1
EXHIBIT 4.15
PURCHASE AND SALE AGREEMENT
This PURCHASE AND SALE AGREEMENT (this "Agreement") dated as of
September 8, 1997 by and among CABOT OIL & GAS CORPORATION, a Delaware
Corporation, CRANBERRY PIPELINE CORPORATION, a Delaware Corporation and BIG
XXXXX GAS COMPANY, a Delaware Corporation (hereinafter jointly referred to as
"Seller") and LOMAK PETROLEUM, INC., a Delaware Corporation, (hereinafter
referred to as "Purchaser").
W I T N E S S E T H:
WHEREAS, Seller desires to sell to Purchaser certain producing oil and
gas leasehold assets and related equipment and to transfer the liabilities and
obligations relating to and corresponding with such assets and equipment, and
Purchaser desires to acquire from Seller such producing oil and gas leasehold
assets and related equipment and will accept and assume the related and
corresponding liabilities and obligations under the terms and conditions herein
set forth.
NOW, THEREFORE, in consideration of the premises and of the respective
representations, warranties, covenants, agreements, assumptions of liabilities
and obligations, and conditions contained herein, the parties hereto hereby
agree as follows:
ARTICLE I
Definitions
As used in this Agreement, terms shall have the following respective
meanings:
Adjustment Estimate: As defined in Section 2.05(A).
Affiliate: Any Person that, directly or indirectly, or through one or
more intermediaries, controls, is controlled by or is under common control with
a party to this Agreement.
Agreed Interest Rate: Seven percent (7%) per year.
Assets: As defined in Section 2.01.
Books and Records: Seller's existing leasehold files, land files,
mineral rights files (where applicable), field equipment files, oil and gas
interest files, contract files, rights of way files, abstracts (if any), well
files, title opinions, curative information, land maps, electric logs, prospect
maps, engineering research files and records, core data, digital well records,
digital maps, geologic maps, production balancing agreements, and accounts
directly (and only) related to the Assets including any and all electronic data
files related thereto.
Closing: The closing of the purchase and sale transaction contemplated
by this Agreement.
Closing Date: The date of the Closing.
Deductible Amount: An amount equal to ONE MILLION FIVE HUNDRED
THOUSAND AND NO/100 DOLLARS ($1,500,000.00).
Designated Title Defects: As defined in Section 7.04.
Effective Time: As defined in Section 2.01.
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Encumbrances: Any mortgage, lien, security interest, pledge, charge,
encumbrance, claim, limitation, irregularity, burden or defect.
Environmental Condition: Any existing condition to the soil,
subsurface, surface waters, groundwaters, atmosphere or other environmental
medium, whether or not yet discovered, which could result in any damage, loss,
cost, expense, claim, demand, investigation, lien or liability relating to the
Assets under any Environmental Statute.
Environmental Deductible Amount: An amount equal to ONE MILLION AND
NO/100 DOLLARS ($1,000,000.00).
Environmental Statute: The Resource Conservation and Recovery Act of
1976, as amended prior to the Closing Date, 42 U.S.C. Sections 6901 et seq.
("RCRA"), the Comprehensive Environmental Response, Compensation, and Liability
Act of 1980 as amended prior to the Closing Date, 42 U.S.C. Sections 9601 et
seq. ("CERCLA"), and all regulations issued thereunder prior to the Closing
Date, and all other Legal Requirements relating to air or water quality,
hazardous or solid wastes, hazardous substances or any other environmental
matters.
Final Settlement Statement: As defined in Section 2.05(B).
Gas Balancing Arrangement: Any circumstance pursuant to which a Person
(including Seller) that owns an interest in the Leaseholds or Mineral Properties
or any unit or joint operating agreement in which the Leaseholds or Mineral
Properties are included or any pipeline purchaser has taken or received, or
failed to have received, any amount of Hydrocarbons under any gas balancing
agreements, Oil and Gas Contracts, or under any other circumstances, including
any rights at law or in equity, that permit any other Person later to "balance"
(whether in kind, in cash or otherwise) by taking for the account of such other
person or pipeline purchaser any disproportionate allocation of Hydrocarbons or
their sale proceeds.
Xxxxxxx Letter Agreement: As defined in Section 13.02(I).
Xxxxxxx Properties: As defined in Section 13.02(I).
Hydrocarbons: Crude oil, natural gas, natural gas liquids and other
gaseous and liquid hydrocarbons or any combination thereof.
Lease Burdens: All royalty interests, overriding royalty interests,
production payments, net profits interests or other similar interests that
constitute a burden on, are measured by or are payable out of the production of,
Hydrocarbons or the proceeds realized from the sale or other disposition
thereof.
Leaseholds: As defined in Section 2.01.
Legal Requirements: Any law, statute, ordinance, decree, requirement,
order, judgment, rule or regulation of, including the terms of any license,
permit, certificate, or abandonment approval issued by, any governmental
authority in existence prior to, at the time of, or after the Closing Date.
Like-Kind Exchange: As defined in Section 11.04.
Mineral Properties: As defined in Section 2.01.
Net Revenue Interest: An interest (expressed as a percentage) in and to
Hydrocarbons produced and saved from or allocated to a Leasehold after deducting
all applicable Lease Burdens.
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Oil and Gas Contracts: Any contracts that affect or relate to the
Leaseholds or the Hydrocarbons covered thereby including amendments to and
claims under oil and gas contracts. "Oil and Gas Contracts" includes acreage
contribution agreements, advance payment agreements, bottom hole agreements,
division orders, drilling contracts, dry hole agreements, exploration
agreements, farmin and farmout agreements, gas balancing agreements (including
claims to recover natural gas or money under gas balancing agreements for
Seller's underproduction before the Effective Time), natural gas and oil sales,
exchange, treating and processing contracts, operating agreements, participation
agreements, storage agreements, support agreements, transfer orders,
transportation agreements, and water rights agreements.
Operating Agreements: Joint operating agreements covering the Assets or
joint operating agreements to which the Assets are subject.
Option Agreement: As defined in Section 13.02(J).
Option Purchase Price: As defined in Section 13.02(J).
Overriding Royalty Interest: An interest in oil, gas and other minerals
produced at the surface, free of the expense of production (but not
transportation or marketing) and in addition to the usual landowner's royalty
reserved to the lessor in an oil and gas lease.
Performance Deposit: As defined in Section 2.03.
Permitted Encumbrances: Those encumbrances described in the Assignment,
Xxxx of Sale, and Conveyance attached as Exhibit "B" to this Agreement and the
following items,
(i) Encumbrances that arise under Oil and Gas Contracts
of a type and nature customary in the oil and gas
industry to secure the payment of amounts that are
not yet delinquent or, if delinquent, are being
contested in good faith in the ordinary course of
business;
(ii) Encumbrances that arise as a result of pooling and
unitization agreements, declarations,
farmouts/farmins, pooling designations, orders or
laws;
(iii) Encumbrances securing payments to mechanics and
materialmen, and Encumbrances securing payment of
taxes or assessments that are, in either case, not
yet delinquent or, if delinquent, are being contested
in good faith in the normal course of business;
(iv) consents to assignment by governmental authorities
(a) that have been obtained on or prior to the
Closing Date or (b) that are customarily obtained
after the delivery of the conveyance of the nature
contemplated by this Agreement;
(v) conventional rights of reassignment obligating Seller
to reassign its interest in any portion of the Assets
to a third party in the event it intends to release
or abandon such interest prior to the expiration of
the primary term or other termination of such
interest;
(vi) easements, rights of way, servitudes, permits,
surface leases, surface use restrictions and other
surface uses and impediments, on, over or in respect
to any of the Assets that are not such as to
interfere materially with the operation, value or use
of the Assets, taken as a whole;
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(vii) such Title Defects as Purchaser expressly waives in writing or
which are waived by Closing or operation of Section 7.04;
(viii) rights reserved to or vested in any governmental authority to
control or regulate any of the Assets in any manner, and all
applicable Legal Requirements;
(ix) matters described in any schedule to this Agreement;
and
(x) any Encumbrance the enforcement of which is barred under
applicable statute of limitations.
Person: An individual, group, partnership, corporation, trust or other
entity.
Pipeline: As defined in Section 2.01
Purchase Price: As defined in Section 2.03.
Purchaser: As defined in the preamble to this Agreement.
Purchaser Indemnified Loss: Any loss, damage or expense (including
reasonable attorneys' fees, expert witness fees and court costs) sustained by
Purchaser arising out of or resulting from any inaccuracy in or breach of any of
the representations, warranties or covenants made by Seller in this Agreement;
provided "Purchaser Indemnified Loss" shall not refer to or include any remedy
under Article VII.
Seller: As defined in the preamble to this Agreement.
Seller Employees: As defined in Section 12.01.
Seller Indemnified Loss: Any loss, damage or expense (including
reasonable attorneys' fees, expert witness fees and court costs) sustained by
Seller arising out of or resulting from (i) any inaccuracy in or breach of any
of the representations, warranties or covenants made by Purchaser in this
Agreement or (ii) the payment or other disposition of the amounts paid to
Purchaser under Section 3.02(D).
Seller's Knowledge: The actual knowledge of the managerial employees of
Seller in charge of the particular matter or function at the level of District
Superintendent or above within Seller's organization.
Tax Credit Properties: As defined in Section 13.02 (J).
Tax Credit Properties Letter Agreement: As defined in Section 13.02
(J).
Tax Credit Properties Purchase Price: As defined in Section 13.02 (J).
Title Defect: Any Encumbrance, other than a Permitted Encumbrance, that
would (a) cause Seller to own less than the Net Revenue Interest in a Leasehold
shown on Exhibit "A" to the Agreement or (b) obligates Seller to pay and bear a
share of the costs and risks of exploring, developing and operating a Leasehold
greater than the Working Interest shown on Exhibit "A" to the Agreement.
Title Defect Amount: As defined in Section 7.04.
Title Defect Deductible Amount: An amount equal to TWO MILLION AND
NO/100 DOLLARS ($2,000,000.00)
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Unit Agreements: Pooling and/or unit agreements covering the Assets to
which the Assets are subject.
Working Interest: The interest in the full and entire leasehold estate
created by virtue of the Leaseholds and all rights and obligations of every kind
and character appurtenant thereto, or arising therefrom.
ARTICLE II
Purchase and Sale
2.01. Conveyance and Transfer of Assets. Seller and Purchaser,
intending to be bound by this Agreement, hereby agree that, at Closing, subject
to the terms and conditions of this Agreement, Seller shall convey, transfer,
assign and deliver, "as is" and "where is", the right, title and interest of
Seller in the xxxxx on the lands covered by the leaseholds described in Exhibit
"A", including all of Seller's right, title and interest in (i) the oil and gas,
and oil, gas, and mineral leases, described in Exhibit "A" hereto
("Leaseholds"); and (ii) the oil and gas, and oil, gas, and mineral fee estates
created by the mineral deeds described in Exhibit "A" ("Mineral Properties")
EXCEPTING AND RESERVING, however, to Seller fifty percent (50%) of all oil and
gas and oil, gas, and mineral rights and interests in, under, and created by
said leases and mineral deeds in and to all depths below the top of the
Queenston Formation, such reserved rights and interests being proportionately
reduced in the event Seller owns less than the entire interest in and to such
leases and mineral fee estates, with and subject to any Unit Agreements and
Seller's rights and obligations under the Operating Agreements, and further
subject to any other depth limitations shown on Exhibit "A"; and (iii) any
easements, surface rights of way or fee interests created by the Leaseholds and
Mineral Properties and by the grants identified in Exhibit "A", including any
and all of Seller's rights of ingress and egress EXCEPTING AND RESERVING,
however, to Seller joint and concurrent ownership and usage of the easements,
surface rights of way or fee interests for access to the Leaseholds and Mineral
Properties and (iv) any and all gas gathering and transmission pipelines in, on,
or otherwise relating to the Leaseholds and Mineral Properties, inclusive of,
but not limited to, that certain portion of the gas gathering and transmission
pipeline system known as the Cranberry Pipeline INSOFAR AND ONLY INSOFAR as that
portion of said pipeline system situated in Crawford, Mercer, and Venango
Counties, Pennsylvania ("Pipeline") and (v) xxxxx, tankage, fixtures, treating
facilities, pumping equipment, flow lines, any Seller owned field compressor
facilities, together with any real and personal property interests appurtenant
or related to or used in connection with the Leaseholds and Mineral Properties,
and the Books and Records exclusively relating thereto; (all of which
Leaseholds, Mineral Properties, Pipeline and other property or rights are
referred to as "Assets" under this Agreement) effective as of 7:00 a.m., Eastern
Standard Time on September 1, 1997 ("Effective Time"). All such Assets are
described in Exhibit "A" to this Agreement.
2.02 Assumption of Liabilities. Subject to the terms and conditions of
this Agreement and in reliance upon the representations and warranties contained
herein, at the Closing Seller shall convey, transfer, assign and deliver "as is"
and "where is" all of Seller's right, title and interest in the Assets (on the
form of Assignment, Xxxx of Sale and Conveyance prescribed in Exhibit "B" with a
description of the Assets attached thereto) to Purchaser; and as of the
Effective Time Purchaser assumes all of the liabilities and obligations of
Seller pertaining to the Assets, as evidenced by executing and delivering with
Seller the Assignment, Xxxx of Sale and Conveyance. Purchaser's assumption of
the liabilities and obligations of Seller shall not include payment of unpaid
costs or expenses attributable to Seller's operation of the Assets prior to the
Effective Date, including without limitation any obligations to Seller Employees
through the Closing Date. As to the liabilities of Seller not assumed by
Purchaser, Seller shall satisfy all such obligations in the ordinary course of
business so that, among other things, the Assets shall be free and clear of any
liabilities or liens with respect thereto.
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2.03 Purchase Price. Upon the terms and subject to the conditions of
this Agreement, at Closing, Purchaser will pay Seller for the Assets a purchase
price of EIGHTY FIVE MILLION NINE HUNDRED THOUSAND AND NO/100 DOLLARS
($85,900,000.00) ("Purchase Price"). The Purchase Price shall be paid in the
amount of: (A) EIGHT MILLION SIX HUNDRED FIFTY THOUSAND AND NO/100 DOLLARS
($8,650,000.00) which was paid by Purchaser to Seller as a non-refundable
performance deposit ("Performance Deposit") in connection with the return of an
executed copy of this Agreement to Seller; and (B) at Closing, the balance of
the Purchase Price for the Assets of SEVENTYSEVEN MILLION TWO HUNDRED FIFTY
THOUSAND AND NO/100 DOLLARS ($77,250,000.00), subject to adjustment according to
the provisions of this Agreement. All payments shall be made by wire transfer to
Seller's account or by National Bank Cashier's Check, or other form of
immediately available funds to Seller.
2.04 Purchase Price Adjustments. The Purchase Price shall be adjusted
as follows:
(A) upward by:
(1) an amount in respect of the value of all
natural gas and merchantable, allowable oil and
condensate credited to the Leaseholds and Mineral
Properties that is beyond the wellhead at the
Effective Time, which amount shall be equal to the
proceeds received by Purchaser therefor, net of
applicable taxes;
(2) the amount of all expenses paid by Seller in respect
of the Assets subsequent to the Effective Time
excluding Seller's overhead but including, without
limitation:
(a) Lease Burdens, actual direct operating
expenditures for work actually performed,
operator and outside operator direct labor
and usual fringe benefit costs, fixed rate
overhead charges paid to outside operators
and/or other third parties, delay rentals,
shut-in royalties, valid calls under the
Operating Agreements, and production and
severance taxes paid with respect to the
Leaseholds and Mineral Properties from the
Effective Time to the Closing;
(b) all capital and drilling expenditures
incurred subsequent to the Effective Time
and other capital and drilling expenditures
incurred as permitted in this Agreement; and
(c) the amount of $100,000.00 per month for the
period from the Effective Time to the
Closing and a prorata payment for each part
thereof (which amount shall be in lieu of
general and administrative costs and
expenses of Seller that are paid or accrued
by Seller in connection with the operation
or ownership of the Assets during the period
of time between the Effective Time and the
Closing); and
(3) an amount equal to the portion of all taxes paid by
Seller and relating to the operation of the Assets
subsequent to the Effective Time; provided, however,
that no upward adjustment of the Purchase Price shall
be made for or in connection with any federal income
taxes, provincial income taxes, gross receipts taxes,
capital gains taxes, franchise taxes or any similar
taxes;
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(4) an amount equal to the purchase price for the Xxxxxxx
Properties under the Xxxxxxx Letter Agreement if the
Xxxxxxx Properties are acquired by Seller prior to
Closing; and
(5) an amount equal to the Tax Credit Properties Purchase
Price under the Tax Credit Properties Letter
Agreement and an amount equal to the Option Purchase
Price under the Tax Credit Properties Letter
Agreement if the Tax Credit Properties are acquired
by Seller prior to Closing.
(B) downward by,
(1) the proceeds (other than those referred to in clause
(2) below) received by Seller (or for which Seller
has received offset or other similar credit) and all
receivables of Seller that are attributable to the
operation or ownership of the Assets during the
period of time between the Effective Time and the
Closing;
(2) the amount of the proceeds received by Seller from
the disposition (inadvertently or with the prior
written consent of the Purchaser) of all or any
portion of the Assets;
(3) an amount equal to all unpaid ad valorem, property,
and similar taxes and assessments that are allocable
to the Seller for the period of time prior to the
Effective Time; and
(4) an amount equal to any downward adjustments for
Designated Title Defects under Article VII.
(C) To Seller's Knowledge, Seller represents the Assets are not subject
to any gas imbalances under any Gas Balancing Arrangement. In the event
Purchaser or Seller discover a gas imbalance within ninety days of Closing, such
party shall notify the other party and Purchaser and Seller shall settle such
gas imbalances using a price of $2.00/mcf for production from the Assets.
2.05 Determination of Purchase Price Adjustments.
(A) Prior to Closing, Seller shall deliver to Purchaser an estimate of
the amount of Purchase Price adjustments as set forth in Section 2.04
("Adjustment Estimate") as of the Closing Date setting forth in reasonable
detail the calculation thereof. For purposes of the Closing, the Purchase Price
shall be adjusted using the Adjustment Estimate.
(B) As soon as reasonably practicable, and in any event within one
hundred twenty (120) calendar days following the Closing, Seller shall deliver
to Purchaser a statement of the actual Purchase Price adjustments calculated
pursuant to Section 2.04 (the "Final Settlement Statement"). Purchaser shall
have thirty (30) days thereafter to review the Final Settlement Statement and
present any corrections thereto. Any disparities shall be resolved by the
independent auditors of the Purchaser and Seller or an independent third auditor
selected by both. The Final Settlement Statement shall thereafter for all
purposes be final and binding on Seller and Purchaser and the amount of the
Purchase Price adjustments as finally determined pursuant to this Section
2.05(B) shall be paid (with interest at the Agreed Interest Rate from the
Closing to the date of payment) within five (5) days after delivery of the Final
Settlement Statement or the resolution of any disputes, whichever is the later.
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ARTICLE III
The Closing
3.01 Place and Time of Closing. The Closing shall be held at the
offices of Seller in Houston, Texas at 10:00 a.m., Central Standard Time, on
October 1, 1997 or at such other place or time as the parties may mutually
agree.
3.02 Deliveries at Closing. Upon the terms and subject to the
conditions of this Agreement, at Closing:
(A) Seller shall furnish to Purchaser a statement setting forth the
Purchase Price adjusted pursuant to the Adjustment Estimate;
(B) Purchaser shall pay to Seller the balance of the Purchase Price in
the manner stipulated in Section 2.03;
(C) Purchaser and Seller shall execute, acknowledge and deliver
effective at the Effective Time the Assignment, Xxxx of Sale and Conveyance in
the form attached as Exhibit "B", with the blanks and exhibits to such document
appropriately completed by Seller;
(D) Seller shall pay to Purchaser the amounts held in related royalty
suspense accounts by Seller attributable to the Leaseholds and Mineral
Properties together with a written explanation (as contained in Seller's files)
of the reasons such funds are held in suspense;
(E) Seller shall deliver to Purchaser possession of the Assets
evidenced by delivery of such documents;
(F) Seller shall deliver to Purchaser possession of the Books and
Records.
(G) Seller and Purchaser shall execute, acknowledge and deliver
effective at the Effective Time the joint operating agreement in the form
attached as Exhibit "C" covering the jointly owned interests of Purchaser and
Seller in the Leaseholds and Mineral Properties.
ARTICLE IV
Representations and Warranties of Seller
Except as otherwise disclosed in this Agreement, Seller represents and
warrants (which representations and warranties are accurate as of the date
hereof or shall be true on and as of the Closing Date in all material respects)
that:
4.01 Organization and Good Standing. Seller is a corporation duly
organized, validly existing and in good standing under the laws of Delaware and
has all requisite corporate power and authority to own and lease the properties
and assets it currently owns and leases and to carry on its business as such
business is currently conducted and Seller is duly qualified to do business as a
foreign corporation and is in good standing in the jurisdiction where the Assets
are located;
4.02 Corporate Authority, Authorization of Agreement. Seller has all
requisite corporate power and authority to execute and deliver this Agreement
and all documents that are executed and delivered pursuant to this Agreement, to
consummate the transactions contemplated hereby and to perform all the terms and
conditions hereof to be performed by it. The execution and delivery by Seller of
this Agreement and all documents that are executed and delivered pursuant to
this Agreement, and the performance by Seller and the consummation of the
transactions contemplated hereby (a) have been duly
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authorized and approved by the Board of Directors of Seller, or (b) are within
the discretion of the officers of Seller; and this Agreement and all documents
executed pursuant to this Agreement are the valid and binding obligation of
Seller, enforceable in accordance with their terms, except as such
enforceability may be limited by bankruptcy, insolvency or other laws relating
to or affecting generally the enforcement of creditors' rights and general
principles of equity;
4.03 No Default; Compliance with Laws and Regulations. Seller is not in
default under, and no condition exists that with notice or lapse of time or both
would constitute a default under any mortgage, indenture, loan, credit agreement
or other agreement or instrument evidencing indebtedness for borrowed money, or
create a lien, charge or other encumbrance on the Assets;
4.04 Producing Leaseholds/Environmental. Except as set forth in
Schedule 1, to Seller's Knowledge, Seller's operation of the Assets has been
conducted in compliance with all applicable Environmental Statutes. The
exclusive remedy of Purchaser for any breach of the representation set forth in
this Section 4.04 is set forth in Section 7.06 hereof.
4.05 Warranties Disclaimer. Except for the warranty provided by Seller
in Section 7.01, Seller will make no warranty or representation of title to
Purchaser of any kind, and will expressly disclaim any implied warranty of
title. Seller will disclaim any warranty of condition or use of personal
property.
4.06 Litigation. Except as set forth in Schedule 2 there are no
actions, suits, proceedings or to Seller's Knowledge, governmental
investigations or inquiries pending, or, to Seller's knowledge, threatened
against Seller or its Affiliates or any of the Assets that might delay, prevent
or hinder the consummation of the transactions contemplated hereby, or
materially effect the value of the Assets.
4.07 Payment of Royalties: To Seller's Knowledge, all material
royalties (other than royalties held in suspense), rentals, and other payments
due under the Leaseholds have been paid in the normal course of business
according to standards generally accepted in the oil and gas industry.
4.08 Payment of Taxes: To Seller's Knowledge, all ad valorem, property,
production, severance, and similar taxes and assessments based on or measured by
the ownership of property or the production of hydrocarbons or the receipt of
proceeds therefrom on the Assets have been properly paid.
4.09 Broker Fees: Seller has incurred no liability, contingent or
otherwise, for brokers' or finders' fees relating to the transactions
contemplated by this Agreement for which Purchaser shall have any responsibility
whatsoever.
4.10 Citizenship of Seller: Seller is not a "foreign person" within the
meaning of Section 1445 of the Internal Revenue Code of 1986, as amended.
4.11 Oil and Gas Contracts: To Seller's Knowledge, Seller has made
available to Purchaser the Oil and Gas Contracts, Operating Agreements, leases
of equipment or facilities and other contracts, agreements and rights that cover
or affect the Assets.
ARTICLE V
Representations and Warranties of Purchaser
Except as otherwise disclosed in this Agreement, Purchaser hereby
represents and warrants that:
5.01 Organization and Existence. Purchaser is a corporation duly
organized, validly existing and in good standing under the laws of the
jurisdiction of incorporation and has all requisite corporate power and
authority to purchase the Assets and to own and lease the properties and Assets
it currently owns
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and leases and to carry on its business as such business is currently conducted
and Purchaser is duly qualified to do business as a foreign corporation and is
in good standing in the jurisdiction where the Assets are located.
5.02 Authority and Approval. Purchaser has all requisite power and
authority to execute and deliver this Agreement, to consummate the transactions
contemplated hereby and to perform all the terms and conditions hereof to be
performed by it. The execution and delivery of this Agreement by Purchaser, the
performance by it of all the terms and conditions hereof to be performed by it
and the consummation of the transactions contemplated hereby have been duly
authorized and approved by its Board of Directors. This Agreement constitutes
the legal, valid and binding obligation of Purchaser, enforceable against
Purchaser in accordance with its terms, except as such enforceability may be
limited by bankruptcy, insolvency or other laws relating to or affecting
generally the enforcement of creditors' rights and general principles of equity.
5.03 No Violations. This Agreement and the execution and delivery
hereof by Purchaser do not, and the fulfillment and compliance with the terms
and conditions hereof and the consummation of the transactions contemplated
hereby will not, violate any provision of or constitute a default (without
regard to any requirement of notice or the lapse of time or both) or require any
filing or consent under Purchaser's certificate of incorporation, or other
governing instruments, or any law or regulation to which Purchaser is subject,
or any provision of any material indenture, mortgage, lien, lease, agreement,
instrument, order, arbitration award, judgment or decree to which Purchaser or
any of its affiliates is a party or by which Purchaser or any of its affiliates
or any of their respective assets or properties is bound.
5.04 Funds Available. Purchaser has, or will have prior to the Closing,
sufficient cash, available lines of credit or other sources of immediately
available funds to enable Purchaser to make payment of the balance of the
Purchase Price at the Closing in accordance herewith.
5.05 Litigation. There are no actions, suits, proceedings or
governmental investigations or inquiries pending, or, to the knowledge of
Purchaser, threatened, against Purchaser or its Affiliates or any of their
respective properties, assets, operations or businesses that might delay,
prevent or hinder the consummation of the transactions contemplated hereby.
ARTICLE VI
Additional Agreements and Covenants
6.01 Covenants of Seller. Seller covenants and agrees (subject to any
requirements imposed upon Seller pursuant to the terms of the Operating
Agreements, the Unit Agreements and the Oil and Gas Contracts), with Purchaser
that from the date of this Agreement until the Closing Date, Seller (i) will
make reasonable efforts to cause the Assets to be operated and maintained in a
good and workmanlike manner consistent with prior practices, and will pay or
cause to be paid all costs and expenses in connection therewith, (ii) will not
sell, lease, encumber, abandon or otherwise dispose of any of the Leaseholds or
Mineral Properties other than to make sales of produced Hydrocarbons in the
ordinary course of business, (iii) will maintain insurance now in force with
respect to the Assets, (iv) will make reasonable efforts to comply with all the
rules, regulations, and orders of all state and federal agencies which are
applicable to Seller and the Assets, (v) will make reasonable efforts to perform
and comply with all of the material covenants and conditions contained in
agreements relating to the Assets, (vi) will pay all taxes and assessments with
respect to the Assets which become due and payable prior to the Closing Date,
and (vii) will not commence or consent to any material operations on any
Leaseholds or Mineral Properties that Seller has not previously committed to and
that may be expected to cost in excess of FIFTY THOUSAND AND NO/100 DOLLARS
($50,000.00) (attributable to 100% of the operating interest) except for
emergency operations, in which case Seller shall promptly notify Purchaser.
Seller shall not be obligated to renew or extend expiring Leaseholds after the
Effective Date unless mutually agreed at Purchaser's
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expense. Without expanding any obligations which Seller may have to Purchaser,
it is expressly agreed that Seller shall never have any liability to Purchaser
with respect to operation of an Asset greater than that which it might have as
the Operator to a Non-operator under the applicable operating agreement or, in
the absence of such an agreement, then under the AAPL 610 (1989) Model Form
Operating Agreement, IT BEING RECOGNIZED THAT CERTAIN OF SUCH AGREEMENTS PROVIDE
THAT THE OPERATOR IS NOT RESPONSIBLE FOR ITS OWN NEGLIGENCE, AND HAS NO
RESPONSIBILITY OTHER THAN FOR GROSS NEGLIGENCE OR WILLFUL MISCONDUCT.
6.02 Records Inspection/Access/Disclaimer. Seller will afford to
Purchaser and its authorized representatives, at Purchaser's sole cost, risk and
expense, and upon reasonable notice, reasonable access to the Assets from the
date hereof until the Closing, during normal business hours, and to the Books
and Records which are related primarily to the Assets insofar as such access and
disclosure does not unreasonably interfere with the normal operation of the
business of Seller or violate the terms of any agreement by which Seller is
bound or any applicable law or regulation. Seller will include all of its
complete records to the best of its knowledge, however Seller does not represent
or guarantee that such information or data or the Book and Records will be
accurate or complete, and any reliance thereon will be at the sole risk,
exposure and expense of Purchaser.
6.03 No Negotiations. After execution of this Agreement, Seller shall
not solicit from any Person any proposals or offers, or enter into any
negotiations relating to the disposition of the Assets, except for sales of
Hydrocarbons in the ordinary course of business.
6.04 Public Announcements. Subject to applicable securities law or
stock exchange requirements, at all times, Seller or Purchaser shall obtain the
approval of the other before issuing, or permitting any of their respective
directors, officers, employees or agents or any Affiliate to issue, any press
release with respect to this Agreement or the transactions contemplated hereby.
6.05 Cooperation. Seller shall cooperate with Purchaser to obtain all
such permissions, approvals and consents by federal, state and local
governmental authorities and others as may be required to consummate the
transactions contemplated herein or as may be reasonably requested by Purchaser.
6.06 Covenants of Purchaser. Purchaser covenants and agrees with Seller
as follows:
(A) Confidential Information. In the event that this Agreement is
terminated or, if not terminated, until the Closing, the confidentiality of any
data or information received by Purchaser regarding the Assets shall be
maintained by Purchaser.
(B) Use of the name "Cabot Oil & Gas Corporation", "Cranberry Pipeline
Corporation" or "Big Xxxxx Gas Company". Within sixty (60) days after the
Closing Date, Purchaser shall eliminate the names (i) "Cabot Oil & Gas
Corporation", "Cabot Oil & Gas" or "Cabot", (ii) "Cranberry Pipeline
Corporation", "Cranberry Pipeline", or "Cranberry", (iii) "Big Xxxxx Gas
Company", "Big Xxxxx Gas" or "Big Xxxxx" and any derivative thereof or any other
word or expression similar thereto from the Assets and thereafter Purchaser
shall not use any logos, trademarks or tradenames belonging to Seller.
(C) Assumed Liabilities. From and after the Closing, Purchaser shall
assume and undertake to pay, perform and discharge, when due, and shall
indemnify and save Seller harmless from all the debts, liabilities, obligations
and commitments of Seller that arise (i) from or out of the ownership of the
Assets regardless of whether such liabilities and obligations are absolute,
contingent or otherwise known or unknown as of the date hereof and (ii) from
such liabilities and obligations of Seller under all Legal Requirements
respecting plugging and abandoning of all xxxxx on the Leaseholds (and the
reclamation of the surface thereof) at the end of their producing life, and
Legal Requirements issued by governmental commissions, or their governmental
successors, including any investigation or order issued or which may be issued
under legal authority. Notwithstanding the foregoing, Purchaser shall not assume
any liabilities
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Page 12
specifically excluded from Section 2.02 as to which Seller shall pay, perform,
and discharge such liabilities when due and shall indemnify and save Purchaser
harmless therefrom.
ARTICLE VII
Title Matters
7.01 Scope. This is a sale of all of Seller's right, title and interest
in the Assets to Purchaser, subject to the Permitted Encumbrances. The Assets
shall be conveyed with Seller's warranty to defend title to the Assets against
every person claiming or to claim an interest therein by, through or under
Seller, but not otherwise subject to the Permitted Encumbrances. If any Asset is
erroneously described, Seller shall, at any time before or after Closing correct
such description upon proof of proper description. Seller shall transfer the
Assets on an "as is" and "where is" basis.
7.02 Limitation on Adjustment. The Purchase Price, as adjusted pursuant
to Section 2.04, shall not be adjusted with respect to matters set forth in
Section 7.05 and shall not be adjusted with respect to Title Defects except as
provided in this Article. Notwithstanding anything in this Agreement to the
contrary, the Purchase Price shall not be adjusted for Title Defect Amounts
(defined in Section 7.04) which do not, in the aggregate, exceed the Title
Defect Deductible Amount and Purchaser shall take delivery of such Leaseholds
and Mineral Properties subject to such Title Defects.
7.03 Title Examination. Seller shall make available to Purchaser the
Books and Records pursuant to Article 6.02. From and after the date of this
Agreement, Purchaser may examine title to the Leaseholds and Mineral Properties
through examination of Seller's Books and Records and any other independent
source of title records Purchaser deems necessary.
7.04 Claim Period/Designated Title Defects. In order to receive a
Purchase Price adjustment attributable to Title Defects, Purchaser must, no
later than sixty (60) days after Closing, furnish Seller with written notice
specifying in detail each Title Defect which Purchaser is asserting, the
Leaseholds that each Title Defect affects and the Title Defect amount estimated
by Purchaser for each Title Defect ("Title Defect Amount"). If the aggregate of
all Title Defect Amounts in Purchaser's written notice exceeds the Title Defect
Deductible Amount then all Title Defects (including the Title Defects which
comprise the Title Defect Deductible Amount) set forth in such notice
("Designated Title Defects") shall be addressed pursuant to this Section 7.04 As
to the Designated Title Defects, Seller shall have sixty (60) days from the
receipt of Purchaser's written notice in which to notify Purchaser in writing
with respect to each Designated Title Defect of (i) Seller's intent to attempt
to cure the Designated Title Defect at Seller's expense, (ii) Seller's election
to reduce the Purchase Price by the Title Defect Amount for the Designated Title
Defect, (iii) Seller's election to reduce the Purchase Price by the Title Defect
Amount for the Designated Title Defect and accept a reconveyance from Purchaser
to Seller of the Leaseholds or Mineral Properties affected by such Designated
Title Defect or (iv) the dispute by Seller of the existence of the Designated
Title Defect or the Title Defect Amount estimated by Purchaser for the
Designated Title Defect. When considering whether Seller has cured a Designated
Title Defect, Seller and Purchaser shall determine whether the Designated Title
Defect has been cured based on the standards currently prevalent in the
acquisition of producing oil and gas properties and pipeline rights of way,
easements and fee rights, and property. If Seller elects to attempt to cure any
Designated Title Defect and cures such Designated Title Defect on or before the
end of Seller's sixty (60) day period, no Purchase Price adjustment shall be
made. Upon the expiration of sixty (60) days after Closing, all Title Defects
are deemed waived except those Designated Title Defects set forth in Purchaser's
notice.
7.05 Preferential Rights and Consents to Assignment. The Assets may be
subject to existing preferential rights to purchase or consents to assignment by
third parties (including those reflected in Schedule 3). Assets subject to
existing preferential rights to purchase or consents to assignment by third
parties shall not be considered as properties with Title Defects or in value
amounts for determining the
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aggregate of all Title Defect Amounts in excess of the Deductible Amount. Seller
shall use reasonable efforts to obtain waivers of all preferential rights and to
obtain all consents to assignment prior to Closing. The amount allocated by
Seller to any Asset subject to a claim of preferential right shall be determined
based on Purchaser's itemized allocation which Purchaser shall provide to Seller
as requested by Seller in connection therewith. The rights and obligations of
the parties concerning such preferential rights and consents to assignment are
as follows:
(A) In the event a preferential right is exercised prior to Closing,
then (i) Seller shall be entitled to all proceeds paid by such third party
exercising its preferential right, (ii) the Purchase Price shall be adjusted
downward in an amount equal to the price paid to Seller by such third party, and
(iii) such Assets shall be deleted from the Assignment, Xxxx of Sale and
Conveyance.
(B) In the event a preferential right is exercised subsequent to
Closing, then Purchaser shall be obligated to comply with such preferential
right but shall be entitled to all proceeds paid by such third party exercising
its preferential right.
7.06 Environmental Condition. Purchaser's exclusive remedy, for any
Environmental Condition shall be as provided in this Section 7.06. If within one
(1) year after the Effective Time Purchaser notifies Seller in writing of facts,
conditions, and circumstances which constitute an Environmental Condition with
respect to the Assets and such Environmental Condition results in Purchaser
having aggregate losses in excess of the Environmental Deductible Amount then
subject to the further limitations set forth in this Section 7.06, Seller shall
indemnify Purchaser for all aggregate losses incurred from the first dollar.
Seller's liability under this Section 7.06 shall be limited to a maximum of
THREE MILLION AND NO/100 DOLLARS ($3,000,000.00) and Seller's liability under
this Section 7.06 shall in no event ever exceed such amount.
ARTICLE VIII
Termination
8.01 Grounds for Termination. This Agreement may be terminated at any
time prior to the Closing:
(A) by the mutual written agreement of Seller and Purchaser; or
(B) by either Seller or Purchaser if the consummation of the
transactions contemplated hereby would violate any non-appealable final order,
decree or judgment of any court or governmental authority having competent
jurisdiction enjoining, restraining or otherwise preventing, or awarding
substantial damages in connection with, the consummation of this Agreement or
the transactions contemplated hereby;
(C) by Seller if Purchaser, through no breach of this Agreement by
Seller, should fail or refuse to close by the Closing Date; or
(D) by Purchaser if Seller, through no breach of this Agreement by
Purchaser should fail or refuse to close by the Closing Date.
8.02 Effect of Termination. The following provisions shall apply in the
event of a termination of this Agreement:
(A) If this Agreement is terminated by Seller or Purchaser as permitted
under Sections 8.01(A), (B), or (D) hereof and not as the result of Purchaser's
failure to perform its obligations hereunder then Seller shall return the
Performance Deposit to Purchaser. Such termination under Sections 8.01(A) or
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Page 14
(B) shall be without liability of any party to this Agreement or any Affiliate,
shareholder, director, officer, employee, agent or representative of such party.
(B) If this Agreement is terminated as a result of (i) the material
breach by Purchaser of any of the material terms and provisions of this
Agreement, (ii) the negligent or willful failure of Purchaser to perform its
obligations hereunder or (iii) Purchasers failure or refusal to close by the
date set forth in Article 8.01(C), Purchaser shall be fully liable for any and
all damages, costs and expenses (including, but not limited to, reasonable
attorneys' fees, expert witness' fees and court costs) thereby sustained or
incurred by Seller and Seller shall be entitled to retain the Performance
Deposit as liquidated damages and not as a penalty.
(C) If this Agreement is terminated as a result of (i) the material
breach by Seller of any of the material terms and provisions of this Agreement,
(ii) the negligent or willful failure of Seller to perform its obligations
hereunder or (iii) Seller's failure or refusal to close by the date set forth in
Article 8.01(D), Seller shall be fully liable for any and all damages, costs and
expenses (including, but not limited to, reasonable attorney's fees, expert
witness fees and court costs) thereby sustained or incurred by Purchaser and
Purchaser shall be entitled to seek specific performance of this Agreement if it
believes that monetary damages would not be adequate to compensate Purchaser
therefore.
ARTICLE IX
Extent and Survival of Representations
and Warranties; Indemnification
9.01 Scope of Representations of Seller. EXCEPT AS AND TO THE EXTENT
EXPRESSLY SET FORTH IN THIS AGREEMENT, SELLER MAKES NO REPRESENTATION OR
WARRANTY WHATSOEVER AND DISCLAIMS ALL LIABILITY AND RESPONSIBILITY FOR ANY
REPRESENTATION, WARRANTY, STATEMENT OR INFORMATION MADE OR COMMUNICATED (ORALLY
OR IN WRITING) TO PURCHASER (INCLUDING, BUT NOT LIMITED TO, ANY OPINION,
INFORMATION OR ADVICE WHICH MAY HAVE BEEN PROVIDED TO PURCHASER BY ANY
AFFILIATE, OFFICER, STOCKHOLDER, DIRECTOR, EMPLOYEE, AGENT, CONSULTANT OR
REPRESENTATIVE OF SELLER OR ANY PETROLEUM ENGINEER OR ENGINEERING FIRM, SELLER'S
COUNSEL OR ANY OTHER AGENT, CONSULTANT OR REPRESENTATIVE). WITHOUT LIMITING THE
GENERALITY OF THE FOREGOING, EXCEPT AS AND TO THE EXTENT EXPRESSLY SET FORTH IN
THIS AGREEMENT, SELLER MAKES NO REPRESENTATION OR WARRANTY AS TO (A) THE TITLE
TO ANY OF THE LEASEHOLDS OR MINERAL PROPERTIES (B) THE AMOUNTS OF HYDROCARBON
RESERVES ATTRIBUTABLE TO THE LEASEHOLDS OR MINERAL PROPERTIES (IF ANY) OR (C)
ANY GEOLOGICAL OR OTHER INTERPRETATIONS OR ECONOMIC EVALUATIONS. PURCHASER
ACKNOWLEDGES AND AFFIRMS THAT IT HAS HAD FULL ACCESS TO THE BOOKS AND RECORDS OF
SELLER AND THE INFORMATION THEREIN, AND PURCHASER HAS MADE ITS OWN INDEPENDENT
INVESTIGATION, ANALYSIS AND EVALUATION OF (I) THE XXXXX ON THE LANDS COVERED BY
THE LEASEHOLDS AND MINERAL PROPERTIES (INCLUDING PURCHASER'S OWN ESTIMATE AND
APPRAISAL OF THE EXTENT AND VALUE OF THE HYDROCARBON RESERVES OF THE LEASEHOLDS
AND MINERAL PROPERTIES), (II) TITLE TO THE LEASEHOLDS AND MINERAL PROPERTIES,
(III) OPERATION OF THE LEASEHOLDS AND MINERAL PROPERTIES AND (IV) ENVIRONMENTAL
CONDITIONS ON, IN AND UNDER THE LEASEHOLDS AND MINERAL PROPERTIES. PURCHASER
SHALL HAVE INSPECTED, OR HAVE WAIVED (AND UPON CLOSING SHALL BE DEEMED TO HAVE
WAIVED) IT'S RIGHT TO INSPECT, THE ASSETS FOR ALL PURPOSES AND SATISFIED ITSELF
AS TO THE ASSETS PHYSICAL AND ENVIRONMENTAL CONDITION, BOTH SURFACE AND
SUBSURFACE, INCLUDING BUT NOT
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LIMITED TO CONDITIONS SPECIFICALLY RELATED TO THE PRESENCE, RELEASE OR DISPOSAL
OF HAZARDOUS SUBSTANCES, SOLID WASTES, ASBESTOS AND OTHER MAN-MADE FIBERS, OR
NATURALLY OCCURRING RADIOACTIVE MATERIALS ("NORM"). PURCHASER IS RELYING SOLELY
UPON ITS OWN INSPECTION OF THE ASSETS, AND PURCHASER SHALL, EXCEPT AS PROVIDED
OTHERWISE IN THIS AGREEMENT, ACCEPT ALL THE SAME IN THEIR "AS IS, WHERE IS"
CONDITION. ANY AND ALL BOOKS AND RECORDS, DATA, RECORDS, REPORTS, PROJECTIONS,
INFORMATION AND OTHER MATERIALS (WRITTEN OR ORAL) FURNISHED BY SELLER OR
OTHERWISE MADE AVAILABLE OR DISCLOSED TO PURCHASER ARE PROVIDED PURCHASER AS A
CONVENIENCE AND SHALL NOT CREATE OR GIVE RISE TO ANY LIABILITY OF OR AGAINST
SELLER AND ANY RELIANCE ON OR USE OF THE SAME SHALL BE AT PURCHASER'S SOLE RISK
TO THE MAXIMUM EXTENT PERMITTED BY LAW; PROVIDED, HOWEVER, THAT SELLER HAS NOT
INTENTIONALLY PROVIDED ANY INFORMATION OR MATERIAL TO PURCHASER WHICH SELLER
KNOWS TO BE FALSE OR MISLEADING.
9.02 Representations and Warranties of Seller. The representations and
warranties of Seller set forth in this Agreement and in any instrument delivered
in connection herewith shall survive the Closing provided that neither Purchaser
nor any Affiliate or successor or assign to Purchaser may bring any action or
present any claim for a breach of such representations and warranties unless
written notice of such claim with reasonable particulars of the claim has been
delivered to Seller within one (1) year after the Effective Time.
9.03 Representations and Warranties of Purchaser. The representations,
warranties and indemnities by Purchaser shall survive until the expiration of
any applicable limitations period.
9.04 Indemnification of Seller. Purchaser agrees to indemnify Seller,
its respective Affiliates and all of their respective directors, officers,
agents and representatives, against, and hold Seller, its respective Affiliates,
and all of their respective directors, officers, agents and representatives,
harmless from, any Seller Indemnified Loss.
9.05 Indemnification of Purchaser. Seller agrees to indemnify Purchaser
against and hold Purchaser harmless from every Purchaser Indemnified Loss;
provided, however, that Purchaser shall not be entitled to assert rights of
indemnification under this Article IX for Purchaser Indemnified Losses unless
and until and then only to the extent the aggregate of all such amounts exceed
the Deductible Amount. If the aggregate of all Purchaser Indemnified Losses
exceeds the Deductible Amount, then Seller shall indemnify Purchaser for all
Purchaser Indemnified Losses incurred from the first dollar. In no event shall
the total of the liabilities and indemnities of Seller under this Agreement,
including, without limitation, any claims relating to its representations,
exceed the Purchase Price.
ARTICLE X
Casualty Loss
It is understood and agreed that Seller does not maintain insurance
covering the Assets. If, prior to the Closing, all or any part of the Assets
shall be destroyed by fire or other casualty, or any part of the Assets shall be
taken in condemnation or under the right of eminent domain, or if proceedings
for such purposes shall be pending or threatened, Seller shall, at the Closing,
pay to Purchaser all sums paid to Seller by reason of such destruction or
taking, and assign, transfer, and set over unto Purchaser all of the right,
title and interest of Seller in and to any unpaid awards or other payments
arising out of such destruction or taking.
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ARTICLE XI
Taxes
11.01 Tax Purchase Price Allocations. Seller and Purchaser recognize
that reporting requirements as imposed by Section 1060(b) of the United States
Internal Revenue Code, and the Regulations thereunder, may apply to the
transaction contemplated by this Agreement. If so, Seller and Purchaser agree
that the Purchase Price shall be allocated among the Assets as mutually agreed
by Seller and Purchaser, and such allocation shall satisfy the requirements of
Section 1060 of the Code, and the Regulations thereunder. For purpose of this
Section, no Asset shall be allocated a negative value.
11.02 Sales and Use Taxes, Recording Fees and Income Taxes. Purchaser
shall pay all documentary, filing and recording fees required in connection with
the filing and recording of any assignments. Purchaser shall be liable for and
pay all applicable transfer, sales and use taxes occasioned by the sale of the
Assets and such amount, if assessed, will be additional to the Purchase Price.
For purposes of federal and state income taxation, Seller shall include in all
appropriate income tax returns all items of income, expense, gain and loss
attributable to the Assets for the period of time ending on or before the
Effective Time, and Purchaser will include in its income tax returns all items
of income expense, gain or loss attributable to the period after the Effective
Time.
11.03 Ad Valorem and Property Taxes. All ad valorem and property taxes
and any similar assessment based upon or measured by Seller's ownership
interests in the Assets or the production of Hydrocarbons therefrom or the
receipt of proceeds on sales therefrom shall be prorated between Seller and
Purchaser as of the Effective Time based upon such taxes assessed against the
Assets for the tax period in question, or if there is insufficient information
for such tax period, based upon taxes assessed for the immediately preceding tax
period just ended. All such taxes will be prorated on the basis of a 365 day
year. Ad valorem and similar taxes assessed for periods prior to the Effective
Time shall be borne by Seller and ad valorem taxes assessed for periods on or
after the Effective Time shall be borne by Purchaser (ad valorem and similar
taxes shall be considered assessed for the period for which they are stated to
be assessed, even if the same are based on production or other activities
occurring in prior periods).
11.04 Like Kind Exchange. Seller may elect to structure this
transaction as a like-kind exchange pursuant to Section 1031 of the Internal
Revenue Code of 1986, as amended, and the regulations promulgated thereunder,
with respect to any or all of the Assets ("Like-Kind Exchange"), by notifying
the Purchaser in writing of such election at any time prior to the date of
Closing. In the event Seller elects a Like-Kind Exchange, then in order to
effect such Like-Kind Exchange, the Purchaser shall cooperate and do all acts as
may be reasonably required or requested by Seller with regard to effecting the
Like-Kind Exchange, including, but not limited to, permitting Seller to assign
its rights under this Agreement to a qualified intermediary of Seller's choice
in accordance with Treasury Regulation Section 1.1031(k)-1(g)(4) or executing
additional escrow instructions, documents, agreements or instruments to effect
an exchange; provided, however, Purchaser shall incur no expense (that is not
reimbursed by the Seller) or liability in connection with such Like-Kind
Exchange and Purchaser shall not be required to take title to any property other
than the Assets in connection with the Like-Kind Exchange, and, in the case of a
Like-Kind Exchange election by Seller, Purchaser's possession of the Properties
will not be delayed by reason of any such Like-Kind Exchange.
ARTICLE XII
Employee Matters
12.01 Seller Employees. The term "Seller Employees" shall mean those
employees set forth on Schedule 4 hereto.
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12.02 Employment Offers. On or before the Closing Date, Purchaser shall
make offers to Seller Employees of full-time employment with Purchaser in
comparable positions to those which Seller Employees hold with Seller, upon
terms and conditions of employment (including without limitation, salaries and
employee benefit programs) which are the same or similar to the terms and
conditions of employment Purchaser has for employees in comparable positions
with Purchaser.
12.03 Employee Termination. On the Closing Date, Seller shall terminate
the employment of all Seller Employees and Purchaser shall offer employment to
Seller Employees on the terms and conditions of employment set forth in this
Article. Seller shall be solely responsible for all obligations to Seller
Employees arising on or before the Closing Date including, without limitation,
any and all accrued pension, severance, vacation, or other benefits.
ARTICLE XIII
Notices; Miscellaneous
13.01 Notices. All notices and other communications given hereunder
shall be in writing and shall be deemed given if delivered personally or mailed
by registered or certified mail, return receipt requested, to the parties at the
following addresses:
(A) If to Purchaser:
Lomak Petroleum, Inc.
000 Xxxxx Xxxxx 00 - XX Xxx 000
Xxxxxxxxx, Xxxx 00000
Attention: Xxxxxxx X. Xxxxx
(000) 000-0000 Phone
(000) 000-0000 Fax
Xxxxxx X. Xxxxxxx, Esq.
Rubin, Baum, Constant, Xxxxx, & Xxxxxxxx
00 Xxxxxxxxxxx Xxxxx - 00xx Xx.
Xxx Xxxx, XX 00000
(B) If to Seller to:
Cabot Oil & Gas Corporation
00000 Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxx 00000
Attention: Xx. X. X. Xxxx
13.02 Miscellaneous.
(A) Exclusive Agreement. This Agreement (including the Schedules and
Exhibits attached hereto) supersedes all prior written or oral agreements
between the parties with respect to the transactions contemplated herein and is
intended as a complete and exclusive statement of the terms of the agreement
between the parties with respect to the transactions contemplated herein.
(B) Choice of Law; Choice of Forum; Amendments; Headings. This
Agreement shall be governed by the laws of the State where the lands covered by
the Leaseholds and Mineral Properties are situated. This Agreement may not be
changed or terminated orally. The headings contained in this
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Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement. Terms such as "herein", "hereby",
"hereto", "hereunder", and "hereof" refer to this Agreement as a whole. The term
"include" and derivatives thereof are used in an illustrative sense and not a
limitative sense.
(C) Assignments and Third Parties. Neither party hereto shall assign
this Agreement or any part hereof without the prior written consent of the other
party. 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 assigns. No such assignment shall release Purchaser of any of its
obligations under this Agreement. Nothing in this Agreement shall entitle any
person other than Seller, Purchaser or their respective permitted successors and
assigns to any claim, cause of action, remedy or right of any kind.
(D) Schedules and Exhibits. The Schedules and Exhibits attached hereto
are made part hereof for all purposes. Seller shall revise or supplement the
Schedules and Exhibits attached to this Agreement at any time within six (6)
months after Closing to reflect a change in any state of facts or the
occurrence, non-occurrence or existence of any events that would make the
information contained in any such Schedule or Exhibit misleading or incorrect if
it was not revised or supplemented.
(E) Severability. If any term or other provision of this Agreement is
invalid, illegal or incapable of being enforced by any rule of law or public
policy, 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 any manner adverse to
any party. Upon any binding determination that any term or other provision is
invalid, illegal or incapable of being enforced, the parties hereto shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible in an acceptable and legally
enforceable manner, to the end that the transactions contemplated hereby may be
completed to the extent possible.
(F) Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original and all of which
together shall constitute but one and the same agreement.
(G) Further Assurances. Seller and Purchaser agree to promptly execute
and deliver or cause to be executed and delivered to the other on the Closing
Date, and at such other times thereafter as shall be reasonably requested, any
additional instrument or take any further action as may be reasonably necessary
or appropriate that the other may reasonably request for the purpose of carrying
out the transactions contemplated by and the purposes and intents of this
Agreement.
(H) Preservation of Books and Records. For a period of two (2) years
after the Closing Date, Purchaser shall (i) preserve and retain the Books and
Records that relate to the period of time prior to the Closing (including, but
not limited to, any documents relating to any governmental or non-governmental
actions, suits, proceedings or investigations prior to the Closing) and (ii)
make the Books and Records available at the then current administrative
headquarters of Purchaser to Seller and its officers, employees, agents and
affiliates upon reasonable notice and at reasonable times, it being understood
that Seller shall be entitled to make and retain copies of any of the Books and
Records as it shall deem necessary; provided, however, in the event Purchaser
shall wish to destroy any of the Books and Records, Purchaser shall give Seller
not less than sixty (60) days notice and Seller shall have the right, at its own
expense, during reasonable business hours to remove such Books and Records and
to keep possession of same. Purchaser agrees to permit representatives of Seller
to meet with employees of Purchaser on a mutually convenient basis in order to
enable Seller to obtain additional information and explanations of any materials
provided pursuant to this Section.
(I) Dispute with Xxxx Xxxxxxx Mutual Life Insurance Company. Set forth
on Schedule 2 is a description of a dispute between Seller and Xxxx Xxxxxxx
Mutual Life Insurance Company ("Xxxxxxx")
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concerning certain oil and gas property interests owned by Xxxxxxx ("Xxxxxxx
Properties") Resolution of the dispute and the possible purchase and sale of the
Xxxxxxx Properties from Xxxxxxx to Seller and Seller to Purchaser is set forth
in a letter agreement between Seller and Purchaser which has been executed
contemporaneously with the execution of this Agreement (the "Xxxxxxx Letter
Agreement").
(J) Tax Credit Properties. Certain properties to be acquired by
Purchaser, pursuant to the terms and conditions of a letter agreement between
Seller and Purchaser which has been executed contemporaneously with the
execution of this Agreement ("Tax Credit Properties Letter Agreement"), are
burdened by an Assignment of Oil & Gas Leases with Reservation of Production
Payment, dated effective September 1, 1995, between Seller, as grantor, and
Natural Gas Investments, L.L.C. ("NGI"), as grantee ("Tax Credit Properties").
Pursuant to an option to Purchase Oil and Gas Interests, dated September 1,
1995, between Seller and NGI ("Option Agreement"), Seller has the unilateral
right to repurchase the Tax Credit Properties from NGI upon the terms and
conditions contained in the Option Agreement. Seller shall exercise its option
to repurchase the Tax Credit Properties, effective September 1, 1997 and pay NGI
for such repurchase in accordance with the Option Agreement ("Option Purchase
Price"). Purchaser's obligation to purchase and pay for the Tax Credit
Properties ("Tax Credit Properties Purchase Price") and to reimburse Seller for
the Option Purchase Price and Seller's obligation to sell the Tax Credit
Properties are set forth in the Tax Credit Properties Letter Agreement.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the date first written above.
SELLER:
CABOT OIL & GAS CORPORATION
By:
---------------------------------
X.X. Xxxx
Attest: Vice President
Xxxx X. Xxxxxxxxx
Secretary
CRANBERRY PIPELINE CORPORATION
By:
Attest: ---------------------------------
Xxxxxxx X. Xxxxxx
Vice President
Xxxx X. Xxxxxxxxx
Secretary
BIG XXXXX GAS COMPANY
By:
Attest: ---------------------------------
Xxxxxxx X. Xxxxxx
Vice President
Xxxx X. Xxxxxxxxx
Secretary
20
Xxxxxxx X. Xxxxx
Lomak Petroleum, Inc.
September 8, 1997
Page 20
PURCHASER:
LOMAK PETROLEUM, INC.
By:
Attest: ---------------------------------
Xxxxxxx X. Xxxxx
Vice President
Secretary
Lomakfin.doc/ss
21
Xxxxxxx X. Xxxxx
Lomak Petroleum, Inc.
September 8, 1997
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