Purchase and Sale Agreement
By and Between
Marathon Oil Company
and
Forcenergy Inc
dated December 12, 1996
Effective October 1, 0000
Xxxx Xxxxx & Xxxxxxx Xxx
Xxxxxx
PURCHASE AND SALE AGREEMENT
This Purchase and Sale Agreement ("Agreement") is made and
entered into this ____ day of _______________, 199__ by and
between Marathon Oil Company, an Ohio corporation
("Seller"), and Forcenergy Inc, a Delaware corporation
("Purchaser").
In consideration of the mutual promises contained herein,
the benefits to be derived by each party hereunder and other
good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, Purchaser and Seller
hereby agree as follows:
1. DEFINITIONS. For purposes of this Agreement, the
listed terms shall have the following meanings:
a. "Property" means:
(i) all of Seller's right, title and interest in
and to the lands described in Exhibit "A" including, without
limitation, all mineral interest, royalty interest,
overriding royalty interest, oil, gas or mineral leasehold
interest, working interest, net revenue interest, easements,
rights-of-way, servitudes, and reversionary rights related
thereto (collectively "Leases"), and
(ii) all of Seller's right, title and interest in
and to each of the oil, gas and injection xxxxx on the
Leases ("Xxxxx"), and
(iii) all of Seller's right, title and interest in
and to all joint operating agreements, pooling and
unitization agreements, production and product sales
agreements, transportation agreements, pipeline connection
agreements, commingling agreements, exploration agreements,
area of mutual interest agreements, farmout and farmin
agreements, permits and licenses and all other similar
agreements and instruments relating to the Leases or the
Xxxxx, including but not limited to such agreements listed
on Exhibit "B" ("Associated Contracts"), and
(iv) all of Seller's right, title and interest in
and to all tangible property consisting of equipment,
inventory, components, pipelines, xxxxx, platforms,
machinery, fixtures, production facilities, measurement
facilities, processing plants, tanks, dehydrators,
separators, compressors, storage facilities, buildings,
office equipment and other tangible property located on or
used directly and exclusively in connection with the Leases,
and
(v) all of Seller's right, title and interest in
all geological, geophysical, engineering, technical and
accounting data, records, files and information directly
related to the Leases or Xxxxx, including without limitation
well logs, cores, structure maps, and seismic data owned by
Seller or to which Seller has rights or interests, except to
the extent that Seller is contractually prohibited from
transferring same, and
(vi) all of Seller's right, title and interest in
all oil, gas, distillate, condensate, casinghead gas, or
other liquid or vaporous hydrocarbons or minerals produced
from or attributable to the Leases or Xxxxx, from and after
the Effective Date, and
(vii) any and all of Seller's stock in Xxxx Inlet
Pipe Line Company, a Delaware corporation, ("Xxxx Inlet")
not acquired by other owners of Xxxx Inlet pursuant to
rights of first refusal to which such stock is subject.
With respect to rights, obligations, warranties and
representations of the parties hereto after Closing,
references herein to the "Property" shall mean only that
portion of the Property which was conveyed at Closing.
Notwithstanding anything herein to the contrary,
"Property" does not mean, and specifically excludes, all of
Seller's right, title and interest in the Grayling Gas Sands
Working Interest Participating Area ("WIPA") of the Trading
Bay Unit ("TBU") or in any of the interests described in (i)
- (vii) above associated with, or otherwise an incident of
ownership of, the Grayling Gas Sands WIPA, including, but
not limited to, certain facilities at the Trading Bay
Production Facility ("TBPF") and the right to utilize all
existing TBU gas pipelines. The Grayling Gas Sands WIPA is
defined as all gas bearing sands above the G-Zone oil pool
of the XxXxxxxx River Field including, but not limited to,
the Upper A (shallow), A, B, C, D, E, (deep), F (deep), and
G-0 (deep). Further, Property does not mean Seller's 51.2%
interest in the Steelhead Platform and related gas
facilities and pipelines. (Collectively, such excluded
interests are referred to herein as the "Retained
Interests"). Seller specifically reserves and excepts from
this transaction all of the Retained Interests. Record
title to the Grayling Gas Sands WIPA shall be retained by
Seller on the State of Alaska form entitled "Assignment
Affecting Record Title to Oil and Gas Lease" for each lease
which is part of the Grayling Gas Sands WIPA and which is
otherwise to be assigned to Purchaser pursuant to the terms
of this Agreement.
b. "Permitted Encumbrances" means:
(i) lessor's royalties, overriding royalties, and
all other matters affecting the interests reflected in the
official real property records, U.C.C. records, the State of
Alaska Department of Natural Resources and/or other public
records of the jurisdictions in which the Leases are located
("Official Records"), if the effect of such burden does not
operate to reduce the Net Revenue Interest as to any Lease
or Well to less than the Net Revenue Interest set forth in
Exhibit "A" for such Lease or Well or increase the Working
Interest as to any Lease or Well to more than that set forth
in Exhibit "A" without a proportionate increase in the Net
Revenue Interest;
(ii) the Associated Contracts;
(iii) required third party consents to
assignments, preferential purchase rights and similar
agreements with respect to which valid waivers or consents
have been obtained from the appropriate parties or the time
period for exercising such rights has expired without the
exercise of such rights;
(iv) liens for taxes or assessments not yet
delinquent;
(v) all rights to consent or approval by, required
notices to, filings with, or other actions by, governmental
entities in connection with the Assignment of oil and gas
leases or easements or rights-of-way or interests therein if
the same are customarily obtained subsequent to such
Assignment;
(vi) the obligations contained in this Agreement
and all Exhibits to this Agreement;
(vii) the Contingent Bonus.
c. "Effective Date" means October 1, 1996 at 7:00
o'clock a.m. local time where the Properties are located.
d. "To the best of a party's knowledge", when used
herein, means that no present officer, director, management
employee, or in house attorney of that party has, or would
have after a reasonably diligent inquiry and with the
exercise of due care, any knowledge materially inconsistent
with the statements qualified by that phrase.
e. "Contingent Bonus" means three percent (3%) of
the value of Purchaser's share of production from the
Property after deducting lessor's royalty. The amount of
the Contingent Bonus shall be calculated in the same means
as is the lessor's royalty. The Contingent Bonus shall be
effective and payable only in those months between December
1996 and May 1998, inclusive, in which the daily average
prices for oil posted by Union Oil Company of California
("Unocal"), or its successor, for Xxxx Inlet crude oil
delivered to the Drift River Terminal, as adjusted for
quality and gravity, less the amount of applicable,
unreimbursed transportation charges incurred in delivering
such crude oil to market from the Drift River Terminal is
greater than $17.70 per barrel. The parties acknowledge
that the Net Revenue Interests set forth in Exhibit "A"
hereto do not reflect the Contingent Bonus. In the event
the referenced posting ceases to exist, then the Alaska
North Slope West Coast price as reported by Platts and
adjusted for gravity and quality, plus or minus the average
difference between the referenced posting and the Platts
reported price for the one (1) year period immediately prior
to the date when the referenced posting ceased to exist
shall be used. Within forty-five (45) days following the
end of each month during such eighteen (18) month period,
Purchaser shall render a statement to Seller showing the
price received for production sold from the Property and, if
applicable, the amount of such Contingent Bonus due Seller
for such month and a check in the amount due.
f. "Xxxx Inlet Funding Agreement" means that certain
Xxxx Inlet Pipe Line Company Funding Agreement effective as
of January 1, 1995 by and between Atlantic Richfield
Company, Marathon, Unocal, Mobil Pipe Line Company and Xxxx
Inlet.
g. "Guaranty Agreement" means that certain Unocal
Pipeline Company Guaranty Agreement effective as of January
1, 1995 from Marathon to Unocal Pipeline Company.
2. PURCHASE AND SALE. Subject to the terms of this
Agreement, Seller agrees to sell and convey the Property to
Purchaser and Purchaser agrees to purchase and pay Seller
for the Property.
3. PURCHASE PRICE.
a. The purchase price for the Property shall be one
hundred twenty-one million five hundred ten thousand dollars
($121,510,000) ("Purchase Price"), subject to adjustment as
herein provided. Within two (2) business days from the
execution of this Agreement by both parties, Purchaser shall
pay an xxxxxxx money deposit of ten million dollars
($10,000,000) (the "Deposit") to Seller by wire transfer of
immediately available funds.
b. The Purchase Price shall be adjusted by the items
listed below in this Section 3b. At Closing, Purchaser
shall pay to Seller, by wire transfer in immediately
available funds, the net amount of the Purchase Price as
adjusted in accordance with this Section 3b. All amounts
due by Purchaser shall be sent to the following account:
Marathon Oil Company, National City Bank, Cleveland, Ohio,
Transit Routing Number 000000000, Account Number 0000000,
Reference: Gulf Coast Region for Alaska Region. The
Purchase Price shall be adjusted after Closing in accordance
with Section 10 below.
(i) The Purchase Price shall be adjusted upward by the
following:
(1) the value of all oil in storage above the
Xxxx Inlet pipeline connection at TBPF as of the Effective
Date and not previously sold by Seller that is attributable
to the Property, such value to be the Unocal price posted
for Xxxx Inlet crude, adjusted for quality and gravity,
delivered to the Drift River Terminal in effect as of the
Effective Date less taxes; and
(2) the amount of all expenditures (including,
without limitation, capital expenditures, but limited to
capital expenditures incurred after the Effective Date),
rental and other charges, ad valorem, property, production,
excise, severance and similar taxes based upon or measured
by the ownership of property or the production of
hydrocarbons or the receipt of proceeds therefrom, expenses
billed under applicable operating agreements and in the
absence of an operating agreement, expenses of the sort
customarily billed under such agreements, paid by Seller in
connection with the operation of the Property, in accordance
with generally accepted accounting principles, attributable
to the period from and after the Effective Date; and
(3) an amount equal to all prepaid expenses
attributable to the Property that are paid by Seller that
are, in accordance with generally accepted accounting
principles, attributable to the period after the Effective
Date, including without limitation, prepaid utility charges
and prepaid ad valorem, property, production, severance, and
similar taxes based upon or measured by the ownership of
property or the production of hydrocarbons or the receipt of
proceeds therefrom; and
(4) an amount equal to the outstanding balance of
advances made by Seller to the operator of the Property as
of the Effective Date.
(ii) The Purchase Price shall be adjusted downward by
the following:
(1) the proceeds, net of royalty, received by
Seller attributable to the Property that are, in accordance
with generally accepted accounting principles, attributable
to the production of hydrocarbons for the period from and
after the Effective Date pursuant to arms-length sales to
unaffiliated third parties, or in the absence of such an
arms-length sale, the fair market value thereof; and
(2) an amount equal to all unpaid ad valorem,
property, production, severance, and similar taxes and
assessments (but not including income taxes) based upon or
measured by the ownership of property or the production of
hydrocarbons or the receipt of proceeds therefrom accruing
to the Property prior to the Effective Date, which amount
shall be computed based upon such taxes assessed against the
applicable portion of the Property for the preceding
calendar year or, if such taxes are assessed on other than a
calendar year basis, for the tax-related year last ended;
and
(3) the value of all uncured Title Defects; and
(4) the Allocated Value (as defined in Section 15
hereof and listed on Exhibit "G" hereof) of the portions of
the Property excluded from this Agreement pursuant to
Section 6 hereof; and
(5) the Deposit; and
(6) the proportionate share of the Allocated
Value of the shares of Xxxx Inlet acquired by other owners
of Xxxx Inlet as a result of the right of first refusal
process to which such shares are subject; and
(7) that portion of any dividend received from
Xxxx Inlet by Seller in 1996 attributable to Xxxx Inlet's
operation from the Effective Date through the Closing Date.
c. All adjustments made to accounting records for the
Property after the Effective Date but attributable to costs
and expenses paid by Seller to co-working interest owners in
the Property prior to the Effective Date shall be for the
account of Seller.
d. Notwithstanding any provision of this Agreement to
the contrary, Purchaser shall not be obligated to close the
transaction contemplated by this Agreement, and shall have
the option to terminate this Agreement if the aggregate
value of all Title Defects which have not been cured to
Purchaser's satisfaction prior to the Closing Date exceeds
ten percent (10%) of the Purchase Price.
e. Notwithstanding any provision of this Agreement to
the contrary, Purchaser shall not be obligated to close the
transaction contemplated by this Agreement if the Allocated
Value of the portion of the Property on which preferential
rights are exercised exceeds twenty percent (20%) of the
Purchase Price.
4. REPRESENTATIONS AND WARRANTIES. NOTWITHSTANDING ANY
PROVISION CONTAINED IN THIS AGREEMENT TO THE CONTRARY, THE
TRANSFER OF THE PROPERTY BY SELLER TO PURCHASER SHALL BE
WITHOUT WARRANTY OF TITLE, EXPRESS, STATUTORY, OR IMPLIED,
EXCEPT THAT SELLER SHALL WARRANT TITLE (EXCEPT FOR TITLE
DEFECTS WAIVED BY PURCHASER OR FOR WHICH AN ADJUSTMENT WAS
MADE TO THE PURCHASE PRICE) TO THE PROPERTY AGAINST THE
CLAIMS AND DEMANDS OF ALL PERSONS CLAIMING THE SAME OR AN
INTEREST (INCLUDING A SECURITY INTEREST) THEREIN BY, THROUGH
OR UNDER SELLER, BUT NOT OTHERWISE; PROVIDED HOWEVER,
PURCHASER SHALL HAVE THE RIGHT OF FULL SUBSTITUTION AND
SUBROGATION IN AND TO ANY AND ALL RIGHTS AND ACTIONS OF
WARRANTY WHICH SELLER HAS OR MAY HAVE AGAINST ANY AND ALL
PRECEDING OWNERS OR VENDORS FOR THE PROPERTY THROUGH THIS
AGREEMENT AND THE ASSIGNMENTS TO BE EXECUTED IN CONSUMMATION
OF THIS AGREEMENT.
Purchaser acknowledges that (i) it has had and pursuant to
this Agreement will have prior to the Closing access to the
Property and the employees of Seller and (ii) in making the
decision to enter into this Agreement and consummate the
transactions contemplated hereby, Purchaser has relied
solely on the basis of its own independent investigation of
the Property and upon the representations, warranties,
covenants and agreements set forth in this Agreement.
Accordingly, Purchaser acknowledges that, except as
expressly set forth herein, Seller has not made, AND SELLER
HEREBY EXPRESSLY DISCLAIMS AND NEGATES, ANY REPRESENTATION
OR WARRANTY, EXPRESSED, IMPLIED, AT COMMON LAW, BY STATUTE,
OR OTHERWISE RELATING TO (x) THE CONDITION OF THE PROPERTY
(INCLUDING WITHOUT LIMITATION, ANY IMPLIED OR EXPRESSED
WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE, OR OF CONFORMITY TO MODELS OR SAMPLES OF MATERIALS,
OR ENVIRONMENTAL CONDITION), (y) ANY INFRINGEMENT BY SELLER
OF ANY PATENT OR PROPRIETARY RIGHT OF ANY THIRD PARTY, AND
(z) ANY INFORMATION, DATA OR OTHER MATERIALS (WRITTEN OR
ORAL) FURNISHED OR COMMUNICATED TO, OR MADE AVAILABLE FOR
REVIEW BY, PURCHASER BY OR ON BEHALF OF SELLER; AND
PURCHASER WILL HAVE SOLE RESPONSIBILITY FOR ANY ACTION TAKEN
BY PURCHASER, OR BY OTHER PERSONS RELYING ON PURCHASER'S
ADVICE, BASED ON ANY SUCH INFORMATION, DATA AND MATERIALS;
provided, however, that the foregoing disclaimer and
negation of representations and warranties shall not affect
or impair the representations and warranties of Seller set
forth in Section 7 hereof.
5. TITLE MATTERS.
a. Marketable Title. As used herein, the term
"Marketable Title" shall mean such right, title and interest
owned or of record that, except for Permitted Encumbrances:
(i) is free from reasonable doubt to the end that
a prudent person engaged in the business of purchasing and
owning, developing and operating producing oil and gas
properties, and with respect to Xxxx Inlet, crude petroleum
pipelines, with knowledge of all of the facts and their
legal bearing would be willing to accept the same.
(ii) subject to Section 6(b) hereof, entitles
Seller to receive not less than the interest set forth in
Exhibit "A" as the "Net Revenue Interest" or "NRI" with
respect to the oil, gas, and associated hydrocarbon minerals
produced, saved and marketed from each unit, Lease or Well,
as the case may be.
(iii) obligates Seller to pay costs and expenses
relating to the operations on and the maintenance and
development of each unit or Well, as the case may be, in an
amount not greater than the "Working Interest" or "WI" set
forth in Exhibit "A" with respect to such Property, without
a corresponding increase in the NRI.
(iv) is free and clear of all material
encumbrances, mortgages, liens and security interests.
(v) is free and clear of all consent requirements
and preferential rights which, as of the Closing, have
neither been waived nor expired.
(vi) is not subject to any agreement whereby any
person has the right to take production without full payment
therefor, or at a reduced price, or pursuant to a call on
production.
(vii) is not subject to a contract for the sale
of production from the Property which cannot be terminated
upon ninety (90) days notice or less.
b. Notice of Title Defect. Purchaser shall notify
Seller in writing, as soon as reasonably practicable after
Purchaser acquires knowledge, and in any event at least ten
(10) days prior to the Closing Date (the "Notification
Deadline"), of any matter ("Title Defect") that would cause
Seller's title to any portion of the Property not to be
Marketable Title, in each case together with an explanation
of (a) the nature of such Title Defect, (b) the Leases (or
portions thereof) affected thereby, and (c) the Defect Value
(as hereinafter defined) for such Title Defect. Any matters
that would otherwise constitute Title Defects but which are
not specifically raised in writing by Purchaser prior to the
Notification Deadline shall conclusively be deemed waived by
Purchaser.
c. Defect Value. As used herein, the term "Defect
Value" shall mean:
(i) with respect to Title Defects under Section 5
a (ii), an amount calculated by multiplying the Allocated
Value of the affected portion of the Property by a fraction
the denominator of which is the NRI set forth on Exhibit "A"
and the numerator of which is the correct net revenue
interest.
(ii) with respect to Title Defects under Section 5
a (iii), an amount calculated by multiplying the Allocated
Value of the affected portion of the Property by a fraction
the numerator of which is the Working Interest as set forth
on Exhibit "A" and the denominator of which is the correct
Working Interest.
(iii) with respect to Title Defects under
Section 5 a (iv), the cost to remove such encumbrance,
mortgage, lien or security interest, but not more than the
Allocated Value of the portion of the Property affected.
(iv) with respect to all other Title Defects, the
Allocated Value of the portion of the Property affected or
such lesser amount upon which the parties agree in writing.
d. Remedies for Title Defects.
Seller shall have the right, but not the
obligation, to attempt to cure any Title Defect with respect
to which it has received notice from Purchaser prior to the
Notification Deadline. Subject to Section 3b(ii)(4), with
respect to any uncured Title Defect for which Seller
receives the required notice from Purchaser before the
Notification Deadline if Seller has not cured all such Title
Defects by the Closing Date, the Purchase Price shall be
reduced accordingly to its Defect Value or, at Seller's
option, the portion of the Property subject to the Title
Defect shall be excluded from the Property and the Purchase
Price shall be reduced by the Allocated Value of such
excluded portion. The foregoing notwithstanding, no
adjustment shall be made to the Purchase Price for Title
Defects unless the aggregate of all Defect Values exceeds
six hundred thousand dollars ($600,000).
6. ENVIRONMENTAL MATTERS.
a. Purchaser acknowledges that the Property has been
used by Seller and others for the purpose of exploration,
development and production of oil and gas. Purchaser
acknowledges that wastes and products, including, but not
limited to, crude oil, natural gas, natural gas liquids,
produced water, and other wastes associated with oil and gas
production and exploration operations may have been spilled,
released or disposed of on-site by, among other ways,
placement in pits, burial, land farming, land spreading and
underground injection, into or onto the Property. In
addition, Purchaser acknowledges that some oilfield
production equipment may contain asbestos and/or naturally
occurring radioactive materials ("NORM"). In this regard,
Purchaser expressly understands that NORM may affix or
attach itself to the inside of xxxxx, materials and
equipment as scale or in other forms, and that xxxxx,
materials and equipment located on the Property may contain
NORM and that NORM-containing materials may be buried or
have been otherwise disposed of on the Property. Purchaser
also expressly understands that special procedures may be
required for the removal and disposal of asbestos and NORM
from the equipment and properties where it may be found, and
that Purchaser assumes all liability when such activities
are performed.
b. Purchaser also agrees and acknowledges that (i) it
has had, or prior to the Closing Date will have, access to
and the opportunity to inspect the Property and the property
of Xxxx Inlet for all purposes, including without
limitation, for the purposes of detecting the presence of
hazardous or toxic substances, pollutants or other
contaminants, environmental hazards, NORM and contamination
of surface and/or subsurface properties, (ii) it has, or
prior to the Closing Date will have, satisfied itself as to
the physical and environmental condition of the Property and
the property of Xxxx Inlet, both surface and subsurface, and
their method of operation and except as set forth herein,
agrees to accept an assignment of the Property at the
Closing on an "AS IS, WHERE IS" basis, "WITH ALL FAULTS" and
(iii) in making the decision to enter into this Agreement
and consummate the transactions contemplated hereby,
Purchaser has relied solely on the basis of the
representations, warranties and covenants of Seller
contained herein and its own independent investigation of
the Property and the Property of Xxxx Inlet and the records
related hereto. Purchaser specifically acknowledges having
received a copy of that certain Compliance Order by Consent
entered into among Unocal, Seller and the Alaska Department
of Environmental Conservation on June 21, 1996. If
Purchaser notifies Seller at least ten (10) days prior to
the Closing Date (the "Environmental Notice Deadline") of
the existence of any environmental conditions, other than
environmental conditions addressed in the Compliance Order
by Consent or otherwise disclosed by Seller to Purchaser in
writing prior to the date hereof, on the Property that
constitutes a violation of Environmental Laws (as
hereinafter defined) ("Environmental Defect") as in effect
on the date hereof, and Seller does not remediate such
Environmental Defect to Purchaser's satisfaction prior to
the Closing Date, then Purchaser may at its sole option and
as its sole remedy either,
x. exclude the affected property from this Agreement
and reduce the Purchase Price by the Allocated Value
for such property or
y. terminate this Agreement whereupon Seller shall
immediately refund the Deposit without interest.
As used herein, the term "Environmental Laws" shall
mean any and all laws, statutes, regulations, rules, orders,
ordinances, permits, or determinations of any governmental
authority including without limitation the Alaska Department
of Environmental Conservation ("ADEC") and the Environmental
Protection Agency ("EPA") pertaining to health, safety or
the environment and applicable to the operation or
maintenance of any portion of the Property, including,
without limitation, the Clean Air Act, as amended, the
Federal Water Pollution Control Act, as amended, the River
and Harbor Act, as amended, the Safe Drinking Water Act, as
amended, the Comprehensive Environmental Response,
Compensation and Liability Act ("CERCLA"), as amended, the
Superfund Amendments and Reauthorization Act of 1986
("XXXX"), as amended, the Resource Conservation and Recovery
Act ("RCRA"), as amended, the Hazardous and Solid Waste
Amendments Act of 1984, as amended, the Toxic Substances
Control Act, as amended, the Occupational Safety and Health
Act ("OSHA"), as amended and other federal, state, and local
laws whose purpose is to conserve or protect health, the
environment, wildlife, or natural resources.
b. If the Closing occurs, and without limiting
Purchaser's other obligations hereunder, PURCHASER HEREBY
ASSUMES AND SHALL BE RESPONSIBLE FOR AND AGREES TO
INDEMNIFY, DEFEND AND HOLD HARMLESS SELLER, ITS DIRECTORS,
OFFICERS, SHAREHOLDERS, EMPLOYEES, AGENTS, AND ASSIGNS (THE
"SELLER INDEMNIFIED PARTIES") FROM AND AGAINST ANY AND ALL
LIABILITY, LIENS, DEMANDS, JUDGMENTS, SUITS, CLAIMS AND
EXPENSES OF ANY KIND OR CHARACTER, INCLUDING REASONABLE
ATTORNEY'S FEES AND COURT COSTS, ATTRIBUTABLE TO DAMAGE TO
PROPERTY, INJURY TO OR DEATH OF PERSONS OR OTHER LIVING
THINGS, NATURAL RESOURCE DAMAGES, CERCLA RESPONSE COSTS,
ENVIRONMENTAL REMEDIATION AND RESTORATION COSTS, OR FINES OR
PENALTIES RELATED TO THE ENVIRONMENTAL CONDITION OF THE
PROPERTY (INCLUDING DISPOSAL OF WASTES ON THE PROPERTY), AND
SUBJECT TO SECTION 1a (vii), ANY CLAIM TO WHICH THE SELLER
INDEMNIFIED PARTIES ARE SUBJECT PURSUANT TO THE GUARANTY
AGREEMENT AND THE XXXX INLET FUNDING AGREEMENT
(COLLECTIVELY, "CLAIMS") ARISING OUT OF OR ATTRIBUTABLE TO,
IN WHOLE OR IN PART, EITHER DIRECTLY OR INDIRECTLY, THE
OWNERSHIP, CONDITION OR OPERATION OF THE PROPERTY OR THE
PROPERTY OF XXXX INLET AT ANY TIME BEFORE, AT OR AFTER THE
CLOSING DATE, INCLUDING, WITHOUT LIMITATION, ANY SUCH CLAIM
THAT IS THE RESULT OF OR CAUSED IN WHOLE OR IN PART BY THE
SELLER INDEMNIFIED PARTIES' VIOLATION OF OR FAILURE TO
FULFILL DUTIES IMPOSED BY, OR INCURRENCE OF LIABILITY UNDER,
ANY ENVIRONMENTAL LAWS, IN EACH CASE WITHOUT REGARD TO SOLE,
PARTIAL OR CONCURRENT NEGLIGENCE, STRICT LIABILITY, OR OTHER
FAULT OF THE SELLER INDEMNIFIED PARTIES, BUT NOT FOR THE
GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF ANY SELLER
INDEMNIFIED PARTY; PROVIDED, THAT THE PARTIES AGREE,
ANYTHING TO THE CONTRARY IN THIS AGREEMENT NOTWITHSTANDING,
THAT NONE OF THE ACTS OR OMISSIONS WHICH IN ANY WAY CREATED
THE CONDITIONS ADDRESSED BY THE COMPLIANCE ORDER BY CONSENT
REFERRED TO IN THIS SECTION 6 SHALL EVER BE CONSTRUED AS
ATTRIBUTABLE, IN WHOLE OR IN PART, TO THE GROSS NEGLIGENCE
OR WILLFUL MISCONDUCT OF ANY SELLER INDEMNIFIED PARTY.
c. Notwithstanding any provision of this Agreement to
the contrary, Purchaser may elect to close the transactions
contemplated by this Agreement prior to the preferential
purchase rights for Xxxx Inlet expiring or being waived but
excluding the transactions which would effect the transfer
of Xxxx Inlet and pay the Purchase Price, as adjusted less
the Allocated Value of Xxxx Inlet. Should Purchaser so
elect, Purchaser may, three (3) business days prior to such
Closing, provide Seller with written notice of Environmental
Defects affecting the property of Xxxx Inlet and Seller
hereby agrees to indemnify and save the Purchaser
Indemnified Parties from and against any and all Claims with
respect to such Environmental Defects in Purchaser's notice.
If and to the extent that subsequent to such a Closing prior
to the preferential purchase rights for Xxxx Inlet expiring
or being waived, such preferential purchase rights are
waived or the time within which they were to be exercised
expires, then Purchaser shall within ten (10) business days
of such waiver or expiration, close on the purchase of Xxxx
Inlet (or the applicable portion thereof) and pay to Seller
the proportionate share of the Allocated Value of Xxxx Inlet
(or a proportionately reduced amount to the extent
preferential purchase rights were exercised).
7. REPRESENTATIONS BY SELLER. Seller represents to
Purchaser that:
a. Seller is a corporation duly organized, validly
existing and in good standing under the laws of the State of
Ohio, has the corporate power and authority, and is duly
qualified to own the Property and to enter into and carry
out the terms of this Agreement.
b. The execution and delivery of this Agreement and
the consummation of the transactions contemplated by this
Agreement have been duly authorized by all necessary
corporate action on behalf of Seller and constitute the
legal, valid and binding obligations of Seller enforceable
against Seller in accordance with their terms. The
consummation of the transactions contemplated hereby will
not violate, conflict with or constitute a default (or an
event which without notice or lapse of time or both would
become a default) under, or result in the creation of a
lien, or encumbrance on, the Property pursuant to;
(i) any provisions of its charter or bylaws or;
(ii) to the best of Seller's knowledge, any
contract, agreement or instrument to which Seller is a party
or by which the Property is bound or affected or;
(iii) any law, regulation or any order, writ,
injunction or decree of any court or governmental
instrumentality; and
c. this Agreement has been duly executed and
delivered on behalf of Seller, and all documents and
instruments required hereunder to be executed and delivered
by it shall have been duly executed and delivered; and
d. to the best of Seller's knowledge,
(i) the instruments listed on Exhibit "B",
constitute all of the Associated Contracts which could
materially affect the Property after the Effective Date; and
(ii) except as set forth in the Associated
Contracts, no present or future production from any of the
Property is dedicated under or subject to any contract,
commitment, agreement or arrangement of any kind which is
not terminable on ninety (90) or fewer days notice; and
(iii) no person or entity has any call upon,
option to purchase or similar right with respect to the
Property or production therefrom except for production which
is subject to agreements which are terminable on ninety (90)
or fewer days notice; and
(iv) except with respect to Seller's non-consent
of the Hemlock completion in the K-26RD well, Seller is not
obligated, by virtue of a prepayment arrangement, a
production payment, a non-consent provision or any other
arrangement, to deliver hydrocarbons produced from the
Property at some future time without payment therefor or at
a reduced rate of payment; and
(v) Seller is not in default of its material
obligations under the Associated Contracts; and
e. to the best of Seller's knowledge, the Property
includes all material permits, licenses, easements and
rights of ingress and egress and other rights necessary for
operations currently conducted on the Leases and Xxxxx; and
f. to the best of Seller's knowledge, no notice from
any governmental body, including without limitation the ADEC
and EPA, has been served upon Seller or the operator of the
Property with respect to the Property claiming any violation
of any law or any other code, rule or regulation, which
could have a material adverse effect on the Property other
than those disclosed to Purchaser in writing prior to the
date hereof. To the best of Seller's knowledge, none of the
Property, nor the ownership, leasing, occupancy, or the
operation thereof, is in violation of any such law,
ordinance, code, rule or regulation, which would have a
material adverse effect on the Property. Except as
disclosed to Purchaser or known to Purchaser prior to the
date hereof, neither Seller nor, to the best of Seller's
knowledge, the operator of the Property or any portion
thereof has received notice of any violation of applicable
Environmental Laws, rules, regulations, ordinances and
orders relating thereto, including laws relating to the
generation, manufacture, processing, transportation or
distribution of pollutants, contaminants or hazardous or
toxic substances or wastes, the noncompliance with which
could have a material adverse effect on the ownership or
operation of the Property; and
g. there has been no material adverse change with
respect to operations conducted on the Property or the
production from the Property, not caused by acts of God,
which has affected the Property from and after the Effective
Date, and Seller has not done anything with respect to the
Property which is not in the ordinary course of Seller's
business, and which would have a material adverse effect on
the Property; and
h. to the best of Seller's knowledge, there is no
suit or action or legal or administrative proceeding or
arbitration pending or threatened, nor any claim, by any
administrative agency or governmental body pending or
threatened against any of the Property, or against Seller
and relating to or affecting in any way the Property, which
could have a material adverse effect on the Property, other
than those reflected in Exhibit "D" attached hereto; and
i. to the best of Seller's knowledge, the operator of
the Property has timely paid all taxes, governmental
charges, duties, penalties, interests and fines due and
payable by it and affecting the Property and its operations
on or before the date of this Agreement where the failure to
make such payment could jeopardize the continued validity of
a lease; and
j. neither Seller nor any affiliate of Seller has
employed any investment banker, broker or finder in
connection with the transactions contemplated by this
Agreement, nor have any of them taken any action which would
give rise to a valid claim against any party hereto for a
brokerage commission, finder's fee royalty or overriding
royalty or like payment and Seller shall indemnify and hold
Purchaser, its affiliates, and their respective officers,
directors, agents and employees harmless from any and all
such obligations; and
k. to the best of Seller's knowledge, except as set
forth in Exhibit "D", and except with respect to the Prudhoe
Bay Unit, no personal injury, material property damage or
other casualty loss has occurred on the Property, which has
not been finally resolved prior to the Effective Date, which
could subject Purchaser to liability; and
l. no third party has a preferential right to
purchase the Property or any portion thereof, except as set
forth in Exhibit "E"; and
m. no third party consents to the Assignment are
required, except as set forth in Exhibit "F" or except to
the extent such consents are customarily obtained subsequent
to an Assignment; and
n. Seller owns twelve thousand (12,000) shares of the
stock of Xxxx Inlet which represents thirty percent (30%) of
the outstanding shares of stock of Xxxx Inlet; and
o. to the best of Seller's knowledge, there are no
outstanding claims, bills, charges or debts associated with
Seller's ownership in Xxxx Inlet except normal operating
expenses and except as set forth in Section 14 hereof.
8. DUE DILIGENCE.
a. Promptly after the execution of this Agreement and
until the Closing Date, Seller will permit Purchaser to
review at Seller's office all available title files,
ownership maps, lease files, assignments, division orders,
payout statements, agreements and similar documents
respecting the Property and production, engineering and
environmental books, records and data in possession of
Seller, and all other files, records, and data related to
the Property, except those subject to attorney client
privilege and such seismic, geological and geophysical data
which Seller is prevented from disclosing by contractual
obligations with third parties. All such information made
available to Purchaser shall be subject to that certain
letter agreement dated September 27, 1996 between Seller and
Purchaser.
b. As set forth above, Seller shall allow Purchaser
or Purchaser's designee at reasonable times and at
Purchaser's sole risk, cost and expense, to conduct physical
inspections of the Property prior to Closing. Purchaser
does hereby indemnify and hold harmless the Seller
Indemnified Parties from and against any and all losses,
costs, damages, obligations, claims, liabilities, expenses
(including court costs and attorneys fees), or causes of
action arising from their inspection and observation of the
Property after the execution of this Agreements, including,
without limitation, claims for personal injuries or death of
their employees, their contractors, agents, consultants and
representatives and the employees thereof, and property
damages, regardless of whether such claims are caused by the
sole or concurrent negligence of Seller or the condition of
the Property.
9. REPRESENTATIONS BY PURCHASER. Purchaser hereby
represents to Seller that:
a. Purchaser is a corporation duly organized, validly
existing and in good standing under the laws of the State of
Delaware, has the corporate power and authority and is duly
qualified to own the Property and to do business in the
State of Alaska and to enter into and carry out the terms of
this Agreement.
b. The execution and delivery of this Agreement and
the consummation of the transactions contemplated by this
Agreement have been duly authorized by all necessary
corporate action on behalf of Purchaser and constitute the
legal, valid and binding obligations of Purchaser
enforceable against Purchaser in accordance with their
terms. The consummation of the transactions contemplated
hereby will not violate, conflict with or constitute a
default (or an event which without notice or lapse of time
or both would become a default) pursuant to
(i) any provisions of its charter or bylaws; or
(ii) to the best of Purchaser's knowledge, any
contract, agreement or instrument to which Purchaser is
bound or affected; or
(iii) any law, regulation or any order, writ,
injunction or decree of any court or governmental
instrumentality.
c. This Agreement has been duly executed and
delivered on behalf of Purchaser, and all documents and
instruments required hereunder to be executed and delivered
by it shall have been duly executed and delivered.
d. Neither Purchaser nor any affiliate of Purchaser
has employed any investment banker, broker or finder in
connection with the transactions contemplated by this
Agreement, nor have any of them taken any action which would
give rise to a valid claim against any party hereto for a
brokerage commission, finder's fee or like payment and
Purchaser shall indemnify and hold the Seller Indemnified
Parties harmless from any and all such obligations.
e. The Property to be acquired by Purchaser pursuant
to this Agreement is to be acquired for the benefit of their
shareholders and not for distribution in violation of the
securities laws of the United States of America or any state
thereof.
f. There is no suit or action or legal or
administrative proceeding or arbitration pending nor any
claim by any administrative agency or governmental body
pending or threatened which could have an adverse effect on
the ability of Purchaser to perform its obligations under
this Agreement.
10. OPERATIONS AND PRODUCTION AFTER THE EFFECTIVE DATE;
POST CLOSING ADJUSTMENT PROCEDURE. Seller shall be
responsible for all necessary and reasonable expenses
incurred for the operation of the Property prior to the
Effective Date, except as to any operations which Seller
chose not to participate in or with respect to which Seller
elected to go non-consent pursuant to the applicable
Associated Contract. Purchaser shall be responsible for
all necessary and reasonable expenses incurred for the
operation of the Property from and after the Effective
Date. "Expenses" as used in this Section 10 shall include,
without limitation, operation, production, workover and
maintenance of the Property facilities, Leases and Xxxxx.
From and after the date hereof until Closing, Seller shall
maintain and operate the Property (or cause the operator of
the Property to maintain and operate the Property) in a
prudent manner consistent with past practices of Seller
and/or the operator of the Property and with good oil and
gas field practices. Except in the case of emergency, from
and after the date hereof, Seller shall not make any single
expenditure related to the Property, or commit to do so, in
an amount that requires the approval of Seller pursuant to
the applicable Associated Contract without Purchaser's
prior written consent. In case of emergency, Seller may
take such action and make such expenditures as are
reasonably necessary to meet the emergency and shall provide
Purchaser with prompt, written and detailed information on
the nature of the emergency and the expenditures. Except
for the sale of production in the ordinary course of
business, from and after the Effective Date, Seller shall
not sell, trade, bargain, convey or otherwise dispose of the
Property or any portion thereof, or commit to do so without
the prior written consent of Purchaser. From and after the
date hereof, Seller shall not drill, sidetrack, rework,
recomplete or abandon any Well or commit to do so
irrespective of the cost thereof, without Purchaser's prior
written consent.
The production from the Property and all proceeds from the
sale thereof attributable to production prior to the
Effective Date shall be the property of Seller. The
production from the Property and all proceeds from the sale
thereof attributable to production from and after the
Effective Date shall be the property of Purchaser.
To account for adjustments to the Purchase Price, as
provided in Section 3b above, as soon as practicable after
Closing, but no later than six (6) months after Closing,
Seller shall prepare and deliver to Purchaser, in accordance
with this Agreement and generally accepted accounting
principles, a statement ("Final Settlement Statement")
setting forth each adjustment or payment that was not
finally determined as of Closing, and showing the
calculation of such adjustments. Within sixty (60) days
after receipt of the Final Settlement Statement, Purchaser
shall deliver to Seller a written report containing changes
that Purchaser proposes to be made to the Final Settlement
Statement. The parties shall then attempt to agree with
respect to the amounts due pursuant to such post closing
adjustments no later than thirty (30) days after Seller
receives Purchaser's proposed changes. The net amount of the
agreed upon changes shall be either added to or subtracted
from the Purchase Price and the Purchase Price as so
adjusted shall be the "Final Purchase Price" and the date
upon which the Final Purchase Price is agreed shall be the
"Final Settlement Date". If the Final Purchase Price is
more than the Purchase Price as adjusted at Closing (the
difference being the "Upward Adjustment"), Purchaser shall
pay the amount of such Upward Adjustment to Seller, via wire
transfer in immediately available funds, within five (5)
days after the Final Settlement Date. If the Final Purchase
Price is less than the Purchase Price as adjusted at Closing
(the difference being the "Downward Adjustment"), Seller
shall pay the amount of Downward Adjustment to Purchaser,
via wire transfer in immediately available funds, within
five (5) days after the Final Settlement Date.
The foregoing provisions of this Section 10 shall not apply
to Seller's shares in Xxxx Inlet. Should any matter be
brought to a vote of the Board of Directors or Shareholders
of Xxxx Inlet from the date hereof until Closing, then
Seller shall consult with Purchaser on such matter and shall
vote in accordance with Purchaser's written instructions, to
the extent consistent with legal obligations and duties
imposed on members of Xxxx Inlet's Board of Directors.
11. TAXES.
a. The owner of record on the assessment date of any
property taxes shall file or cause to be filed all required
reports and returns incident to the property taxes and shall
pay or cause to be paid to the taxing authorities all
property taxes relating to the tax period during which the
Closing occurs.
b. The Purchase Price excludes, and Purchaser shall
be liable for, any sales, use, excise, stock, stamp,
document, filing, recording, authorization and similar
taxes, fees and charges required to be paid in connection
with the sale of the Property pursuant to this Agreement.
Purchaser agrees to indemnify the Seller Indemnified Parties
from and against any such taxes, fees and charges required
to be paid in connection with, or as a result of, the
consummation of the transactions contemplated by this
Agreement.
c. Purchaser and Seller agree to provide each other
with reasonable access to all relevant documents, data and
other information (other than that which is subject to an
attorney client or other privilege) which may be required by
the other party for the purpose of preparing royalty reports
and tax returns, filing refund claims and responding to any
audit by any lessor or taxing jurisdiction. Except where
disclosure is required by applicable law or judicial order,
any information obtained by a party pursuant to this Section
11c. shall be kept confidential by such party, except to the
extent disclosure is required in connection with the filing
of any tax returns or claims for refund or in connection
with the conduct of an audit, or other proceedings in
response to any audit, by a taxing jurisdiction.
d. Purchaser shall be responsible for all other taxes
relating to the Property from and after the Effective Date.
Seller shall be responsible for all other taxes relating to
the Property prior to the Effective Date.
12. OBLIGATIONS OF THE PARTIES.
a. As of the Effective Date, Purchaser shall assume
and agrees to perform, pay for and comply with the
obligations and liabilities (express or implied) of Seller
relating to the Property (i) of which Purchaser has
knowledge and (ii) to the extent required by this Agreement
or as set forth in the Official Records, the Associated
Contracts, the Leases, or applicable laws or regulations,
including without limitation, obligations arising with
respect to plugging, abandonment and clearing of all Xxxxx,
jackets, and/or platforms insofar and only insofar as such
Xxxxx, jackets and platforms are part of the Property.
Except as provided in Section 7g, and except to the extent
of Seller's gross negligence or willful misconduct,
Purchaser assumes the risk of any change in the condition of
the Property from and after the Effective Date and there
shall be no reduction in the Purchase Price due to such
change in condition of the Property.
b. As set forth generally in Section 1a, Seller and
Purchaser acknowledge that certain of Seller's interests in
facilities and production in the area of the facilities and
production which are part of the Property, including,
without limitation, certain undivided interests in the TBPF,
do not constitute a part of the Property ("Retained
Interests"). Seller and Purchaser acknowledge that, EXCEPT
AS EXPRESSLY PROVIDED OTHERWISE HEREIN, SELLER RETAINS ALL
LIABILITY FOR THE RETAINED INTERESTS, INCLUDING, WITHOUT
LIMITATION, ALL LIABILITY FOR POLLUTION, ENVIRONMENTAL
DAMAGE, NORM, INJURY OR DEATH OF ANY PERSONS OR DAMAGE, LOSS
OR DESTRUCTION OF ANY PROPERTY (REAL OR PERSONAL) AND ANY
AND ALL LIABILITY ASSOCIATED WITH THE PLUGGING AND
ABANDONMENT OF FACILITIES, PIPELINES, XXXXX AND PLATFORMS TO
THE EXTENT, BUT ONLY TO THE EXTENT, THAT THEY ARE PART OF
THE RETAINED INTERESTS AND NOT EXPRESSLY PROVIDED OTHERWISE
HEREIN AND SELLER SHALL INDEMNIFY AND SAVE PURCHASER, ITS
DIRECTORS, OFFICERS, SHAREHOLDERS, EMPLOYEES, AGENTS AND
ASSIGNS ("PURCHASER INDEMNIFIED PARTIES") HARMLESS FROM AND
AGAINST ALL SUCH LIABILITIES INCLUDING, WITHOUT LIMITATION,
REASONABLE ATTORNEY'S FEES AND COURT COSTS, ASSOCIATED WITH
THE RETAINED INTERESTS.
c. (i) Seller shall be responsible for eighty
percent (80%) of the environmental, plugging and
abandonment liabilities attributable to Seller's fifty-one
and two tenths percent (51.2%) ownership of the Steelhead
Platform (which is part of the Retained Interests) and
Purchaser shall be responsible for environmental, plugging
and abandonment liabilities for the remainder of the
Retained Interests.
(ii) If and when Unocal should resign or be
removed as Suboperator of the Steelhead Platform, then
Purchaser agrees that upon written request from Seller and
provided that, at the time of such request, Seller has an
ownership interest in the Steelhead Platform, Purchaser
shall take all reasonable and necessary action pursuant to
the applicable agreements and to the extent Purchaser can do
so without spending other than nominal sums of money (other
than sums for which Seller agrees to reimburse Purchaser),
to have Seller elected as successor Suboperator of the
Steelhead Platform. Purchaser's obligations with respect to
having Seller elected successor of the Steelhead Platform
are personal to Marathon Oil Company and shall vest only in
those of Seller's successors and assigns which are
affiliates or subsidiaries of Marathon Oil Company, or which
acquire all or substantially all of the assets of Marathon
Oil Company.
(iii) Seller shall have full access to the Xxxxx
Xxxxxx, King Salmon and Grayling Platforms and to the TBPF
for future gas production activities from the Retained
Interests. Seller shall have the right but not the
obligation to take over Purchaser's rights and obligations
for any slot and wellbore on any of those three platforms
prior to final abandonment by Purchaser. Seller's
acceptance of a Well and slot shall not relieve Purchaser of
any environmental, plugging and abandonment obligations for
the platform, facilities, pipelines, slots and Xxxxx at the
time of final abandonment, but Seller, in turn, shall assume
the environmental, plugging and abandonment liability for
one of the Steelhead oil or water injection xxxxx for each
slot (and associated Well) which Seller takes over on the
Xxxxx Xxxxxx, Xxxx Salmon and Grayling Platforms. Seller
shall reimburse Purchaser for Purchaser's working interest
ownership share of any Grayling Gas Sands Well investments
made by Purchaser after the Effective Date, for each Well
taken over (but not to exceed five hundred thousand dollars
($500,000) for each Well) and shall bear the cost of
subsequent facility modifications required by Seller to
produce gas well gas from each Well. Purchaser shall not be
obligated to maintain these platforms for Seller's future
use. Seller shall have the right, but not the obligation,
to assume Purchaser's interest and abandonment obligations
in any of these platforms prior to Purchaser's committing to
abandonment.
d. Seller shall allow Purchaser to board and inspect
the Xxxxx Platform at Purchaser's sole cost, risk and
expense. Purchaser shall be responsible for all liabilities
and damages associated with such visits. If, within five
(5) years from the Closing Date, Purchaser elects to drill,
redrill or recomplete a well, or establish any oil and gas
production operations from the Xxxxx Platform, then Seller
shall convey such platform to Purchaser at no additional
cost to Purchaser subject to mutually agreeable terms,
including a requirement that Purchaser shall assume Xxxxx
Platform ownership (which includes all environmental,
plugging and abandonment liabilities associated with the
Xxxxx Platform facilities, xxxxx and pipelines). Purchaser
understands that the Xxxxx Platform is inactive and will
require expenditures to establish production. Seller shall
not be obligated to maintain this platform for Purchaser's
future use. Purchaser shall have the right, but not the
obligation, to assume Seller's interest in the Xxxxx
Platform at any time prior to Seller's committing to
abandonment thereof or sale to a third party.
Seller shall allow Purchaser to board and inspect the Spark
Platform at Purchaser's sole cost, risk and expense. Until
the third anniversary of the Closing Date, Purchaser shall
have the option to use the Spark Platform to drill, redrill
or recomplete a well, or establish any oil and gas
production operations. Subject to mutually agreeable terms,
if Purchaser elects to exercise such option, Seller shall
sell Seller's interest in the Spark Platform, including
developed gas reserves and all other rights of Seller in the
associated Leases, to Purchaser for ten million five hundred
thousand dollars ($10,500,000) and Purchaser shall assume
all obligations for the environmental, plugging and
abandonment of the Spark Platform and its facilities, xxxxx,
and pipelines. If Purchaser elects to purchase the Spark
Platform during the option period, Seller shall thereafter
exchange gas pursuant to the agreement described in Section
12e below. Seller shall not be obligated to maintain this
platform for Purchaser's future use. If Purchaser does not
exercise the foregoing option prior to the third anniversary
of the Closing Date, then Purchaser shall have the right,
but not the obligation, to assume Seller's interest in this
platform prior to Seller's committing to abandonment. If
Seller receives a bona fide offer from a third party to
purchase the Spark Platform on or after the third
anniversary of the Closing Date, Seller shall immediately
notify Purchaser of such offer, and Purchaser will then have
sixty (60) days in which to match such offer to purchase the
Spark Platform pursuant to this Section 12d. Purchaser's
failure to match the third party offer in a timely manner
will be a waiver of the right of first refusal.
The options to purchase the Spark and Xxxxx Platforms
pursuant to this Section 12d are personal to Forcenergy Inc
and shall vest only in those of its successors and assigns
which are affiliates or subsidiaries of Forcenergy, or which
succeed to all or substantially all of the assets of
Forcenergy Inc.
e. Seller shall, at no additional cost to Purchaser,
provide up to 20 BCF of Grayling Gas Sands ("GGS") gas to
Purchaser at XxXxxxxx River Field, to be used only for fuel
gas in the oil operations at XxXxxxxx River and Trading Bay
Fields. Seller and Purchaser shall enter into an agreement
for the supply of this fuel gas in substantially the same
form as Exhibit "J" hereto.
Seller shall exchange (swap) up to 20 BCF of gas with
Purchaser with no exchange fee charged by Seller and Seller
will not incur any additional costs associated with this gas
exchange. This exchange shall be governed by the applicable
provisions of a separate agreement in substantially the same
form as Exhibit "J" hereto.
At Purchaser's election, Seller shall sell gas to Purchaser
pursuant to the applicable provisions of a separate
agreement in substantially the same form as Exhibit "J"
hereto.
f. If the owners of Xxxx Inlet, other than Seller, do
not consent to Purchaser as having adequate financial
responsibility to meet the obligations of Seller under the
Xxxx Inlet Funding Agreement and the Guaranty Agreement,
Purchaser agrees to procure and maintain liability
insurance, provided such insurance is obtainable at
commercially reasonable rates, with financially reputable
liability insurance providers, with such deductable and/or
self insurance retention levels and in such policy amounts
as is commercially reasonable and prudent in connection with
the ownership of the Property. Such insurance shall extend
to Purchaser's liabilities under the Xxxx Inlet Funding
Agreement and the Guaranty Agreement. Such insurance shall
designate Seller as an additional insured thereunder.
g. Seller shall take all necessary action on behalf
of Purchaser to insure that Purchaser derives all benefit of
Seller in that certain letter agreement dated January 29,
1996 between Seller and Unocal.
h. If Purchaser is ever entitled, as a TBU working
interest owner, to vote on the possible expansion of the
Grayling Gas Sands WIPA, Purchaser will vote on such
question as directed by the written instructions of Seller.
If the Grayling Gas Sands WIPA should ever be expanded
(horizontally or vertically), Purchaser shall execute the
necessary State of Alaska forms to effectuate record title
transfer of its interests to Seller in the TBU Grayling Gas
Sands in the expanded area. If Purchaser desires to drill a
well which results in the expansion of the Grayling Gas
Sands WIPA, Purchaser shall first consult with Seller and,
if Seller approves such well, Seller shall reimburse
Purchaser for Seller's share of the costs of such well
simultaneously with Purchaser's assignment of record title
in the expanded Grayling Gas Sands WIPA to Seller.
13. INDEMNIFICATION. CONTINGENT UPON COMPLETION OF THE
CLOSING, AND SUBJECT TO OTHER INDEMNITY PROVISIONS CONTAINED
HEREIN:
a. SELLER SHALL DEFEND, INDEMNIFY AND HOLD HARMLESS
THE PURCHASER INDEMNIFIED PARTIES FROM ANY AND ALL
LIABILITY, LIENS, DEMANDS, JUDGMENTS, SUITS, CLAIMS AND
EXPENSES OF ANY KIND OR CHARACTER, INCLUDING WITHOUT
LIMITATION, REASONABLE ATTORNEY'S FEES AND COURT COSTS,
ARISING OUT OF OR IN CONNECTION WITH THE PROPERTY PRIOR TO
THE EFFECTIVE DATE; INCLUDING WITHOUT LIMITATION, AUDIT
ADJUSTMENTS UNDER APPLICABLE JOINT OPERATING AGREEMENTS,
ROYALTIES, RENTALS AND TAXES, CONTRACTUAL CAUSES OF ACTION,
CLAIMS FOR INJURY OR DEATH OF ANY PERSONS OR DAMAGE, LOSS,
OR DESTRUCTION OF ANY PROPERTY, REAL OR PERSONAL, UNDER ANY
THEORY OF TORT, CONTRACT OR STRICT LIABILITY.
b. EXCEPT FOR SELLER'S GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT, PURCHASER SHALL DEFEND, INDEMNIFY AND HOLD
HARMLESS THE SELLER INDEMNIFIED PARTIES FROM ANY AND ALL
LIABILITY, LIENS, DEMANDS, JUDGMENTS, SUITS, CLAIMS AND
EXPENSES OF ANY KIND OR CHARACTER, INCLUDING REASONABLE
ATTORNEY'S FEES AND COURT COSTS, ARISING OUT OF OR IN
CONNECTION WITH THE PROPERTY FROM AND AFTER THE EFFECTIVE
DATE; INCLUDING WITHOUT LIMITATION, AUDIT ADJUSTMENTS UNDER
APPLICABLE JOINT OPERATING AGREEMENTS, CONTRACTUAL CAUSES OF
ACTION, CLAIMS FOR INJURY OR DEATH OF ANY PERSONS OR DAMAGE,
LOSS, OR DESTRUCTION OF ANY PROPERTY, REAL OR PERSONAL,
UNDER ANY THEORY OF TORT, CONTRACT OR STRICT LIABILITY.
c. SELLER AND PURCHASER AGREE THAT THE INDEMNITY
PROVISIONS OF THIS SECTION 13 SHALL APPLY REGARDLESS OF
WHETHER THE APPLICABLE INDEMNIFIED PERSON WAS WHOLLY OR
PARTIALLY, ACTIVELY OR PASSIVELY, NEGLIGENT OR OTHERWISE AT
FAULT, AND WHETHER OR NOT THE CLAIMS ARE BASED ON A THEORY
OF NEGLIGENCE, NEGLIGENCE PER SE, STRICT LIABILITY, WILLFUL
MISCONDUCT, PRODUCTS LIABILITY, PREMISES LIABILITY,
LIABILITY BASED ON STATUTE, OR OTHER THEORY OF LIABILITY AS
TO THE APPLICABLE INDEMNIFIED PERSON, AND REGARDLESS OF BY
WHOM THE CLAIMS ARE MADE OR BROUGHT, INCLUDING, WITHOUT
LIMITATION, PURCHASER'S OR SELLER'S EMPLOYEES, AGENTS OR
REPRESENTATIVES, PRIVATE CITIZENS, PERSONS OR ORGANIZATIONS,
OR ANY REPRESENTATIVES OF ANY FEDERAL, STATE OR LOCAL
GOVERNMENT.
14. EXISTING CONTRACTS. The Assignments will be made
subject to this Agreement. Effective as of the Effective
Date, Purchaser shall assume Seller's debt associated with
its ownership in Xxxx Inlet not to exceed $6,700,000 (or if
and to the extent that rights of first refusal with respect
to Xxxx Inlet stock are exercised, a proportionately reduced
amount). Any such debt in excess of $6,700,000 (or the
proportionately reduced amount) shall not be assumed by
Purchaser. Any change in the debt of Xxxx Inlet after the
Closing shall be for the account of and the responsibility
of Purchaser. As a stockholder in Xxxx Inlet, Purchaser
shall also assume Seller's share of Xxxx Inlet's obligation
to maintain a letter of credit in favor of the EPA
concerning Xxxx Inlet ballast water treatment facilities in
an amount up to $4,800,000 (or, if and to the extent rights
of first refusal to purchase Xxxx Inlet stock are exercised,
a proportionately reduced amount) and shall replace Seller
as the obligor of such letter of credit. If and when such
letter of credit is drawn down, either in whole or in part
for claims directly related to the Xxxx Inlet ballast water
treatment facilities, Seller shall, within three (3)
business days of receipt of written notice thereof, pay to
Purchaser, by wire transfer of immediately available funds,
the full amount by which the letter of credit was drawn
down.
15. PREFERENTIAL RIGHTS AND CONSENTS. Seller shall cause
all preferential rights of third parties, if any, to
purchase all or a portion of the Property to be exercised or
waived prior to Closing. To facilitate the consummation of
the transactions contemplated by this Agreement, the Parties
may defer Closing for any portion of the Property subject to
the exercise of preferential purchase rights which have not
been waived prior to the time that the Parties agree to
close on the remaining portion of the Property. Seller
shall procure all necessary third party consents to the
Assignments prior to Closing except for such consents
customarily granted by government agencies following
execution of assignments of oil and gas leases, easements,
rights of way and interests therein. Exhibit "G" attached
hereto is an allocation of the Purchase Price among the
portions of the Property. Said allocation or pertinent
portion thereof shall be provided to third parties owning
preferential purchase rights to establish the portion of the
Purchase Price to be allocated to the portion of the
Property ("Allocated Value") associated with the
preferential rights.
16. CONDITIONS PRECEDENT.
a. Purchaser's obligations to deliver the Purchase
Price at Closing is subject to Purchaser's satisfaction that
the following conditions (which may occur simultaneously
with the delivery of the Purchase Price) have been met.
(i). Seller shall have performed and complied
with all terms of this Agreement required to be performed or
complied with by Seller on or before Closing, and all of the
representations and warranties made by Seller in this
Agreement shall be true and correct in all material respects
on and as of Closing; and
(ii). no suit, action or proceeding by or before
any governmental authority shall have been instituted or
threatened (and not subsequently dismissed, settled, or
otherwise terminated) which might restrain, prohibit or
invalidate any of the transactions contemplated by this
Agreement other than an action or proceeding instituted or
threatened by Purchaser or any of its affiliates; and
(iii). Seller and Purchaser shall have executed
and delivered to Purchaser an assignment(s) of the Property,
which assignment(s) shall be in the representative form
which is attached as Exhibits "C-1" and "C-2" (the
"Assignments"); and
(iv). all liens and encumbrances not constituting
Permitted Encumbrances affecting the Property shall have
been released; and
(v). that there are no Title Defects (except
those waived by Purchaser or which cumulatively have Defect
Values of less than $600,000) and Seller has Marketable
Title to the Property free and clear of all unreleased
mortgages, security interests liens and encumbrances, except
for Permitted Encumbrances, that Seller's interest in each
of the Leases and Xxxxx being transferred is as recited in
Exhibit "A" and such interest entitles Seller to not less
than the Net Revenue Interest nor more than the Working
Interest unless there is a proportionate increase in the Net
Revenue Interest set out in Exhibit "A"; and
(vi). that there are no Environmental Defects
identified by Purchaser by the Environmental Notice Deadline
which have not been remedied to Purchaser's satisfaction.
(vii). all requisite filings, if any, pursuant to
the Xxxx-Xxxxx-Xxxxxx Antitrust Improvement Act of 1976, as
amended, have been made and all necessary approvals with
respect thereto have been received.
b. Seller's obligation to proceed with Closing is
subject to Seller's satisfaction that the following
conditions have been met:
(i). Purchaser shall have performed and complied
with all terms of this Agreement required to be performed or
complied with by Purchaser prior to Closing, and all of the
representations and warranties made by Purchaser under this
Agreement shall be true and correct in all material respects
on and as of the Closing; and
(ii). No suit, action or proceeding by or before
any governmental authority shall have been instituted or
threatened (and not subsequently dismissed, settled, or
otherwise terminated) which might restrain, prohibit or
invalidate any of the transactions contemplated by this
Agreement other than an action or proceeding instituted or
threatened by Seller or any of its affiliates; and
(iii). Seller and Purchaser shall have executed
and delivered to Purchaser the Assignments; and
(iv). Purchaser shall have delivered to Seller
the Purchase Price as adjusted by delivering an amount equal
to the sum provided for in Section 3a as adjusted pursuant
to Section 3b.
(v) Seller shall have received documentation
satisfactory to Seller evidencing the release of Seller from
any and all liability up to $4,800,000 (or the
proportionately reduced amount if applicable) with respect
to the letter of credit in favor of the EPA concerning Xxxx
Inlet's ballast water treatment facilities, and up to
$6,700,000 (or the proportionately reduced amount if
applicable) with respect to Xxxx Inlet's $22,000,000 credit
facility. Seller shall use all reasonable efforts to
accomplish the foregoing prior to the Closing Date.
(vi) Purchaser shall have executed counterpart
originals of the Xxxx Inlet Funding Agreement and the
Guaranty Agreement.
17. CLOSING. The Closing shall occur on or before April
30, 1997 ("Closing Date") at the offices of Seller at 0000
Xxx Xxxxxx, Xxxxxxx, Xxxxx 00000 (or at such other place as
the parties may agree). The following shall take place at
the Closing:
a. Seller and Purchaser shall execute the
Assignments, and the Assignments shall be delivered to
Purchaser;
b. Purchaser shall pay by wire transfer to the Seller
the Purchase Price, as adjusted. All amounts due by
Purchaser shall be sent to the following account: Marathon
Oil Company, National City Bank, Cleveland, Ohio, Transit
Routing Number 000000000, Account Number 0000000, Reference:
Gulf Coast Region for Alaska Region.
c. Seller shall deliver to Purchaser a certificate of
non-foreign status in the form attached hereto as Exhibit
"I".
d. Seller shall deliver to Purchaser a statement of
an officer of Seller certifying that, as of the Closing
Date, all of Seller's representations and warranties herein
remain true and correct and that Seller has complied with
all the material terms of this Agreement.
e. Purchaser shall deliver to Seller a statement of
an officer of Purchaser certifying that, as of the Closing
Date, all of its representations and warranties herein
remain true and correct and that Purchaser has complied with
all the material terms of this Agreement.
f. Purchaser and Seller shall execute transfer orders
or letters-in-lieu thereof in the form attached as Exhibit
"H" hereto, directing purchasers of production from the
Property to deliver proceeds from production on and after
the Effective Date to Purchaser.
No instrument to be executed and delivered at the Closing,
or action to be taken at the Closing, shall be effective
until all such agreements have been executed and delivered
or actions have been taken, and all such instruments and
actions shall be deemed to be effective concurrently.
If this Agreement is terminated, or the transactions
contemplated herein do not close by April 30, 1997 for any
reason other than Purchaser's breach of this Agreement, then
Seller shall immediately thereafter refund the Deposit,
without interest. The parties hereby acknowledge that the
extent of damages to Seller occasioned by Purchaser's breach
of this Agreement would be impossible or extremely difficult
to ascertain and that the amount of the Deposit is a fair
and reasonable estimate of such damages under the
circumstances. In the event of Purchaser's breach of this
Agreement, Seller shall retain ten percent (10%) of the
Deposit as liquidated damages as its sole remedy and shall
promptly refund the remaining ninety percent (90%) to
Purchaser. Provided however, if Purchaser elects to close
excluding Xxxx Inlet as provided in Section 6c, and such
closing occurs, then Seller shall have the remedy of
specific performance with respect to the purchase and sale
of Xxxx Inlet only.
18. TERMINATION.
a. This Agreement and the transactions contemplated
hereby may be terminated:
(i) at any time at or prior to Closing by mutual
consent of Seller and Purchaser; or
(ii) at any time after April 30, 1997, by Seller
or Purchaser, by the delivery of written notice to the other
party, if the Closing shall not have occurred by such date;
(iii) by Seller, if the total Allocated Value of
all portions of the Property excluded by Purchaser from this
Agreement exceeds ten percent (10%) of the Purchase Price.
provided, however that a Party may not exercise any right of
termination pursuant to this Section 18a if the event giving
rise to such termination right shall be due to the willful
failure of such Party to perform or observe in any material
respect any of the covenants or agreements set forth herein
to be performed or observed by such Party;
b. If this Agreement is terminated pursuant to
Section 18a, this Agreement shall become void and of no
further force or effect (except for the provisions of
Section 24 which shall survive such termination and continue
in full force and effect); provided, however, that such
termination shall not relieve either Party from liability
for any defaults under this Agreement that occurred prior to
such termination.
19. PURCHASER'S REMEDIES. Purchaser shall be entitled to
specific performance of this Agreement. Purchaser shall be
entitled to recover its reasonable litigation expenses,
attorneys fees and costs which are incurred by Purchaser as
a result of Seller's default.
20. NOTICES. All notices and communications required or
permitted under this Agreement shall be in writing and shall
be deemed given when actually received by the party entitled
to notice, addressed as follows:
Seller: Marathon Oil Company
X.X. Xxx 000000
Xxxxxxxxx, XX 00000-0000
Attention: Alaska Region Manager
Fax: (000) 000-0000
Purchaser: Forcenergy Inc
0000 X.X. 0xx Xxxxxx, Xxxxx 000
Xxxxx, XX 00000-0000
Attention: President
Fax: (000) 000-0000
21. COMPLETE AGREEMENT This Agreement (including the
Exhibits) constitutes the entire understanding and agreement
between the parties with respect to the subject matter
hereof, and supersedes all negotiations, prior discussions
and prior agreements and understandings relating to the
subject matter hereof. The terms of this Agreement shall
survive the Closing.
22. FURTHER ASSURANCES. The parties agree to do such
further acts or execute such further documents as may
reasonably be required to effectuate the terms of this
Agreement, including, without limitation, executing
assignments of the Leases on forms as may be required by the
State of Alaska.
23. FILES AND RECORDS.
a. Promptly after Closing, Seller shall deliver to
Purchaser originals of all files, records, data and
information in the possession of Seller relating to the
Property, with the exception of Seller's corporate,
financial and general tax records, privileged communications
between Seller and its attorneys and the work product of
Seller's attorneys, but including copies of all Lease files,
land files, Well files, oil sales contract files, division
order files, abstracts, title opinions, accounting files for
the Property and back up data relating thereto (including,
but not limited to computerized data) and other files,
records, data and information in the possession of Seller;
also, information and data, including engineering,
geological, geophysical and seismic data, logs, core sample
reports, seismic data and all rights thereto of Seller,
insofar as same are related to the Property and are in the
possession of Seller, but only to the extent transfer of
such geological, geophysical and seismic data or information
is not prohibited by existing contractual obligations with
third parties. Any engineering, geological and geophysical
data or information developed or prepared by Seller and
delivered to Purchaser shall be delivered to Purchaser
without any warranty or representation by Seller. Seller
may retain copies of such files, data, records and
information at Seller's expense.
b. Purchaser agrees that the records given to it
pursuant to Section 23a. shall be open for inspection by
representatives of Seller at reasonable times and upon
reasonable notice during regular business hours for a period
of ten (10) years following the date of Closing (or for such
longer period as may be required by law or governmental
regulation), and that Seller may during such period at its
expense make such copies thereof as it may reasonably
request. Seller and Purchaser each shall use commercially
reasonable efforts for a reasonable period of time following
Closing to afford the other access to, (i) in the case of
Seller, employees of Seller who remain employees of Seller
following the date of Closing and are familiar with the
ownership and operation of the Property and (ii) in the case
of Purchaser, employees of Purchaser who are familiar with
the ownership and operation of the Property, in each case
which the Party desiring such access shall reasonably
request for its proper corporate purpose, including, without
limitation, the defense of legal proceedings. Such access
may include interviews or attendance at depositions or legal
proceedings; provided, however, that in any event all out-of-
pocket expenses reasonably incurred by any Party in
connection with this Section 23b shall be paid or promptly
reimbursed by the Party requesting such access.
24. CONFIDENTIALITY AND PUBLIC ANNOUNCEMENTS.
a. Seller and Purchaser agree to use reasonable
business efforts to maintain the confidentiality of this
Agreement and any proprietary and confidential technical
information relating to Property, except for information (i)
which becomes available on a non-confidential basis from
another source not subject to an obligation of
confidentiality with respect to such information, (ii) which
becomes generally available to the public or within the
industry other than through a breach of this Agreement, or
(iii) the disclosure of which is required by law or the
Associated Contracts or (iv) which is necessary to provide
pursuant to preferential purchase rights. The parties
hereto agree not to record this Agreement. Upon execution
of this Agreement by both parties, Seller shall make all
records and documents, including, without limitation, title
records, respecting the Property available to Purchaser for
Purchaser's inspection and evaluation.
b. Seller and Purchaser shall consult with each other
prior to issuing any news release or making any similar
public announcement concerning this Agreement or the
transactions contemplated hereby and, except as required by
applicable law or the applicable rules or regulations of any
governmental body or stock exchange, neither Party shall,
prior to Closing, issue any news release or make any similar
public announcement without the prior written consent of the
other Party.
25. COUNTERPART EXECUTION. This Agreement may be executed
by signing the original or a counterpart thereof. If this
Agreement is executed in multiple counterparts, each
counterpart shall be deemed an original, and all of which
when taken together, shall constitute but one and the same
agreement with the same effect as if both Parties had signed
the same instrument.
26. SURVIVAL. The representations, warranties, and
indemnities made or provided for herein shall survive the
Closing and shall not be deemed to have merged with the
separate representations, warranties and covenants made in
the Assignments; provided, however, that any claim with
respect to the breach thereof must be brought within four
(4) years from the Closing Date after which time it shall be
deemed to have been waived.
27. MISCELLANEOUS PROVISIONS.
a. Captions have been inserted for reference purposes
only and shall not define or limit the terms of this
Agreement.
b. If any provision of this Agreement is held
invalid, illegal or incapable of being enforced under any
rule of law, all other conditions and provisions of this
Agreement shall nevertheless remain in full force and effect
so long as the economic or legal substance of the
transactions contemplated hereby is not affected in a
materially adverse manner with respect to either party.
c. This Agreement cannot be modified or amended
except by a written instrument duly executed by Seller and
Purchaser. No waiver of any of the provisions of this
Agreement shall be deemed or shall constitute a waiver of
any other provisions hereof (whether or not similar), nor
shall such waiver constitute a continuing waiver unless
expressly provided.
d. All expenses incurred by each party incidental to
the preparation and carrying out of this Agreement are for
the account of the party incurring the same.
e. Except as expressly provided herein to the
contrary, neither party hereto shall assign this Agreement
or any of its rights or obligations hereunder without the
prior written consent of the other party and any assignment
made without such consent shall be void. Except as
otherwise provided herein, this Agreement shall be binding
upon and inure to the benefit of the parties hereto and
their respective successors and permitted assigns. Seller
acknowledges and agrees that the restrictions set forth in
this Section 27e shall not, after Closing, obligate
Purchaser to obtain the written consent of Seller prior to
an assignment by Purchaser of its ownership interest in the
Property, and Purchaser acknowledges and agrees that any
such assignment shall not release Purchaser from any of its
liabilities or obligations hereunder.
f. Except as expressly provided herein, this
Agreement is not intended to create, nor shall it be
construed to create, any rights in any third party under
doctrines concerning third-party beneficiaries.
g. Purchaser and Seller waive any and all rights to
incidental, consequential (including, without limitation,
loss of profits), special, punitive and exemplary damages
resulting from a breach of this Agreement or any
representation or warranty hereunder.
h. This Agreement, the other documents delivered
pursuant hereto and the legal relations among the parties
hereto, shall be governed by and construed in accordance
with the internal laws of the State of Alaska. Any action
brought to enforce any provision hereof or claiming a breach
hereof shall be brought in a court of competent jurisdiction
in Anchorage, Alaska.
28. LIKE KIND EXCHANGE. Seller shall have the option, at
or before Closing, to structure the Closing of this
transaction in such a manner so as to qualify as part of a
like-kind exchange pursuant to Section 1031 of the Internal
Revenue Code. Purchaser will cooperate with Seller to
facilitate a "like-kind" exchange(s). In the event Seller
desires such an exchange(s)(including three corner
exchanges), Seller shall timely notify Purchaser, in
writing, of its intent and Seller shall be responsible for
arrangement of the like-kind exchange(s), compliance with
time limits on like-kind exchange(s), the preparation of
appropriate documents to complete the transaction, and all
additional costs related thereto. Seller shall defend,
indemnify and hold harmless the Purchaser
Indemnified Parties from and against any and all claims,
suits, causes of action, demands, liabilities, judgments,
fines, penalties, expenses (including, without limitation,
court costs and reasonable attorney's fees), damages and
losses of whatsoever kind or nature that relate to or are
attributable to any actions taken pursuant to this Section
28. Purchaser makes no representation as to the tax
consequences to Seller of such an exchange, and shall not in
any way be liable therefor.
29. XXXX-XXXXX-XXXXXX. If the Parties determine that the
Xxxx-Xxxxx-Xxxxxx Antitrust Improvement Act of 1976 ("Act")
is applicable to this transaction, then both Parties shall
promptly file with the Federal Trade Commission and the
Department of Justice the required notifications, reports,
and supplemental information to comply in all respects with
the requirements of the Act. Purchaser shall promptly pay
to the appropriate government agency all filing fees
required of "acquiring persons" as determined by the Act.
EXECUTED in multiple originals this ____ day of
__________, 199__, in the presence of the undersigned
competent witnesses.
Seller
WITNESSES: Marathon Oil Company
_________________________ By:_________________________
_________________________ Its:________________________
Purchaser
WITNESSES: Forcenergy Inc
_________________________ By:_________________________
_________________________ Its:________________________
k:\acct\xxxxxx\xxxx\marathn.doc
EXHIBITS
A - the Leases
B - Associated Contracts
C-1 - Assignment (oil and gas properties)
C-2 Assignment (Xxxx Inlet Pipe Line Company stock)
D - Litigation
E - Preferential Rights
F - Consents
G - Allocated Values
H - Letter-in-Lieu
I - Non Foreign Certificate
J - Fuel Gas Agreement
The above exhibits to the Purchase and Sale Agreement are excluded from
this document. Any omitted exhibits will be furnished to the Commission
upon request.
INDEX
SECTION
1. - DEFINITIONS
2. - PURCHASE AND SALE
3. - PURCHASE PRICE
4. - REPRESENTATIONS AND WARRANTIES
5. - TITLE MATTERS
6. - ENVIRONMENTAL MATTERS
7. - REPRESENTATIONS BY SELLER
8. - DUE DILIGENCE
9. - REPRESENTATIONS BY PURCHASER
10. - OPERATIONS AND PRODUCTION AFTER THE EFFECTIVE
DATE; POST CLOSING ADJUSTMENT PROCEDURE
11. - TAXES
12. - OBLIGATIONS OF THE PARTIES
13. - INDEMNIFICATION
14. - EXISTING CONTRACTS
15. - PREFERENTIAL RIGHTS AND CONSENTS
16. - CONDITIONS PRECEDENT
17. - CLOSING
18. - TERMINATION
19. - PURCHASER'S REMEDIES
20. - NOTICES
21. - COMPLETE AGREEMENT
22. - FURTHER ASSURANCES
23. - FILES AND RECORDS
24. - CONFIDENTIALITY AND PUBLIC ANNOUNCEMENTS
25. - COUNTERPART EXECUTION
26. - SURVIVAL
27. - MISCELLANEOUS PROVISIONS
28. - LIKE KIND EXCHANGE
29. - XXXX-XXXXX-XXXXXX
DEFINITIONS
SECTION
29. - Act
6a. - ADEC
6a. - Preamble - Agreement
15. - Allocated Value
16a.(iii)- Assignments
1a.(iii) - Associated Contracts
6a. - CERCLA
6d. - Claims
17. - Closing Date
1e. - Contingent Bonus
1a (vii) - Xxxx Inlet
5c. - Defect Value
0x. - Xxxxxxx
00. - Xxxxxxxx Xxxxxxxxxx
0x. - Environmental Defect
6y. - Environmental Laws
0x. - Xxxxxxxxxxxxx Xxxxxx Xxxxxxxx
0x. - EPA
10. - Expenses
10. - Final Purchase Price
10. - Final Settlement Date
10. - Final Settlement Statement
1f. - Funding Agreement
12e. - GGS
1g. - Guaranty Agreement
1a. - Leases
5a. - Marketable Title
0x. - XXXX
0x. - Xxxxxxxxxxxx Xxxxxxxx
0x. - OSHA
1b.(i) - Official Records
1b. - Permitted Encumbrances
0x. - Xxxxxxxx
0x. - Xxxxxxxx - Xxxxxxxxx
00x. - Purchaser Indemnified Parties
0x. - Xxxxxxxx Xxxxx
0x. - XXXX
0x. - Retained Interests
6a. - XXXX
6a. - Preamble - Seller
6b. - Seller Indemnified Parties
1a. - TBPF
1a. - TBU
5b. - Title Defect
1d. - "To the best of a party's knowledge"
10. - Upward Adjustment
1a.(ii) - Xxxxx
1a. - WIPA
