ASSET PURCHASE AND SALE AGREEMENT
THIS ASSET PURCHASE AND SALE AGREEMENT ("Agreement"), made and entered
into this 1st day of October, 2002 by and between AMERICAN RESOURCES OFFSHORE,
INC., whose address is 000 Xxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, XX 00000
("Seller"), and FIDELITY EXPLORATION & PRODUCTION COMPANY, whose address is 1700
Lincoln, Suite 4600, Xxxxxx, XX 00000 ("Buyer").
ARTICLE 1
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PURCHASE AND SALE
1.01 Purchase and Sale. Subject to the terms of this Agreement, Seller
agrees to sell the hereinafter described Assets to Buyer and Buyer agrees to
purchase the Assets from Seller.
1.02 Assets. The following items comprise the Assets:
(a) all of Seller's right, title and interest in and to the
oil and gas leases and lands described in Exhibit A hereof, and in the
xxxxx located in and on such oil and gas leases, including, without
limitation, operating rights and record title, working, leasehold,
mineral, royalty, overriding royalty, net revenue, net profits or
reversionary interests and any and all other interests in such oil and
gas leases and lands (the "Leases");
(b) all of Seller's right, title and interest in and to all
xxxxx, equipment, fixtures, platforms, personal property and
improvements (including, without limitation, wellbores, pipe,
inventory, facilities, supplies, materials, plant, pipelines, gathering
lines, facilities and systems, processing facilities and systems and
salt water disposal facilities and systems and any and all other
personal, real , movable and immovable property, fixtures or equipment
located on, appurtenant to or used in connection with the Leases now,
as of the Effective Time or as of the Closing Date ("Equipment");
(c) all of Seller's right, title and interest in and to any
and all contracts or agreements attributable to the ownership or
operation of the Assets, any and all instruments, payout balances or
commitments, any and all licenses, orders, permits, easements or
rights-of-way and any and all other rights, privileges, benefits or
powers of Seller relating to the Assets, together with all of Seller's
rights, claims and causes of action under or otherwise deriving from
the Assets after the Effective Time ("Contracts");
(d) all of Seller's right, title and interest in and to any
and all oil, gas, condensate, related hydrocarbons and other minerals
produced from the Leases after the Effective Time ("Substances");
(e) any and all accounts and funds including, without
limitation, Seller's share of any gas imbalances, makeup obligations,
abandonment escrow accounts, instruments, general intangibles, liens
and security interests arising from the sale or other disposition of
the items described in this Section 1.02 on or after the Effective Time
("Accounts").
(f) any and all of Seller's information relating to the Assets
, including, without limitation, reservoir, land, operation and
production files and other data including geological, engineering and
proprietary geophysical data (both "2-D" and "3-D", to the extent that
Seller is allowed to transfer such data pursuant to the applicable
license agreements), maps, logs, core analyses, formation tests,
production records and legal, title, accounting and contract files.
("Technical Files").
(g) Any and all of Seller's escrowed accounts for abandonment
and the payment of taxes for production of oil or gas.
1.03 Effective Time. The purchase and sale of the Assets shall be
effective for all purposes on October 1, 2002, at 7:00 a.m., Central Standard
Time ("Effective Time").
ARTICLE 2
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PURCHASE PRICE
2.01 Purchase Price. The purchase price for the Assets is U.S. TWO
MILLION, SEVEN HUNDRED THIRTY THOUSAND DOLLARS ($2,730,000.00) (the "Purchase
Price").
2.02 THIS SPACE IS INTENTIONALLY LEFT BLANK
2.03 Adjustments to Purchase Price. The Purchase Price shall be
adjusted as provided in this Section 2.03 and the resulting amount shall be
referred to as the "Adjusted Purchase Price". Not less than two (2) days prior
to the Closing Date, Seller shall deliver to Buyer a Preliminary Closing
Statement, substantially in the form attached hereto as Schedule 2.03, setting
forth adjustments to the Purchase Price using the best information then
available and prepared in accordance with customary accounting principles used
in the oil and gas industry.
(a) The Purchase Price shall be increased by the following:
(1) an amount equal to the quantity of merchantable
oil produced from the Leases and in storage at the Effective
Time, and not sold or disposed of prior to Closing, multiplied
by the market price for such oil at the Effective Time, net of
all taxes and gravity adjustments and transportation expenses
necessary to market such production.
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(2) the amount of the operating and capital
expenditures together with any lease operating expenses
charged under applicable operating agreements and general and
administrative costs charged as overhead charges under
applicable operating agreements, that are (i) attributable to
the Assets during the period between the Effective Time and
Closing, (ii) incurred and paid by Seller, including without
limitation capital expenditures approved in accordance with
Section 4.01 or otherwise made in compliance with this
Agreement.
(3) taxes paid by Seller for assessments based on
ownership of the Assets after the Effective Time, the
production of hydrocarbons therefrom, or the receipt of
proceeds attributable thereto (excluding income taxes) after
the Effective Time. Taxes based on production of hydrocarbons
from the Assets prior to the Effective Time but assessed
thereafter shall, unless payment thereof is covered by funds
escrowed for that purpose, be the responsibility of Seller and
no upward purchase adjustment shall be made on account
thereof.
(4) an amount equal to all prepaid expenses
attributable to the Assets paid by Seller and attributable to
the period from and after the Effective Time, including
without limitation, prepaid insurance and prepaid ad valorem,
property, production and other taxes accruing to the benefit
of Buyer subsequent to the Effective Time. Taxes based on
production of hydrocarbons from the Assets prior to the
Effective Time but assessed thereafter shall, unless payment
thereof is covered by funds escrowed for that purpose, be the
responsibility of Seller and no upward purchase adjustment
shall be made on account thereof.
(b) The Purchase Price shall be decreased by the following:
(1) the amount of net proceeds or other value received
by Seller for the sale or disposition of Substances, as
defined herein, including net proceeds from the sale of
liquids and other constituents removed in gas plants or other
processing facilities for production occurring after the
Effective Time;
(2) the amount of proceeds or other value received by
Seller for the sale or disposition after the Effective Time of
any portion of the Assets;
(3) an amount equal to the value of all uncured Title
Defects as determined under Section 5.08; and
(4) the amount of all unpaid taxes and assessments
based on the ownership of property, the production of
hydrocarbons or the receipt of proceeds, excluding income
taxes, accruing to the Assets prior to the Effective Time and
for the payment of which Buyer assumes liability subsequent to
Closing. If possible, this adjustment shall be computed using
the tax rate and values for the tax period in question. If
this is not possible, the adjustment shall be based on the
taxes assessed for the immediately preceding tax period. If
taxes assessed for the preceding tax period are determined to
be more or less than the actual taxes, the difference shall be
a Post-Closing Adjustment or Subsequent Adjustment under
Sections 9.01 and 9.02.
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2.04 Payment of Adjusted Purchase Price. At Closing, Buyer shall pay
Seller an amount equal to the Adjusted Purchase Price in immediately available
funds.
2.05 Allocation of Purchase Price/Tangibles-Intangibles. Exhibit A-4
contains the allocation of the value of each individual property as mutually
agreed by Seller and Buyer (the "Allocated Value"). The parties shall allocate
the value of each individual Asset among tangibles and intangibles after Closing
in accordance with Section 1060 of the Internal Revenue Code of 1986, as
amended. Buyer and Seller agree to be bound by such allocation of the Purchase
Price among tangibles and intangibles for all purposes; to consistently report
such allocations for all federal, state and local income tax purposes; and to
timely file all reports required by the Internal Revenue Code of 1986, as
amended, concerning the Purchase Price allocation.
ARTICLE 3
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REPRESENTATIONS AND DISCLAIMERS
3.01 Seller's Representations and Warranties. Seller represents and
warrants to Buyer as of the date hereof, as of Closing and as of the Effective
Date that:
(a) Seller is a corporation organized, existing and in good
standing under the laws of the State of Delaware and is qualified to do
business in, and is in good standing under the laws of the States of
Louisiana and Texas. Seller is qualified under applicable law and
regulation to own the Assets. With respect to all persons claiming by
through or under Seller but not otherwise, Seller has, and will convey
to Buyer, Defensible Title (as defined in Section 5.06 below) to the
Assets. Seller warrants and agrees to defend title to the Assets
against the lawful claims of all persons claiming by, through or under
Seller, but not otherwise.
(b) Seller has the authority to carry on its business as
presently conducted, to enter into this Agreement and to perform its
obligations under this Agreement.
(c) The execution and delivery of this Agreement have been
authorized by all necessary action, corporate and otherwise, on the
part of Seller. Execution and delivery of this Agreement does not, and
the consummation of the transactions contemplated by this Agreement
will not, violate or be in conflict with any agreement, instrument,
judgment, order, decree, law or regulation by which Seller is bound.
(d) Subject to laws and equitable principles affecting the
rights of creditors, this Agreement is a binding obligation of Seller
enforceable according to its terms.
(e) Except as set forth on Schedule 3.01 (e), no suit, claim,
demand or investigation, of which Seller has received notice, is
pending or, to Seller's Knowledge, (as hereinafter defined), threatened
that might result in impairment or loss or diminution of Seller's title
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to the Assets or otherwise adversely affect the Assets in any material
respect. There are no bankruptcy or reorganization proceedings pending
or threatened against Seller. As used in this Agreement, the term
"Knowledge" means actual knowledge acquired or which should, in the
exercise of reasonable care, given Sellers status as a non-operator,
have been acquired by the management of Seller in the ordinary course
and operation of Seller's business.
(f) All contracts which burden or will burden or encumber the
Assets or which are otherwise material to the ownership, use or
operation of the Assets are described on Exhibit A hereof. All such
contracts were entered into in the ordinary course of business and, if
executed by Seller, were duly executed and delivered by Seller and are
in force according to their terms. Neither Seller, nor any other party
to Seller's Knowledge, is in breach of any obligation which might
adversely affect the Assets in any material respect.
(g) To Seller's Knowledge, all rentals, royalties, shut-in
royalties, overriding royalties and other payments due pursuant to or
with respect to the Leases have been properly paid.
(h) To Seller's Knowledge (i) the Leases have been drilled,
completed, operated, developed and produced in compliance with all
applicable judgments, orders, laws, rules and regulation; (ii) all
necessary certificates, consents, permits, licenses and other
governmental authorizations affecting the Assets have been obtained and
are in force and (iii) there are no violations of any applicable
regulations, rules or orders of the Federal Energy Regulatory
Commission, the Department of Energy, the Minerals Management Service
or any other regulatory agency with respect to the Assets, except under
circumstances as would not adversely affect the Assets in any material
respect.
(i) The Leases are not obligated, under a take-or-pay or
similar arrangement, and Seller is not obligated by virtue of an
election to non-consent, or not participate in a past or current
operation on the Leases pursuant to applicable operating agreements, to
produce Substances, or allow Substances to be produced, without
receiving full payment at the time of delivery in an amount that
corresponds to the net revenue interest described in Exhibit A.
(j) To Seller's Knowledge taxes based on or measured by the
ownership of property, the production or removal of hydrocarbons and
the receipt of proceeds which are due and relating to the Assets have
been properly paid, subject to possible adjustment for volume or price
corrections.
(k) Seller is timely receiving its share of proceeds from the
sale of hydrocarbons produced from the Leases without suspense,
counterclaim or set-off. To Seller's Knowledge, there has been no
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production of hydrocarbons from the Leases in excess of the allowable
production established pursuant to applicable state or federal law or
regulation that would result in a restriction on production from the
Leases subsequent to the Effective Time.
(l) To Seller's Knowledge, except for Casualty Losses covered
by Section 5.07, there has been no material adverse change in the
condition of any of the Leases or Equipment after the Effective Time
except depletion through normal production within authorized
allowables, changes in rates of production that occur in the ordinary
course of operation and depreciation of Equipment through ordinary wear
and tear.
(m) Seller has incurred no liability for brokers' or finders'
fees related to the transactions contemplated by this Agreement for
which Buyer shall be liable.
(n) To Seller's Knowledge, there are no outstanding
authorizations for expenditures or any oral or written commitments or
proposals to conduct operations on the Leases which are required to be
approved by non-operators under the terms of the applicable joint
operating agreement.
(o) Except as set forth on Schedule 3.01(o), as of the
Effective Time, no portion of the Assets is over produced, under
produced or otherwise subject to an imbalance in respect of substances
produced from the Leases.
3.02 Buyer's Representations and Warranties. Buyer represents and
warrants to Seller as of the date hereof, as of Closing and as of the Effective
Date as follows:
(a) Buyer is a corporation organized, existing and in good
standing under the laws of the State of Delaware and is qualified to do
business and is in good standing under the laws of the States of Texas
and Louisiana. Buyer is qualified under applicable law and regulation
to own the Assets and, in particular, Buyer is qualified to do business
in each of the adjacent States, and on the Continental Shelf, Gulf of
Mexico, in which the Assets are located to the extent the laws of such
place require Buyer to so qualify.
(b) Buyer has the authority to carry on its business as
presently conducted, to enter into this Agreement and to perform its
obligations under this Agreement.
(c) The execution and delivery of this Agreement have been
authorized by all necessary action, corporate and otherwise, on the
part of Buyer. Execution and delivery of this Agreement does not, and
the consummation of the transactions contemplated by this Agreement
will not, violate or be in conflict with any agreement, instrument,
judgment, order, decree, law or regulation by which Buyer is bound.
(d) Subject to laws and equitable principles affecting the
rights of creditors, this Agreement is a binding obligation of Buyer
enforceable according to its terms. There are no bankruptcy nor
reorganization proceedings pending or, to Buyer's Knowledge, threatened
against Buyer.
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(e) Buyer has incurred no liability for brokers' or finders'
fees related to the transactions contemplated by this Agreement for
which Seller shall be liable.
(f) There are no pending suits, actions or other proceedings
in which Buyer is a party (or, to Buyer's Knowledge, which have been
threatened to be instituted against Buyer) which affect the execution
and delivery of this Agreement or the consummation of the transactions
contemplated hereby.
(g) Buyer is a knowledgeable purchaser, owner and operator of
oil and gas properties, has the ability to evaluate the Assets for
purchase, and is acquiring the Assets for its own account and not with
the intent to make a distribution in violation of the Securities Act of
1933 as amended.
ARTICLE 4
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COVENANTS
4.01 Seller's Covenants. Seller covenants and agrees with Buyer as
follows:
(a) Following execution of this Agreement and until Closing,
Seller shall (i) continue to operate the Assets or cause the Assets to
be operated, in a good and workmanlike manner; (ii) maintain insurance
now in force with respect to the Assets; (iii) notify Buyer of any
suit, claim or demand within Seller's Knowledge which might adversely
affect the Assets; (iv) pay or cause to be paid all costs, taxes and
expenses which Seller is obligated to pay in connection with the Assets
as they become due; (v) pay or cause to be paid all rentals and other
payments necessary to maintain the Leases in force according to their
terms and comply with all express and implied covenants contained in
the Leases or Contracts; (vi) exercise due diligence in safeguarding
the Assets and maintaining the confidentiality of all data and other
confidential or proprietary materials relating to the Assets; (vii)
promptly notify Buyer of all significant operations which are proposed
with respect to the Assets; and (viii) use efforts, consistent with the
standards expected of a reasonably prudent operator but without any
obligation to pay money to obtain any consents, waivers (including
waiver of preferential purchase rights) and approvals required of third
parties or governmental authorities in connection with consummation of
the transactions contemplated by this Agreement. Buyer acknowledges
that Seller owns undivided interests in the Leases and that acts or
omissions of other owners of undivided interests in the Leases shall
not be a breach of any covenant in this Agreement. Seller shall not be
obligated to perform any act which would be in breach of a provision
in, or its duties under, a Lease, Contract or applicable law, rule or
regulation.
(b) Following execution of this Agreement, Seller shall not,
without Buyer's consent; (i) abandon any well capable of commercial
production; (ii) release all or a portion of a Lease; (iii) commence or
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consent to an operation estimated to cost an amount in excess of the
amount an operator is entitled to expend without non-operator approval
under the applicable operating agreement(s) (excluding emergency
operations and operations undertaken to avoid a penalty or forfeiture
provision of any applicable agreement or order); (iv) create a lien,
security Interest or other encumbrance on the Assets; (v) sell or
dispose of the Assets (except in connection with preferential rights to
purchase) other than Assets sold, consumed or produced in the ordinary
course of business; (vi) amend a Lease or amend a Contract or Account
or enter into new contracts affecting the Assets other than in the
ordinary course of business; (vii) waive, compromise or settle any
claim that diminishes or adversely burdens an Assets.
(c) Following the execution of this Agreement and until
Closing, Seller will provide Buyer and its attorneys, employees,
accountants, engineers, consultants and agents (collectively
"representatives"), at Buyer's sole expense, risk and cost, reasonable
access, during business hours, to the Contracts and other records of
Seller pertaining to the ownership and/or operation of the Assets
(including, without limitation, title files, division order files, and
production, severance and ad valorem tax records) for the purpose of
Buyer's conducting a due diligence review of the Assets insofar as the
same are in Seller's possession or control, or insofar as Seller has
access to the same, and to the extent, in each case, that Seller may do
so without violating legal constraints or any legal obligation. Seller
shall not be obligated to furnish any updated abstracts, title opinions
or additional title information which are not in Seller's or its
attorney's possession, but shall cooperate with Buyer in Buyer's
efforts to obtain (at Buyer's expense) such additional title
information as Buyer may reasonably require.
BUYER RECOGNIZES AND AGREES THAT ALL MATERIALS MADE AVAILABLE TO BUYER
AND ITS REPRESENTATIVES IN CONNECTION WITH THE TRANSACTION CONTEMPLATED
HEREBY, WHETHER MADE AVAILABLE PURSUANT TO THIS SECTION OR OTHERWISE,
ARE MADE AVAILABLE TO BUYER AS AN ACCOMMODATION, AND WITHOUT
REPRESENTATION OR WARRANTY OF ANY KIND AS TO THE ACCURACY AND
COMPLETENESS OF SUCH MATERIALS. NO WARRANTY OF ANY KIND IS MADE BY
SELLER AS TO THE INFORMATION SUPPLIED TO BUYER OR WITH RESPECT TO THE
ASSETS TO WHICH THE INFORMATION RELATES, AND BUYER EXPRESSLY AGREES
THAT ANY CONCLUSIONS DRAWN THEREFROM SHALL BE THE RESULT OF ITS OWN
INDEPENDENT REVIEW AND JUDGMENT.
(d) Seller will identify, with respect to all Assets, (A) all
preferential rights to purchase ("Preferential Rights") which would be
applicable to the transaction contemplated hereby and of which Seller
has Knowledge (B) the names and addresses of parties holding such
rights insofar as Seller has Knowledge of the same, (it being agreed
that, in attempting to identify such Preferential Rights, and the names
and addresses of such parties holding the same, Seller shall not be
obligated to go beyond its own records), and (ii) request, from the
parties so identified (and in accordance with the documents creating
such rights), execution of waivers of Preferential Rights so
identified. Seller shall indemnify and hold Buyer (and its officers,
directors, employees, attorneys, contractors and agents) completely
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free and harmless from and against any and all claims, actions, causes
of action, liabilities, damages, losses, costs or expenses (including,
without limitation, court costs and attorney's fees) whatsoever that
arise out the exercise of any Preferential Right or the failure to
obtain consent or waivers of Preferential Rights with respect to any of
the Assets. If a party from whom a waiver of a Preferential Right is
requested refuses to give such waiver, Seller will tender to such party
the Asset to which such waiver appertains (at a price equal to the
amount specified in Exhibit A-4 hereto for such Asset , reduced
appropriately, as determined by mutual agreement of Buyer and the
Seller, if less than the entire interest in and to such Asset must be
tendered), and to the extent that such Preferential Right is exercised
by such party, and such Asset is actually sold to such party so
exercising such right, such Asset will be excluded from the transaction
contemplated hereby and the Purchase Price will be adjusted downward by
the amount actually paid to Seller by the party exercising such right.
If the holder of Preferential Rights fails to fully exercise such
rights and purchase the Assets, or part thereof, pursuant to the terms
of this Agreement within 30 days of the Closing Date provided for
herein then Buyer will, subject to the indemnification contained
herein, purchase such Assets as originally contemplated herein before
the holder of such Preferential Rights failed to consummate the
purchase transaction.
(e) Seller, and its respective representatives shall keep
confidential all terms and provisions of this Agreement, the
transaction contemplated by this Agreement, and all information and
data concerning the Assets, and Buyer's business, financial condition,
operations, strategies and prospects.
(f) Seller shall take or cause to be taken all such actions as
may be necessary or advisable to consummate and make effective the
purchase of the Assets and the transactions contemplated by this
Agreement and to assure that as of the Closing Date it will not be
under any material corporate, legal or contractual restriction that
would prohibit or delay the timely consummation of such transactions.
(g) Seller shall cause all the representations and warranties
of Seller contained in this Agreement to be true and correct on and as
of the Closing Date. To the extent the conditions precedent to the
obligations of Buyer are within the control of Seler, Seller shall
cause such conditions to be satisfied on or prior to the Closing Date
and, to the extent the conditions precedent to the obligations of Buyer
are not within the control of Seller, Seller shall take or cause to be
taken all such commercially reasonable actions as may be necessary to
cause such conditions to be satisfied on or prior to the Closing Date.
(h) Seller shall promptly notify Buyer (i) if any
representation or warranty of Seller contained in this Agreement is
discovered to be or becomes untrue, or (ii) if Seller fails to perform
or comply with any covenant or agreement contained in this Agreement or
it is reasonably anticipated that Seller will be unable to perform or
comply with any covenant or agreement contained in this Agreement.
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4.02 Buyer's Covenants. Buyer covenants and agrees with Seller as
follows:
(a) Buyer and its respective representatives shall keep
confidential all terms and provisions of this Agreement, the
transaction contemplated by this Agreement, and all information and
data concerning the Assets, Seller's business, financial condition,
operations, strategies and prospects.
(b) Buyer shall take or cause to be taken all such actions as
may be necessary or advisable to consummate and make effective the
purchase of the Assets and the transactions contemplated by this
Agreement and to assure that as of the Closing Date it will not be
under any material corporate, legal or contractual restriction that
would prohibit or delay the timely consummation of such transactions.
(c) Buyer shall cause all the representations and warranties
of Buyer contained in this Agreement to be true and correct on and as
of the Closing Date. To the extent the conditions precedent to the
obligations of Seller are within the control of Buyer, Buyer shall
cause such conditions to be satisfied on or prior to the Closing Date
and, to the extent the conditions precedent to the obligations of
Seller are not within the control of Buyer, Buyer shall take or cause
to be taken all such commercially reasonable actions as may be
necessary to cause such conditions to be satisfied on or prior to the
Closing Date.
(d) Buyer shall promptly notify Seller (i) if any
representation or warranty of Buyer contained in this Agreement is
discovered to be or becomes untrue, or (ii) if Buyer fails to perform
or comply with any covenant or agreement contained in this Agreement or
it is reasonably anticipated that Buyer will be unable to perform or
comply with any covenant or agreement contained in this Agreement.
ARTICLE 5
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BUYER'S REVIEW AND TITLE
5.01 Due Diligence. Buyer may, prior to Closing and at its cost, review
data and information, title documents and conduct other examinations and
investigations in respect of the Assets. Should, as a result of such review,
examinations and investigations, or otherwise, one or more matters come to
Buyer's attention which would constitute a Title Defect, as described below, and
should there be one or more of such Title Defects which Buyer is unwilling to
waive and close the transaction contemplated herein notwithstanding the fact
that such Title Defects exist, Buyer shall notify Seller in writing of such
Title Defects as soon as the same are identified by Buyer, but in no event later
than 1 day prior to the Closing Date. Such notification shall include for each
asserted Title Defect (i) a description of the Title Defect and the Interest to
which it applies; (ii) an explanation of the basis for the claim of a Title
Defect and (iii) the amount by which Buyer would propose to adjust the Purchase
Price in view of such Title Defect. Buyer's failure to give notice of a Title
Defect within the time and in the manner required by this Section 5.01 shall
constitute a waiver by Buyer of the Title Defect and the Title Defect will be
treated as a Permitted Encumbrance as set forth below.
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5.02 Access to Assets. Following the execution of this Agreement and
until Closing, subject to the consent and cooperation of operators and other
third parties, Seller shall provide Buyer and its representatives access to the
Assets and the right to observe operations and inspect any and all of the
Assets, Equipment, improvements and fixtures included in the Assets, to the
extent that Seller has the legal right to grant such access and right. All
visits to Seller's facilities by Buyer, and on Buyer's behalf, will be scheduled
by mutual consent of the Parties, subject to Buyer's providing Seller reasonable
notice of the locations that Buyer wishes to visit and the proposed times of
such visits. Seller may accompany Buyer and its representatives during their
site visits. Entry onto the Assets will (i) subject Buyer to third party
restrictions, if any, and to Seller's industrial safety, hygiene, and drug and
alcohol requirements and (ii) be at Buyer's sole risk and expense.
5.03 Environmental Assessment. Buyer may conduct an environmental
assessment of the Assets, including investigations to identify wetlands and
sensitive and protected habitats. If Buyer undertakes an environmental
assessment, both the consultant (if consultants are employed) and the scope of
the proposed assessment, including testing protocols, must be acceptable to
Seller before the work may begin. If Buyer and Seller cannot agree on Buyer's
proposed environmental assessment plan, then Seller may, at its sole option,
withdraw from this Agreement any of the Assets that Buyer proposes to assess,
and the Purchase Price will be adjusted for each withdrawn Asset. If Seller
withdraws all the Assets pursuant to this Section, this Agreement will
terminate.
If Buyer takes samples from the Assets, Seller may require splitting of each
sample. Notwithstanding anything in the foregoing that may appear to the
contrary, the presence of naturally occurring radioactive materials ("NORM")
will not constitute a Title Defect (hereinafter defined). IT IS EXPRESSLY
RECOGNIZED THAT THE LANDS AND/OR WATER BOTTOM ALONG WITH SURFACE FACILITIES AND
PRODUCTION EQUIPMENT LOCATED THEREON, HAVING BEEN USED IN CONNECTION WITH OIL
AND GAS PRODUCTION ACTIVITIES, MAY CONTAIN NORM AS A RESULT OF THESE OPERATIONS.
ACCORDINGLY, LANDS AND/OR WATER BOTTOMS, THE XXXXX, AND THE EQUIPMENT
TRANSFERRED HEREIN ARE TRANSFERRED WITH THE RESTRICTION THAT THEY WILL BE USED
ONLY IN CONNECTION WITH OIL AND GAS PRODUCING ACTIVITIES ASSOCIATED WITH THE
LEASES, AND WILL NOT BE SUBSEQUENTLY TRANSFERRED FOR UNRESTRICTED USE UNLESS THE
CONCENTRATIONS OF NORM ASSOCIATED THEREWITH ARE BELOW THE LEVELS SPECIFIED AS
ALLOWABLE FOR UNRESTRICTED TRANSFER AS SET FORTH IN ANY AND ALL APPLICABLE LAWS,
ORDERS, RULES OR REGULATIONS OF ANY GOVERNMENTAL AGENCY OR COURT HAVING
JURISDICTION. ADDITIONALLY, BUYER AGREES TO COMPLY WITH ALL PROVISIONS OF SUCH
LAWS, ORDERS RULES OR REGULATIONS APPLICABLE TO SAID LANDS AND/OR WATER BOTTOMS,
THE XXXXX, AND THE PERSONAL PROPERTY. BUYER FURTHER AGREES TO INCLUDE THE
PROVISIONS OF THIS CLAUSE IN ANY SUBSEQUENT SALE OR ASSIGNMENT OF ANY INTEREST
THEREIN TRANSFERRED.
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5.04 Gas Imbalance. Upon the occurrence of Closing, but effective as of
the Effective Time, Buyer shall succeed to and assume the position of Seller
with respect to all gas imbalances and make-up obligations related to the Assets
(regardless of whether such imbalances or make-up obligations arise at the
wellhead, pipeline, gathering system or other level, and regardless of whether
the same arise under contract or otherwise). As a result of such succession,
Buyer shall (i) be entitled to receive any and all benefits which Seller would
have been entitled to receive by virtue of such position (including, without
limitation, rights to produce and receive volumes of production in excess of
volumes which it would otherwise be entitled to produce and receive by virtue of
ownership of the Interest rights to receive cash balancing payments), and (ii)
be obligated to suffer any detriments which Seller would have been obligated to
suffer by virtue of such position (including, without limitation, the obligation
to deliver to others production volumes which would have otherwise been
attributable to its ownership of the Assets, to deliver production to purchasers
hereof without receiving full payment therefor, or to make cash balancing
payments or to repay take or pay payments) and (iii) shall be responsible for
any and all royalty obligations with respect to such imbalances (including,
without limitation, any of the same arising out of royalties having been paid on
an "entitlements" basis rather than a "receipts" basis).
5.05 Title Defects. "Title Defect" means any encumbrance, irregularity
or defect in Seller's title to an Asset which, alone or in combination with
other defects, causes Seller's title to be less than Defensible Title. Title
Defects shall include a Casualty Loss treated as a Title Defect under Section
5.07.
5.06 Defensible Title.
(a) "Defensible Title" means such right, title or interest
held by Seller that (i) will entitle Buyer, as Seller's successor, to
receive not less than the Net Revenue Interests or ("NRI"), described
in Exhibit A of all oil, gas, condensate, related hydrocarbons and
other minerals produced under the terms of the Leases (or other
property denominated in Exhibit A); (ii) will obligate Buyer, as
Seller's successor to bear a percentage of costs and expenses related
to the maintenance, operation and development of the Leases (or other
property denominated in Exhibit A) not greater than the Working
Interest or ("WI") (being Operating Rights or Record Title, as the case
may be) shown in Exhibit A, unless the circumstances causing the
Working Interest to be greater will cause the corresponding Net Revenue
Interest to increase in the same proportion; and (iii) is free of all
liens, security interests, encumbrances and defects, except for
Permitted Encumbrances.
(b) "Permitted Encumbrances" are:
(1) lessor's royalties, overriding royalties,
production payments, net profits, interests, reversionary
interests and similar burdens on production that do not, and
will not, reduce Buyer's Net Revenue Interest below the Net
Revenue Interest shown in Exhibit A or increase Buyer's
Working Interest above the Working Interest shown in Exhibit A
(unless the circumstance causing the Working Interest to
increase will cause the corresponding Net Revenue Interest to
increase in the same proportion);
12
(2) preferential rights to purchase and third party
consents with respect to which, prior to Closing, (i) waivers
or consents are obtained from the appropriate parties or (ii)
the time for asserting such rights has expired without
exercise;
(3) mechanics', materialmen's, operators', tax and
similar liens or charges arising in the ordinary course of
business related to an Asset, if such liens secure payments
not yet due;
(4) all consents from, notices to, approvals by or
other actions by governmental authority in connection with
sale or transfer of properties such as the Assets if such
matters are customarily and appropriately obtained after the
sale or transfer;
(5) liens, security interests or other encumbrances
to be released at or prior to Closing;
(6) rights of a governmental entity to control or
regulate the Assets, together with all applicable laws, rules
and regulations;
(7) easements, rights-of-way, surface leases and
other surface use restrictions if such restrictions will not
materially adversely affect the use, value or operation of the
Assets;
(8) title matters waived or deemed to be waived by
Buyer and described on Schedule 5.06(b)(8);
(9) the presence of NORM; and
(10) the Contracts
5.07 Casualty Loss. If, prior to Closing, all or any portion of an
Interest is destroyed or taken under the right of eminent domain ("Casualty
Loss"), Buyer may elect (i) to treat the Casualty Loss as a Title Defect or (ii)
purchase the affected Asset notwithstanding the Casualty Loss. If Buyer so
purchases the affected Asset, there shall be no reduction of the Purchase Price
and Seller shall, at Closing, pay to Buyer all sums paid to Seller which are
associated with the Casualty Loss and shall assign to Buyer all of Seller's
interest in any unpaid payments or causes of action associated with the Casualty
Loss. Prior to Closing, Seller shall not compromise or settle a Casualty Loss
without Buyer's consent.
5.08 Disposition of Title Defects. In the event that Buyer gives Seller
notice of Title Defects:
13
(a) Seller may (but shall have no obligation to) attempt to
cure, prior to Closing, Title Defects.
(b) Whether or not Seller has then begun to, or ever begins
to, cure asserted Title Defects, Seller may postpone the Closing by
designating a new Closing Date to be a date not later than 30 days
after Seller's receipt of a Defect notice. Notwithstanding any such
election to postpone Closing, there shall still be no obligation to
cure Title Defects.
(c) Notwithstanding any other election made under this Section
(without limitation, it being expressly recognized that attempts to
cure asserted Title Defects may continue while the parties are acting
under this election), Seller may elect to have one or more asserted
Title Defects handled under the following Section.
5.09 Purchase Price Adjustments.
(a) Except as provided in Section 5.09(b) below, in the event
that, as a part of Buyer's due diligence review, Title Defects are
presented to Seller and Seller is unable (or unwilling) to cure such
Title Defects prior to Closing, then:
(i) Buyer and Seller shall, with respect to each
Asset affected by such matters, attempt to agree upon an
appropriate adjustment of the Purchase Price to account for
such matters; and
(ii) with respect to Assets as to which Buyer and
Seller are unable to agree upon an adjustment for an asserted
Title Defect, such Assets will be excluded from the
transaction contemplated hereby and the Purchase Price will be
reduced by the amount attributed to such Asset on Exhibit A;
provided, however, in the event an adjustment is required,
pursuant to this paragraph, but such Asset is to be excluded
as provided herein, Seller may, at its sole discretion, elect
to not close and such election shall be considered as a
failure to close that is permitted in Section 6.01 hereof.
(b) If an asserted Title Defect reflects (or Seller otherwise
determines) that Seller's share of Substances produced and saved from
the Leases comprising an Asset is less than, or greater than, the
decimal share set forth as the Net Revenue Interest in Exhibit A or
causes Seller to be obligated to pay a share of costs of operations
greater than the percentage share of Working Interest set forth on
Exhibit A hereof (without at least a proportionate increase in the
corresponding Net Revenue Interest) then the Purchase Price for the
Asset shall be adjusted downward, or upward as the case may be,
proportionately, by multiplying such Purchase Price by a fraction (A)
the numerator of which is the amount of the actual Net Revenue Interest
and (B) the denominator of which is the Net Revenue Interest shown on
Exhibit A.
14
(c) If the aggregate Purchase Price reduction (or increase)
with respect to a Title Defect, which would result from the above
stated procedure does not exceed $5,000, no adjustment shall me made
for such Title Defect, and the Assets affected thereby will not be
excluded as a result of the existence of such Title Defect. If the
Purchase Price reduction (or increase) which would result from the
above stated procedure, as applied to all Title Defects for which an
adjustment is to be made, does not exceed $5,000, then no adjustment of
the Purchase Price shall occur, and none of the Assets which would be
otherwise excluded by such procedure shall be excluded. If the Purchase
Price reduction (or increase) which would result from the above stated
procedure exceeds $5,000, the Purchase Price shall be adjusted by the
amount by which such reduction (or increase) exceeds $5,000.
Notwithstanding the provisions of this paragraph 5.09 (c), in the event
that through the exercise of preferential rights to purchase by third
parties, the value of the properties, as listed on Exhibit "A-4", after
said exercise of preferential rights results in a downward adjustment
fifty percent (50%) or more of the Purchase Price, this Agreement may
be terminated by either party by written notice to the non-terminating
party. In the event of such termination, neither party shall have any
obligation whatsoever to the other party hereunder.
5.10 NO WARRANTY OF MERCHANTABILITY OR FITNESS. EXCEPT AS OTHERWISE
SPECIFICALLY SET FORTH IN THIS AGREEMENT, SELLER MAKES NO WARRANTIES, EXPRESS OR
IMPLIED, INCLUDING THE WARRANTY OF MERCHANTABILITY AND THE IMPLIED WARRANTY OF
FITNESS FOR A PARTICULAR PURPOSE, REGARDING THE EQUIPMENT AND OTHER LIKE
PERSONAL PROPERTY LOCATED ON OR INCLUDED IN THE ASSETS AND THE SAME ARE TO BE
SOLD ON AN "AS IS, WHERE IS" BASIS AND CONDITION.
5.11 WAIVER OF CONSUMER RIGHTS. BUYER WAIVES ITS RIGHTS UNDER THE TEXAS
DECEPTIVE TRADE PRACTICES-CONSUMER PROTECTION ACT, SECTION 17.41 ET SEQ., TEXAS
BUSINESS & COMMERCE CODE, A LAW THAT GIVES CONSUMERS SPECIAL RIGHTS AND
PROTECTIONS. AFTER CONSULTATION WITH AN ATTORNEY OF BUYER'S OWN SELECTION, BUYER
VOLUNTARILY CONSENTS TO THIS WAIVER. IN ORDER TO EVIDENCE ITS ABILITY TO GRANT
SUCH WAIVER, BUYER HEREBY REPRESENTS AND WARRANTS TO SELLER THAT BUYER (I) IS IN
THE BUSINESS OF SEEKING OR ACQUIRING, BY PURCHASE OR LEASE, GOODS OR SERVICES
FOR COMMERCIAL OR BUSINESS USE, (II) HAS ACTUAL KNOWLEDGE AND EXPERIENCE IN
FINANCIAL AND BUSINESS MATTERS THAT ENABLE IT TO EVALUATE THE MERITS AND RISKS
OF THE TRANSACTION CONTEMPLATED HEREBY AND (III) IS NOT IN SIGNIFICANTLY
DISPARATE BARGAINING POSITION.
5.12 WAIVER OF LOUISIANA RIGHTS IN REDHIBITION. BUYER EXPRESSLY WAIVES
THE WARRANTY OF FITNESS FOR INTENDED PURPOSES OR GUARANTEE AGAINST HIDDEN OR
LATENT REDHIBITORY VICES UNDER LOUISIANA LAW, INCLUDING LOUISIANA CIVIL CODE
ARTICLES 2520 (1870) THROUGH 2548, AND THE WARRANTY IMPOSED BY LOUISIANA CIVIL
CODE ARTICLES 2476; WAIVES ALL RIGHTS IN REDHIBITION PURSUANT TO LOUISIANA CIVIL
CODE ARTICLES 2520, ET SEQ.; OR FOR RESTITUTION OR OTHER DIMINUTION OF THE
15
PURCHASE PRICE; ACKNOWLEDGES THAT THIS EXPRESS WAIVER SHALL BE CONSIDERED A
MATERIAL AND INTEGRAL PART OF THIS SALE AND THE CONSIDERATION THEREOF; AND
ACKNOWLEDGES THAT THIS WAIVER HAS BEEN BROUGHT TO THE ATTENTION OF BUYER AND
EXPLAINED IN DETAIL AND THAT BUYER HAS VOLUNTARILY AND KNOWINGLY CONSENTED TO
THIS WAIVER OF WARRANTY OF FITNESS AND/OR WARRANTY AGAINST REDHIBITORY VICES AND
DEFECTS FOR THE ASSETS. SELLER MAKES THIS SALE OF THE ASSETS TO BUYER WITHOUT
ANY WARRANTY AS TO THE CONDITION OF THE ASSETS, INCLUDING ABSENCE OF VICES OR
DEFECTS (WHETHER APPARENT OR LATENT, KNOWN OR UNKNOWN, EASILY DISCOVERABLE OR
HIDDEN), FITNESS FOR ANY ORDINARY USE, OR FITNESS FOR ANY INTENDED USE OR
PARTICULAR PURPOSE, EVEN FOR RETURN OR REDUCTION OF THE PURCHASE PRICE OR
OTHERWISE, IT BEING UNDERSTOOD THAT BUYER TAKES THE ASSETS "AS IS" AND "WHERE
IS"; BUYER HEREBY ACKNOWLEDGING RELIANCE SOLELY ON ITS OWN INSPECTION OF THE
ASSETS, AND NOT ON ANY WARRANTIES OR REPRESENTATIONS FROM SELLER WITH RESPECT TO
THE CONDITION OF THE ASSETS. IN ADDITION, BUYER ACKNOWLEDGES THAT, EXCEPT AS
EXPRESLY STATED HEREIN, SELLER HAS MADE NO REPRESENTATIONS OR WARRANTIES OF ANY
KIND OR CHARACTER, EXPRESS OR IMPLIED, WITH RESPECT TO THE CONDITION OF THE
ASSETS, INCLUDING, WITHOUT LIMITATION, ANY WARRANTIES OR REPRESENTATIONS AS TO
ABSENCE OF VICES OR DEFECTS (WHETHER APPARENT OR LATENT, KNOWN OR UNKNOWN,
EASILY DISCOVERABLE OR HIDDEN), FITNESS FOR ANY ORDINARY USE, FITNESS FOR ANY
INTENDED USE OR PARTICULAR PURPOSE, TAX CONSEQUENCES, ENVIRONMENTAL CONDITION.
EXCEPT AS EXPRESSLY STATED HEREIN, ALL WARRANTIES WITH RESPECT TO THE CONDITION
OF THE ASSETS ARE HEREBY DISCLAIMED BY SELLER AND EXPRESSLY WAIVED BY BUYER.
EXCEPT AS EXPRESSLY STATED HEREIN, BUYER HAS NOT RELIED AND WILL NOT RELY ON,
AND SELLER IS NOT LIABLE FOR OR BOUND BY, AN EXPRESS OR IMPLIED WARRANTIES,
GUARANTIES, STATEMENTS, REPRESENTATIONS OR INFORMATION PERTAINING TO THE
CONDITION OF THE ASSETS OR RELATING THERETO MADE OR FURNISHED BY SELLER, ANY
PARTY ACTING OR PURPORTING TO ACT FOR SELLER, OR ANY BROKER OR AGENT
REPRESENTING OR PURPORTING TO REPRESENT SELLER, TO WHOMEVER MADE OR GIVEN,
DIRECTLY OR INDIRECTLY, ORALLY OR IN WRITING.
ARTICLE 6
---------
CONDITIONS TO CLOSING
6.01 Seller's Conditions. Seller's obligations at Closing are subject
to the satisfaction at or prior to Closing of the following conditions:
(a) Buyer's representations and warranties under Section 3.02
shall be true in all material respects on the date of this Agreement,
the Effective Date and as of Closing.
16
(b) Buyer shall have performed in all material respects the
covenants and agreements which Buyer was required to perform or satisfy
at or prior to Closing.
(c) Except for matters not customarily and appropriately
obtained prior to Closing, Seller has received evidence, in form
reasonably satisfactory to its counsel, that all permits, consents,
approvals, licenses, qualifications and orders required by governmental
authority, or the terms of the Assets, to be obtained prior to Closing
have been obtained or waived.
(d) The aggregate downward adjustment (if any) of the Purchase
Price which results from the procedures set forth in Section 5.09 does
not exceed ten percent (10%) of the Purchase Price.
(e) There is no action or proceeding pending or threatened
before a court, arbitrator or governmental authority seeking to
restrain or prohibit the consummation of the transactions contemplated
by this Agreement or to obtain substantial damages from Seller related
to this Agreement.
6.02 Buyer's Conditions. Buyer's obligations at Closing are subject to
the satisfaction at or prior to Closing of the following conditions:
(a) Seller's representations and warranties under Section 3.01
shall be true in all material respects on the date of this Agreement,
the Effective Date and as of Closing.
(b) Seller shall have performed in all material respects the
covenants and agreements which Seller was required to perform or
satisfy at or prior to Closing.
(c) Except for matters not customarily and appropriately
obtained prior to Closing, Buyer has received evidence, in form
reasonably satisfactory to its counsel, that all permits, consents,
approvals, licenses, qualifications and orders required by governmental
authority, or the terms of the Assets, to be obtained prior to Closing
have been obtained or waived.
(d) The aggregate upward adjustment (if any) of the Purchase
Price which results from the procedures set forth in and Section 5.09
does not exceed ten percent (10%) of the Purchase Price.
(e) There is no action or proceeding pending or threatened
before a court, arbitrator or governmental authority seeking to
restrain or prohibit the consummation of the transactions contemplated
by this Agreement or to obtain substantial damages from Buyer related
to this Agreement.
17
ARTICLE 7
---------
CLOSING
7.01 Closing Date. Subject to the terms of this Agreement, the
consummation of the transactions contemplated by this Agreement ("Closing"),
shall occur at Seller's office listed above (or at such other place and time as
the Parties may agree) on or before October 31, 2002 at 10:00 a.m. ("Closing
Date").
7.02 Closing Obligations. At Closing, the following shall occur, each
being a condition precedent to the others and each being deemed to have occurred
simultaneously:
(a) Seller shall execute and deliver to Buyer assignments
conveying the Assets to Buyer in forms acceptable to Buyer and Seller.
Seller shall also execute and deliver such other assignments on
appropriate forms as may be required by governmental authority
(b) Seller and Buyer shall execute and deliver to each other
the Preliminary Closing Statement.
(c) Buyer shall deliver the Adjusted Purchase Price to Seller
by direct bank or wire transfer, as directed by Seller.
(d) Seller shall deliver to Buyer possession of the Assets.
(e) Seller shall execute transfer orders or letters-in-lieu on
forms prepared by Buyer, and reasonably satisfactory to Seller,
directing purchasers of production to make payment to Buyer as
contemplated by this Agreement.
(f) Seller shall deliver releases of all liens, security
interests and encumbrances affecting the Assets to be released at
Closing.
(g) Seller and Buyer will coordinate the filing and/or
recording of assignment and conveyancing documents in the appropriate
governmental records. The recording party (which maybe either Seller or
Buyer or both) will provide either the original or photocopies of the
filed and/or recorded documents as agreed by the parties, to the
non-recording party. All costs of filing, recording and other
reasonable fees will be borne by Buyer.
ARTICLE 8
---------
TERMINATION
8.01 Termination. This Agreement and the transactions contemplated by
this Agreement may be terminated in the following situations:
(a) by Seller or Buyer if Closing does not occur on or before
the Closing Date provided, however, that a party cannot so terminate if
it is in breach of this Agreement;
18
(b) by Seller if the conditions contained in Section 6.01 are
not satisfied or waived as of the Closing Date;
(c) by Buyer if the conditions contained in Section 6.02 are
not satisfied or waived as of the Closing Date; and
(d) by Seller and Buyer pursuant to written Agreement.
8.02 Liabilities Upon Termination.
If this Agreement is terminated for any reason or is breached, nothing
contained herein shall be construed to limit Seller's or Buyer's legal or
equitable remedies, including damages for the breach of failure of any
representation, warranty covenant or agreement contained herein and the right to
enforce specific performance of this Agreement.
ARTICLE 9
---------
OBLIGATIONS AFTER CLOSING
9.01 Post-Closing Adjustments. Seller and Buyer acknowledge that the
amount of all adjustments under Section 2.03 may not be available prior to
Closing. As soon as practicable after Closing, Seller shall prepare and submit
to Buyer a statement containing adjustments contemplated by Section 2.03 that
were not finally determined as of Closing ("Final Settlement Statement"). Seller
shall promptly notify Buyer of any changes Seller proposes and the parties shall
negotiate in good faith to agree on these adjustments within ninety (90) days
after the Closing Date. Payment to the appropriate party shall be made within
five (5) days after agreement is reached ("Final Settlement Date").
9.02 Subsequent Adjustments. Seller and Buyer recognize that either
party may receive funds or pay expenses after the Final Settlement Date which
are properly the property or obligation of the other party. Upon receipt of net
proceeds or net expenses due to or payable by the other party, whichever occurs
first, such party shall submit a statement showing the items of income and
expense. Payment by the appropriate party shall be made within ten (10) days of
receipt of the statement.
9.03 Reservation of Claims. Except as provided in this Agreement,
Seller is entitled to all claims related to the Assets prior to the Effective
Time regardless of when payment is made. Except as provided in this Agreement,
Buyer is entitled to all claims related to the Assets that arise after the
Effective Time.
9.04 Files and Records. Upon Closing, Seller shall permit Buyer, at
Buyer's expense, to take possession of originals of all files, records and data
in Seller's possession relating to the Assets. Seller shall have the right to
copy (at Seller's expense) and retain a copy of all such files, records and
data.
19
9.05 Further Assurances. After Closing, Seller and Buyer agree to
execute and deliver such instruments and take such other action as may be
necessary or advisable to carry out their obligations under this Agreement.
9.06 Survival and Indemnity.
(a) The representations, covenants, agreements and indemnities
(the "obligations") of or by Seller and Buyer shall survive the
Closing.
(b) Allocation of Liability.
(i) Liabilities. Buyer agrees to assume, pay,
perform, fulfill, discharge and be liable for all Assumed
Liabilities, and Seller agrees to retain, pay, perform,
fulfill, discharge and be and remain liable for all Retained
Liabilities.
(ii) Definitions. The term "Assumed Liabilities"
shall mean and include:
(x) all costs, expenses, liabilities and
obligations assumed or otherwise agreed to be paid by
Buyer pursuant to the terms of this Agreement; and
(y) all costs, expenses, liabilities, claims
and obligations arising out of, in connection with,
or resulting directly or indirectly from the
ownership or operation of the Assets, including
environmental cleanup liabilities and plugging and
abandonment liabilities for existing xxxxx,
platforms, facilities, or pipelines arising out of,
in connection with, or resulting directly or
indirectly from the ownership or operation of the
Assets (the "Abandonment and Clean-up Liability") but
excluding Retained Liabilities.
The term "Retained Liabilities" shall mean and include:
(x) all costs, expenses, liabilities and
obligations assumed or otherwise agreed to be paid by
Seller pursuant to the terms of this Agreement; and
(y) all costs, expenses, liabilities, claims
and obligations (except Abandonment and Clean-up
Liability and related costs, expenses, liabilities,
claims and obligations) arising out of, in connection
with, or resulting directly or indirectly from
20
production or sale of hydrocarbons attributable to
the Assets or the proper accounting or payment to
parties for their interest therein insofar as such
claims relate to periods of time prior to the
Effective Time.
(c) In the event that the Closing occurs, (i) Buyer shall
protect, defend, indemnify and hold Seller harmless from any and all
damages, claims, losses, demands, fines, penalties, judgments
(including interest), costs, expenses, environmental liabilities, and
other liabilities, direct, contingent, or otherwise, including
consulting and attorneys' fees and costs of court ("Damages") arising
or accruing with respect to the Assumed Liabilities and (ii) Seller
shall protect, defend, indemnify and hold Buyer harmless from any
Damages arising or accruing with respect to the Retained Liabilities.
The term "Damages," as used herein, shall not include (i) any amount
which was taken into account as an adjustment to the Purchase Price
pursuant to this Agreement or (ii) either party's costs and expenses as
described in Section 10.02. Buyer and Seller agree that their sole and
exclusive remedies with respect to claims arising, after closing, under
this Agreement, shall be limited to remedies set forth in this Section
9.06.
9.07 CONSPICUOUSNESS/EXPRESS NEGLIGENCE. THE DEFENSE, INDEMNIFICATION
AND HOLD HARMLESS PROVISIONS PROVIDED FOR IN THIS AGREEMENT SHALL BE APPLICABLE
WHETHER OR NOT THE DAMAGES, LOSSES, INJURIES, LIABILITIES, COSTS OR EXPENSES IN
QUESTION AROSE SOLELY OR IN PART FROM THE ACTIVE, PASSIVE OR CONCURRENT
NEGLIGENCE, OR OTHER FAULT OF ANY INDEMNIFIED PARTY. BUYER AND SELLER
ACKNOWLEDGE THAT THIS STATEMENT COMPLIES WITH THE EXPRESS NEGLIGENCE RULE AND IS
CONSPICUOUS.
9.08 Allocation of Proceeds. Seller shall receive all proceeds from the
sale of Substances physically produced or allocable to the Assets prior to the
Effective Time. Buyer shall receive all proceeds from the sale of Substances
physically produced or allocable to the Assets on or after the Effective Time.
ARTICLE 10
----------
MISCELLANEOUS
10.01 Notices. All notices required or permitted under this Agreement
shall be effective upon receipt if personally delivered, if mailed by registered
or certified mail, postage prepaid, or if delivered by telegram, telecopy or
facsimile if directed to the parties as follows:
21
TO BUYER: TO SELLER:
Fidelity Exploration & Production Company American Resources Offshore, Inc.
0000 Xxxxxxx, Xxxxx 0000 801 Xxxxxx Street, 2100
Xxxxxx, XX 00000 Xxxxxxx, XX 00000
Telephone: (000) 000-0000 Telephone: (000) 000-0000
Fax: (000) 000-0000 Fax: (000) 000-0000
Attn: Xxxxxx X. Xxxxxx Attn: Xxxx X. Xxxxxx
Any party may give written notice of a change in the address or individual to
whom delivery shall be made.
10.02 Expenses. Except as otherwise provided in this Agreement, all
fees, costs and expenses incurred by the parties in negotiating this Agreement
or in consummating the transactions contemplated by this Agreement shall be paid
by the party incurring them.
10.03 Amendment. This Agreement may not be altered or amended, nor any
rights waived, except by a written instrument executed by the party to be
charged with the amendment or waiver. No waiver of any provision of this
Agreement shall be construed as a continuing waiver of the provision.
10.04 Assignment. Buyer shall not have the right to assign its rights
and delegate its duties under this Agreement without written consent of Seller,
which consent shall not be unreasonably withheld..
10.05 Conditions. The inclusion in this Agreement of Conditions to
Seller's and Buyer's obligations at Closing shall not, in and of itself, be a
covenant of either party to satisfy the conditions to the other party's
obligations at Closing.
10.06 Headings. The headings are for convenience only and do not limit
or otherwise affect the provisions of this Agreement.
10.07 Counterparts. This Agreement may be executed in counterparts,
each of which shall be an original and which, taken together, shall constitute
the same instrument.
10.08 References. References, including use of a pronoun, shall
include, where applicable, masculine, feminine, singular or plural individuals
or legal entities.
10.09 Governing Law. This Agreement and the transactions contemplated
by this Agreement shall be governed and construed in accordance with the
internal laws of the State of Texas without giving effect to any principles of
conflicts of laws.
22
10.10 Announcements. Except as otherwise provided for herein or as
required by law, prior to Closing, neither Seller nor Buyer shall announce or
otherwise publicize this Agreement or the transactions contemplated by this
Agreement without the prior written consent of the other party.
10.11 Entire Agreement. This Agreement is the entire understanding
between Seller and Buyer concerning the subject matter of this Agreement. This
Agreement supersedes all negotiations, discussions, representations, prior
agreements and understandings, whether oral or written.
10.12 Parties in Interest. This Agreement is binding upon and shall
inure to the benefit of Seller and Buyer and, except where prohibited, their
heirs, successors, representatives and assigns. No other party is intended to
have any benefits, rights or remedies under this Agreement. There are no
third-party beneficiaries.
10.13 Exhibits. All Exhibits and Schedules attached to this Agreement
are incorporated into this Agreement for all purposes.
10.14 Severance. If any provision of this Agreement is found to be
illegal or unenforceable, the other terms of this Agreement shall remain in
effect and this Agreement shall be construed as if the illegal or unenforceable
provision had not been included.
BUYER: SELLER:
FIDELITY EXPLORATION & PRODUCTION COMPANY AMERICAN RESOURCES OFFSHORE, INC.
By: _________________________________
Name: Xxxx X. Xxxxx By: _____________________________
Its: Vice President Land Name: Xxxx X. Xxxxxx
Its: Vice President
23
Exhibit A-1 - Leases - Page 1 of 2
----------------------------------
EXHIBIT A-1 - Leases
To the Purchase and Sale Agreement By and Between
American Resources Offshore, Inc. and Fidelity Exploration & Production Company
Lease
Effective Lease
Lease No. Block No. Block Name Date Acreage Status Description
------------------------------------------------------------------------------------------------------------------------------------
G18903 BA X0 Xxxxxx Xxxx Xxxxx X-0 01/01/98 5,760.00 Primary Term All of Block A-2, Brazos Area,
OCS Leasing Map, Texas Map No.
5.
G12465 BA 000 Xxxxxx Xxxx Xxxxx 000 11/01/90 5,760.00 Producing All of Block 542, Brazos Area,
OCS Leasing Map, Texas Map No.
5.
G17120 GA 000 Xxxxxxxxx Xxxx Xxxxx 213 02/01/97 4,679.71 Producing That portion of Block 213,
Galveston Area, OCS Leasing Map,
Texas Map No. 6, seaward of the
Federal/State Boundary,
specifically described in the
OCS Block Diagram attached to
the Lease Form MMS-2005.
G18921 GA 000 Xxxxxxxxx Xxxx Xxxxx 418 01/01/98 5,760.00 Producing All of Block 418, Galveston
Area, OCS Leasing Map, Texas Map
No. 6.
G15769 HI 00 Xxxx Xxxxxx Xxxx Xxxxx 37 12/01/95 5,760.00 Producing All of Block 37, High Island
Area, OCS Leasing Map, Texas Map
No. 7.
00419 SS 000 Xxxx Xxxxx Xxxx Xxxxx 150 11/01/54 5,000.00 Producing All of Block 150, Ship Shoal
Area, as shown on official
leasing map, La. Map Xx. 0,
Xxxxxxxxx Xxxxx Xxxxx Xx. Xxxxx
Xx. Xxxxx Name Date Acreage
Status Description
Exhibit A-1 - Leases - Page 1 of 2
EXHIBIT A-1 - Leases
--------------------
To the Purchase and Sale Agreement By and Between
American Resources Offshore, Inc. and Fidelity Exploration & Production Company
Lease
Effective Lease
Lease No. Block No. Block Name Date Acreage Status Description
------------------------------------------------------------------------------------------------------------------------------------
G16435 ST 000 Xxxxx Xxxxxxxxx Xxxx
Xxxxx Addition Block 211 07/01/96 5,000.00 Producing All of Block 000, Xxxxx
Xxxxxxxxx Xxxx, Xxxxx Addition,
OCS L Map No. 6A.
G01998 WC 000 Xxxx Xxxxxxx Xxxx Xxxxx 152 07/01/96 5,000.00 Producing All of Block 152, West Cameron
Area, Official Leasing Map,
Louisiana Map No. 1.
G16122 WC 000 Xxxx Xxxxxxx Xxxx Xxxxx 172 02/01/71 5,000.00 Producing All of Block 172, West Cameron
Area, Official Leasing Map,
Louisiana Map No. 1.
G16123 WC 000 Xxxx Xxxxxxx Xxxx Xxxxx 195 06/01/96 5,000.00 Producing All of Block 195, West Cameron
Area, Official Leasing Map,
Louisiana Map No. 1.
G05315 WC 000 Xxxx Xxxxxxx Xxxx
Xxxx Addition Block 368 07/01/83 5,000.00 Producing All of Block 368, West Cameron
Area, West Addition, OCS Leasing
Map, Louisiana Map No. 1A.
Exhibit A-1 - Leases - Page 1 of 2
EXHIBIT "A-2"
-------------
INTERESTS
---------
To the Purchase and Sale Agreement By and Between
American Resources Offshore, Inc. and Fidelity Exploration & Production Company
Payment
Interest Before Interest If Only A Interest After
Any Payout Payout A Occurs Defined by Any and All Payouts
Block Lease WI NRI WI NRI Contract No. WI NRI
*
------------------------------------------------------------------------------------------------------
BA A2 G18903 4.93340 3.94672 4.44010 3.55204 9512 4.44010 3.55204
BA A2 G18903 0.82233 0.65790 0.74010 0.59208 9512 0.74010 0.59208
BA 542 G12465 0.82233 0.68527 0.82233 0.68527 9908 0.82233 0.68527
GA 213 G17120 6.66680 5.33340 6.00012 4.80010 9512 6.00012 4.80010
GA 418 G18921 6.00000 4.80000 5.40000 4.32000 9512 5.40000 4.32000
HI 37 G15769 3.33333 2.60000 3.00000 2.34000 9407 3.00000 2.34000
HI 37 G15769 5.33333 4.16001 4.80000 3.74400 9407 4.80000 3.74400
Type
Current of
Block Status Leasehold Description
--------------------------------------------------------------------------------
BA A2 BPO RT All of Block A-2, Brazos Area, less and
except the SW/4 from surface down to
50,000', OCS Leasing Map, Texas Map Xx.
0.
XX X0 XXX XX Xxxxx X-0, Xxxxxx Xxxx, XX/0 from
surface down to 50,000', OCS Leasing
Map, Texas Map No. 5.
BA 542 APO OR Block 542, Brazos Area, NE/4 SE/4; SE/4
NW/4 WE/4: S/2 SE/4; from surface down
to 50,000, OCS Leasing Map, Texas Map
No. 5
GA 213 APO RT(1) That portion of Block 213, Galveston
Area, OCS Leasing Map, Texas Map No. 6,
seaward of the Federal/State Boundary,
specifically described in the OCS Block
Diagram attached to the Lease Form
MMS-2005.
GA 418 BPO RT All of Block 418, Galveston Area, OCS
Leasing Map, Texas Map No. 6.
HI 37 BPO RT(2) All of Block 37, High Island Area, OCS
Leasing Map, Texas No. 7, less and
except the OCS-G 15769 No. 1 well and
any production therefrom.
HI 37 BPO RT OCS-G15769 No. 1 Well
*Contract No. As Listed in RT = Record Title
Exhibit A-3 to this Assignment OR = Operating Rights
RI = Royalty Interest
Exhibit A-2 - Interests - Page 1 of 5
EXHIBIT "A-2"
INTERESTS
To the Purchase and Sale Agreement By and Between
American Resources Offshore, Inc. and Fidelity Exploration & Production Company
Payment
Interest Before Interest If Only A Interest After
Any Payout Payout A Occurs Defined by Any and All Payouts
Block Lease WI NRI WI NRI Contract No. WI NRI
*
------------------------------------------------------------------------------------------------------
SS 150 G0419-A 10.0000 6.83333 10.0000 6.48333 9001 10.0000 6.48333
SS 150 G0419-B 0.00000 0.50000 0.00000 0.50000 9001 0.00000 0.50000
Type
Current of
Block Status Leasehold Description
--------------------------------------------------------------------------------
SS 150 BPO OR3 OCS 0419, INSOFAR AND ONLY INSOFAR As
the Lease covers the W/2; NE/4 of the
NE4; N/2 of the NW/4 of the NE/4; SW/4
of the NW/4 of the NE/4; SW/4 of the
NE/4; NE/4 of the SE/4 of the NE/4; SW/4
of the SE/4 of the NE/4; W/2 of the
SE/4; W/2 of the NE/4 of the SE/4 of
Block 150, Ship Shoal Area, INSOFAR AND
ONLY INSOFAR as the lease covers and
affects the operating rights in depths
from the earth's surface down to the
stratigraphic equivalent of the true
vertical depth of 11,177 (being the TVD
drilled in the OCS 0419 #9 Well plus
100'), LESS AND EXCEPT the OCS 0419 No.
B-3, No. B-4ST and No. C-1 Xxxxx, and
FURTHER LESS AND EXCEPT OCS 0419,
INSOFAR AND ONLY INSOFAR as the lease
covers and affects the E/2 of the NW/4,
the SW/4 of the NE/4, the SW/4 of the
NW/4 of the NE/4, and the SW/4 of the
NE/4 of the NE/4 of Block 150, Ship
Shoal Area, and further limited INSOFAR
AND ONLY INSOFAR as the lease covers and
affects operating rights in depths from
the earth's surface down to the
stratigraphic the true vertical depth of
10, 625 feet (being the TVD drilled in
the OCS 0419 #C-1 Well, plus 100') LESS
AND EXCEPT the stratigraphic equivalents
ot the BN-7 Sand, 1-3 Sand, 1-4 Sand,
and J-1 Sand.
SS 150 APO RI7 OCS-0419, INSOFAR AND ONLY INSOFAR as
the lease covers and affects the E/2 of
the NW/4, the SW/4 of the NE/4, the SW/4
of the NW/4 of the NE/4, and the SW/4 of
the NE/4 of the NE/4 of Block 150, Ship
Shoal Area, and further limited INSOFAR
AND ONLY INSOFAR as the lease covers and
affects operating rights in depths from
the earth's surface down to the
stratigraphic equivalent of the true
vertical depth of 10,625 feet (being the
TVD drilled in the OCS 0419 #C-1 Well,
plus 100') LESS AND EXCEPT the
stratigraphic equivalents of the BN-7
Sand, 1-3 Sand, 1-4 Sand and J-1 Sand.
*Contract No. As Listed in RT = Record Title
Exhibit A-3 to this Assignment OR = Operating Rights
RI = Royalty Interest
Exhibit A-2 - Interests - Page 2 of 5
EXHIBIT "A-2"
INTERESTS
To the Purchase and Sale Agreement By and Between
American Resources Offshore, Inc. and Fidelity Exploration & Production Company
Payment
Interest Before Interest If Only A Interest After
Any Payout Payout A Occurs Defined by Any and All Payouts
Block Lease WI NRI WI NRI Contract No. WI NRI
*
------------------------------------------------------------------------------------------------------
SS 150 G0419-B3 10.00000 6.80533 10.00000 6.45553 9001 10.00000 6.45553
SS 150 G0419-B4 10.00000 6.83333 10.00000 6.48333 9001 10.00000 6.48333
SS 150 G0419-C1 0.00000 0.33340 0.00000 0.50000 9619 0.00000 0.50000
ST 211 G16435 6.66680 5.33344 6.00012 4.80010 9512 6.00012 4.80010
ST 211 G16435 0.00000 0.19200 0.36001 0.45491 9512 0.36001 0.45491
WC 152 G16122 4.60000 3.58800 4.14000 3.22920 9407 4.14000 3.22920
WC 152 G16122 0.00000 0.13034 0.00000 0.13034 0103 0.00000 0.13034
Type
Current of
Block Status Leasehold Description
--------------------------------------------------------------------------------
SS 150 BPO OR3&4 OCS 0419 Xx. X-0 Xxxx
XX 000 XXX XX0 XXX 0419 No. X-0XX Xxxx
XX 000 XXX XX XXX-X0000 No. X-0 Xxxx
XX 000 XXX XX0 All of Block 000, Xxxxx Xxxxxxxxx Xxxx,
Xxxxx Addition, OCS Leasing Map,
Louisiana Map No. 6A; less the SW/4 SW/4
from the earth's surface to 10,380' XXX.
XX 000 XXX XX XX/0 XX/0 Xxxxx 000, Xxxxx Xxxxxxxxx,
Xxxxx Addition, OCS Leasing Map,
Louisiana Map No. 6A; from the earth's
surface to 10,380' TVD.
WC 152 BPO RT8 All of Block 152, West Cameron Area,
less and except the S/2 from the surface
down to 7,000', OCS Leasing Map,
Louisiana Map No. 1.
WC 152 APO RT8 S/2 of Block 152, West Cameron Area,
from the surface down to 7,000', OCS
Leasing
*Contract No. As Listed in RT = Record Title
Exhibit A-3 to this Assignment OR = Operating Rights
RI = Royalty Interest
Exhibit A-2 - Interests - Page 3 of 5
EXHIBIT "A-2"
INTERESTS
To the Purchase and Sale Agreement By and Between
American Resources Offshore, Inc. and Fidelity Exploration & Production Company
Payment
Interest Before Interest If Only A Interest After
Any Payout Payout A Occurs Defined by Any and All Payouts
Block Lease WI NRI WI NRI Contract No. WI NRI
*
------------------------------------------------------------------------------------------------------
WC 172 G01998 5.40000 4.21200 4.86000 3.79080 9407 4.86000 3.79080
XX 0000 G01998-A 0.00000 0.000000 1.350000 1.053000 9407 1.215000 0.947700
Type
Current of
Block Status Leasehold Description
--------------------------------------------------------------------------------
WC 172
APO OR6 Oil and Gas Lease of Submerged Lands
under the Outer Continental Shelf Lands
Act between the United States of
America, as Lessor, and Chevron Oil
Company, as Lessee, dated effective
February 1, 1971, designated with serial
No. OCS-G 1998 (the "Lease"), INSOFAR
AND ONLY INSOFAR as the Lease covers
Block 172, West Cameron Area, as shown
on Official containing approximately
5,000 acres, and FURTHER INSOFAR ONLY as
to operating rights in and to the
following portions and depths: N/2, N/2
of the S/2 from 7,000' TVD and below;
N/2, SW/4, N/2 of the SE/4, N/2 of the
SW/4 of the SE/4 and NW/4 of the SE/4 of
the SE/4 from the surface of the earth
down to 7,000' TVD; N/2 of the S/2 of
the SW/4, N/2 of the SW/4 of the SE/4
and NW/4 of the SE/4 of the SE/4 from
8,200' TVD and below; S/2 of the S/2 of
the SW/4 from 10,000' TVD and below,
LESS AND EXCEPT operating rights in the
following portions and depths: NW/4 of
the NW/4 from those depth intervals
described as the stratigraphic
equivalent of the Middle Cib Op Sand as
seen in the OCS-G 1998 No. E-1 Well
between the depths of 9,933' and 9,987'
measured depth, and the stratigraphic
equivalent of the Upper Cib Op Sand as
seen in the same well between the depths
of 9,499' and 9,593' measured depth.
APO OR XXX-X00000, Xxxxx 000, Xxxx Xxxxxxx
XX 0000 Area, INSOFAR AND ONLY INSOFAR AS to
operating rights in NW/4 of the NW/4 of
Block 172 from those depth intervals
described as the stratigraphic
equivalent of the Middle Cib Op Sand as
seen in the OCS-G 1998 No. E-1 Well
between the depths of 9,933' and 9,987'
measured depth, and the stratigraphic
equivalent of the Upper Cib Op Sand as
seen in the same well between the depths
of 9,499' and 9,593' measured depth,
including without limitation, all right,
title and interest in the OCS-G 1998 No.
E-1 Well.
*Contract No. As Listed in RT = Record Title
Exhibit A-3 to this Assignment OR = Operating Rights
RI = Royalty Interest
Exhibit A-2 - Interests - Page 4 of 5
EXHIBIT "A-2"
INTERESTS
To the Purchase and Sale Agreement By and Between
American Resources Offshore, Inc. and Fidelity Exploration & Production Company
Payment
Interest Before Interest If Only A Interest After
Any Payout Payout A Occurs Defined by Any and All Payouts
Block Lease WI NRI WI NRI Contract No. WI NRI
*
------------------------------------------------------------------------------------------------------
WC 195 G16123 4.60000 3.58800 4.14000 3.22920 9407 4.14000 3.22920
XX 0000 G05315 6.00000 4.23977 0.00000 0.00000 6.00000 4.23977
XX 0000 G05315 5.87360 4.15042 5.87356 4.15042 5.87356 4.15042
XX 0000 G05315 0.00000 0.542166 0.00000 0.00000 0.00000 0.542166
XX 0000 G05315 0.00000 0.032814 0.00000 0.00000 0.00000 0.032814
Type
Current of
Block Status Leasehold Description
--------------------------------------------------------------------------------
WC 195 BPO RT9 All of Block 195, West Cameron Area,
less and except the SE/4 from the
surface down to 12,000' SSTVD, OCS
Leasing Map, Louisiana Map No. 1.
XX 0000 RT All of Block 368, West Cameron Area,
West Addition, OCS Leasing Map,
Louisiana Map No. 1A.
WC 0368 OR All of Block 368, West Cameron Area,
West Addition, LIMITED to those depths
from the subsea surface down to 9,584
feet TVD.
XX 0000 RI All of Block 368, West Cameron Area,
West Addition, OCS Leasing Map,
Louisiana Map No. 1A.
WC 0368 RI All of Block 368, West Cameron Area,
West Addition, LIMITED to those depths
from the subsea surface down to 9,584
feet TVD.
Footnotes to Leasehold Description
1 Interest in #1 Well suspended due to non-consent on sidetrack operation
under JOA dated February 1, 1997 (Contract No. 9705).
2 Subject to Farmout Agreement dated July 1, 2002, by and between American
Resources Offshore, Inc. and Pure Resources, L.P.
3 The interests shown in the "Interest After Payout" columns is actually the
interest after an escalation of ORRI, based on a cumulative production
under the terms of the Chevron Farmout Agreement (Contract No. 9001), it is
displayed in these columns for simplicity of presentation.
4 Interest subject to the overriding royalty interest assignment to Xxxx X.
Avare, et ux.
5 Subject to the terms and conditions of a farmout agreement as outlined in
the Letter Ageement (Contract No. 9902) by and between ARO and Spinnaker
Exploration Company regarding the SW/4 of the SW/4 of Block 211, South
Timbalier Area, South Addition.
6 ARO owns additional contractual rights in the OCS-G1998 No. D-1 Well as the
result of the acceptance of a proportionate share of non-consent interest
in the well.
7 The interest shown is that reserved under the terms of the Pennzoil Farmout
Agreement (Contract No. 9619). Assignments pursuant to this Agreement may
not have been approved by the MMS.
8 Subject to Farmout Agreement dated April 6, 2001, by and between TDC Energy
and American Resources Offshore, Inc., et al., covering Block 000, Xxxx
Xxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxxx.
9 Subject to Letter Agreement dated May 10, 2001, by and between Pure
Resources, L.P. and American Resources Offshore, Inc., covering Block 000,
Xxxx Xxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxxx.
*Contract No. As Listed in RT = Record Title
Exhibit A-3 to this Assignment OR = Operating Rights
RI = Royalty Interest
Exhibit A-2 - Interests - Page 5 of 5
EXHIBIT A-3 - CONTRACTS
To the Purchase and Sale Agreement by and between
American Resources Offshore, Inc. and Fidelity Exploration & Production Company
ARO
Contract No.
------------
8701 Offshore Operating Agreement dated April 30, 1987 by and between
Century Offshore Management Corporation (Operator) and Apache
Corporation (Non-Operator) covering Block 368, West Cameron
Area, Offshore Louisiana.
8702 Farmout Agreement, dated April 20, 1987, by and between Shell
Offshore, Inc., et al, as farmors and Century Offshore
Management Corporation covering XXX-X 0000, Xxxxx 368, West
Cameron Area, West Addition, Offshore Louisiana.
9001 Farmout Agreement dated effective August 30, 1990, by and
between Chevron U.S.A., Inc., as farmor, and Century Offshore
Management Corporation, as farmee, covering a portion of OCS
0419, Block 150, Ship Shoal Area, Offshore Louisiana.
9101 Gas Purchase Contract dated December 1, 1991 by and between
Amoco Energy Trading Corporation (Buyer) and K. E. Resources,
Ltd. (Seller).
9405 Joint Operating Agreement dated December 1, 1994, as amended, by
and between Century Offshore Management Corporation (Operator),
and Settle Oil and Gas Company and Southern Gas Company of
Delaware, Inc. (Non-Operators), covering Block 000, Xxxx Xxxxx
Xxxx, Xxxxxxxx Xxxxxxxxx.
Exhibit A-3 - Contracts - Page 1 of 11
EXHIBIT A-3 - CONTRACTS
To the Purchase and Sale Agreement by and between
American Resources Offshore, Inc. and Fidelity Exploration & Production Company
ARO
Contract No.
------------
9406 Purchase and Sale Agreement dated effective October 31, 1994, by
and between Settle Oil and Gas Company (seller) and Southern Gas
Company of Delaware, Inc. covering the sale of interest in a
portion of OCS 000, Xxxxx 000, Xxxx Xxxxx Xxxx.
9407 Louisiana Offshore Ventures Program dated January 1, 1994.
9408 Purchase and Sale Agreement dated effective October 31, 1994, by
and between Settle Oil and Gas Company (seller) and American
Resources of Delaware, Inc. the sale of interest in a portion of
XXX 000, Xxxxx 000, Xxxx Xxxxx Xxxx.
9409 Letter Agreement dated December 30, 1994, by and between Settle
Oil and Gas Company and Southern Gas Company of Delaware, Inc.
covering a portion of OCS 000, Xxxxx 000, Xxxx Xxxxx Xxxx.
9511 Joint Operating Agreement dated December 1, 1995, as amended,
between IP Petroleum Company, Inc. (Operator) and Teco Gas &
Oil, Inc., et al (Non-Operators), covering Block 00, Xxxx Xxxxxx
Xxxx, Xxxxxxxx Xxxxx, as amended July 12, 1997.
9512 Texas 3D Ventures Program Agreement dated April 1, 1995
9513 Letter Agreement dated May 26, 1995 by and between Settle Oil
and Gas Company and Southern Gas Company of Delaware, Inc.
covering a portion of XXX 000, Xxxxx 000, Xxxx Xxxxx Xxxx.
Exhibit A-3 - Contracts - Page 2 of 11
EXHIBIT A-3 - CONTRACTS
To the Purchase and Sale Agreement by and between
American Resources Offshore, Inc. and Fidelity Exploration & Production Company
ARO
Contract No.
------------
9514 Severance Agreement dated effective November 30, 1995 by and
between American Resources of Delaware, Inc. and Xxxxxx X. Xxxxx
including a provision for the assignment of an overriding
royalty interest on the OCS 419 No. B4ST Well at Ship Shoal
Block 150, and the Assignments to be executed pursuant thereto.
9609 Joint Operating Agreement dated June 1, 1996, between IP
Petroleum Company, Inc. (Operator) and TECO Gas & Oil, Inc., et
al (Non-Operators), covering Block 000, Xxxx Xxxxxxx Xxxx,
Xxxxxxxx, Xxxxxxxxx, as amended July 12, 1997.
9613 Joint Operating Agreement dated July 1, 1996, between IP
Petroleum Company, Inc. (Operator) and TECO Gas & Oil, Inc., et
al (Non-Operators), covering Block 000, Xxxx Xxxxxxx Xxxx,
Xxxxxxxx, Xxxxxxxxx, as amended July 12, 1997.
9619 Farmout Agreement dated November 14, 1996, as amended, by and
between Century Offshore Management Corporation and American
Resources of Delaware, Inc., as Farmors, and Pennzoil
Exploration and Production Company , as Farmee, covering a
portion of OCS 0000, Xxxxx 000, Xxxx Xxxxx Xxxx, Xxxxxxxx
Xxxxxxxxx.
Exhibit A-3 - Contracts - Page 3 of 11
EXHIBIT A-3 - CONTRACTS
To the Purchase and Sale Agreement by and between
American Resources Offshore, Inc. and Fidelity Exploration & Production Company
ARO
Contract No.
------------
9621 Area of Mutual Interest dated March 26, 1996, covering the
"South Timbalier Area Block 211", by and between IP Petroleum
Company, Inc., The Xxxxxxx X. Helis Company, L.L.C., MG Oil &
Gas Corp., TECO Gas & Oil, Inc. and Houston Energy &
Development, Inc.
9622 Area of Mutual Interest dated April 16, 1996, covering the "High
Island Area Block 37", by and between IP Petroleum Company,
Inc., Xxxxxxxx Oil and Gas, L.P., TECO Gas & Oil, Inc., MG Oil &
Gas Corp., The Xxxxxxx X. Helis Company, L.L.C. and Xxxxxxxx
Offshore, Inc.
9623 Joint Operating Agreement dated July 1, 1996, as amended,
between IP Petroleum, Inc. (Operator) and TECO Gas & Oil, Inc.,
Et Al (Non-Operators), covering Block 211, South Timbalier Area,
Offshore Louisiana.
9624 Area of Mutual Interest dated August 22, 1996, covering the
"Galveston 213 AMI", by and between IP Petroleum Company, Inc.,
MG Oil and Gas Corp., The Xxxxxxx X. Helis Company, L.L.C.,
Houston Energy and Development, Inc. and TECO Gas & Oil, Inc.
9625 Platform Use Agreement dated May 26, 1996, by and between
Century Offshore Management Corporation, Settle Oil & Gas
Company, and Southern Gas Company of Delaware, Inc. regarding
the production and processing of oil and gas attributable to
Southern's interest through platform, facilities and pipelines
owned by Century and Settle, covering Ship Shoal Block 150.
9626 Letter Agreement dated September 23, 1996, between IP Petroleum
Company, Inc., and Xxxxxxxx Oil Corporation, covering the High
Island Block 37.
Exhibit A-3 - Contracts - Page 4 of 11
EXHIBIT A-3 - CONTRACTS
To the Purchase and Sale Agreement by and between
American Resources Offshore, Inc. and Fidelity Exploration & Production Company
ARO
Contract No.
------------
9627 Letter Agreement dated October 3, 1996, between IP Petroleum
Company, Inc. and Xxxxxxxx Oil Corporation, covering High Island
Block 37.
9705 Joint Operating Agreement dated February 1, 1997, between IP
Petroleum Company, Inc. (Operator) and TECO Gas & Oil, Inc., et
al (Non-Operators), covering Block 213, Galveston Area, Offshore
Texas.
9708 Joint Operating Agreement dated August 1, 1997, between IP
Petroleum Company, Inc. (Operator) and Teco Gas & Oil, Inc., et
al (Non-Operators), covering Block 172, West Cameron Area,
Offshore Louisiana.
9711 Exchange Agreement dated August 21, 1997, between Chevron
U.S.A., Inc. and IP Petroleum Company, Inc. and covering federal
offshore leases OCS-G 0000, Xxxx Xxxxxxx Xxxxx 172 and OCS-G
14300.
9714 Production Handling Agreement dated September 23, 1997 by and
between the owners of West Cameron Block 364 and the owners of
West Cameron Block 368, as defined in the Agreement, regarding
the processing of natural gas, condensate and water produced
from Block 364 at the production facilities located on Block
368.
9716 Bidding Agreement dated August 20, 1997, between IP Petroleum
Company, Inc., Teco Gas & Oil, Inc. The Xxxxxxx X. Helis
Company, L.L.C., and Houston Energy & Development, Inc.
regarding the bidding process for the purchase of Block 418,
Galveston Area and stipulating the form of the Operating
Agreement for the Lease.
Exhibit A-3 - Contracts - Page 5 of 11
EXHIBIT A-3 - CONTRACTS
To the Purchase and Sale Agreement by and between
American Resources Offshore, Inc. and Fidelity Exploration & Production Company
ARO
Contract No.
------------
9717 Joint Operating Agreement dated August 22, 1997, between IP
Petroleum Company, Inc. and Xxxxxxx Resources Corporation
(CoOperator) and The Xxxxxxx X. Helis Company, L.L.C., et al
(Non-Operators), covering Block X0 Xxxx Xxxxxx Xxxx, Xxxxxxxx,
Xxxxx, attached as Exhibit "B" to the Bidding Agreement
effective the same date and by and between the same parties.
9722 Area of Mutual Interest dated July 17, 1997, covering the "West
Cameron Area Block 172", by and between IP Petroleum Company,
Inc., TECO Gas & Oil, Inc., The Xxxxxxx X. Helis Company, L.L.C.
and Xxxxxxxx Offshore, Inc.
Area of Mutual Interest dated and effective August 6, 1997
9723 covering the "Xxxxxxxxx Xxxx Xxxxx 000 AMI", by and between IP
Petroleum Company, Inc., The Xxxxxxx X. Helis Company, L.L.C.,
Houston Energy and Development, Inc. and TECO Gas and Oil, Inc.
Purchase and Sale Agreement dated effective September 1, 1997,
9724 by and between K. E. Resources, Ltd. (seller) and American
Resources Offshore, Inc. covering the sale of interest in OCS-G
0000, Xxxxx 000, Xxxx Xxxxxxx Xxxx, Xxxx Addition, OCS-G 0000,
Xxxxx 000, Xxxx Xxxxx Xxxx and XXX-X 0000, Xxxxx 225, Ship Shoal
Area, Offshore Louisiana.
9801 Farmout Agreement dated December 29, 2000, by and between
Century Offshore Management Corporation, as farmee, and American
Resources Offshore, Inc., and Fidelity Oil Holdings, Inc., as
farmees, covering a portion of XXX-X00000, Xxxxx 000, Xxxx
Xxxxxxx Area, West Addition, Offshore Louisiana.
Exhibit A-3 - Contracts - Page 6 of 11
EXHIBIT A-3 - CONTRACTS
To the Purchase and Sale Agreement by and between
American Resources Offshore, Inc. and Fidelity Exploration & Production Company
ARO
Contract No.
------------
9806 Closing Agreement dated January 5, 1998, effective November 1,
1997, by and between Apache Corporation (Seller) and American
Resources, Inc. (Buyer) covering the sale of interest in
XXX-X00000, Xxxxx 000, Xxxx Xxxxxxx Xxxx, Xxxx Addition,
Offshore Louisiana.
9807 Letter Agreement dated January 23, 1998, effective November 1,
1997, by and between Nuevo Energy Company (Seller) and American
Resources, Inc. (Buyer), covering the sale of interest in
XXX-X00000, Xxxxx 000, Xxxx Xxxxxxx Area, West Addition,
Offshore Louisiana.
Purchase and Sale Agreement dated February 17, 1998, by and
9808 between American Resources Offshore, Inc., as Buyer and TECO Oil
and Gas, Inc., as Seller.
9809 Joint Operating Agreement dated January 1, 1998, between The
Xxxxxxx X. Helis Company, L.L.C. (Operator) and American
Resources Offshore, Inc., Et Al (Non-Operators), covering Block
418, Galveston Area, Offshore Texas.
9810 Farmout Agreement dated October 28, 1998, by and between Century
Offshore Management Corporation, as farmor, and American
Resources Offshore, Inc., as farmee, covering a portion of
XXX-X00000, Xxxxx 000, Xxxx Xxxxxxx Xxxx, Xxxx Addition,
Offshore Louisiana.
9903 Purchase and Sale Agreement dated March 9, 1999, by and between
American Resources Offshore, Inc. (Seller) and Challenger
Minerals, Inc. (Buyer) covering the sale of interest in a
portion of XXX-X00000, Xxxxx 000, Xxxx Xxxxxxx Xxxx, Xxxxxxxx
Xxxxxxxxx.
Exhibit A-3 - Contracts - Page 7 of 11
EXHIBIT A-3 - CONTRACTS
To the Purchase and Sale Agreement by and between
American Resources Offshore, Inc. and Fidelity Exploration & Production Company
ARO
Contract No.
------------
9905 Participation Agreement dated August 2, 1999 by and between IP
Petroleum Company, Inc. ("IPP"), The Xxxxxxx X. Helis Company,
L.L.C. ("Helis"), American Resources Offshore, Inc. ("ARO"),
Challenger Minerals, Inc. ("CMI"), JN Exploration Company &
Production Limited Partnership ("JN"), Panaco, Inc. ("Panaco"),
and Equitable Production Company ("Equitable") covering West
Cameron Block 172.
9906 Farmout Agreement dated August 20, 1999 by and between the lease
owners of OCS-G 14538, Block 000, Xxxxx Xxxxxxxxx Xxxx, Xxxxx
Addition, and OCS-G 16435, Block 000, Xxxxx Xxxxxxxxx Xxxx,
Xxxxx Xxxxxxxx, Xxxxxxxx Louisiana, as Farmors and Spinnaker
Exploration Company, as Farmee, defining the terms and
conditions of the farmout of the SW/4 SW/4 of the Lease.
9907 Operating Agreement dated July 30, 1999, by and between
Spinnaker Exploration Company, L.L.C., Ocean Energy, Inc. and
Case-Xxxxxxx Oil Corporation, as it covers INSOFAR AND ONLY
INSOFAR as SW/4 SW/4 of South Timbalier Block 211.
9908 Joint Development Agreement dated November 11, 1999, by and
between Xxxxxxxx Oil and Gas, L.P., Newfield Exploration
Company, IP Petroleum Company, Inc., American Resources
Offshore, Inc., Samson Offshore Company, Houston Energy, Inc.
and The Xxxxxxx X. Helis Company, L.L.C.
0001 Agreement and Settlement of Compromise dated March 22, 2000, by
and between American Resources Offshore, Inc. ("ARO"), The
Xxxxxxx X. Helis Company, L.L.C. ("Helis"), Basin Exploration,
Inc. ("Basin") and Fidelity Oil Holdings, Inc. ("Fidelity")
covering West Cameron Block 172.
Exhibit A-3 - Contracts - Page 8 of 11
EXHIBIT A-3 - CONTRACTS
To the Purchase and Sale Agreement by and between
American Resources Offshore, Inc. and Fidelity Exploration & Production Company
ARO
Contract No.
------------
0002 Offer to Purchase dated April 19, 2000, by and between American
Resources Offshore, Inc., as Seller, and IP Petroleum Company,
Inc., and The Xxxxxxx X. Helis Company, L.L.C., as Buyer,
covering High Island Block 37.
0003 Ratification of Operating Agreement dated September 1, 2000, to
the Joint Operating Agreement dated January 1, 1998, whereas
Virgin Offshore U.S.A., Inc. ("Virgin") has acquired a portion
of the interests covering Xxxxxxxxx Xxxxx 000, of The Xxxxxxx X.
Helis Company, L.L.C., American Resources Offshore, Inc., Duke
Energy Hydrocarbons, LLC, and Houston Energy, Inc., in the
Lease.
0004 Ratification of Operating Agreement dated September 1, 2000, to
the Joint Operating Agreement dated January 1, 1998, whereas
Palace Exploration Company ("Palace") has acquired a portion of
the interests covering Xxxxxxxxx Xxxxx 000, of The Xxxxxxx X.
Helis Company, L.L.C., American Resources Offshore, Inc., Duke
Energy Hydrocarbons, LLC, and Houston Energy, Inc., in the
Lease.
0005 Ratification of Operating Agreement dated September 1, 2000, to
the Joint Operating Agreement dated January 1, 1998, whereas
Duke Energy Hydrocarbons, LLC ("DEH") has acquired a portion of
the interests covering Xxxxxxxxx Xxxxx 000, of Fidelity Oil
Holdings, Inc., American Resources Offshore, Inc., and Houston
Energy, Inc., in the Lease.
0006 Letter Agreement dated September 21, 2000, but effective as of
September 1, 2000 by and between Fidelity Oil Holdings, Inc.
("Fidelity"), American Resources Offshore, Inc. ("ARO"), Houston
Energy, Inc. ("HEI") (hereinafter sometimes collectively
referred to as "Assignors"), and Duke Energy Hydrocarbons, LLC
("DEH") (hereinafter sometimes referred to as "Assignee")
covering Galveston Block 418.
Exhibit A-3 - Contracts - Page 9 of 11
EXHIBIT A-3 - CONTRACTS
To the Purchase and Sale Agreement by and between
American Resources Offshore, Inc. and Fidelity Exploration & Production Company
ARO
Contract No.
------------
0007 Letter Agreement dated October 4, 2000 between The Xxxxxxx X.
Helis Company, L.L.C. ("Helis"), American Resources Offshore,
Inc. ("ARO"), Houston Energy, Inc. ("HEI") and Fidelity Oil
Holdings, Inc. ("Fidelity") covering Galveston Block 418.
0008 Letter Agreement dated October 10, 2000, but effective as of
September 1, 2000 by and between The Xxxxxxx X. Helis Company,
L.L.C. ("Helis"), American Resources Offshore, Inc. ("ARO"),
Houston Energy, Inc. ("HEI") and Duke Energy Hydrocarbons, LLC
("DEH") (hereinafter sometimes collectively referred to as
"Assignors") and Virgin Offshore U.S.A., Inc. ("Virgin")
(hereinafter sometimes referred to as "Assignee") covering
Galveston Block 418.
0009 Letter Agreement dated October 16, 2000, but effective as of
September 1, 2000 by and between The Xxxxxxx X. Helis Company,
L.L.C. ("Helis"), American Resources Offshore, Inc. ("ARO"),
Houston Energy, Inc. ("HEI") and Duke Energy Hydrocarbons, LLC
("DEH") (hereinafter sometimes collectively referred to as
"Assignors") and Palace Exploration Company ("Palace")
(hereinafter sometimes referred to as "Assignee") covering
Galveston Block 418.
0010 Production Handling Agreement dated December 10, 2000, Century
Exploration Company, as Producer, and Century Exploration
Company, American Resources Offshore, Inc., and Fidelity Oil
Holdings, Inc., as Handler, covering West Cameron Block 368.
Exhibit A-3 - Contracts - Page 10 of 11
EXHIBIT A-3 - CONTRACTS
To the Purchase and Sale Agreement by and between
American Resources Offshore, Inc. and Fidelity Exploration & Production Company
ARO
Contract No.
------------
0101 Production Handling Agreement dated April 16, 2001, by and
between Pure Partners, L.P. ("Pure"), Duke Energy Hydrocarbons,
LLC ("DEH"), The Xxxxxxx X. Helis Company, L.L.C. ("Helis"),
Houston Energy, Inc. ("HEI"), Shell Offshore Properties and
Capital II, Inc. ("SOPAC"), American Resources Offshore, Inc.
("ARO"), Fidelity Oil Holdings, Inc. ("Fidelity"), H.E.&D.
Offshore, Inc. ("HED"), Palace Exploration Company ("Palace")
and Virgin Offshore U.S.A., Inc. ("Virgin") sometimes
hereinafter referred to collectively as the "Parties" and
individually as "Party", covering Galveston Block 418.
0102 Letter Agreement date May 10, 2001, by and between Pure
Resources, L.P. and American Resources Offshore, Inc., covering
Block 000, Xxxx Xxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxxx.
0103 Farmout Agreement dated April 6, 2001, by and between TDC Energy
(Farmee) and American Resources Offshore, Inc., et al, (Farmor)
covering Block 000, Xxxx Xxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxxx.
0201 Farmout Agreement dated July 1, 2002, by and between American
Resources Offshore, Inc. (Farmor) and Pure Resources, L.P.
(Farmee) covering Block 37, High Island Area, Offshore Texas.
0202 Operating and Platform Use Agreement dated September 19, 2002,
by and between Century Exploration Company, as Operator and
Century Exploration Company, American Resources Offshore, Inc.,
and Fidelity Exploration & Production Company, as Producers,
covering West Cameron Block 368.
Exhibit A-3 - Contracts - Page 11 of 11
EXHIBIT A-4
ASSETS
To the Purchase and Sale Agreement By and Between
American Resources Offshore, Inc. and
Fidelity Exploration and Production Company
ALLOCATED
PROPERTY VALUE
-------- -----
Brazos Block A2 $ 0
Brazos Block 542 $ 0
Xxxxxxxxx Xxxxx 213 $ 0
Xxxxxxxxx Xxxxx 418 $ 625,000
High Island Block 37 $ 0
Ship Shoal Block 150 $ 727,000
South Timbalier Block 211 $ 000,000
Xxxx Xxxxxxx Xxxxx 152 $ 5,000
West Cameron Block 172 $ 000,000
Xxxx Xxxxxxx Xxxxx 195 $ 0
Xxxx Xxxxxxx Xxxxx 368 $ 355,000
----------
$2,730,000
Schedule 2.03
Attached to and made apart of that certain
Asset Purchase and Sale Agreement among
American Resources Offshore, Inc. as "Seller"
and
Fidelity Exploration & Production Company, as "Buyer"
PRELIMINARY
CLOSING STATEMENT
AMERICAN RESOURCES OFFSHORE, INC. / FIDELITY
--------------------------------------------
1. AGREEMENT Purchase and Sale Agreement dated October 1, 2002 by
--------- and between American Resources Offshore, Inc., as
Seller, and Fidelity Exploration & Production
Company, as Buyer (the "Agreement").
2. ASSETS SOLD All of Seller's right, title and interest in and to
----------- Oil and Gas Leases as follows:
Effective Lease
Lease No. Block No. Block Name Date
--------- --------- ---------- ----
OCS-G 1998 WC 000 Xxxx Xxxxxxx Xxxxx 172 02/01/71
OCS-G 5315 WC 000 Xxxx Xxxxxxx Xxxxx 368 07/01/83
OCS-G 15769 HI 37 High Island Block 37 12/01/95
OCS-G 16435 ST 000 Xxxxx Xxxxxxxxx Xxxxx 211 07/01/96
OCS-G 17120 GA 000 Xxxxxxxxx Xxxxx 213 02/01/97
OCS-G 18921 GA 000 Xxxxxxxxx Xxxxx 418 01/01/98
OCS-G 0419 SS 150 Ship Shoal Block 150 11/01/54
OCS-G 18903 BA X-0 Xxxxxx Xxxxx X-0 00/00/00
XXX-X 12465 BA 542 Brazos Block 542 11/01/90
OCS-G 16122 WC 000 Xxxx Xxxxxxx Xxxxx 152 07/01/96
OCS-G 16123 WC 000 Xxxx Xxxxxxx Xxxxx 195 06/01/96
and other property (the "Assets") more particularly
described in the Agreement.
3. EFFECTIVE TIME October 1, 2002 at 7:00 a.m. C.S.T.
--------------
4. PURCHASE PRICE
--------------
Section 2.01 $2,730,000.00
PLUS
Section 2.03(a)(1) Value of oil storage in a
Effective Time............... (1) .
----------------
PLUS
Section 2.03(a)(2) Post Effective Time operating
and capital expenditures paid
by Seller.................... (1) .
----------------
PLUS
Section 2.03(a)(3) Post Effective Time Taxes paid
by Seller.................... (1) .
---------------
PLUS
Section 2.03(a)(4) Post Effective Time prepaid
expenses paid by Seller...... (1) .
----------------
LESS
Section 2.03(b)(1) Proceeds received by Seller from
the sale of substances produced
after the Effective Time..... (1) .
----------------
LESS
Section 2.03(b)(2) Proceeds received by Seller from
the sale of Assets after the
Effective Time............... (1) .
----------------
LESS
Section 2.03(b)(3) Value of uncured Title
Defects...................... -0- .
----------------
LESS
Section 2.03(b)(4) Pre-Effective Time Taxes
on production to be paid
by Buyer..................... -0- .
----------------
Section 2.04 ADJUSTED PURCHASE PRICE $2,730,000.00(2)
----------------
(1) Estimate subject to confirmation on a post closing basis pursuant to
Section 1.05
(2) To Be Paid by Wire Transfer
1. The wiring instructions for American Resources Offshore, Inc.:
Bank: Bank One
Transit Routing Number (ABA): 000000000
Bank Account Number: 157-183-4629
Bank Account Name: American Resources Offshore, Inc.
2. DOCUMENTS TO BE SIGNED AND DELIVERED
BY SELLER AND BUYER AT CLOSING
7.02(a) Assignments of Record Title 16435, 17120,
17691, 18921,
5315-1, 16122,
16123, 18903
Assignments of Operating Rights 1998-1, 1998-2,
1998-3, 1998-4,
5315-2,0419-1,
12465
Assignments of Overriding Royalty Interest 0419-2
7.02(f) Partial Release of Mortgages and Security Interests
UCC Release
Such other instruments as are reasonably necessary to effectuate the
conveyance of the Properties to the Buyer
BUYER SELLER
FIDELITY EXPLORATION & AMERICAN RESOURCES
PRODUCTION COMPANY OFFSHORE, INC.
By:________________________________ By:__________________________________
Its:_______________________________ Its:_________________________________
U.S. Tax ID No.:___________________ U.S. Tax ID No.:_____________________
1700 Lincoln, Xxxxx 0000 000 Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxx 00000 Xxxxxxx, Xxxxx 00000
Schedule 3.01(e)
Attached to and made apart of that certain
Asset Purchase and Sale Agreement among
American Resources Offshore, Inc., as "Seller"
and
Fidelity Exploration & Production Company, as "Buyer"
Suits, Claims, Demands or Investigations
----------------------------------------
1. Cause No. 2002-14352 - OSCA Inc. vs IP Petroleum Company, Inc. in the
00xx Xxxxxxxx Xxxxxxxx Xxxxx xx Xxxxxx Xxxxxx, Xxxxx; covering High
Island Xxxxx 00, XXX-X 00000. Buyer and Seller agree that Buyer assumes
Seller's obligation and liability under this suit, and Buyer will
receive the benefit under Counterclaim and Petition in Intervention
filed on behalf of Buyer, Seller and others.
Schedule 3.01(o)
Attached to and made apart of that certain
Asset Purchase and Sale Agreement among
American Resources Offshore, Inc., as "Seller"
and
Fidelity Exploration & Production Company, as "Buyer"
Gas Imbalances
--------------
None
Schedule 5.06(b)(8)
Attached to and made apart of that certain
Asset Purchase and Sale Agreement among
American Resources Offshore, Inc., as "Seller"
and
Fidelity Exploration & Production Company, as "Buyer"
Title Matters Waived
--------------------
None
Schedule 5.07
Attached to and made apart of that certain
Asset Purchase and Sale Agreement among
American Resources Offshore, Inc., as "Seller"
and
Fidelity Exploration & Production Company, as "Buyer"
Casualty Loss
-------------
1. Ship Shoal Block 150 - OCS-G 0419 - Property sustained post Effective
Time hurricane damage to platform and facility. Buyer will be
responsible for Seller's share of these damages.
2. West Cameron Block 368 - OCS-G 5315 - Property sustained post Effective
Time hurricane damage to platform and facility. Buyer will be
responsible for Seller's share of these damages.
Seller will, with Buyers approval file an insurance claim under Seller and
Buyers joint property insurance coverage and will remit any funds received from
the claim to Buyer net of deductibles. Buyer shall be responsible for Seller's
share of any deductable.
