Initial Purchasers, in form and
substance satisfactory to the Initial Purchasers, in the form of the “comfort
letter” delivered on the date hereof, except that (i) it shall cover the
financial information included in the Final Offering Memorandum and any
amendment or supplement thereto and (ii) procedures shall be brought down to
a
date no more than three business days prior to the Closing Date.
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(b) No
Material Adverse Change or Ratings Agency Change.
For the
period from and after the date of this Agreement and prior to the Closing Date:
(i) in
the
reasonable judgment of the Initial Purchasers there shall not have occurred
any
Material Adverse Change; and
(ii) there
shall
not have occurred any downgrading, nor shall any notice have been given of
any
intended or potential downgrading or of any review for a possible change that
does not indicate the direction of the possible change, in the rating accorded
any securities or indebtedness of the Company, any Guarantor or any of their
respective subsidiaries by any “nationally recognized statistical rating
organization” as such term is defined for purposes of Rule 436 under the
Securities Act.
(c) Opinion
of Counsel for the Company.
On the
Closing Date the Initial Purchasers shall have received the favorable opinion
of
Xxxxxxxx & Xxxxxx LLP, counsel for the Company, dated as of such Closing
Date, the form of which is attached as Exhibit
A.
(d) Opinion
of Counsel for the Initial Purchasers.
On the
Closing Date the Initial Purchasers shall have received the favorable opinion
of
Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx LLP, counsel for the Initial
Purchasers, dated as of such Closing Date, with respect to such matters as
may
be reasonably requested by the Initial Purchasers.
(e) Officers’
Certificate.
On the
Closing Date the Initial Purchasers shall have received a written certificate
executed by the Chairman of the Board, Chief Executive Officer or President
of
the Company and each Guarantor and the Chief Financial Officer or Chief
Accounting Officer of the Company and each Guarantor, dated as of the Closing
Date, to the effect set forth in Section 5(b)(ii) hereof, and further to the
effect that:
(i) for
the
period from and after the date of this Agreement and prior to the Closing Date
there has not occurred, to the best of their knowledge, any Material Adverse
Change;
(ii) the
representations, warranties and covenants of the Company and the Guarantors
set
forth in Section 1 hereof were true and correct as of the Time of Execution
and
are true and correct as of the Closing Date with the same force and effect
as
though expressly made on and as of the Closing Date; and
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(iii) the
Company
and the Guarantors have complied with all the agreements and satisfied all
the
conditions on their part to be performed or satisfied at or prior to the Closing
Date.
(f) Engineers
Letter.
On the
date hereof, the Initial Purchasers shall have received from Cawley, Gillespie,
a letter dated the date hereof addressed to the Initial Purchasers, in form
and
substance satisfactory to the Initial Purchasers, containing the conclusions
and
findings of such firm with respect to the oil and gas properties of the Company
and its subsidiaries. In addition, on the Closing Date, the Initial Purchasers
shall have received from Cawley, Gillespie, a letter dated the Closing Date
addressed to the Initial Purchasers (which may refer to the letter previously
delivered to the Initial Purchasers), in form and substance satisfactory to
the
Initial Purchasers, containing the conclusions and findings of such firm with
respect to the oil and gas properties of the Company and its
subsidiaries.
(g) PORTAL
Listing.
At the
Closing Date the Notes shall have been designated for trading on the PORTAL
Market.
(h) Registration
Rights Agreement and Indenture.
The
Company and the Guarantors shall have entered into the Registration Rights
Agreement and the Indenture, the Trustee shall have entered into the Indenture
and the Initial Purchasers shall have received executed counterparts
thereof.
(i) Additional
Documents.
On or
before the Closing Date, the Initial Purchasers and counsel for the Initial
Purchasers shall have received such information, documents and opinions as
they
may reasonably require for the purposes of enabling them to pass upon the
issuance and sale of the Securities as contemplated herein, or in order to
evidence the accuracy of any of the representations and warranties, or the
satisfaction of any of the conditions or agreements, herein
contained.
If
any
condition specified in this Section 5 is not satisfied when and as required
to
be satisfied, this Agreement may be terminated by the Initial Purchasers by
notice to the Company at any time on or prior to the Closing Date, which
termination shall be without liability on the part of any party to any other
party, except that Sections 4, 6, 8 and 9 hereof shall at all times be effective
and shall survive such termination.
SECTION
6. Reimbursement
of Initial Purchasers’ Expenses. If
this
Agreement is terminated by the Initial Purchasers pursuant to Section 5 or
10
hereof, including if the sale to the Initial Purchasers of the Securities on
the
Closing Date is not consummated because of any refusal, inability or failure
on
the part of the Company to perform any agreement herein or to comply with any
provision hereof (other than as a result of a breach by this Agreement by the
Initial Purchasers), the Company agrees to reimburse the Initial Purchasers
(or
such Initial Purchasers as have terminated this Agreement with respect to
themselves), severally, upon demand for all out-of-pocket costs and expenses
that shall have been reasonably incurred by the Initial Purchasers in connection
with the proposed purchase and the offering and sale of the Securities,
including, without limitation, fees and disbursements of counsel, printing
expenses, travel expenses, expenses associated with the road show for the
marketing of the Securities, postage, facsimile and telephone charges.
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24 -
SECTION
7. Offer,
Sale and Resale Procedures. Each
of
the Initial Purchasers, on the one hand, and the Company and the Guarantors,
on
the other hand, hereby agree to observe the following procedures in connection
with the offer and sale of the Securities:
(A)
Offers
and sales of the
Securities will be made only by the Initial Purchasers or Affiliates thereof
qualified to do so in the jurisdictions in which such offers or sales are made.
Each such offer or sale shall only be made to persons whom the offeror or seller
reasonably believes to be Qualified Institutional Buyers or non-U.S. persons
outside the United States to whom the offeror or seller reasonably believes
offers and sales of the Securities may be made in reliance upon Regulation
S,
upon the terms and conditions set forth in Annex I hereto, which Annex I is
hereby expressly made a part hereof.
(B)
The
Securities will be offered
by approaching prospective Subsequent Purchasers on an individual basis. No
general solicitation or general advertising (within the meaning of Rule 502
under the Securities Act) will be used in the United States in connection with
the offering of the Securities.
(C)
Upon
original issuance by the
Company, and until such time as the same is no longer required under the
applicable requirements of the Securities Act, the Notes (and all securities
issued in exchange therefor or in substitution thereof, other than the Exchange
Notes) shall bear the following legend:
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25 -
“THIS
NOTE AND THE GUARANTEES ENDORSED HEREON HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE
SECURITIES LAWS. NEITHER THIS NOTE, THE GUARANTEES ENDORSED HEREON, NOR ANY
INTEREST OR PARTICIPATION HEREIN MAY BE OFFERED, SOLD, ASSIGNED, TRANSFERRED,
PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION
OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO THE REGISTRATION
REQUIREMENTS OF, THE SECURITIES ACT. THE HOLDER OF THIS NOTE AND THE GUARANTEES
ENDORSED HEREON, BY ITS ACCEPTANCE HEREOF, AGREES NOT TO OFFER, SELL OR
OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE WHICH IS TWO YEARS AFTER
THE
LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE COMPANY
OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS NOTE AND THE GUARANTEES
ENDORSED HEREON (OR ANY PREDECESSOR OF THIS NOTE AND THE GUARANTEES ENDORSED
HEREON) (THE “RESALE RESTRICTION TERMINATION DATE”), EXCEPT THAT THE NOTES AND
GUARANTEES MAY BE TRANSFERRED (A) TO THE COMPANY OR ANY SUBSIDIARY THEREOF,
(B)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, (C)
FOR SO LONG AS THE NOTES AND THE GUARANTEES ENDORSED THEREON ARE ELIGIBLE FOR
RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”), TO A PERSON
IT REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE
144A THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE
IN
RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS
THAT
OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE
SECURITIES ACT, OR (E) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE COMPANY’S AND
THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (1) PURSUANT TO
CLAUSE (D) PRIOR TO THE END OF THE 40-DAY DISTRIBUTION COMPLIANCE PERIOD WITHIN
THE MEANING OF REGULATION S UNDER THE SECURITIES ACT OR PURSUANT TO CLAUSE
(E)
PRIOR TO THE RESALE RESTRICTION TERMINATION DATE TO REQUIRE THE DELIVERY OF
AN
OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO
EACH
OF THEM, AND (2) IN EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATE
OF TRANSFER IN THE FORM APPEARING ON THIS NOTE IS COMPLETED AND DELIVERED BY
THE
TRANSFEROR TO THE TRUSTEE. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF
A
HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.”
Following
the sale of the Securities by the Initial Purchasers to Subsequent Purchasers
pursuant to the terms hereof, the Initial Purchasers shall not be liable or
responsible to the Company or any Guarantor for any losses, damages or
liabilities suffered or incurred by the Company or any Guarantor, including
any
losses, damages or liabilities under the Securities Act, arising from or
relating to any resale or transfer of any Security by a Subsequent Purchaser
or
a subsequent transferee.
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26 -
SECTION
8. Indemnification.
(a) Indemnification
of the Initial Purchasers. Each
of
the Company and the Guarantors, jointly and severally, agrees to indemnify
and
hold harmless each Initial Purchaser, its directors, officers and employees,
and
each person, if any, who controls any Initial Purchaser within the meaning
of
the Securities Act and the Exchange Act against any loss, claim, damage,
liability or expense, as incurred, to which such Initial Purchaser, director,
officer, employee or controlling person may become subject, under the Securities
Act, the Exchange Act or other federal or state statutory law or regulation,
or
at common law or otherwise (including in settlement of any litigation, if such
settlement is effected with the written consent of the Company and/or any
Guarantor sought to be bound), insofar as such loss, claim, damage, liability
or
expense (or actions in respect thereof as contemplated below) arises out of
or
is based: (i) upon any untrue statement or alleged untrue statement of a
material fact contained in the Pricing Disclosure Package or the Final Offering
Memorandum (or any amendment or supplement thereto), or the omission or alleged
omission therefrom of a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; or (ii) any act or failure to act or any alleged act or failure
to
act by any Initial Purchaser in connection with, or relating in any manner
to,
the offering contemplated hereby, and which is included as part of or referred
to in any loss, claim, damage, liability or action arising out of or based
upon
any matter covered by clause (i) above, provided that the Company and the
Guarantors shall not be liable under this clause (ii) to the extent that a
court
of competent jurisdiction shall have determined by a final judgment that such
loss, claim, damage, liability or action resulted directly from any such acts
or
failures to act undertaken or omitted to be taken by such Initial Purchaser
through its gross negligence or willful misconduct; and to reimburse each
Initial Purchaser and each such director, officer, employee or controlling
person for any and all expenses (including the reasonable fees and disbursements
of counsel chosen by Banc of America Securities LLC) as such expenses are
reasonably incurred by such Initial Purchaser or such director, officer,
employee or controlling person in connection with investigating, defending,
settling, compromising or paying any such loss, claim, damage, liability,
expense or action; provided, however, that the foregoing indemnity agreement
shall not apply to any loss, claim, damage, liability or expense to the extent,
but only to the extent, arising out of or based upon any untrue statement or
alleged untrue statement or omission or alleged omission made in reliance upon
and in conformity with written information furnished to the Company by the
Initial Purchasers expressly for use in the Pricing Disclosure Package or the
Final Offering Memorandum (or any amendment or supplement thereto). The
indemnity agreement set forth in this Section 8(a) shall be in addition to
any
liabilities that the Company and the Guarantors may otherwise
have.
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27 -
(b) Indemnification
of the Company and the Guarantors. Each
Initial Purchaser agrees, severally and not jointly, to indemnify and hold
harmless the Company, each Guarantor, each of their respective directors,
officers and employees and each person, if any, who controls the Company or
any
Guarantor within the meaning of the Securities Act or the Exchange Act, against
any loss, claim, damage, liability or expense, as incurred, to which the
Company, any Guarantor or any such director, officer or employee or controlling
person may become subject, under the Securities Act, the Exchange Act, or other
federal or state statutory law or regulation, or at common law or otherwise
(including in settlement of any litigation, if such settlement is effected
with
the written consent of such Initial Purchaser), insofar as such loss, claim,
damage, liability or expense (or actions in respect thereof as contemplated
below) arises out of or is based upon any untrue statement or alleged untrue
statement of a material fact contained in the Pricing Disclosure Package or
the
Final Offering Memorandum (or any amendment or supplement thereto), or the
omission or alleged omission therefrom of a material fact necessary in order
to
make the statements therein, in the light of the circumstances under which
they
were made, not misleading, in each case to the extent, but only to the extent,
that such untrue statement or alleged untrue statement or omission or alleged
omission was made in the Pricing Disclosure Package or the Final Offering
Memorandum (or any amendment or supplement thereto), in reliance upon and in
conformity with written information furnished to the Company by the Initial
Purchasers expressly for use therein; and to reimburse the Company, any
Guarantor and each such director, officer, employee or controlling person for
any and all expenses (including the reasonable fees and disbursements of
counsel) as such expenses are reasonably incurred by the Company, any Guarantor
or such director, officer or employee or controlling person in connection with
investigating, defending, settling, compromising or paying any such loss, claim,
damage, liability, expense or action. Each of the Company and the Guarantors
hereby acknowledges that the only information that the Initial Purchasers have
furnished to the Company expressly for use in the Pricing Disclosure Package
or
the Final Offering Memorandum (or any amendment or supplement thereto) are
the
statements in the fourth sentence of the sixth paragraph, the eighth paragraph
and the tenth paragraph under the caption “Plan of Distribution” in the
Preliminary Offering Memorandum and the Final Offering Memorandum. The indemnity
agreement set forth in this Section 8 (b) shall be in addition to any
liabilities that each Initial Purchaser may otherwise have.
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(c) Notifications
and Other Indemnification Procedures.
Promptly after receipt by an indemnified party under this Section 8 of notice
of
the commencement of any action, such indemnified party will, if a claim in
respect thereof is to be made against an indemnifying party under this Section
8, notify the indemnifying party in writing of the commencement thereof, but
the
omission so to notify the indemnifying party will not relieve it from any
liability which it may have to any indemnified party for contribution or
otherwise under the indemnity agreement contained in this Section 8 other than
to the extent it is prejudiced as a proximate result of such failure. In case
any such action is brought against any indemnified party and such indemnified
party seeks or intends to seek indemnity from an indemnifying party, the
indemnifying party will be entitled to participate in and, to the extent that
it
shall elect, jointly with all other indemnifying parties similarly notified,
by
written notice delivered to the indemnified party promptly after receiving
the
aforesaid notice from such indemnified party, to assume the defense thereof
with
counsel reasonably satisfactory to such indemnified party; provided, however,
if
the defendants in any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably concluded
that a conflict may arise between the positions of the indemnifying party and
the indemnified party in conducting the defense of any such action or that
there
may be legal defenses available to it and/or other indemnified parties which
are
different from or additional to those available to the indemnifying party,
the
indemnified party or parties shall have the right to select separate counsel
to
assume such legal defenses and to otherwise participate in the defense of such
action on behalf of such indemnified party or parties. Upon receipt of notice
from the indemnifying party to such indemnified party of such indemnifying
party’s election so to assume the defense of such action and approval by the
indemnified party of counsel, the indemnifying party will not be liable to
such
indemnified party under this Section 8 for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof unless (i) the indemnified party shall have employed separate counsel
in
accordance with the proviso to the immediately preceding sentence (it being
understood, however, that the indemnifying party shall not be liable for the
expenses of more than one separate counsel (together with local counsel),
approved by the indemnifying party (Banc of America Securities LLC in the case
of Sections 8(b) and 9 hereof), representing the indemnified parties who are
parties to such action) or (ii) the indemnifying party shall not have employed
counsel satisfactory to the indemnified party to represent the indemnified
party
within a reasonable time after notice of commencement of the action, in each
of
which cases the fees and expenses of counsel shall be at the expense of the
indemnifying party.
(d) Settlements.
The
indemnifying party under this Section 8 shall not be liable for any settlement
of any proceeding effected without its written consent, but if settled with
such
consent or if there be a final judgment for the plaintiff, the indemnifying
party agrees to indemnify the indemnified party against any loss, claim, damage,
liability or expense by reason of such settlement or judgment. Notwithstanding
the foregoing sentence, if at any time an indemnified party shall have requested
an indemnifying party to reimburse the indemnified party for fees and expenses
of counsel as contemplated by this Section 8, the indemnifying party agrees
that
it shall be liable for any settlement of any proceeding effected without its
written consent if (i) such settlement is entered into more than 60 days after
receipt by such indemnifying party of the aforesaid request and (ii) such
indemnifying party shall not have reimbursed the indemnified party in accordance
with such request prior to the date of such settlement. No indemnifying party
shall, without the prior written consent of the indemnified party, effect any
settlement, compromise or consent to the entry of judgment in any pending or
threatened action, suit or proceeding in respect of which any indemnified party
is or could have been a party and indemnity was or could have been sought
hereunder by such indemnified party, unless such settlement, compromise or
consent (i) includes an unconditional release of such indemnified party from
all
liability on claims that are the subject matter of such action, suit or
proceeding and (ii) does not include any statements as to or any findings of
fault, culpability or failure to act by or on behalf of any indemnified party.
-
29 -
SECTION
9. Contribution.
If
the
indemnification provided for in Section 8 hereof is for any reason held to
be
unavailable to or otherwise insufficient to hold harmless an indemnified party
in respect of any losses, claims, damages, liabilities or expenses referred
to
therein, then each indemnifying party shall contribute to the aggregate amount
paid or payable by such indemnified party, as incurred, as a result of any
losses, claims, damages, liabilities or expenses referred to therein (i) in
such
proportion as is appropriate to reflect the relative benefits received by the
Company and the Guarantors, on the one hand, and the Initial Purchasers, on
the
other hand, from the offering of the Securities pursuant to this Agreement
or
(ii) if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault
of
the Company and the Guarantors, on the one hand, and the Initial Purchasers,
on
the other hand, in connection with the statements or omissions which resulted
in
such losses, claims, damages, liabilities or expenses, as well as any other
relevant equitable considerations. The relative benefits received by the Company
and the Guarantors, on the one hand, and the Initial Purchasers, on the other
hand, in connection with the offering of the Securities pursuant to this
Agreement shall be deemed to be in the same respective proportions as the total
net proceeds from the offering of the Securities pursuant to this Agreement
(before deducting expenses) received by the Company and the total discount
received by the Initial Purchasers bear to the aggregate initial offering price
of the Securities. The relative fault of the Company and the Guarantors, on
the
one hand, and the Initial Purchasers, on the other hand, shall be determined
by
reference to, among other things, whether any such untrue or alleged untrue
statement of a material fact or omission or alleged omission to state a material
fact relates to information supplied by the Company and the Guarantors, on
the
one hand, or the Initial Purchasers, on the other hand, and the parties’
relative intent, knowledge, access to information and opportunity to correct
or
prevent such statement or omission.
The
amount paid or payable by a party as a result of the losses, claims, damages,
liabilities and expenses referred to above shall be deemed to include, subject
to the limitations set forth in Section 8 hereof, any legal or other fees or
expenses reasonably incurred by such party in connection with investigating
or
defending any action or claim. The provisions set forth in Section 8 hereof
with
respect to notice of commencement of any action shall apply if a claim for
contribution is to be made under this Section 9; provided,
however, that
no
additional notice shall be required with respect to any action for which notice
has been given under Section 8 hereof for purposes of indemnification.
-
30 -
The
Company, the Guarantors and the Initial Purchasers agree that it would not
be
just and equitable if contribution pursuant to this Section 9 were determined
by
pro rata allocation (even if the Initial Purchasers were treated as one entity
for such purpose) or by any other method of allocation which does not take
account of the equitable considerations referred to in this Section 9.
Notwithstanding
the provisions of this Section 9, no Initial Purchaser shall be required to
contribute any amount in excess of the discount received by such Initial
Purchaser in connection with the Securities distributed by it. No person guilty
of fraudulent misrepresentation (within the meaning of Section 11 of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Initial Purchasers’ obligations
to contribute pursuant to this Section 9 are several, and not joint, in
proportion to their respective commitments as set forth opposite their names
in
Schedule
A.
For
purposes of this Section 9, each director, officer and employee of an Initial
Purchaser and each person, if any, who controls an Initial Purchaser within
the
meaning of the Securities Act and the Exchange Act shall have the same rights
to
contribution as such Initial Purchaser, and each director, officer or employee
of the Company or any Guarantor, and each person, if any, who controls the
Company or any Guarantor within the meaning of the Securities Act and the
Exchange Act shall have the same rights to contribution as the Company and
the
Guarantors.
SECTION
10. Termination
of this Agreement. Prior
to
the Closing Date, this Agreement may be terminated by the Initial Purchasers
by
notice given to the Company if at any time after the date of this Agreement:
(i)
trading or quotation in any of the Company’s securities shall have been
suspended or limited by the Commission or by NASDAQ, or trading in securities
generally on either NASDAQ or the NYSE shall have been suspended or limited,
or
minimum or maximum prices shall have been generally established on any of such
quotation system or stock exchange by the Commission or the NASD; (ii) a general
banking moratorium shall have been declared by any of federal, New York or
Delaware authorities; (iii) there shall have occurred any outbreak or escalation
of national or international hostilities or any crisis or calamity, or any
change in the United States or international financial markets, or any
substantial change or development involving a prospective substantial change
in
United States’ or international political, financial or economic conditions, as
in the judgment of the Initial Purchasers is material and adverse and makes
it
impracticable to proceed with the offering sale or delivery of the Securities
in
the manner and on the terms described in the Pricing Disclosure Package or
to
enforce contracts for the sale of securities; (iv) in the judgment of the
Initial Purchasers there shall have occurred any Material Adverse Change; or
(v)
the Company and its subsidiaries shall have sustained a loss by strike, fire,
flood, earthquake, accident or other calamity of such character as in the
judgment of the Initial Purchasers may interfere materially with the conduct
of
the business and operations of the Company and its subsidiaries regardless
of
whether or not such loss shall have been insured. Any termination pursuant
to
this Section 10 shall be without liability on the part of (i) the Company or
any
Guarantor to any Initial Purchaser, except that the Company and the Guarantors
shall be obligated to reimburse the expenses of the Initial Purchasers pursuant
to Sections 4 and 6 hereof, (ii) any Initial Purchaser to the Company, or (iii)
any party hereto to any other party, except that the provisions of Sections
8
and 9 hereof shall at all times be effective and shall survive such termination.
-
31 -
SECTION
11. Representations
and Indemnities to Survive Delivery. The
respective indemnities, agreements, representations, warranties and other
statements of the Company and the Guarantors and of each of their respective
officers and of the several Initial Purchasers set forth in or made pursuant
to
this Agreement will remain in full force and effect, regardless of any
investigation made by or on behalf of any Initial Purchaser or the Company
or
any of the Guarantors or any of its or their partners, officers, directors,
employees or any controlling person, as the case may be, and will survive
delivery of and payment for the Securities sold hereunder and any termination
of
this Agreement.
SECTION
12. Notices.
All
communications hereunder shall be in writing and shall be mailed, hand
delivered, couriered or facsimiled and confirmed to the parties hereto as
follows:
If
to the
Initial Purchasers:
Banc
of
America Securities LLC
0
Xxxx
00xx Xxxxxx
Xxx
Xxxx,
XX 00000
Facsimile:
(000) 000-0000
Attention:
Xxx Xxxxxxxx
with
a
copy to:
Fried,
Frank, Harris, Xxxxxxx & Xxxxxxxx LLP
Xxx
Xxx
Xxxx Xxxxx
Xxx
Xxxx,
XX 00000
Facsimile:
(000) 000-0000
Attention:
Xxxxxxx Xxxx Jacob, Esq.
If
to the
Company or the Guarantors:
0000
Xxxxxx Xxxxx Xxxxxxx
Xxxxxxxx
0, Xxxxx 000
Xxxxxx,
XX 00000
Phone:
(000) 000-0000
Facsimile:
(000) 000-0000
Attention:
Xxxxxx X. Xxxxxxxx, Xx.
Chief
Financial Officer
with
a
copy to:
-
32 -
Xxxxxxxx
& Knight LLP
0000
Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx,
Xxxxx 00000
Facsimile:
(000) 000-0000
Attention:
Xxx Xxxxxxxxxxx
Any
party
hereto may change the address or facsimile number for receipt of communications
by giving written notice to the others.
SECTION
13. Successors.
This
Agreement will inure to the benefit of and be binding upon the parties hereto,
including any substitute Initial Purchasers pursuant to Section 16 hereof,
and
to the benefit of the indemnified parties referred to in Sections 8 and 9
hereof, and in each case their respective successors, and no other person will
have any right or obligation hereunder. The term “successors” shall not include
any Subsequent Purchaser of other purchaser of the Securities as such from
any
of the Initial Purchasers merely by reason of such purchase.
SECTION
14. Partial
Unenforceability. The
invalidity or unenforceability of any section, paragraph or provision of this
Agreement shall not affect the validity or enforceability of any other section,
paragraph or provision hereof. If any section, paragraph or provision of this
Agreement is for any reason determined to be invalid or unenforceable, there
shall be deemed to be made such minor changes (and only such minor changes)
as
are necessary to make it valid and enforceable.
SECTION
15. Governing
Law Provisions. THIS
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL
LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED
IN SUCH STATE WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES THEREOF.
(a) Consent
to Jurisdiction. Any
legal
suit, action or proceeding arising out of or based upon this Agreement or the
transactions contemplated hereby (“Related Proceedings”) may be instituted in
the federal courts of the United States of America located in the City and
County of New York or the courts of the State of New York in each case located
in the City and County of New York (collectively, the “Specified Courts”), and
each party irrevocably submits to the exclusive jurisdiction (except for suits,
actions, or proceedings instituted in regard to the enforcement of a judgment
of
any Specified Court in a Related Proceeding, as to which such jurisdiction
is
non-exclusive) of the Specified Courts in any Related Proceeding. Service of
any
process, summons, notice or document by mail to such party’s address set forth
above shall be effective service of process for any Related Proceeding brought
in any Specified Court. The parties irrevocably and unconditionally waive any
objection to the laying of venue of any Specified Proceeding in the Specified
Courts and irrevocably and unconditionally waive and agree not to plead or
claim
in any Specified Court that any Related Proceeding brought in any Specified
Court has been brought in an inconvenient forum.
-
33 -
SECTION
16. Default
of One or More of the Several Initial Purchasers. If
any
one or more of the several Initial Purchasers shall fail or refuse to purchase
Securities that it or they have agreed to purchase hereunder on the Closing
Date, and the aggregate number of Securities which such defaulting Initial
Purchaser or Initial Purchasers agreed but failed or refused to purchase does
not exceed 10% of the aggregate number of the Securities to be purchased on
such
date, the other Initial Purchasers shall be obligated, severally, in the
proportions that the number of Securities set forth opposite their respective
names on Schedule
A bears
to
the aggregate number of Securities set forth opposite the names of all such
non-defaulting Initial Purchasers, or in such other proportions as may be
specified by the Initial Purchasers with the consent of the non-defaulting
Initial Purchasers, to purchase the Securities which such defaulting Initial
Purchaser or Initial Purchasers agreed but failed or refused to purchase on
the
Closing Date. If any one or more of the Initial Purchasers shall fail or refuse
to purchase Securities and the aggregate number of Securities with respect
to
which such default occurs exceeds 10% of the aggregate number of Securities
to
be purchased on the Closing Date, and arrangements satisfactory to the Initial
Purchasers and the Company for the purchase of such Securities are not made
within 48 hours after such default, this Agreement shall terminate without
liability of any party to any other party except that the provisions of Sections
4, 6, 8 and 9 hereof shall at all times be effective and shall survive such
termination. In any such case either the Initial Purchasers or the Company
shall
have the right to postpone the Closing Date, as the case may be, but in no
event
for longer than seven days in order that the required changes, if any, to the
Final Offering Memorandum or any other documents or arrangements may be
effected.
As
used
in this Agreement, the term “Initial Purchaser” shall be deemed to include any
person substituted for a defaulting Initial Purchaser under this Section 16.
Any
action taken or not taken under this Section 16 shall not relieve any defaulting
Initial Purchaser from liability in respect of any default of such Initial
Purchaser under this Agreement.
-
34 -
SECTION
17. No
Advisory or Fiduciary Responsibility. Each
of
the Company and the Guarantors acknowledges and agrees that: (i) the purchase
and sale of the Securities pursuant to this Agreement, including the
determination of the offering price of the Securities and any related discounts
and commissions, is an arm’s-length commercial transaction between the Company
and the Guarantors, on the one hand, and the several Initial Purchasers, on
the
other hand, and the Company and the Guarantors are capable of evaluating and
understanding and understand and, assuming the accuracy of the representations
and warranties of the Initial Purchasers and the fulfillment by them of their
obligations, accept the terms, risks and conditions of the transactions
contemplated by this Agreement; (ii) in connection with each transaction
contemplated hereby and the process leading to such transaction each Initial
Purchaser is and has been acting solely as a principal and is not the agent
or
fiduciary of the Company, Guarantors or their respective affiliates,
stockholders, creditors or employees or any other party; (iii) no Initial
Purchaser has assumed or will assume an advisory or fiduciary responsibility
in
favor of the Company and the Guarantors with respect to any of the transactions
contemplated hereby or the process leading thereto (irrespective of whether
such
Initial Purchaser has advised or is currently advising the Company or the
Guarantors on other matters) or any other obligation to the Company and the
Guarantors except the obligations expressly set forth in this Agreement; (iv)
the several Initial Purchasers and their respective affiliates may be engaged
in
a broad range of transactions that involve interests that differ from those
of
the Company and the Guarantors and that the several Initial Purchasers have
no
obligation to disclose any of such interests by virtue of any fiduciary or
advisory relationship; and (v) the Initial Purchasers have not provided any
legal, accounting, regulatory or tax advice with respect to the offering
contemplated hereby and the Company and the Guarantors have consulted their
own
legal, accounting, regulatory and tax advisors to the extent they deemed
appropriate.
This
Agreement supersedes all prior agreements and understandings (whether written
or
oral) between the Company, the Guarantors and the Initial Purchasers, or any
of
them, with respect to the subject matter hereof. The Company and the Guarantors
hereby waive and release, to the fullest extent permitted by law, any claims
that the Company and the Guarantors may have against the Initial Purchasers
with
respect to any breach or alleged breach of fiduciary duty.
SECTION
18. General
Provisions. This
Agreement constitutes the entire agreement of the parties to this Agreement
and
supersedes all prior written or oral and all contemporaneous oral agreements,
understandings and negotiations with respect to the subject matter hereof.
This
Agreement may be executed in two or more counterparts, each one of which shall
be an original, with the same effect as if the signatures thereto and hereto
were upon the same instrument. This Agreement may not be amended or modified
unless in writing by all of the parties hereto, and no condition herein (express
or implied) may be waived unless waived in writing by each party whom the
condition is meant to benefit. The section headings herein are for the
convenience of the parties only and shall not affect the construction or
interpretation of this Agreement.
-
35 -
If
the
foregoing is in accordance with your understanding of our agreement, kindly
sign
and return to the Company the enclosed copies hereof, whereupon this instrument,
along with all counterparts hereof, shall become a binding agreement in
accordance with its terms.
|
Very
truly yours,
|
|||
|
XXXXXXX
EXPLORATION COMPANY, a Delaware corporation
|
|||
|
By:
|
/s/
Xxxxxx X. Xxxxxxxx, Xx.
|
||
|
Name:
|
Xxxxxx
X. Xxxxxxxx, Xx.
|
||
|
Title:
|
Chief
Financial Officer
|
||
|
XXXXXXX,
INC., a Nevada corporation
|
|||
|
By:
|
/s/
Xxxxxx X. Xxxxxxxx, Xx.
|
||
|
Name:
|
Xxxxxx
X. Xxxxxxxx, Xx.
|
||
|
Title:
|
Chief
Financial Officer
|
||
|
XXXXXXX
OIL & GAS, L.P., a Delaware limited partnership
|
|||
|
By:
|
XXXXXXX,
INC.,
|
||
|
Its
managing general partner
|
|||
|
By:
|
/s/
Xxxxxx X. Xxxxxxxx, Xx.
|
||
|
Name:
|
Xxxxxx
X. Xxxxxxxx, Xx.
|
||
|
Title:
|
Chief
Financial Officer
|
||
The
foregoing Purchase Agreement is hereby confirmed and accepted by the Initial
Purchasers as of the date first above written.
BANC
OF
AMERICA SECURITIES LLC
CREDIT
SUISSE SECURITIES (USA) LLC
|
By:
|
Banc
of America Securities LLC
|
||
|
By:
|
/s/
Xxx Xxxxxxxx
|
||
|
Name:
|
Xxx
Xxxxxxxx
|
||
|
Title:
|
Managing
Director
|
||
SCHEDULE
A
|
Initial
Purchasers
|
Aggregate
Principal
Amount
of
Securities to be Purchased
|
|||
|
Banc
of America Securities LLC
|
$
|
17,500,000
|
||
|
Credit
Suisse Securities (USA) LLC
|
17,500,000
|
|||
|
Total
|
$
|
35,000,000
|
||
Sch
A-1
EXHIBIT A
Form
of Opinion of Xxxxxxxx & Knight LLP, Counsel for the Company, to beDelivered
Pursuant to Section 5(c) of the Purchase Agreement
1. The
Company is a corporation that is validly existing and in good standing under
the
laws of Delaware. Xxxxxxx, Inc. is a corporation that is validly existing and
in
good standing under the laws of Nevada. Xxxxxxx Oil & Gas is a limited
partnership that is validly existing and in good standing under the laws of
Delaware.
2. Each
Relevant Party (a) has the corporate or limited partnership power, as the case
may be, to execute, deliver and perform each Transaction Document to which
it is
a party and in the case of the Company to conduct its business as described
in
the Pricing Disclosure Package and the Final Offering Memorandum, (b) has taken
all corporate or limited partnership action, as the case may be, necessary
to
authorize the execution, delivery and performance of such Transaction Documents,
and (c) has duly executed and delivered the Purchase Agreement, the Registration
Rights Agreement, the DTC Agreement, the Indenture, the Notes and the
Guarantees.
3. Based
solely on certificates of public officials, each Relevant Party was in good
standing and authorized to do business in each state specified with respect
to
such Relevant Party in Schedule I.C hereto as of the date specified in such
Schedule.
4. Each
of
the Registration Rights Agreement, the DTC Agreement and the Indenture to which
a Relevant Party is a party is such Relevant Party’s valid and binding
obligation, enforceable against it in accordance with the terms thereof. When
executed and authenticated as provided in the Indenture, the Notes, the Exchange
Notes, the Guarantees and the Guarantees of the Exchange Notes to which a
Relevant Party is a party will be such Relevant Party’s valid and binding
obligation, enforceable against it in accordance with the terms thereof
5. The
execution and delivery by each Relevant Party of the Transaction Documents
to
which it is a party do not, and the performance by each such Relevant Party
of
its obligations thereunder will not, (a) violate the certificate of
incorporation or the certificate of formation or bylaws or regulations of such
Relevant Party, (b) breach or result in a default under, or require that any
consent, approval, license, or authorization be obtained under, any agreement
or
instrument listed in Schedule I.D hereto (the “Applicable Contracts”) or (c)
result in a violation by any such Relevant Party of any Applicable Laws.
6. No
Relevant Party is, or as a result of the transactions contemplated by the
Transaction Documents will be, required to register as an investment company
under the Investment Company Act of 1940, as amended.
A-1
7. No
authorization, approval or other action by, and no notice to or filing with,
any
United States federal or New York governmental authority or regulatory body,
or
any third party that is a party to any Applicable Contract, is required for
the
due execution, delivery or performance by any Relevant Party of any Transaction
Document to which it is a party, except as may be required under the Securities
Act and the Trust Indenture Act of 1939, as amended, in connection with the
registration statement described in the Final Offering Memorandum and
contemplated by the Registration Rights Agreement and as may be required under
the securities or blue sky laws of any jurisdiction in the United States in
connection with the offer and sale of the Securities.
8. Based
upon the representations, warranties and agreements of the Company and the
Initial Purchasers in the Purchase Agreement and assuming compliance with the
offering and transfer procedures and restrictions described in the Final
Offering Memorandum, it is not necessary in connection with the offer and sale
of the Securities to you under the Purchase Agreement or in connection with
the
initial resale of such Securities by you in the manner contemplated by the
Purchase Agreement to register the Securities under the Securities Act of 1933,
as amended, other than any registration that may be required in connection
with
the Exchange Offer contemplated by the Final Offering Memorandum and the
Registration Rights Agreement, it being understood that no opinion is expressed
as to any subsequent resale of any Securities.
9. The
statements in the Pricing Disclosure Package and the Final Offering Memorandum
under the captions “Plan of Distribution” and “Description of the Exchange
Notes” and, in each case, insofar as such statements constitute summaries of
legal matters or documents referred to therein, fairly summarize in all material
respects the legal matters or documents referred to therein. The statements
in
the Pricing Disclosure Package and the Final Offering Memorandum under the
caption “United States Federal Income Tax Considerations,” insofar as such
statements constitute summaries of legal matters referred to therein, fairly
summarize in all material respects the legal matters referred to therein.
10. The
documents incorporated by reference in the Pricing Disclosure Package and the
Final Offering Memorandum (other than the financial statements and financial
schedules therein, as to which no opinion need be rendered), when they were
filed with the Commission, complied as to form in all material respects with
the
requirements of the Exchange Act.
A-2
In
the
course of our acting as counsel to the Company in connection with the
preparation of the Pricing Disclosure Package and the Final Offering Memorandum,
we participated in conferences with officers and other representatives of the
Relevant Parties, representatives of the Initial Purchasers and the Initial
Purchasers’ counsel, and representatives of the independent public accountants
for the Relevant Parties, at which the contents of the Pricing Disclosure
Package and the Final Offering Memorandum and related matters were discussed
and, although we are not passing upon, and do not assume any responsibility
for,
the accuracy, completeness or fairness of the statements contained in the
Pricing Disclosure Package and the Final Offering Memorandum and have not made
any independent checks or verification thereof, during the course of such
participation, nothing has come to our attention that leads us to believe that
the Pricing Disclosure Package, as of the Time of Execution, or that the Final
Offering Memorandum, as of the date thereof and as of the date hereof, contained
or contains any untrue statement of any material fact or omitted or omits to
state any material fact required to be stated therein or necessary to make
the
statements therein not misleading; except that we express no opinion and provide
no negative assurance as to the financial statements and related notes and
schedules and other financial, oil and gas reserves or prospects or production
data and statistical data derived from such financial statements, notes and
schedules and other financial, oil and gas reserves or prospects or production
data.
A-3
EXHIBIT
B
Subsidiaries
of Xxxxxxx Exploration Company
XXXXXXX,
INC.
XXXXXXX
OIL & GAS, X.X.
XXXXXXX
HOLDINGS I, LLC
XXXXXXX
HOLDINGS II, LLC
B-1
ANNEX
I
Resale
Pursuant to Regulation S or Rule 144A.
Each
Initial Purchaser understands that:
Such
Initial Purchaser agrees that it has not offered or sold and will not offer
or
sell the Securities in the United States or to, or for the benefit or account
of, a U.S. Person (other than a distributor), in each case, as defined in Rule
902 of Regulation S (i) as part of its distribution at any time and (ii)
otherwise until 40 days after the later of the commencement of the offering
of
the Securities pursuant hereto and the Closing Date, other than in accordance
with Regulation S or another exemption from the registration requirements of
the
Securities Act. Such Initial Purchaser agrees that, during such 40-day
restricted period, it will not cause any advertisement with respect to the
Securities (including any “tombstone” advertisement) to be published in any
newspaper or periodical or posted in any public place and will not issue any
circular relating to the Securities, except such advertisements as are permitted
by and include the statements required by Regulation S.
Such
Initial Purchaser agrees that, at or prior to confirmation of a sale of
Securities by it to any distributor, dealer or person receiving a selling
concession, fee or other remuneration during the 40-day restricted period
referred to in Rule 903 of Regulation S, it will send to such distributor,
dealer or person receiving a selling concession, fee or other remuneration
a
confirmation or notice to substantially the following effect:
“The
Securities covered hereby have not been registered under the U.S. Securities
Act
of 1933, as amended (the “Securities Act”), and may not be offered and sold
within the United States or to, or for the account or benefit of, U.S. persons
(i) as part of your distribution at any time or (ii) otherwise until 40 days
after the later of the date the Securities were first offered to persons other
than distributors in reliance upon Regulation S and the Closing Date, except
in
either case in accordance with Regulation S under the Securities Act (or in
accordance with Rule 144A under the Securities Act in transactions that are
exempt from the registration requirements of the Securities Act), and in
connection with any subsequent sale by you of the Securities covered hereby
in
reliance on Regulation S under the Securities Act during the period referred
to
above to any distributor, dealer or person receiving a selling concession,
fee
or other remuneration, you must deliver a notice to substantially the foregoing
effect. Terms used above have the meanings assigned to them in Regulation S
under the Securities Act.”
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