Attached files
Exhibit
2.1
ASSET
PURCHASE AND SALE AGREEMENT
This
Asset Purchase and Sale Agreement (“Agreement”) is entered into this 18th day of
November, 2009 (“Effective Date”), by and among Green Irons Holdings Corp., a
Nevada corporation (“Green Irons”), and Alamo Oil Limited, an United Kingdom
corporation (“Alamo”). Green Irons is referred to herein as “Buyer” and Alamo is
referred to herein as “Seller.” Buyer and Seller are called herein collectively
the “Parties.”
RECITALS
A. Seller
is the owner of certain interests in certain oil and gas leases and well bores,
which are set forth as attached hereto as Exhibit A.
B. Seller
desires to sell and assign its interests in and obligations concerning those oil
and gas leases for the benefit of Buyer, for the consideration and on the terms
and subject to the conditions specified in this Agreement.
C. Buyer
desires to purchase those certain interests in and assume those obligations
concerning those oil and gas leases, on
the terms and subject to the conditions specified in this
Agreement.
NOW,
THEREFORE, IN CONSIDERATION OF THE RECITALS SPECIFIED ABOVE THAT SHALL BE DEEMED
TO BE A SUBSTANTIVE PART OF THIS AGREEMENT, AND THE MUTUAL COVENANTS, PROMISES,
UNDERTAKINGS, AGREEMENTS, REPRESENTATIONS AND WARRANTIES SPECIFIED IN THIS
AGREEMENT AND OTHER GOOD AND VALUABLE CONSIDERATION, THE RECEIPT AND SUFFICIENCY
OF WHICH ARE HEREBY ACKNOWLEDGED, WITH THE INTENT TO BE OBLIGATED LEGALLY AND
EQUITABLY, THE PARTIES DO HEREBY COVENANT, PROMISE, AGREE, REPRESENT AND WARRANT
AS FOLLOWS:
ARTICLE
1
DEFINITIONS
Capitalized
terms used in this Agreement have the meanings given such terms in this Article
1 or elsewhere in this Agreement.
“Affiliate”
means (i) with respect to the Seller, any corporation, limited liability
company, association, partnership or person that directly or indirectly, through
one or more intermediaries, controls, is controlled by, or under common control
with, the Seller, and (ii) any Seller's officers, directors and
shareholders.
“Assets”
has the meaning set forth in Article 2.01 hereof.
“Buyer”
has the meaning set forth in the preface to this Agreement.
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“Buyer
Indemnified Party” has the meaning provided in Article 7.03.
“Closing”
has the meaning set forth in Article 3.02 hereof.
“Closing
Date” has the meaning set forth in Article 3.02 hereof.
“Code”
means the Internal Revenue Code of 1986, as amended.
“Commission”
means the Securities and Exchange Commission (or any successor body
thereto).
“Conveyance
Documents” means the Conveyance in the form attached hereto as Exhibit B,
together with those other forms of assignments, bills of sale, deeds and other
instruments the Parties agree are necessary or appropriate to convey interest in
the Assets or from Seller to Buyer as contemplated by the
Agreement.
“Environmental
Audit” means an assessment of Seller’s compliance with Environmental Laws
relative to the Assets consisting of examination of Seller’s files and public
documents, interviews of personnel of Seller and of other appropriate persons
and visual inspection of the Assets.
“Examination
Period” has the meaning set forth in Article 6.02.
“Governmental
Approvals” has the meaning set forth in Article 13.
“Hydrocarbons”
means crude oil, natural gas, casinghead gas, condensate, helium, sulphur, S02,
C02, natural gas liquids and other gaseous and liquid hydrocarbons or any
combination thereof.
“Indemnifying
Party” has the meaning set forth in Article 7.04(a) hereof.
“Lands”
means the lands covered by the Mineral Interests.
“Leases”
means the oil and gas leases or oil, gas, and mineral leases shown in Exhibit A
hereto or that cover any portion of the area described in such
Exhibit.
“Loss”
or “Losses” means all damages, payments, penalties, fines, assessments, costs,
amounts paid in settlement, obligations, taxes, losses (including reductions in
the value of Assets), liabilities, expenses and fees incurred, including court
costs and attorneys' fees and expenses and costs of investigating, preparing or
defending any action or proceeding, provided, however, that Buyer shall be
deemed to have incurred a Loss or Losses only if, and only to the extent that,
the cumulative aggregate of all such Loss or Losses attributable to or arising
in connection with the portion of the Assets acquired from Alamo exceeds $50,000
or the cumulative aggregate of all such Loss or Losses attributable to or
arising in connection with the portion of the Assets acquired from Green Irons
exceeds $250,000.
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“Mineral
Interests” means the interests of Seller in the Leases described in Exhibit A
and any mineral interest owned by Seller in and to the lands described in
Exhibit A.
“Parties”
has the meaning set forth in the preface above.
“Permitted
Encumbrances” means, with respect to the Assets, the following:
(i) liens
for taxes not yet due or, if due, being challenged in good faith by appropriate
proceedings;
(ii) materialmen's,
mechanics' and other similar liens or charges arising in the ordinary course of
business for obligations that are not delinquent and that will be paid or
discharged in the ordinary course of business or, if delinquent, that are being
contested in good faith in the ordinary course of business;
(iii)
easements, rights-of-way, servitudes, permits, surface leases, and other rights
granted to or reserved for third parties in respect of surface operations that
do not materially interfere with the operation of the portion of the Assets
burdened thereby;
(iv) rights
reserved to or vested in any governmental authority to control or regulate any
of Well Bores or Units and all applicable laws, rules, regulations and orders of
such authorities.
(v) liens
arising under operating agreements, unitization and pooling agreements, orders
and statutes and production sales contracts securing amounts not yet due or, if
due, being contested in good faith in the ordinary course of business as set
forth in Exhibit A attached hereto and made a part hereof for all
purposes;
(vi) the
terms and conditions of all contracts and agreements relating to the Leases
including, without limitation, exploration agreements, gas sales contracts,
processing agreements, farmins, farmouts, operating agreements, and right-of-way
agreements, to the extent such terms and conditions are normal and customary in
the oil and gas industry in the area in which the affected Assets are
located;
(vii) royalties,
overriding royalties, net profits interests, production payments, reversionary
interests, and similar interests that do not decrease Seller's interest, except
as specified in Exhibit A attached hereto;
(viii) conventional
rights of reassignment requiring notice to the holders of the rights prior to
surrendering or releasing a leasehold interest; and
(ix) the
absence of Governmental Approvals other than Governmental Approvals that were
applicable to a previous transaction involving the transfer of all or any
portion of the Assets but were not complied with at the time of the consummation
of such transaction.
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“Purchase
Price” has the meaning given set forth in Article 3.01.
“Records”
means all originals, copies, computer tapes and discs, files, records,
information or data relating to the Assets in the possession of Seller, or in
the possession of any agent for the Seller, including, without limitation, title
records (including abstracts of title, title opinions, certificates of title and
title curative documents), accounting records and files, contracts,
correspondence, production records, electric logs, core data, pressure data,
decline curves, graphical production curves, geologic and geophysical
information, drilling reports, well completion reports, drill stem test charts
and reports, engineering reports, regulatory reports, and all related materials,
insofar as the foregoing items constitute materials that may be lawfully
conveyed to Buyer (i.e. the materials are not subject to a proprietary agreement
precluding their transfer to Buyer).
“Seller”
has the meaning set forth in the preface to this Agreement.
“Seller
Indemnified Party” has the meaning given to it in Article 7.02.
“Survival
Period” has the meaning set forth in Article 7.01 hereof.
“Taxes”
has the meaning set forth in Article 9.
“Third
Party Claim” has the meaning set forth in Article 7.04(a) hereof.
“Transfer
Requirements” means all consents, approvals, authorizations or permits of, or
filings with or notifications to, any third party which must be obtained, made
or complied with for or in connection with the transactions contemplated by this
Agreement in order (a) for such transactions to be effective, (b) to prevent any
termination, cancellation, default, acceleration or change in terms (or any
right arising therefrom) under any terms, conditions or provisions of any Asset
(or of any agreement, instrument or obligation relating to or burdening any
Asset or any interest therein or portion thereof) as a result of such
transactions, or (c) to prevent the creation or imposition of any lien, charge,
penalty, restriction, security interest or encumbrance on or with respect to any
Asset or any interest therein or portion thereof (or any right arising
therefrom) as a result of such transactions.
“Units”
means all unitization, communitization, pooling agreements, working interest
units created by operating agreements, and orders covering the lands subject to
the Leases, or any portion thereof, and the units and pooled or communitized
areas created thereby.
“Wells”
means wells for the production of Hydrocarbons.
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ARTICLE
2
SALE
AND PURCHASE
2.01
Assets. Subject to the terms and conditions of this Agreement and in
consideration of Buyer’s payment to Seller of the Purchase Price as provided in
this Agreement, the Buyer agrees to purchase from the Seller, and the Seller
agrees to sell and convey to Buyer, the following Assets:
(a) all
of the oil, gas and mineral interests in the leases and well bores described on
Exhibit A as specified in the Conveyance Documents in Exhibit B (the “Leasehold
Interests”);
(b) All
of Seller’s right, title, and interest in and to all of the immovable, movable
and mixed property of Seller, or in which Seller owns an interest, that is
attributable or allocable to the Assets and used or held for use in connection
with the exploration, development, operation or maintenance of any of the
Leasehold Interests or the production, treatment, measurement, storage,
gathering, transportation or marketing of oil, gas or other hydrocarbons
attributable to the Leasehold Interests (or the interests of others
therein)
(c) All
of Seller’s right, title, and interest in and to all original files, records,
data, information and documentation of Seller (or if originals are not
available, copies of such items) pertaining to or evidencing Seller’s use,
ownership or operation of any of the assets, or the maintenance or operation
thereof, or to any units in which any of the Leasehold Interests may be included
or to the producing, treating, measuring, processing, storing, gathering,
transporting or marketing of oil and gas attributable to the Leasehold Interests
or such units and water, brine or other minerals and products produced in
association therewith, including, without limitation, lease files, land files,
well files, production sales agreement files, division order files, title
opinions and abstracts, legal records (excluding any records or information the
disclosure of which would result in the waiver of an attorney-client privilege),
tax records, financial and accounting records, governmental, tribal and
regulatory filings and permits, environmental records, and, except to the extent
the transfer thereof may not be made without violating applicable contractual
restrictions, geological and geophysical data, seismic records, production
reports, maps, and computer software (collectively, the “Records” );
and
(d) All
rights of Seller in and to those instruments and agreements listed on Exhibits A
and B hereto, the other instruments and agreements under which Seller’s
interests in the Leasehold Interests arise, and all other agreements and
contractual rights, easements, rights-of-way, servitudes, and other rights,
privileges, and benefits to the extent relating to any asset described in
clauses (a) through (d) above, including, without limitation, all rights of
Seller in, to and under or derived from all production sales contracts,
operating agreements, pooling, unitization or communitization agreements,
purchase, exchange or processing agreements, production handling agreements,
surface leases, easements or rights-of-way, farmout or farmin agreements, dry
hole or bottom hole contribution agreements, seismic agreements, permits,
licenses, options, orders and all other contracts, agreements and instruments
relating to the exploration for, or the development, production, storage,
gathering, treatment, transportation, processing, or sale or disposal of oil,
gas, other hydrocarbons, other minerals, water, brine or other substances from
any Leasehold Interest or any units of which they are a part (collectively, the
“Rights” )
The
Leasehold Interests, the Related Property, the Records, and the Rights are
herein collectively called the “Assets.”
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ARTICLE
3
PURCHASE
PRICE; CLOSING
3.01
Purchase Price. In consideration for the sale and conveyance to Buyer of
the Assets, subject to the terms and conditions hereof, the Buyer agrees to
tender and deliver to the Seller in the manner hereinafter provided, Three
Hundred Fifty Thousand (350,000) shares of Buyer’s common stock as consideration
(the “Purchase Price”).
3.02
The Closing. The closing of the transactions contemplated by this
Agreement (the “Closing”) will take place at the offices of M2 Law Professional
Corporation located at 500 Newport Center Drive, Suite 800, Newport Beach, CA
92660, simultaneously with the execution of this Agreement on the Effective
Date, or at such other place, date and time as the Buyer and the Seller may
mutually determine (the “Closing Date”).
3.03
Closing Obligations. At the Closing, the following events
shall occur:
(a) Seller
and Buyer shall execute, acknowledge and deliver to each other the Conveyance
Documents. In the Conveyance Documents, Seller shall bind itself and its
respective successors and assigns to warrant title to the Assets unto Buyer, its
successors and assigns, against every person whomsoever lawfully claiming or to
claim the same or any part thereof by, through and under Seller, but not
otherwise, and with full substitution and subrogation of Buyer in and to all
warranties of title heretofore made by Seller’s predecessors in title in respect
of the Assets. Further, in the Conveyance Documents, any movable or tangible
property situated on and comprising a portion of the Assets shall be sold on an
“AS
IS, WHERE IS” basis without any warranty, either express or implied, as
to title, value, quality, condition or fitness for any purpose and with all
defects;
(b) Buyer
shall make the payment of the Purchase Price as described in Article
3.01;
(c) Seller
shall execute such other instruments and take such other action as may be
necessary to carry out its obligations under this Agreement; and
(d) Buyer
shall execute such other instruments and take such other action as may be
necessary to carry out its obligations under this Agreement.
ARTICLE
4
REPRESENTATIONS
AND WARRANTIES
4.01
Representations and Warranties of Seller. Seller represents and warrants
to Buyer that the statements contained in this Article 4.01 are true and correct
as of the Closing Date:
(a) Seller
is a corporation which is duly organized, validly existing and in good standing
under the laws of the United Kingdom, and is qualified to do business and in
good standing under the laws of any jurisdiction where the Seller conducts
operations.
(b) Seller
has all requisite power and authority to carry on their respective businesses as
presently conducted, to enter into this Agreement, to perform their obligations
pursuant to this Agreement.
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(c) The
execution and delivery of this Agreement has been, and the execution and
delivery of all certificates, documents and instruments required to be executed
and delivered by the Seller at Closing, and the consummation of the transactions
contemplated hereby and thereby as of the Closing Date shall have been duly
authorized by all necessary corporate action on the part of the Seller. No
further authorization is required by any law, statute, regulation, court order
or judgment applicable to the Seller. This Agreement constitutes the legal,
valid and binding obligations the Seller enforceable in accordance with their
respective terms, subject however, to the effects of bankruptcy, insolvency,
reorganization, moratorium and similar laws, as well as to principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law). After Closing, the Seller will have the ability to continue
in its same business without a fundamental change in the nature or scope of its
business.
(d) The
execution and delivery of the Agreement and the consummation of the transactions
contemplated hereby and thereby will not (i) violate, or be in conflict with,
any provisions of the Seller’s charter documents, (ii) constitute a breach of,
or any event of default under, any contract or agreement to which the Seller is
a party or by which it or its assets are bound, or constitute the happening of
an event or condition upon which any other party to such a contract or agreement
may exercise any right or option which will materially adversely affect any of
the Assets, (iii) violate any judgment, decree, order, statute, rule or
regulation applicable to Seller, or (iv) result in any material liability to
Buyer under the terms of any contracts or agreements.
(e) No
suit, action or other proceeding is pending before any court or any governmental
agency as of the date of this Agreement to which the Seller is a party or which
involves the Assets and which might result in a material impairment or loss of
the Seller’s title to the Assets or that might materially hinder or impede the
operation of the Assets or the ability of the Seller to perform its obligations
under this Agreement. Seller will promptly give the Buyer notice of any such
proceeding arising prior to or after the Closing with respect to which it has
notice. The Seller has received no notice of any pending or threatened action,
suit, proceeding, inquiry or investigation, at law or in equity, before or by
any court, governmental agency, public board or body against or affecting the
Seller or the Assets that questions the powers and authority of the Seller to
enter into or perform its obligations under this Agreement or to carry out the
transactions on its part described in this Agreement to own and dispose of the
Assets.
(f) Prior
to the Closing Date, all royalties, rentals and other payments due with respect
to the Mineral Interests have been properly and timely paid as prescribed by the
Leases governing them. All conditions necessary to keep the Leases in force have
been fully performed no notices have been received by Seller of any claim to the
contrary and all of the Leases are in full force and effect.
(g) Prior
to the Closing Date, (i) Seller is not obligated by virtue of any prepayment
arrangement under any contract for the sale of Hydrocarbons and containing a
"take or pay" or similar provision to deliver Hydrocarbons produced from the
Assets at some future time without then or thereafter receiving full payment
therefor, and (ii) Seller is under no obligation to reduce its share of
production under any balancing agreement or similar contract.
(h) 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 on the Assets have been properly paid and all such taxes and
assessments which become due and payable prior to the Closing Date shall have
been properly paid by Seller.
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(i) All
laws, regulations and orders of all governmental agencies having jurisdiction
over the Assets or operations conducted thereon have, to Seller's knowledge,
been and shall continue to be complied with in all material respects until the
Closing Date. Seller has obtained all material necessary permits from
governmental agencies having jurisdiction in connection with all operations
currently conducted with respect to the Assets, including, without limitation,
the injection and disposal of salt water, or operations currently conducted
thereon and have timely, properly and accurately made and will continue to
timely, properly and accurately make all filings required by all governmental
agencies with respect to the Assets or operations currently conducted thereon
and through the Closing Date.
(j) Seller
has not incurred liability, contingent or otherwise, for brokers' or finders'
fees relating to the transactions contemplated by this Agreement for which Buyer
shall have any responsibility whatsoever.
(k) With
respect to the Basic Documents (defined below), in all material respects (i) the
Basic Documents all are in full force and effect and are the valid and legally
binding obligations of the parties thereto and are enforceable in accordance
with their respective terms; (ii) Seller is not in breach or default with
respect to any of its material obligations pursuant to any such Basic Document
or any regulations incorporated therein or governing same; (iii) all material
payments (including, without limitation, royalties, delay rentals, shut-in
royalties, or payments, fees for salt water disposal or injection, and joint
interest or other billings under unit or operating agreements) due from Seller
thereunder have been made by Seller; (iv) to Seller's knowledge no other party
to any Basic Document (or any successor in interest thereto) is in breach or
default with respect to any of their material obligations thereunder; (v)
neither the Seller nor, to Seller's knowledge, any other party to any Basic
Document has given or threatened to give notice of any action to terminate,
cancel, rescind or procure a judicial determination of any Basic Document or any
provision thereof; and (vi) the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby and thereby will not result
in a breach of, constitute a default under, or result in a violation of the
material provisions of any Basic Document and none of the Basic Documents will
require, after the Effective Date, that any advance payments be made to any
party other than those required under operating agreements. As used
herein the term “Basic Documents” shall mean the Leases, partnership, joint
venture, limited partnership, farmout, dry hole, bottom hole, operating
agreements, acreage contribution, purchase and acquisition agreements, area of
mutual interest agreements and salt water disposal and/or injection agreements,
servicing contracts, casement and/or right-of-way agreements, surface leases,
surface use agreements, unitization or pooling agreements and all other material
executory contracts and agreements relating to the Assets, including, without
limitation, those contracts and agreements described in Article 4.01(m)
hereto.
(l) Seller
has good and valid title to the Assets; Exhibit A contains a list of all Mineral
Interests and other mineral estates and interests within the interest in the
Leases owned by Seller and is true and correct, except as otherwise noted
therein.
(m) The
Mineral Interests entitle Seller to receive not less than the undivided interest
set forth in Exhibit A of all indicated hydrocarbons produced, saved and
marketed from or attributable to the Leases.
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(n) No
portion of the Mineral Interests (1) has been contributed to and is currently
held by a tax partnership; (2) is subject to any form of agreement (whether
formal or informal, written or oral) deemed by any state or federal tax statute,
rule or regulation to be or have created a tax partnership; or (3) otherwise
constitutes "partnership property" (as that term is used in Subchapter K of
Chapter 1 of Subtitle A of the Code) of a tax partnership. For the purpose of
this Article 4.01(n) a "tax partnership" is an entity deemed to be a partnership
within the meaning of Section 761 of the Internal Revenue Code or any similar
state or federal statute, rule or regulation, by reason of elections made not to
be excluded from the application of such partnership provisions.
(o) The
Seller represents that it has been furnished with such information as Seller may
have requested from the Buyer concerning the Buyer.
(p) Seller
has provided Buyer with complete and accurate information relating to the Leases
and Assets, including without limitation, all applicable agreements relating,
appertaining or incidental to the Leases, production history and
characteristics. Seller has also provided Buyer with copies of all land files
heretofore maintained and belonging to Seller.
(q) Prior
to Closing, Seller shall have made available to Buyer for examination all title
and other information relating to the Assets insofar as the same are in Seller's
possession and after Closing will cooperate with Buyer in Buyer's efforts to
obtain such additional information relating to the Assets as Buyer may
reasonably require, to the extent in each case that Seller may do so without
violating legal constraints or any obligation of confidence or other contractual
commitment of Seller to a third party. After Closing, Seller shall cooperate
with Buyer in Buyer's efforts to obtain, at Buyers' expense, such additional
title information as Buyer may reasonably deem prudent.
(r) Seller
has caused the Assets to be maintained in a good and workmanlike manner
consistent with good oilfield practices, has maintained insurance now in force
with respect to the Assets, has paid or caused to be paid all costs and expenses
in connection therewith, has kept the Leases in full force and effect and has
performed and, to the best knowledge of Seller, complied with all the covenants
and conditions contained in the Leases and all agreements relating to the
Assets.
(s) During
the period between the Effective Date and the Closing, Seller has not entered
into any agreements or commitments with respect to the Assets, has not modified
or terminated any of the agreements relating to the Assets, including, without
limitation, the Basic Documents, has not encumbered, sold or otherwise disposed
of any of the Assets other than any personal property which may have been
replaced by equivalent property or consumed in the operation of the Assets, and
has not voluntarily compromised any amounts payable to the Seller due to
casualty loss or any pending or threatened taking related to the
Assets.
(t) Seller
has exercised reasonable efforts in safeguarding and maintaining all
engineering, geological and geophysical data, reports and maps, contract rights
and like information relating to the Assets.
(u) In
the event that as of the Closing Date the Assets are subject to outstanding
Governmental Approvals, Seller agrees to indemnify the Buyer Indemnified Party
against any Loss or Losses arising by reason of the failure to obtain such
Governmental Approvals. Seller represents that it will exercise reasonable
efforts to obtain such Governmental Approvals. The indemnity herein provided
shall survive the Closing until the required Governmental Approvals have been
obtained.
(v) Seller
has permitted Buyers' authorized representatives to consult with Seller's and/or
any third-party contract operator's agents and employees during reasonable
business hours and to conduct on-site inspections, reasonable tests and
inventories with respect to the Assets and inspect and examine any and all
production and related data, well logs and geological and geophysical data
relating to the Assets.
(w) Prior
to the Closing Date, Seller has used reasonable efforts to maintain its
relationships with all suppliers, customers and others having business
relationships with Seller with respect to the Assets so that such relationships
will be preserved for Buyer on and after the Closing Date.
(x) There
are no underground storage tanks located on any of Lands.
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4.02
Representations and Warranties of Buyer. Green Irons represents and
warrants to Seller that the statements contained in this Article 4.02 are true
and correct as of the Closing Date:
(a) Green
Irons is a corporation duly organized, validly existing and in good standing
under the laws of the State of Nevada, and is qualified to do business and in
good standing under the laws of any jurisdiction where Green Irons conducts
operations.
(b) Buyer
has all requisite power and authority, corporate and otherwise, to carry on its
business as presently conducted, to enter into this Agreement to which it is a
party, and to perform its obligations under this Agreement.
(c) The
execution and delivery of this Agreement has been, and the execution and
delivery of all certificates, documents and instruments required to be executed
and delivered by Buyer at Closing, and the consummation of the transactions
contemplated hereby as of the Closing Date shall have been duly authorized by
all necessary corporate action on the part of Buyer and no further authorization
is required by any law, statute, regulation, court order or judgment applicable
to Buyer. This Agreement constitutes a legal, valid and binding obligation of
Buyer enforceable in accordance with its terms, subject however, to the effects
of bankruptcy, insolvency, reorganization, moratorium and similar laws, as well
as to principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
(d) The
execution and delivery of the Agreement and the consummation of the transactions
contemplated hereby will not (i) violate, or be in conflict with any provisions
of Buyer's certificate of incorporation, bylaws or governing documents, (ii)
constitute a material breach of, or any event of default under, any contract or
agreement to which Buyer is a party or by which it or its assets are bound, or
constitute the happening of an event or condition upon which any other party to
such a contract or agreement may exercise any right or option which will
materially adversely affect the ability of Buyer to perform its obligations
hereunder, or (iii) violate any judgment, decree, order, statute, rule or
regulation applicable to Buyer.
(e) No
suit, action or other proceeding is pending before any court or governmental
agency as of the date of this Agreement to which Buyer is a party and which
might materially hinder or impede the ability of Buyer to perform its
obligations hereunder. Green Irons shall promptly notify Seller of any such
proceeding arising prior to the Closing with respect to which it receives actual
notice.
(f) Buyer
has not incurred any liability, contingent or otherwise, for brokers' or
finders' fees relating to the transactions contemplated by this Agreement for
which Seller shall have any responsibility whatsoever.
ARTICLE
5
ENVIRONMENTAL
REPRESENTATIONS AND WARRANTIES
5.01
Definitions. As used in this Article
5.01:
(a) “Contaminated
Site List” means any list, registry, or other compilation established by any
Governmental Entity of sites that require or potentially require investigation,
removal actions, remedial actions, or any other response under any Environmental
Laws or treaty covering environmental matters, as the result of the Release or
threatened Release of any Hazardous Materials.
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(b) “Environmental
Laws” means all laws, rules, regulations, statutes, ordinances or orders of any
Governmental Entity relating to (A) the control of any potential pollutant or
protection of the air, water or land, (B) solid, gaseous or liquid waste
generation, handling, treatment, storage, disposal or transportation, and (C)
exposure to hazardous, toxic or other substances alleged to be harmful, and
includes without limitation, the terms and conditions of any license, permit,
approval, or other authorization by any Governmental Entity, and judicial,
administrative, or other regulatory decrees, judgments, and orders of any
Governmental Entity. The term “Environmental Laws” shall include, but not be
limited to, the Clean Air Act, 42 U.S.C.ss.7401 et seq., the Clean Water Act, 33
U.S.C.ss.1251 et seq., the Resource Conservation Recovery Act (“RCRA”), 42
U.S.C.ss.6901 et seq., the Superfund Amendments and Reauthorization Act, 42
U.S.C.ss.11011 et seq., the Toxic Substances Control Act, 15 U.S.C.ss.2601 et
seq., the Water Pollution Control Act, 33 U.S.C.ss.1251, et seq., the Safe
Drinking Water Act, 42 U.S.C.ss.300f et seq., the Comprehensive Environment
Response, Compensation, and Liability Act (“CERCLA”), 42 U.S.C.ss.9601 et seq.,
the Oil Pollution Act of 1990, 33 U.S.C.A.ss.2701 et seq., and any applicable
statutes promulgated by the State of Utah or any counties, cities, townships or
other jurisdictions located therein.
(c) “Environmental
Liabilities” shall mean any and all liabilities, responsibilities, claims,
suits, losses, costs (including remediation, removal, response, abatement,
cleanup, investigative, and/or monitoring costs and any other related costs and
expenses), damages, settlements, expenses, charges, assessments, liens,
penalties, fines, prejudgment and postjudgment interest, attorney fees and other
legal fees (A) pursuant to any agreement, order, notice, or responsibility,
(including directives embodied in Environmental Laws), injunction, judgment, or
similar documents (including settlements), or (B) pursuant to any claim by a
Governmental Entity or other person for personal injury, property damage, damage
to natural resources, remediation, or similar costs or expenses incurred by such
Governmental Entity or person pursuant to common law, statute, rule or
regulation.
(d) “Environmental
Remediation Costs” means all costs and expenses of actions or activities to (A)
cleanup or remove Hazardous Materials from the environment, (B) to prevent or
minimize the further movement, leaching or migration of Hazardous Materials in
the environment, (C) prevent, minimize or mitigate the Release or threatened
Release of Hazardous Materials into the environment, or injury or damage from
such Release, and (D) comply with the requirements of any Environmental Laws.
Environmental Remediation Costs include, without limitation, costs and expenses
payable in connection with the foregoing for legal, engineering or other
consultant services, for investigation, testing, sampling, and monitoring, for
boring, excavation, and construction, for removal, modification or replacement
of equipment or facilities, for labor and material, and for proper storage,
treatment, and disposal of Hazardous Materials.
(e) “Governmental
Entity” means any court, administrative agency or commission or other
governmental authority or agency, domestic or foreign, including local
authorities.
(f) “Hazardous
Materials” means any toxic or hazardous materials or substances, or solid
wastes, including asbestos, buried contaminants, chemicals, flammable or
explosive materials, radioactive, materials, petroleum and petroleum products,
and any other chemical, pollutant, contaminants substance or waste that is
regulated by any Governmental Entity under any Environmental Law.
(g) “Material”
or “Material Adverse Effect” for purposes of this Article 5.01 means any matter,
response, action, remediation, or other item calling for the payment or
expenditure by any Seller or Buyer after the Closing of funds in excess of
$50,000 per occurrence, or $250,000 in the aggregate.
(h) “Release”
means any spilling, leaking, pumping, pouring, emitting, emptying, discharging,
injecting, escaping, leaching, dumping, or disposing into the environment of any
Hazardous Materials.
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5.02
Representations and Warranties. With respect to the Assets, the Seller
represents and warrants to Buyer that, to the best of its
knowledge:
(a) With
respect to permits and licenses relating to the Assets, (A) all Material
licenses, permits, consents, or other approvals required under Environmental
Laws that are necessary to the current operations on the Assets have been
obtained and are in full force and effect, and Seller is unaware of any basis
for revocation or suspension of any such licenses, permits, consents or other
approvals, (B) no declaration, environmental impact statement, or other filing
or notice to any Governmental Entity is required under Environmental Laws as a
condition or in connection with the transactions contemplated by this Agreement,
and (C) no Environmental Laws impose any obligation upon any Seller, as a result
of any transaction contemplated hereby, requiring prior notification to any
Governmental Entity of the transfer of any permit, license, consent, or other
Approval which materially is necessary to the operations of the
Assets.
(b) No
Governmental Entity has given notice to the Seller of any claim or investigation
under or violation of any Environmental Law with respect to the Assets or of any
intent to encumber or place a lien under any Environmental Laws upon the Assets.
No Material notice or Material restriction has been, or is required to be placed
in any deed or other public real property record pursuant to any Environmental
Laws with respect to the Assets.
(c) Except
as would not have a Material Adverse Effect and with respect to the Assets or
any of the Lands, (A) no oral or written notification of any Release of any
Hazardous Materials has been given to any Governmental Entity by or on behalf of
Seller, (B) none of the Assets is on (nor has any Seller received any notice
from any Governmental Entity that any of the Assets is being considered or
proposed for listing on) any Contaminated Site List, (C) none of the Assets is
the subject of any judgment, decree or order of any Governmental Entity
requiring any investigation, removal, remediation or similar action, or other
response under any Environmental Laws, (D) the Seller has not received any
notice from any Governmental Entity that it is liable or responsible, or
potentially liable or responsible, in any material respect for any removal,
remedial, or other similar type action under any Environmental Laws as the
result of the Release or threatened Release of Hazardous Materials with respect
to the Assets and (E) there is no claim, complaint, investigation, litigation,
or administrative proceeding threatened before any Governmental Entity (and to
the best of its information and belief, Seller knows of no threatened claim,
complaint, investigation, litigation, or administrative proceeding) in which it
is asserted by any Governmental Entity or any other person that Seller (x) has
violated or is not in compliance with any Environmental Laws with respect to the
Assets, (y) is liable for or should be ordered or compelled to undertake any
removal, remediation, or other response action as the result of the
Release or threatened Release of any Hazardous Materials with respect to the
Assets or (z) is liable for damages (including without limitation, damages to
natural resources), fines, penalties, or other relief as the result of the
violation or noncompliance of any Environmental Laws or as the result of the
Release or threatened Release of any Hazardous Materials with respect to the
Assets.
(d) Except
where the failure to have such permits and authorizations would not have a
Material Adverse Effect, all Hazardous Materials, garbage, refuse, and similar
waste materials with respect to the Assets have been transported by Seller only
to sites which have proper permits or other authorization from Governmental
Entities for the disposal of such materials. To the best knowledge of Seller, no
such site to which Hazardous Materials, garbage, refuse, or similar waste
materials have been transported for disposal Seller are on any Contaminated Site
List.
(e) Except
as would not have a Material Adverse Effect, all operations of Seller with
respect to the Assets are in compliance with all Environmental
Laws.
(f) Except
as would not have a Material Adverse Effect, no facts or circumstances exist
which could reasonably be expected to result in any Environmental Liabilities to
Seller or the Buyer following the Closing with respect to the
Assets.
(g) Seller
does not now own, lease or otherwise operate any disposal sites on the
Assets.
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ARTICLE
6
ENVIRONMENTAL
COVENANT
6.01
Availability of Data to Buyer; Environmental Audit. Prior to the date
hereof, Seller has made available to Buyer information which is in the
possession or control of Seller or to which Seller has access (other than
publicly available information to which Buyer has equal access) and which
relates to the environmental condition of the Assets, which information
includes, without limitation, information regarding crude oil and produced water
that may have been spilled or disposed of on-site and the locations thereof;
onsite pits and pit closures; on-site burial; land farming; land spreading;
underground injection; and on-site solid waste disposal sites. Seller has
further delivered to Buyer true and correct copies of its Environmental Reports.
No material environmental events have occurred since the dates of these
reports.
6.02
Environmental Assessment. Buyer shall have the right to make an
environmental assessment of the Assets during the period beginning on the date
of execution of this Agreement and ending ninety (90) days after the Closing
Date ("Examination Period"). If during the Examination Period, Buyer determines
that operations of Seller or its affiliates with respect to the Assets are not
in compliance with all Environmental Laws, without regard to whether Seller has
been previously notified of such matter by an applicable authority, then Buyer
shall give Seller notice thereof together with an explanation of the
environmental problem. Seller shall have five (5) days following such notice to
notify Buyer whether Seller elects to (x) remediate, dispose of, restore, or
otherwise resolve such environmental problem or lack of compliance in accordance
with all applicable laws, rules, and regulations, and to Buyer's reasonable
satisfaction, or (y) reduce the Purchase Price to be paid under this Agreement
(b) by $50,000. Buyer and Seller agree to cooperate with each other in
connection with all activities to be conducted hereunder.
ARTICLE
7
SURVIVAL
AND INDEMNIFICATION
7.01
Survival of Representations and Warranties. The representations and
warranties of (i) the Seller contained in Article 4.01 and Article 5 hereof
shall survive the Closing for a period of one year from the Closing Date and
(ii) the representations and warranties of the Buyer contained in Article 4.02
hereof shall survive the Closing for one year from the Closing Date (the
"Survival Period").
7.02
Indemnification Provision for the Benefit of the Seller. In the event the
Buyer breaches any of its representations and warranties contained in Article
4.02 hereof, then the Buyer agrees to indemnify and hold harmless the Seller,
any current, former, and future director, officer, manager, member, partner,
shareholder, employee and agent of Seller, and any successor, assign, heir, and
executor of any of the foregoing (the "Seller Indemnified Party"), from and
against the entirety of any Losses resulting from or related or attributable to
the breach which the Seller, or any such Affiliate (or any such other
indemnified person in such person's capacity set forth above) shall suffer,
provided such claim for indemnification is brought within the Survival Period;
and further provided that "Losses", as used in this sentence, shall not include,
and Buyer shall not be responsible or liable for, any death, personal injury, or
consequential damages in respect of such breach. Further, subject to the
limitations of the immediately preceding sentence, the Buyer indemnifies,
defends and holds the Seller Indemnified Parties harmless from and against any
and all Losses directly or indirectly arising out of or resulting from any
Hazardous Materials being present or released in, on or around any part of the
surface of the Fee Tract, or in the soil, groundwater or soil vapor on or under
the surface of the Fee Tract subsequent to the Closing Date that is caused by
the Buyer or its agents and employees.
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7.03
Indemnification Provision for the Benefit of the Buyer. In the event the
Seller breaches any of its representations and warranties contained in Article
4.01 and Article 5 hereof, then the Seller agrees to indemnify and hold harmless
the Buyer, any current, former, and future director, officer, manager, member,
partner, shareholder, employee and agent of Buyer, and any successor, assign,
heir, and executor of any of the foregoing (the "Buyer Indemnified Party"), from
and against the entirety of any Losses resulting from or related or attributable
to the breach which the Buyer, or any such Affiliate (or any such other
indemnified person in such person's capacity set forth above) shall suffer,
provided such claim for indemnification is brought within the Survival Period;
and further provided that "Losses", as used in this sentence, shall not include,
and Seller shall not be responsible or liable for, any death, personal injury,
or consequential damages in respect of such breach. Further, subject to the
limitations of the immediately preceding sentence, the Seller indemnifies,
defends and holds the Buyer Indemnified Parties harmless from and against any
and all Losses directly or indirectly arising out of or resulting from any
Hazardous Materials being present or released in, on or around any part of the
surface of the Fee Tract, or in the soil, groundwater or soil vapor on or under
the surface of the Fee Tract prior to the Closing date and thereafter, except
for the presence of such Hazardous Materials that is caused by the Buyer or its
agents and employees.
7.04 Matters
Involving Third Parties.
(a) If
any third party shall notify a Seller Indemnified or Buyer Indemnified Party
with respect to any matter which may give rise to a claim for indemnification
against Seller or Buyer, as the case may be (the "Indemnifying Party") under
this Article 7 or otherwise pursuant to this Agreement, then the Indemnified
Party shall promptly (and in any event within ten (10) business days after
receiving service of process in a lawsuit, administrative proceeding or
arbitration proceeding with respect to the Third Party Claim) notify each
Indemnifying Party thereof in writing. Each of the matters described in this
Article 7.04(a) shall be referred to in this Agreement as a "Third Party
Claim".
(b) Any
Indemnifying Party will have the right to assume and thereafter conduct the
defense of the Third Party Claim with counsel of its choice reasonably
satisfactory to the Indemnified Party; provided, however, that the Indemnifying
Party will not consent to the entry of any judgment or enter into any settlement
with respect to the Third Party Claim without the prior written consent of the
Indemnified Party (not to be withheld unreasonably) unless the judgment or
proposed settlement involves only the payment of money damages and does not
impose an injunction or other equitable relief upon (or constitute an admission
of guilt, liability, fault or responsibility for) the Indemnified Party. The
Indemnified Party shall have the right to employ separate counsel in any such
action and to participate in the defense thereof, but the fees and expenses of
such counsel shall be at the expense of the Indemnified Party unless (i) the
employment thereof has been specifically authorized in writing by the
Indemnifying Party or (ii) the Indemnifying Party failed to assume the defense
and employ counsel.
(c) Unless
and until an Indemnifying Party assumes the defense of the Third Party Claim as
provided in Article 7.04(b) above, however, the Indemnified Party may defend
against the Third Party Claim in any manner it reasonably may deem appropriate
with such reasonable costs and expenses associated therewith to be borne for the
account of the Indemnifying Party.
(d) In
no event will the Indemnified Party consent to the entry of any judgment or
enter into any settlement with respect to the Third Party Claim without the
prior written consent of the Indemnifying Party (not to be withheld
unreasonably), unless the Indemnified Party waives indemnification with respect
to the Third Party Claim so settled and adjudicated.
(e) The
indemnification obligations of Seller and Buyer, respectively under this
Agreement shall include court costs and attorney's fees and expenses and costs
of investigating, preparing or defending any action or proceeding with respect
to any Third Party Claim.
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ARTICLE
8
POST
CLOSING COVENANTS
8.01
Certain Obligations of Seller. Seller agrees that, with respect to the
period following the Closing:
(a) Records.
On or before five (5) business days after Closing, Seller shall, at Seller's
cost, deliver to Buyer, at Buyer's offices in Houston, Texas, copies of all
Records.
(b) Retained
Liabilities. Seller retains and shall remain liable and responsible for, and
Buyer specifically does not assume, any liabilities and obligations of Seller
not related to or arising out of the ownership, use, maintenance and operation
of the Assets, whether known or unknown, accrued or contingent and not otherwise
specifically set forth in this Agreement.
8.02
Certain Obligations of Buyer. Buyer agrees that within (30) days
following Closing, Buyer shall record those Conveyance Documents necessary to
evidence in the public record that Buyer has acquired the Assets and within a
reasonable time thereafter, Buyer shall supply Seller with a true and accurate
photocopy of the recorded and filed Conveyance Documents. In the event Buyer
fails to record any such Conveyance Document within such time period, Seller
may, but shall not be obligated to, record such Conveyance Document on Buyer's
behalf and at Buyer's cost (for which Buyer will promptly reimburse Seller upon
demand).
ARTICLE
9
EFFECT
OF CLOSING
The
following terms, provisions and prorations shall be effective at the
Closing:
(a) Revenues.
All proceeds from accounts receivables, notes receivable, income, revenues,
monies and other items attributable to the Assets with respect to any period of
time prior to the Effective Date shall belong to and be retained by or paid over
to Seller and all necessary reports with respect to such proceeds shall be filed
by Seller. All proceeds from production, accounts receivables, notes
receivables, income, revenues, monies and other items attributable to the Assets
with respect to any period of time from and after the Effective Date shall
belong to and be retained by or paid over to Buyer.
(b) Expenses.
All accounts payable and accrued liabilities for costs and expenses attributable
to the Assets with respect to any period of time prior to the Effective Date,
including excise, severance, and similar taxes based on production or royalties,
shall be the obligation of and paid by the Seller, and all necessary reports
with respect to such costs and expenses shall be filed by Seller. All production
royalties payable to Seller and exploration and drilling expenses as specified
in the Agreement, along with any accounts payable and accrued liabilities for
direct costs and expenses attributable to the Assets with respect to any period
of time from and after the Effective Date shall be the obligation of and be paid
by the Buyer.
(c) Ad
Valorem And Property Taxes. All ad valorem taxes, real property taxes, personal
property taxes and similar obligations (the "Taxes") shall be apportioned as of
the Effective Date between Buyer and Seller. All such Taxes allocable to periods
prior to the Effective Date shall be paid by Seller, and all such Taxes
allocable to the Effective Date and after shall be paid by Buyer. Any refunds of
Taxes allocable to periods prior to the Effective Date shall be the property of
Seller. Any refunds of Taxes allocable to periods after the Effective Date shall
be the property of Buyer. Buyer shall file or cause to be filed all required
reports and returns incident to such Taxes which are due on or after the
Effective Date, and shall pay or cause to be paid to the taxing authorities all
such Taxes reflected on such reports and returns; provided, however, Seller
shall promptly reimburse Buyer for any amounts owing by Seller with respect
thereto pursuant to this paragraph.
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(d) Sales
Taxes, Filing Fees, Etc. Buyer shall be liable for any sales taxes or other
transfer taxes, as well as any applicable conveyance, transfer and recording
fees, and real estate, transfer, stamp or other taxes imposed upon the sale of
the Assets. Seller agrees to use its reasonable best efforts to assist Buyer in
obtaining any applicable exemptions to any applicable state sales tax. If Seller
is required by applicable state law to report and pay these taxes or fees, Buyer
shall promptly deliver a check to Seller in full payment, and Seller shall
deliver said check to the appropriate taxing authorities and shall bear any and
all penalties, costs and expenses associated with the failure of Seller to
deliver said check.
(e) Other
Taxes. All production, severance or excise taxes, conservation fees and other
similar such taxes or fees (other than income taxes), if any, relating to
production attributable to the Assets prior to the Effective Date shall be paid
by Seller and all such taxes and fees relating to such production attributable
to the Assets on and after the Effective Date shall be paid by
Buyer.
(f) Payments;
Shared Obligations. If amounts are received by either Party hereto which, under
the terms of this Article 9 belong to the other Party, such amount shall
immediately be paid over to the proper Party. If an invoice or other evidence of
an obligation is received which under the terms of this Article 9 is partially
the obligation of Seller and partially the obligation of Buyer, then the Parties
shall consult each other and each shall promptly pay its portion of such
obligation to the obligee.
ARTICLE
10
CONFIDENTIALITY
AGREEMENT
Each
Party, its Affiliates and its and their directors, officers, employees, agents,
representatives, consultants, investors and lenders, agree to keep the terms and
conditions of this Agreement and all proprietary and confidential information
exchanged between Buyer and Seller in connection with this Agreement,
confidential, and to not disclose the existence of this Agreement without the
prior written consent of the other Party, which consent may be withheld at
either Party's sole discretion, for a period not to exceed one year from the
Closing Date. The foregoing restriction shall not apply to disclosures and
information which (i) are required to comply with applicable statutes and
regulations; (ii) are required to enforce this Agreement; (iii) are required to
obtain financing related to the transactions contemplated hereby; (iv) enter the
public domain through a third party who does not thereby breach an obligation of
confidentiality; or (v) are made in association with press releases issued in
accordance with Article 15.01 hereof.
ARTICLE
11
CONDITIONS
OF CLOSING
11.01 Seller's
Conditions of Closing. Seller’s obligation to consummate the
transactions provided for herein is subject to the satisfaction or waiver on or
before the Closing Date of the following conditions:
(a) Representations
and Warranties.
The representations and warranties of Buyer contained in this Agreement
shall be true and correct in all material respects on the date of Closing as
though made on and as of that date.
16
(b) Performance.
Buyer shall have performed in all material respects the obligations,
covenants and agreements required hereunder to be performed by it at or prior to
the Closing.
(c) Pending
Matters.
No suit, action or other proceeding by a non-affiliated third party or a
governmental authority shall be pending or threatened which seeks substantial
damages from Seller in connection with, or seeks to restrain, enjoin or
otherwise prohibit the consummation of the transactions contemplated by this
Agreement.
(d) Stock
Repurchase. Simultaneous with the Closing, Sandy McDougall, the principal
shareholder of Buyer, shall have agreed to transfer 4,616,666 shares of Buyer’s
common stock to Buyer and such shares shall be cancelled by
Buyer.
(e) Private
Placement. Simultaneous with the Closing, Buyer and certain investors, who are
parties to note and warrant purchase agreements of even effective date therewith
will close a private placement transaction of a minimum of Two Hundred Fifty
Thousand U.S. Dollars (US$250,000.00).
11.02 Buyer’s
Conditions of Closing. Buyer’s obligation to consummate the transactions
provided for herein is subject to me satisfaction or waiver on or before the
Closing Date of the following conditions:
(a)
Representations and Warranties. The representations and warranties of Seller
contained in this Agreement shall be true and correct in all material respects
on the date of Closing as though made on and as of that date.
(b)
Performance. Seller shall have performed in all material respects the
obligations, covenants and agreements required hereunder to be performed by it
at or prior to the Closing.
(c) Pending
Matters. No suit, action or other proceeding by a non-affiliated third party or
a governmental authority shall be pending or threatened which seeks substantial
damages from Buyer in connection with, or seeks to restrain, enjoin or otherwise
prohibit, the consummation of the transactions contemplated by this
Agreement.
(d) Operatorship.
Buyer shall be satisfied in its sole discretion that it will succeed to or will
become operator of all units and wells comprising a part of the Assets that were
being operated by Seller at the Effective Date.
(e) No
Material Adverse Change.
Since the date of this Agreement, there shall have been no material
adverse change in the value of the Assets and no event shall have occurred that
has had, or is reasonably likely to have, a material adverse effect on the
ability of Buyer to own and operate the Assets, and enjoy the benefits
associated therewith, in the same fashion as Seller has prior to the date
hereof.
(f) Satisfaction
With Due Diligence.
Buyer shall be satisfied in its sole discretion with the results of its
due diligence investigation of the Assets, including, but not limited to: (a)
the operational and environmental condition of the Assets; and (b) title to the
Assets.
17
ARTICLE
12
CASUALTY
LOSS AND CONDEMNATION
If,
prior to the Closing Date, all or any portion of the Assets are destroyed by
fire or other casualty or are taken in condemnation or under right of eminent
domain or proceedings for such purpose are pending or threatened in writing,
Buyer may elect to purchase such Assets or portions thereof notwithstanding any
such destruction, taking or pending or threatened taking (without reduction in
the Purchase Price with respect thereto), in which case Seller shall, at the
Closing, pay to Buyer all sums paid to Seller by third parties (including
insurers) by reason of the destruction or taking of such Assets, and shall
assign, transfer and set over unto Buyer all of Seller's right, title and
interest in and to any unpaid awards or other amounts due from third parties
(including insurers) arising out of the destruction, taking or pending or
threatened taking of such Assets or portions thereof. Prior to Closing, Seller
shall not voluntarily compromise, settle or adjust any amounts payable by reason
of any destruction, taking or pending or threatened taking as to the Assets or
portions thereof without first obtaining the written consent of
Buyer.
ARTICLE
13
GOVERNMENTAL
CONSENTS
At
the Closing, if any, Seller shall execute and deliver to Buyer such assignments
of federal, state and Indian leases as require consent to assignment, on the
forms required by the governmental or tribal agency having jurisdiction thereof.
Buyer shall promptly file for and obtain the necessary approvals for such
assignments. Until such approvals (the “Governmental Approvals”) are obtained,
Seller shall continue to hold governmental title to such leases as nominee for
Buyer.
ARTICLE
14
TERMINATION
14.01
Right of Termination. This Agreement and the transactions contemplated
hereby may be terminated:
(a) At
any time at or prior to Closing by mutual consent of Seller and Buyer;
or
(b) At
any time at or after November 30, 2009, by Seller or Buyer, by the delivery of
written notice to the other Party, if the Closing shall not have occurred by
such date;
provided,
however no such Party may exercise any right of termination pursuant to this
Article 14.01 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.
14.02
Return of Data.
Buyer agrees that if this Agreement is terminated for any reason whatsoever,
Buyer shall use its good faith efforts to identify and promptly return to Seller
all information furnished by or on behalf of Seller to Buyer, its officers,
employees, and representatives in connection with this Agreement or Buyer’s
investigation of the Assets, together with all copies, extracts or excerpts of
such information.
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ARTICLE
15
MISCELLANEOUS
15.01
Press Releases and Public Announcements. Neither Party shall issue any
press release or make any public announcement relating to the subject matter of
this Agreement prior to the Closing, if any, without the prior approval of the
other Party, which approval shall not be unreasonably withheld; provided,
however, that either Party may make any public disclosure it believes in good
faith is required by applicable law or any listing or trading agreement
concerning its publicly traded securities (in which case the disclosing Party
will use its reasonable best efforts to advise the other Party prior to making
the disclosure).
15.02
Entire Agreement. This Agreement (including the documents referred to
herein) constitutes the entire agreement between the Parties and supersedes any
prior agreements, or representations by or between the Parties, written or oral,
to the extent they have related in any way to the subject matter
hereof.
15.03
Succession and Assignment. This Agreement shall be binding upon and inure
to the benefit of the Parties and their respective successors and permitted
assigns. Neither Party may assign either this Agreement or any of its rights,
interests, or obligations hereunder without the prior written approval of the
other Party, which approval shall not be unreasonably withheld.
15.04
Counterparts. This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original but all of which together will
constitute one and the same instrument.
15.05
Headings. The section or Article headings contained in this Agreement are
inserted for convenience only and shall not affect in any way the meaning or
interpretation of this Agreement.
15.06
Governing Law. This Agreement shall be governed by and construed in
accordance with the domestic laws of the State of Nevada without giving effect
to any choice or conflict of law provision or rule (whether of the State of
Nevada or any other jurisdiction) that would cause the application of the laws
of any jurisdiction other than the State of
Nevada.
15.07
Legal Fees. The prevailing party in any legal proceeding brought under or
to enforce this Agreement shall be additionally entitled to recover court costs
and reasonable attorney's fees from the nonprevailing party. Each Party shall
pay their respective legal costs associated with the negotiation and drafting of
this Agreement.
15.08
Exhibits. All exhibits and schedules hereto which are referred to herein
are hereby made a part hereof and incorporated herein by such
reference.
15.09
Waiver. Any of the terms, provisions, covenants, representations,
warranties or conditions hereof may be waived only by written instrument
executed by the Party waiving the compliance. The failure of either Party at any
time or times to require performance of any provisions hereof shall in no manner
affect such Party's right to enforce the same. No waiver by either Party of any
condition or of the breach of any term, provision, covenant, representation or
warranty contained in this Agreement, whether by conduct or otherwise, in any
one or more instances, shall be deemed to be construed as a further or
continuing waiver of any such condition or breach, or a waiver of any other
condition or of the breach of any other term, provision, covenant,
representation or warranty.
15.10
Further Assurances. After the Closing, if any, each of the Parties will
execute, acknowledge, and deliver to the other such further instruments, and
take such other actions, as may be reasonably requested in order to more
effectively assure to said Party all of the respective properties, rights,
titles, interests, estates, and privileges intended to be assigned, delivered,
or inuring to the benefit of such Party in consummation of the transactions
contemplated hereby.
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15.11
Resignation as Operator, etc. At the Closing, Seller shall execute and
deliver to Buyer appropriate letters resigning as the operator of any of the
Assets that Seller is operating and other appropriate documents concerning
transfer of operations. Buyer acknowledges and agrees that Seller cannot and
does not covenant or warrant that Buyer shall become successor operator of all
or any portion of the Assets, since the Assets or portions thereof may be
subject to unit, pooling, communitization, operating or other agreements which
control the appointment of a successor operator; provided, however, that Seller
agrees to use its reasonable best efforts to assist Buyer in becoming successor
operator.
15.12
Notices. All notices, requests, demands, claims and other communications
hereunder will be in writing. Any notice, request, demand, claim or other
communication hereunder shall be deemed duly given if (and then two business
days after) it is sent by registered or certified mail, return receipt
requested, postage prepaid, and addressed to the intended recipient as set forth
below:
IF TO
SELLER:
Alamo Oil
Limited
5
Spinnaker Close
Hedon
Hull, HU12 8RE
United
Kingdom
IF TO
BUYER:
Green
Irons Holdings Corp.
8275
South Eastern #200
Las
Vegas, NV 89123
Any Party
may send any notice, request, demand, claim, or other communication hereunder to
the intended recipient at the address set forth above using any other means
(including personal delivery, expedited courier, messenger service, telecopy,
telex, ordinary mail, or electronic mail), but no such notice, request, demand,
claim, or other communication shall be deemed to have been duly given unless and
until it actually is received by the intended recipient. Any Party may change
the address to which notices, requests, demands, claims, and other
communications hereunder are to be delivered by giving the other Party notice in
the manner herein set forth.
15.13
Disclaimer of Representations and Warranties. Except as expressly set
forth in this Agreement and in Conveyance Documents delivered pursuant to
Article 3.03(a), the Parties hereto make no, and disclaim any, representation or
warranty whatsoever, whether express or implied. Each Party hereto disclaims all
liability and responsibility for any other representation, warranty, statement,
or communication (orally or in writing) to the other Party (including, but not
limited to, any information contained in any opinion, information, or advice
that may have been provided to any such Party by any officer, stockholder,
director, partner, member, manager, employee, agent, consultant, representative,
or contractor of such disclaiming Party or its Affiliates or any engineer or
engineering firm, or other agent, consultant, or representative) wherever and
however made. Without limiting the generality of the foregoing, Seller makes no
representation or warranty as to (a) the amount, value, quality, or
deliverability of petroleum, natural gas, or other reserves attributable to the
Assets or any portion thereof, or (b) any geological, engineering, or other
interpretations or economic evaluations. SELLER MAKES NO, AND DISCLAIMS ANY,
REPRESENTATION OR WARRANTY, WHETHER EXPRESS OR IMPLIED, AND WHETHER BY COMMON
LAW, STATUTE, OR OTHERWISE, AS TO (I) MERCHANTABILITY, (II) FITNESS FOR ANY
PARTICULAR PURPOSE, (III) CONFORMITY TO MODELS OR SAMPLES OF MATERIALS, AND/OR
(IV) CONDITION OF THE LEASES OR ASSETS THAT ARE THE SUBJECT OF THIS AGREEMENT.
The Parties agree that the preceding disclaimers of warranty are "conspicuous"
disclaimers for purposes of any applicable law, rule, or
order.
20
15.14
Severability. Any term or provision of this Agreement that is invalid or
unenforceable in any situation and in any jurisdiction shall not affect the
validity or enforceability of the remaining terms and provisions hereof or the
validity or enforceability of the offending term or provision in any other
situation or in any other jurisdiction.
15.15
No Third Party Beneficiaries. Except as provided for in Article 7 hereof
with respect to the rights of an Indemnified Party, this Agreement shall not
confer any rights or remedies upon any person other than the Parties and their
respective successors and permitted assigns, and other persons given rights of
indemnification hereunder.
15.16
Construction. The Parties have participated jointly in the negotiating
and drafting of this Agreement. In the event ambiguity or question of intent or
interpretation arises, this Agreement shall be construed as if drafted jointly
by the Parties and no presumption or burden of proof shall arise favoring or
disfavoring either Party by virtue of the authorship of any of the provisions of
this Agreement. Any reference to any federal, state, local or foreign statute or
law should be deemed also to refer to all rules and regulations promulgated
thereunder, unless the contexts requires otherwise. The word "including" shall
mean including, without limitation. If the date specified in this Agreement for
giving any notice or taking any action is not a business day (or if the period
during which any notices required to be given or any action taken expires on a
date which is not a business day) then the date for giving such notice or taking
such action (and the expiration date for such period during which notice is
required to be given or action taken) shall be the next day which is a business
day.
IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date
first above written.
BUYER:
GREEN
IRONS HOLDINGS CORP.
By:
_/s/ Sandy
McDougal____________
Sandy
McDougall
Its: President
SELLER:
ALAMO OIL
LIMITED
By:
_/s/ Michael
Stott________________
Michael
Stott
Its: President
21
Exhibit
A
SCHEDULE
OF LEASES
Lessor: Rita
Ann Lozano, Lisa Lynn Lozano, Hector Carlos Lozano, Jr.
Lessee: Clamp
Operating, Inc.
Date: October
26, 2004
Recorded: Volume
1020,
Page 538,
Deed Records of Frio County, Texas
WELLBORES
:
|
API
|
RRC
#:
|
Lease
Name
|
Well
Num
|
|
42-633-32208
|
08603
|
HECTOR
C. LOZAN0
|
1
|
|
42-633-32220
|
08603
|
HECTOR
C. LOZAN0
|
2
|
|
42-633-32228
|
08603
|
HECTOR
C. LOZAN0
|
3
|
22
Exhibit
B
Conveyance
Documents
23