EXHIBIT 10.4
PARTICIPATING INTEREST AGREEMENT
This Agreement is made on February 4, 2003.
BETWEEN:
GEOGLOBAL RESOURCES (INDIA) INC., a company incorporated in the
Province of Alberta, Canada, and having an office at 200, 000 - 0xx
Xxxxxx X.X., Xxxxxxx, Xxxxxxx, X0X 0X0, Xxxxxx ("GGR INDIA"); and
XXX GROUP (MAURITIUS) INC., a company incorporated under the laws of
the Republic of Mauritius having a registered office at x/x
Xxxxxxxxxxxxx Xxxxxxxxx Xxxxxxxx Xxxxxxx, 0xx Xxxxx, Xxx Xxxxxxxx,
Xxxxx Xxxxxx Street, Port Louis, Mauritius ("RGM").
WHEREAS:
(A) GGR India holds a 10% undivided interest under the Production Sharing
Contract ("PSC-KG") and is a party to the Carried Interest Agreement
("CIA");
(B) Xxxx Xxxx Xxx ("JPR") of Guatemala owns all the common shares of GGR
India and of RGM and accordingly JPR controls GGR India and RGM;
(C) JPR and the Parties wish to provide for the participation by RGM in
respect of the Production Sharing Contract and in furtherance of that
goal GGR India agrees to assign and transfer and RGM agrees to accept
the Participating Interest on the terms and conditions hereinafter
provided.
NOW THEREFORE in consideration of representations and the mutual covenants and
understandings contained herein, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the Parties hereto
agree as follows:
1. INTERPRETATION
1.1 In this Agreement the following words and expressions shall have the
following meanings:
"AFFILIATE" has the same meaning as the definition as "Affiliate" in
the PSC-KG.
"AGREEMENT" means this Agreement.
"CARRIED INTEREST AGREEMENT" or "CIA" means the Carried Interest
Agreement dated August 27th, 2002, between Gujarat State Petroleum
Corporation Limited and GGR India.
"EFFECTIVE DATE" has the same meaning as the definition of "Effective
Date" in the PSC-KG.
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"GOVERNMENT" means Directorate General of Hydrocarbons under the
Ministry of Petroleum & Natural Gas of India.
"GOVERNMENT PERMISSION" has the meaning ascribed to it in Clause 2.2.
"JOINT VENTURE PARTNERS" means the joint venture partners under the
PSC-KG, which, at the present date are Gujarat State Petroleum
Corporation Limited, GGR India and Jubilant Enpro Limited.
"PARTY" means GGR India or RGM and "PARTIES" means both of them.
"PARTICIPATING INTEREST" means fifty per cent (50%) of GGR India's
undivided interest in and under the PSC-KG and the CIA together with
any other documents supplemental or ancillary thereto and its rights,
interests and obligations relating thereto and all assets, joint
property, rights and interests relating thereto.
"PRODUCTION SHARING CONTRACT" or "PSC-KG" means the production sharing
contract dated February 4th, 2003, among the Government, Gujarat State
Petroleum Corporation Limited, Jubilant Enpro Limited and GGR India
with respect to the contract area identified as Block-KG-OSN-2001/3.
2. ASSIGNMENT OF PARTICIPATING INTEREST
2.1 (a) Subject to the terms of this Agreement, GGR India hereby
agrees to assign and transfer to RGM and RGM hereby agrees to
accept, the Participating Interest.
(b) Subject to the terms of this Agreement, the assignment and
transfer referred to in Clause 2.1(a) shall, as between the
Parties, be deemed for all purposes to be made with effect on
and from the Effective Date.
2.2 The Parties acknowledge the assignment and transfer in Clause 2.1(a) is
conditional upon the receipt of consent and/or permission from the
Government pursuant to Article 28 of the PSC-KG (the "GOVERNMENT
PERMISSION").
2.3 From the date hereof until all actions contemplated in Clause 2.5 are
completed, as between the Parties, GGR India shall retain the exclusive
right to deal with the other parties to the PSC-KG and the CIA and
shall be entitled to make all decisions regarding the Participating
Interest in its sole discretion as it determines is appropriate on
behalf of itself and RGM.
2.4 From the date hereof until all actions contemplated in Clause 2.5 are
completed, RGM hereby agrees to be bound by and responsible for any and
all actions taken by, obligations undertaken by and costs incurred by
GGR India in regard to the Participating Interest and acknowledges that
it will be responsible and liable to GGR India for its share of all
costs, interests, liabilities and obligations arising out of or in
relation to the Participating Interest, including the payment of all
income, withholding or transfer taxes, or any interest or penalties
relating thereto imposed on or arising in respect of the Participating
Interest. RGM further undertakes and agrees to fully indemnify GGR
India in respect of
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any and all costs, expenses, losses, damages or liabilities occasioned
by RGM's failure to pay the same.
2.5 The Parties acknowledge a shared belief that the Government Permission
is forthcoming and agree that each Party shall use all reasonable
endeavours and provide all reasonable assistance to the other Party in
obtaining the Government Permission. Upon receiving the Government
Permission, the assignment and transfer shall be effective as between
the Parties in accordance with Clause 2.1(b) and the Parties shall
arrange for the execution of assignment and novation agreements in
respect of the PSC-KG and the CIA, as well as any joint operating
agreement which may have been entered into among GGR India and the
other Joint Venture Partners, in order to formally recognize the
assignment and transfer of the Participating Interest to RGM.
2.6 Subject to all actions contemplated in Clause 2.5 being completed:
(a) RGM undertakes to indemnify GGR India and keep GGR India
indemnified from all costs, claims, liabilities and expenses
in respect of the Participating Interest arising out of or in
connection with any event, incident, act or omission occurring
on or after the Effective Date.
(b) RGM shall be entitled to all income, receipts, credits,
reimbursements, monies receivable, rebates and other benefits
in respect of the Participating Interest which relate to the
period on or after the Effective Date.
(c) GGR India shall have the right to off-set any sums owing to
RGM pursuant to paragraph 2.6(b) against sums owing to GGR
India pursuant to paragraph 2.6(a) hereof.
3. REPRESENTATIONS AND WARRANTIES
3.1 Each Party represents and warrants to the other Party that this
Agreement and all other documents executed and delivered by and on
behalf of a Party pursuant to this Agreement have been or will be duly
authorized, executed and delivered by such Party and constitute or will
constitute valid and binding obligations of such Party and such Party
has taken all actions necessary to authorize and complete the
transactions contemplated herein.
3.2 RGM acknowledges and agrees that it has relied on its own
investigations and due diligence with respect to the Participating
Interest, and that it is fully aware of the terms and conditions of the
PSC-KG and the CIA.
4. FURTHER ASSURANCE
4.1 Each Party undertakes to the other Party that it will do all such acts
and things and execute all such deeds and documents as may be necessary
or desirable to carry into effect or to give legal effect to the
provisions of this Agreement and the transactions hereby contemplated.
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5. RIGHT TO ASSIGN, SELL OR DISPOSE
5.1 From the date hereof until August 4, 2009, RGM agrees that it shall
not:
(a) dispose of any of any interest in this Agreement or any
Participating Interest, whether by assignment, sale, trade,
lease, sublease, farmout or otherwise; or
(b) assign or transfer shares of RGM to any third party;
without first complying with the provisions of Clause 5.2, provided
that it may assign, transfer or dispose such an interest to an
individual member of JPR's family, a corporate body controlled by JPR
or a member of his family, or an Affiliate of RGM, without any
requirement to comply with the provisions of this Clause 5, provided
such transferee agrees in writing to be bound by all the terms of this
agreement. In any event, RGM shall give five (5) days prior written
notice to GGR India of all transfers in reliance upon the proviso set
forth in the foregoing sentence.
5.2 If RGM wishes to make an assignment, transfer or disposition
contemplated in Clause 5.1, it shall, by notice, advise GGR India of
its intention to make such assignment, transfer or disposition,
including in such notice a description of the Participating Interest or
other interest proposed to be disposed, the identity of the proposed
assignee, the price or other consideration for which the RGM is
prepared to make such disposition and all other material terms of the
proposed transaction, the proposed effective date and closing date of
the transaction and any other information material to the exercise of
GGR India's rights hereunder. GGR India shall have a right of first
refusal to purchase the interest described in such notice.
5.3 Within twenty (20) days from receipt of notice in Clause 5.2 GGR India
may give notice to RGM that it elects to purchase the Participating
Interest or other interest described in the disposition notice for the
applicable price or comparable consideration. Such notice of acceptance
shall create a binding contractual obligation upon RGM to sell, and
upon GGR India to purchase, for the applicable consideration, all of
the Participating Interest or other interest included in such
disposition notice on the terms and conditions set forth in the
disposition notice.
5.4 If GGR India does not elect to exercise its right of first refusal, the
assignment, transfer or disposition to the original proposed assignee
may proceed, subject to the consent of GGR India, such consent not to
be unreasonably withheld.
6. GENERAL
6.1 The rights and remedies herein provided are cumulative and not
exclusive of any rights and remedies provided by law.
6.2 No provision of this Agreement may be amended, modified, waived,
discharged or terminated, otherwise than by the express written
agreement of the parties hereto nor may any breach of any provision of
this Agreement be waived or discharged except with the express written
consent of the Party not in breach.
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6.3 The Parties agree that if the Government Permission is materially
delayed or such Government Permission is declined such that a Party is
deprived of economic benefit it would otherwise be entitled to receive
under the Agreement, the Parties agree to amend the Agreement or take
such other reasonable steps to ensure that an equitable result for both
Parties is achieved consistent with their intentions as set out herein
or contemplated hereby, and in particular, the Parties agree to ensure
that RGM is provided an economic benefit equivalent to that originally
contemplated by the Parties herein In the event Government Permission
is declined, neither Party shall be entitled to assert any claim
against the other Party, except in accordance with their rights as
specifically set forth herein.
7. NOTICES
7.1 Any notice or other communication given or made under this Agreement
shall be in writing and may be delivered to the relevant Party or sent
by prepaid letter, telex or facsimile transmission to the address of
that Party specified in this Agreement or to that Party's telex or
facsimile transmission number thereat or such other address or number
as may be notified hereunder by that Party from time to time for this
purpose and shall be effectual notwithstanding any change of address
not so notified.
7.2 Unless the contrary shall be proved, each such notice or communication
shall be deemed to have been given or made and delivered, if by letter
72 hours after posting, if by delivery, when left at the relevant
address and, if by telex or facsimile transmission, when transmitted.
7.3 The respective addresses for service are:
(a) GGR India
GeoGlobal Resources (India) Inc.
200, 000 - 0xx Xxxxxx X.X.
Xxxxxxx, Xxxxxxx
X0X 0X0, Xxxxxx
Facsimile No. (000) 000-0000
Attention: Xxxxx X. Xxxx
(b) RGM
Xxx Group (Mauritius) Inc.
c/o International Financial Services Limited
0xx Xxxxx, Xxx Xxxxxxxx, Xxxxx Xxxxxx Xxxxxx,
Xxxx Xxxxx, Xxxxxxxxx
Facsimile No. (000) 000-0000
Attention: Dev Joory
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8. GOVERNING LAW
8.1 This Agreement shall be governed by and construed in all respects in
accordance with the laws of Alberta and the Parties agree to submit to
the non-exclusive jurisdiction of the Courts in Alberta as regards any
claim or matter arising in relation to this Agreement.
AS WITNESS the hands of the duly authorised representatives of the Parties the
day and year first above written.
For and on behalf of:
GEOGLOBAL RESOURCES (INDIA) INC.
Per:
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Per:
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For and on behalf of:
XXX GROUP (MAURITIUS) INC.
Per:
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Per:
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DATED MARCH , 2003
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GEOGLOBAL RESOURCES (INDIA) INC.
XXX GROUP (MAURITIUS) INC.
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PARTICIPATING INTEREST AGREEMENT
REGARDING AN INTEREST IN
THE BLOCK KG-OSN-2001/3 PRODUCTION SHARING CONTRACT
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