Attached files
| file | filename |
|---|---|
| 8-K/A - Gulf United Energy, Inc. | gulfunited8ka031810.htm |
| EX-10.1 - Gulf United Energy, Inc. | ex10-1.htm |
| EX-99.1 - Gulf United Energy, Inc. | ex99-1.htm |
| EX-10.3 - Gulf United Energy, Inc. | ex10-3.htm |
| EX-10.4 - Gulf United Energy, Inc. | ex10-4.htm |
| EX-10.5 - Gulf United Energy, Inc. | ex10-5.htm |
| EX-10.6 - Gulf United Energy, Inc. | ex10-6.htm |
Exhibit 10.2
PARTICIPATION
AGREEMENT
THIS
Participation Agreement (this “Agreement”) is entered into on the 12th day of
March, 2010 (the “Execution Date”) between Upland Oil and Gas, LLC Sucursal del
Peru, a Texas limited liability company acting through its branch registered
under the laws of the Republic of Peru (“Operator”), and Gulf United Energy del
Peru Ltd., a company organized and existing under the laws of the British Virgin
Islands (“Gulf”). Operator and Gulf are sometimes referred to
collectively as “Parties” and individually as “Party.”
WITNESSETH:
WHEREAS,
on March 21, 2007, Upland Oil and Gas LLC Sucursal del Peru, Endevco Eureka del
Peru S.A.C. and East Cameron Partners del Peru S.A.C. entered into the License
Contract for Exploration and Exploitation of Hydrocarbons for Block XXIV with
PeruPetro S.A. (“Block XXIV License Contract”); and
WHEREAS,
as of the date of this Agreement, Operator owns not less than eighty percent
(80%) of the rights and obligations of the Contractor under the Block XXIV
License Contract and the Contract Area (as defined below); and
WHEREAS,
Operator is willing to assign and transfer an undivided thirty-five percent
(35%) of the rights and obligations of the Contractor under the Block XXIV
License Contract to Gulf subject to a proportionate part of the overriding
royalty interest of the 1% of gross revenues from Block XXIV assigned to HTX
Capital, LLC pursuant to that certain Override Agreement by and between Operator
and HTX Capital, LLC, dated the 20th day of
January, 2010 (the “License Override”) and to a proportionate part of the
1% net production interest in Block XXIV assigned to Adam Pollack pursuant to
that certain Agreement dated November 23, 2009 by and between Adam Pollack and
Jorge Rivera (the “Pollack Net Production Interest”) in accordance with the
terms set forth herein and Gulf wishes to acquire such interest;
and
WHEREAS,
on February 28, 2008 Petron Resources, LP entered into the Regional Studies
Agreement with PeruPetro S.A. (the “TEA Agreement”) covering Areas I, II, III,
and IV (“TEA Areas”); and
WHEREAS,
pursuant to that certain Assignment and Assumption Agreement by and between
Operator and Petron Resources, LP dated January 7, 2009 (the “Petron
Assignment”), Petron Resources, LP assigned all of its interest in the TEA
Agreement to Operator; and
WHEREAS,
as of the date of this Agreement, Operator owns one hundred percent (100%) of
the rights and obligations of The Company under the TEA Agreement in the TEA
Areas (as defined below), subject to final regulatory approval of the Petron
Assignment and to an overriding royalty interest of 1% of gross
revenues from TEA Areas I, II, III, and IV assigned to HTX Capital,
LLC pursuant to that certain Override Agreement by and between Operator and HTX
Capital, LLC, dated the 20th day of
January, 2010 (the “TEA Override”); and
WHEREAS,
Operator is willing to assign and transfer thirty-five percent (35%) of the
rights and obligations of The Company under the TEA Agreement to Gulf in
accordance with the terms set forth herein and Gulf wishes to acquire such
interest.
-1-
NOW
THEREFORE, in consideration of the mutual covenants set forth in this Agreement,
the Parties agree as follows:
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1.Definitions. Unless
otherwise defined herein, terms defined in the Block XXIV License Contract
or the TEA Agreement when used in this Agreement shall have the same
meaning as defined in the Block XXIV License Contract or TEA Agreement, as
applicable. Terms defined in the singular shall have the same meaning when
used in the plural and vice versa. A reference to a “Clause” is a
reference to a numbered clause of this Agreement unless otherwise
specified.
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1.1
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“AFE”
has the meaning specified in the Block XXIV
JOA.
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1.2
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“Affiliate”
means with respect to any Person, a Person that directly or indirectly
Controls, or is Controlled by, or is under common Control with, such
Person. For purposes of this definition, Control
means the ownership directly or indirectly of fifty percent (50%) or more
of the voting rights in a Person. “Controls”, “Controlled by”
and other derivatives shall be construed
accordingly.
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1.3
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“Approval
Date” has the meaning specified in Clause
2.3.
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1.4
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“Approval
Notice” has the meaning specified in Clause
2.3.
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1.5
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“Adjusted
Participating Interest” means a Block XXIV Adjusted Participating Interest
or a TEA Adjusted Participating Interest, as
applicable.
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1.6
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“Assignments”
means the instruments in the form attached hereto as Exhibit A (“Block
XXIV Deed of Assignment”) (for the Block XXIV License Contract), and
Exhibit B (“TEA Deed of Assignment”) (for the TEA Agreement) and such
other instruments as may be necessary or appropriate to transfer and
assign the Gulf Participating Interests from Operator to Gulf, free and
clear of all Encumbrances except the Block XXIV JOA and a proportionate
part of the obligations under the HTX Override and the Pollack Net
Production Interest.
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1.7
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“Block
XXIV Approvals” has the meaning specified in Clause
3.5.
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1.8
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“Block
XXIV Carried Costs” has the meaning specified in Clause
2.4.
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1.9
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“Block
XXIV JOA” means the Operating Agreement dated July 23, 2007 between
Operator, Endevco Eureka Del Peru S.A.C., and East Cameron Partners Del
Peru S.A.C., together with all future amendments of the
same.
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1.10
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“Block
XXIV License Contract” has the meaning specified in the recitals to this
Agreement.
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1.11
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“Block
XXIV Adjusted Participating Interest” means a Block XXIV Participating
Interest as adjusted pursuant to Clauses 2.8(b) and (c), as
applicable.
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1.12
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“Block
XXIV Participating Interest” means the undivided percentage interest of
any Person in the rights and obligations of the Contractor under the Block
XXIV License Contract.
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1.13
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“Business
Day” means a day (other than a Saturday or Sunday) on which commercial
banks in Texas are generally open for
business.
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1.14
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“Carry
Period” has the meaning specified in Clause
2.4.
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1.15
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“Contract
Area” shall have the same meaning as such term is defined in the Block
XXIV License Contract. The current Contract Area covered by the
Block XXIV License Contract is set forth on Exhibit C attached
hereto.
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1.16
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“Contractor”
means all of the parties to the Block XXIV License Contract, except
PeruPetro S.A., and their successors and permitted
assigns.
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1.17
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“Cut-off
Date” means June 1, 2010.
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1.18
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“Encumbrance”
means any lien, security interest, pledge, encumbrance, claim, restriction
on voting, hypothecation, option, right of first refusal, preemptive
right, community property interest, mortgage, charge, title retention
agreement or other encumbrance, or other restriction of any
kind.
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1.19
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“Escrow
Agent” means Davis, Gerald & Cremer, P.C., attorneys at
law.
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1.20
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“Execution
Date” has the meaning specified in the opening sentence of this
Agreement.
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1.21
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“Governmental
Entity” means any government, including the Government of Peru, and all
departments, political subdivisions, instrumentalities, agencies,
corporations or commissions under the direct or indirect control thereof
or owned thereby and shall include any court, legislature, council or
state government or national, regional, municipal or local
authorities.
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1.22
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“Gulf
Participating Interests” means an undivided 35% of the rights and
obligations of the Contractor under the Block XXIV License Contract and an
undivided 35% of the rights and obligations of The Company under the TEA
Agreement.
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1.23
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“Gulf
Adjusted Participating Interests” means the undivided percentage of the
rights and obligations of Contractor under the portions of the Block XXIV
License Contract as to which such percentage applies and of The Company
under the TEA Agreement as determined and redetermined under Clauses
2.8(b) and (c).
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1.24
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“HTX
Override” means the License Override and the TEA
Override.
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1.25
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“JOA”
means the Block XXIV JOA or the TEA JOA, as
applicable.
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1.26
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“K”
means 1,000. Example: “$500K” means
$500,000.
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1.27
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“License
Override” has the meaning specified in the recitals to this
Agreement.
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1.28
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“M”
means 1,000,000. Example: “$1.8M” means
$1,800,000.
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1.29
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“On-Going
Costs” means any and all costs and expenses incurred in accordance with
the applicable JOA in carrying out Operations conducted on or after the
Execution Date.
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1.30
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“Operations”
shall have the same meaning as such term is defined in the Block XXIV
License Contract or TEA Agreement as the case may
be.
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1.31
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“Participating
Interest” means a Block XXIV Participating Interest or a TEA Participating
Interest, as applicable.
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1.32
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“Past
Costs” covers any and all costs and expenses incurred in carrying out
Operations conducted prior to the Execution Date, which include, without
limitation, costs such as: (a) third-party costs for (i) data
acquisition, licensing and evaluation, (ii) Block XXIV License Contract
negotiations and acquisitions, including legal, consulting, translation
and secretarial services, and (iii) environmental studies; (b) internal
costs (salaries, benefits and other related overhead) for personnel of
Operator and its Affiliates related to (i) Block XXIV License Contract
negotiations and acquisitions, (ii) preparation for drilling operations,
and (iii) data acquisition, licensing and evaluation, (c) drilling costs;
and (d) costs and expenses incurred in relation to the bidding
stage. For the purposes of this Agreement, Gulf’s proportionate
share of the Past Costs is stipulated to be Four Million One Hundred
Thousand Dollars ($4,100,000).
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1.33
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“Person”
means any natural or judicial person, including an individual, firm,
corporation, partnership, limited liability company, trust, association,
joint venture, Governmental Entity or other
entity.
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1.34
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“Petron
Assignment” has the meaning specified in the recitals to this
Agreement.
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1.35
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“Pollack
Net Production Interest” has the meaning specified in the recitals to this
Agreement.
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1.36
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“Required
Approvals” means the Block XXIV Approvals and the TEA
Approvals.
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1.37
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“Restructuring
Period” has the meaning specified in Clause
7.3.
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1.38
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“TEA
Adjusted Participating Interest” means a TEA Participating Interest as
adjusted pursuant to Clauses 2.8(b) and (c), as
applicable.
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1.39
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“TEA
Agreement” has the meaning specified in the recitals to this
Agreement.
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1.40
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“TEA
Approvals” has the meaning specified in Clause
3.5.
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1.41
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“TEA
Area” shall have the same meaning as such term is defined in the TEA
Agreement. The current TEA Area (Blocks I, II, III and IV)
covered by the TEA Agreement is set forth in Exhibit D
hereto.
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1.42
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“TEA
Carried Costs” has the meaning specified in Clause
2.6.
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1.43
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“TEA
JOA” means the Joint Operating Agreement entered into between Operator and
Gulf pursuant to Clause 2.7 covering the TEA Agreement and the TEA
Area.
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1.44
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“TEA
Override” has the meaning specified in the recitals to this
Agreement.
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1.45
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“TEA
Participating Interest” means the undivided percentage interest of any
Person in the rights and obligations of The Company under the TEA
Agreement.
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1.46
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“The
Company” means all of the parties to the TEA Agreement, other than
PeruPetro S.A., and their successors and permitted
assigns.
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1.47
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“Transfer
Date” has the meaning specified in Clause
2.3.
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2.
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Assignments and
Consideration.
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2.1
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Execution of
Documents. On the Execution Date, the following shall
occur:
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(a)
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Operator
and Gulf shall execute the Assignments and deliver them to Escrow
Agent. Escrow Agent shall hold all counterparts of the
Assignments until the Required Approvals have been
obtained.
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(b)
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Gulf
shall pay Operator by wire transfer of immediately available funds to the
account of Operator specified by notice in writing from Operator to Gulf
$200,000, reimbursing Operator for a portion of the Past
Costs.
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(c)
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Operator
shall deliver to Gulf a Certificate of Operator executed by the Secretary
or other appropriate officer of Operator certifying that (i) attached
thereto are true and correct copies of the organizational documents of
Operator and of the resolutions duly adopted by Operator approving this
Agreement and the transactions contemplated hereby, (ii) such resolutions
were duly adopted in accordance with the organizational documents of
Operator and are in full force and effect, and (iii) the identity, and
specimen signatures, of the officers of Operator duly authorized to
execute and deliver this Agreement and the other documents contemplated
hereby.
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(d)
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Gulf
shall deliver to Operator a Certificate of Gulf executed by the Secretary
or other appropriate officer of Gulf certifying that (i) attached thereto
are true and correct copies of the organizational documents of Gulf and of
the resolutions duly adopted by Gulf approving this Agreement and the
transactions contemplated hereby, (ii) such resolutions were duly adopted
in accordance with the organizational documents of Gulf and are in full
force and effect, and (iii) the identity, and specimen signatures, of the
officers of Gulf duly authorized to execute and deliver this Agreement and
the other documents contemplated
hereby.
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(e)
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Operator
shall deliver to Gulf agreements executed by the equity owners of Operator
in form and substance satisfactory to Gulf whereby such equity owners
approve and agree to the provisions of Clause 7.4 of this Agreement and
agree to execute and deliver any instruments necessary or appropriate to
convert the Gulf Participating Interests to preferred and common equity
interests in Operator as contemplated
thereby.
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2.2
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Required
Approvals. Within thirty (30) Business Days following
the Execution Date, Operator shall request the approvals from PeruPetro
S.A. and the Ministry of Energy and Mines, the Ministry of Finance and the
President of Peru, and any other applicable Governmental Entities and
third Persons required for the Assignments and shall submit all
documentation required in order to obtain such
approvals. Operator shall provide Gulf a copy of all documents
submitted in connection with such requests for approval. Gulf
will cooperate with Operator in connection with such
requests. Without limiting the foregoing, within thirty (30)
days following the Execution Date, Gulf will provide Operator with
information regarding the qualification requirements set forth on Exhibit
H attached hereto. Operator shall use its best efforts to obtain the
Required Approvals as soon as possible after the Execution
Date. Operator shall keep Gulf fully informed of all
communications with PeruPetro S.A., other Governmental Entities and third
Persons with respect to the process for obtaining such
approvals. Operator will promptly provide Gulf copies of all
correspondence, notices and requests received or made by it with respect
to the Required Approvals.
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2.3
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Gulf Participating
Interests.
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(a)
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Within
thirty (30) Business Days following the date (the “Approval Date”) on
which the Required Approvals have been obtained, Operator shall deliver a
notice (the “Approval Notice”) to Gulf stating that such approvals have
been obtained and including copies of the documentation evidencing such
approvals. On the later to occur of: (i) the 30th
day (or the next Business Day thereafter if such day is not a
Business Day) following delivery of the Approval Notice to Gulf or (ii)
the 90th
day (or the next Business Day thereafter if such day is not a
Business Day) following the Execution Date (the “Transfer Date”), the
following shall occur at the offices of Vinson & Elkins LLP in
Houston, Texas:
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(i)
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Gulf
shall pay $900,000 to Operator by wire transfer of immediately available
funds to the account of Operator specified by notice in writing from
Operator to Gulf, reimbursing Operator for a portion of the Past
Costs;
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(ii)
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the
Parties shall instruct the Escrow Agent to deliver to Gulf the original
counterparts of the Assignments delivered to the Escrow Agent pursuant to
Clause 2.1(a);
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(iii)
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the
assignment and transfer from Operator to Gulf of the Gulf Participating
Interests shall be effective; and
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(iv)
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Operator
and Gulf shall execute and deliver such other instruments as may be
necessary or appropriate to implement the transfer and assignment of the
Gulf Participating Interests from Operator to
Gulf.
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(b)
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Operator
shall notify Gulf at least sixteen (16) days before, but no more than
twenty-one (21) days before each of the first six (6) wells to be drilled
in the Contract Area is spudded. Within fifteen (15) days after
the receipt of each such notice, Gulf shall pay to Operator by wire
transfer of immediately available funds to the account of Operator
specified by notice in writing from Operator to Gulf $500,000, which
payments together with the amounts paid pursuant to Clause 2.1(b), Clause
2.3(a)(i) and Clause 2.3(c) shall fully reimburse Operator for the Past
Costs. The amounts to be paid by Gulf pursuant to this Clause
2.3(b) in connection with each of the first six (6) wells drilled in the
Contract Area are in addition to the amounts to be paid by Gulf pursuant
to Clause 2.4 in connection with each such
well.
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(c)
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In
the event that six (6) wells have not been spudded in the Contract Area
prior to the Cut-Off Date, Operator shall notify Gulf and within fifteen
(15) days after the receipt of such notice, Gulf shall pay to Operator by
wire transfer of immediately available funds to the account of Operator
specified in such notice the difference between $4,100,000 and the amounts
paid by Gulf pursuant to Clauses 2.3(a) and 2.3(b). Thereafter,
Gulf shall have no further obligations under Clause
2.3(b).
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2.4
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Block XXIV Carried
Costs. Subject to the terms and conditions of this
Agreement and the Block XXIV JOA, Gulf agrees to participate in all
Operations conducted in the Contract Area pursuant to Work Programs and
Budgets approved pursuant to Article VI of the Block XXIV JOA and attached
hereto as Exhibit E, and to pay 80% of the On-Going Costs incurred in
connection therewith in accordance with the Block XXIV JOA, until the
earlier of the following: (i) six (6) wells have been drilled
in the Contract Area, or (ii) 80% of the On-Going Costs incurred under the
JOA equals $6,000,000. The On-Going Costs that Gulf agrees to
pay pursuant to the preceding sentence are the “Block XXIV Carried Costs”
and the period of time from the Execution Date to the earlier of times
described in clauses (i) and (ii) of the preceding sentence is the “Carry
Period”. During the Carry Period, Operator shall provide Gulf
with an AFE at least sixteen (16) days before, but no more than twenty-one
(21) days before, each of the first six (6) wells in the Contract Area is
scheduled to be spudded, and Gulf will pay the Block XXIV Carried Costs
attributable to each AFE in accordance with the terms of the Block XXIV
JOA within fifteen (15) days after receipt of the AFE, except that Gulf
will pay the Block XXIV Carried Costs for the first such well to be
drilled on the Contract Area as set forth in the AFE for such well
attached hereto as Exhibit F on or before March 20,
2010. Operator will consult with Gulf in advance concerning the
location, depth and AFE for each future well proposed to be drilled in the
Contract Area during the Carry Period. Notwithstanding anything
to the contrary contained in this Agreement or the Block XXIV JOA, during
the Carry Period the Block XXIV Carried Costs of any well shall not be due
prior to 15 days after the date the Block XXIV Carried Costs of any other
well were due so that there will always be at least fifteen (15) days
between the date that the Block XXIV Carried Costs for any well are due
under this Clause 2.4 and the date the Block XXIV Carried Costs of any
other well are due under this Clause 2.4. During the Carried
Period, Operator will not drill more than one well at a
time. Notwithstanding anything to the contrary, during the
Carry Period, Operator has no duty to spud a given well until and unless
Operator has received payment from Gulf of the applicable Carried Costs
for that well together with any payment then-due by Gulf under 2.3(a) or
2.3(b) for Past Costs.
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2.5
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Block XXIV
JOA. All Operations conducted in the Contract Area shall
be conducted pursuant to the terms of the Block XXIV JOA and Gulf and
Operator shall be responsible for their respective Block XXIV
Participating Interest shares of the On-Going Costs of such Operations,
except that during the Carry Period, Gulf shall be responsible for, and
shall pay, the Block XXIV Carried Costs as provided in Clause
2.4. From and after the Execution Date, Gulf shall be deemed to
have a 35% Participating Interest under the Block XXIV JOA and Gulf shall
be entitled to exercise all rights under the Block XXIV JOA attributable
to such 35% Participating Interest. Gulf’s rights under this
Clause 2.5, the Block XXIV Deed of Assignment, or the TEA Deed of
Assignment may not be assigned except as provided in Clause
3.7.
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2.6
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TEA Carried
Costs. Subject to the terms and conditions of this
Agreement and the TEA JOA, Gulf agrees to pay 100% of the On-Going Costs
of all Operations conducted with respect to the TEA Areas pursuant to work
programs and budgets approved pursuant to the terms of the TEA JOA
(specifically including EarthSat imaging study and aeromagnetic survey and
evaluation) up to $1.5 million (the “TEA Carried
Costs”). Operator shall bill Gulf for, and Gulf will pay, the
TEA Carried Costs incurred in accordance with the terms of the TEA
JOA. Operator will consult with Gulf in advance concerning all
Operations with respect to which Gulf agrees to pay 100% of the On-Going
Costs pursuant to this Clause 2.6.
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2.7
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TEA JOA. The
Parties will work in good faith to negotiate and enter as soon as
practicable after the execution of this Agreement a joint operating
agreement covering the TEA Agreement and TEA Areas and
designating Operator as the operator thereunder. The joint operating
agreement so entered into is referred to in this agreement as the “TEA
JOA”. All Operations conducted with respect to the TEA Area shall be
conducted pursuant to the terms of the TEA JOA, and Gulf and Operator
shall be responsible for their respective TEA Participating Interest
shares of the On-Going Costs of such Operations, except as otherwise
provided in Clause 2.6.
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2.8
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Default.
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(a)
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In
the event that Gulf defaults in the payment of any Block XXIV Carried
Costs or TEA Carried Costs due under this Agreement or any JOA, Operator
shall notify Gulf of such failure in accordance with the terms of Article
VIII of the applicable JOA. In the event that Gulf fails to
cure any such default within the times contemplated by Article 8.4(D) of
the applicable JOA, Operator may, at its option exercisable anytime
thereafter until such default is cured, as its sole and exclusive remedy
notify Gulf that Gulf’s Participating Interests in the Block XXIV License
Contract and the TEA Agreement and Gulf’ rights and obligations under the
Block XXIV JOA and TEA JOA are terminated, save and except notwithstanding
anything to the contrary contained in this Agreement or any JOA, or
otherwise available to Operator in law or equity, it is understood and
agreed Gulf shall be entitled to retain its (i) 35% Participating Interest
in each well for which it has paid the Block XXIV Carried Costs
theretofore invoiced to Operator and the equipment and other facilities
therein or used in connection therewith, (ii) 70% of
the revenues attributable to the Block XXIV Participating
Interests of Operator and Gulf in such wells in excess of the costs and
expenses incurred under the Block XXIV JOA attributable to the Block XXIV
Participating Interests of Operator and Gulf for operating and maintaining
the wells, equipment and other facilities in or used in connection with
the Contract Area and producing, transporting, marketing and otherwise
disposing of production from the Contract Area until such time as Gulf has
recovered from such excess revenues the amounts actually paid by Gulf
under Clauses 2.1, 2.3, 2.4 and 2.6; thereafter revenue with respect to
such wells shall be shared in proportion to each Party’s Adjusted
Participating Interest therein, and (iii) all rights and obligations under
the Block XXIV JOA and TEA JOA attributable to the rights and interests
retained by Gulf under Clauses 2.8(a)(i) and
(ii).
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(b)
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In
the event that Gulf defaults in the payment of any Past Costs due under
this Agreement, Operator shall notify Gulf of such failure and if Gulf
fails to cure such default within thirty (30) days after the receipt of
such notice, Operator may notify Gulf that Operator has elected to reduce
Gulf’s Participating Interest and increase Operator’s
Participating Interest to their respective Adjusted Participating
Interests, except as otherwise provided in Clause 2.8(a). Gulf’s Block
XXIV Adjusted Participating Interest and its TEA Adjusted Participating
Interest shall be the percentage determined by dividing the total amount
of Block XXIV Carried Costs, TEA Carried Costs and Past Costs paid by Gulf
pursuant to Clauses 2.1, 2.3, 2.4 and 2.6 of this Agreement by $11,600,000
and multiplying such quotient by 35%. Operator’s Block XXIV
Adjusted Participating Interest and its TEA Adjusted Participating
Interest shall be its Block XXIV Participating Interest and its TEA
Participating Interest increased by the difference between Gulf’s
Participating Interest and Gulf’s Adjusted Participating
Interest. In the event that Operator elects to reduce Gulf’s
Participating Interest and increase Operator’s Participating Interest to
their respective Adjusted Participating Interests, the Adjusted
Participating Interests shall become effective as to Block XXIV License
Contract and the TEA Agreement five (5) Business Days after receipt by
Gulf of Operator’s notice of election to reduce Gulf’s Participating
Interest and increase Operator’s Participating Interest to their
respective Adjusted Participating Interests as provided by this Clause
2.8(b), except as otherwise provided in Clause
2.8(a).
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(c)
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In
the event that Operator elects to reduce Gulf’s Participating Interest and
increase Operator’s Participating Interest to their respective Adjusted
Participating Interests as provided by this Clause 2.8(b) and at any time
thereafter on or before the Cut-off Date, Gulf pays all or any portion of
the Past Costs that it had failed to pay under this Agreement, then the
Adjusted Participating Interests shall be redetermined based on the same
formula as set forth in the second sentence of Clause 2.8(b) but taking
into account all Block XXIV Carried Costs, TEA Carried Costs and Past
Costs paid by Gulf. In the event that at such time of
redetermination the total amount of Block XXIV Carried Costs and TEA
Carried Costs that have been invoiced to Gulf in accordance with the terms
of this Agreement and the applicable JOAs is less than $7,500,000, then
for the purpose redetermining the Adjusted Participating Interests
pursuant to this Clause 2.8(c), the $11,600,000 amount used in the formula
in the second sentence of Clause 2.8(b) shall be $4,100,000 plus the total
amount of Block XXIV Carried Costs and TEA Carried Costs that have been
invoiced to Gulf in accordance with the terms of this Agreement
and the applicable JOAs. In the event that the Adjusted
Participating Interests are redetermined pursuant to this Clause 2.8(c),
such Adjusted Participating Interests shall be effective as of the date
that Operator paid the Past Costs that resulted in such redetermination as
to Block XXIV License Contract and the TEA Agreement, except for any wells
that were commenced between the time that the Adjusted Participating
Interests became effective under Clause 2.8(b) and the time that Operator
paid such unpaid Past Costs. With respect to the wells in which
Operator retained its 35% Participating Interest as provided in Clause
2.8(a), the redetermined Adjusted Participating Interests shall become
effective after Gulf has recovered the amounts contemplated by in part
(ii) of the last sentence of Clause 2.8(a). The rights and
remedies set forth in Clauses 2.8(b) and (c) shall be Operator’s sole and
exclusive rights and remedies arising out of any failure of Gulf to pay
any Past Costs under this
Agreement.
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(d)
|
In
the event of any default by Operator in the performance of any of its
obligations under this Agreement or any JOA, Gulf may exercise all of the
rights and remedies available to it under Article VIII of the applicable
JOA and any other rights and remedies available to Gulf in law or
equity.
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(e)
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Each
Party is specifically granted the right to seek specific performance of
the terms of this Agreement, except that Operator’s sole right and
remedies with respect to failure of Gulf to pay On-Going Costs and Past
Costs under this Agreement are set forth in Clauses 2.8(a), (b) and
(c). Operator’s rights and remedies under the TEA JOA and Block
XXIV JOA with respect to any other breaches or defaults by Gulf are not
restricted by this Clause 2.8.
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3.
|
Additional
Agreements.
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3.1
|
Disproportionate
Revenue Sharing. Gulf shall be entitled to receive 70%
of the revenues attributable to the Block XXIV Participating Interests of
Operator and Gulf in excess of the costs and expenses incurred under the
Block XXIV JOA attributable to the Block XXIV Participating Interests of
Operator and Gulf for operating and maintaining wells, equipment and other
facilities in or used in connection with the Contract Area and producing,
transporting, marketing and otherwise disposing of production from the
Contract Area until such time as Gulf has recovered from such excess
revenues the amounts actually paid by Gulf under Clauses 2.1, 2.3, 2.4 and
2.6; thereafter revenue shall be shared in proportion to each Party’s
Participating Interest.
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3.2
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Gulf Branch
Registration. Promptly following the Execution Date,
Gulf shall register a branch in the Republic of Peru, if required pursuant
to the laws of the Republic of
Peru.
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3.3
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Payment
Currency. Payments between the Parties under this
Agreement shall be made in US dollars (US
$).
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3.4
|
Share of Contractor’s
Obligations. Gulf hereby ratifies, confirms and accepts
the terms of the Block XXIV License Contract and the TEA Agreement, and
Gulf agrees to abide by and comply with the terms of the Block XXIV
License Contract and TEA Agreement to the extent of its Block XXIV
Participating Interest and TEA Participating
Interest.
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3.5
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Required
Approvals. The Assignment contemplated hereby with
respect to the Block XXIV License Contract and the Block XXIV JOA can only
be made effective after PeruPetro S.A. approves the qualifications of Gulf
in accordance with Clause 16 of the Block XXIV License Contract and the
provisions of Peruvian law and PeruPetro S.A. approves such Assignment
(the “Block XXIV Approvals”). The Assignment contemplated
hereby with respect to the TEA Agreement can only be made effective after
PeruPetro S.A. approves the qualifications of Gulf in accordance with
Peruvian law, the Assignment with respect to the TEA Agreement and the
assignment of the TEA Agreement from Petron Resources, LP to Operator (the
“TEA Approvals”). After the Execution Date, each Party will use
all reasonable efforts to timely take any actions, make any filings or
submissions and affect any undertakings reasonably required in order to
obtain the Required Approvals. Until such time as the Required
Approvals are obtained and the actions described in Clause 2.3(a) have
been taken, Operator shall hold the Gulf Participating Interests in trust
for the benefit and enjoyment of
Gulf.
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3.6
|
Non-Operator
Dealings. For a period of twelve (12) months following
the Execution Date, Gulf agrees that it will not purchase or otherwise
acquire any rights of any third Person (including, without limitation,
East Cameron Partners del Peru S.A.C. or Endevco Eureka del Peru S.A.C.)
under the Block XXIV JOA or the Block XXIV License Contract without the
express written permission of Operator, which permission shall not be
unreasonably withheld.
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3.7
|
Non-Assignment. Gulf
agrees that it will not sell, assign or transfer the Gulf Participating
Interests, its rights under the Assignments, the Block XXIV License
Contract, or the TEA Agreement, except as permitted by the terms of the
applicable JOA. Operator shall not sell, assign or transfer its
Participating Interests or its rights in the Block XXIV License Contract
or the TEA Agreement except as permitted by the terms of the applicable
JOA.
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4.
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License
Contract.
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4.1
|
Operator. Notwithstanding
the amendment of the Block XXIV License Contract, the Operator shall
remain as Operator thereunder, subject to the terms of the Block XXIV
JOA.
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5.
|
Confidentiality and
Access to Data.
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5.1
|
Confidentiality. Each
Party agrees that all information disclosed under this Agreement, except
information which (a) at the time such information is provided to a Party
under this Agreement, is in the public domain; (b) subsequently comes into
the public domain, except through breach of the undertakings set out in
this Clause 5; or (c) is already lawfully in possession of a Party prior
to the Execution Date, shall be considered confidential and
shall not be disclosed to any other person or entity without the prior
written consent of the Party which owns such confidential
information. This obligation of confidentiality shall remain in
force during the term of the Block XXIV License Contract or TEA Agreement,
as the case may be, and for a period of two (2) years
thereafter. Notwithstanding the foregoing, confidential
information may be disclosed without consent and without violating the
obligations contained in this Clause 5 in the following
circumstances:
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(a)
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to
an Affiliate provided the Affiliate is bound to the provisions of this
Clause 5 and the Party disclosing is responsible for the violation of an
Affiliate;
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(b)
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to
a governmental agency or other entity when required by the Block XXIV
License Contract or TEA Agreement;
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(c)
|
to
the extent such information is required to be furnished in compliance with
the applicable laws/regulations, or pursuant to any legal proceedings or
because of any order of any court binding upon a
Party;
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-12-
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(d)
|
to
attorneys engaged, or proposed to be engaged, by any Party where
disclosure of such information is essential to such attorneys’ work for
such Party and such attorneys are bound by an obligation of
confidentiality;
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(e)
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to
contractors and consultants engaged, or proposed to be engaged, by any
Party where disclosure of such information is essential to such
contractor’s or consultant’s work for such
Party;
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(f)
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to
a bona fide prospective transferee of all or a portion of a Party’s
Participating Interest, or portion thereof, to the extent appropriate in
order to allow the assessment of such Participating Interest (including an
entity with whom a Party and/or its Affiliates are conducting bona fide
negotiations directed toward a merger, consolidation or the sale of a
majority of its or an Affiliate’s
shares);
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(g)
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to
a bank. or other Person to the extent appropriate to a Party arranging for
funding;
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(h)
|
to
the extent that a Party determines in good faith that such information is
required to be disclosed by any law, rule or regulation of any Government
Entity or stock exchange having jurisdiction over such Party, or its
Affiliates or is subject to a request by any regulatory authority or
Governmental Entity; provided that such Party shall provide notice of the
disclosure to the non-disclosing Party and to the extent Clause 12 is
applicable thereto, comply with the requirements
thereof;
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(i)
|
to
its respective employees, subject to each Party taking sufficient
precautions to ensure such information is kept confidential;
and
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(j)
|
to
the other parties to the Block XXIV License Contract and JOA and PeruPetro
S.A. solely to the extent as may be required to satisfy the
Conditions.
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Disclosure
as pursuant to Clause 5.1 (e), (f), (g) and (j) shall not be made unless prior
to such disclosure the disclosing Party has obtained a written undertaking from
the recipient party to keep the information strictly confidential for at least
as long as the period set out above and to use the information for the sole
purpose described in Clause 5.1 (e), (f), (g), and (k), whichever is applicable,
with respect to the disclosing Party.
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5.2
|
Access to
Data. Each Party shall provide the other Party with
access to all data relating to the Contract Area and the TEA Areas in its
possession, custody or control, including without limitation technical,
geological, commercial and other information relating to the Contract
Area. The data provided under this Clause 5.2 shall be subject
to the confidentiality obligations under Clause
5.1.
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6.
|
Representations and
Warranties.
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6.1
|
Gulf
hereby represents and warrants to Operator as of the Execution Date and
the Transfer Date as follows:
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-13-
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(a)
|
In
making the decision to enter into this Agreement and consummate the
transactions contemplated hereby, Gulf has relied solely on the basis of
its own independent due diligence
investigation.
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(b)
|
Gulf
has all necessary corporate power and authority to enter into this
Agreement and the Assignments and to perform its obligations hereunder and
thereunder. All necessary corporate action has been taken to
authorize Gulf to sign and deliver, and perform, the transactions
contemplated by this Agreement and the Assignments. This
Agreement has been duly executed and delivered by Gulf and constitutes a
legal, valid and binding obligation of Gulf, enforceable against Gulf in
accordance with its terms, subject to the legal doctrines of bankruptcy,
insolvency or similar legal doctrines affecting creditors’ rights
generally and general principles of equity. The Assignments,
once executed by Gulf and Operator, will have been duly executed and
delivered by Gulf and constitute legal, valid and binding obligations of
Gulf, enforceable against Gulf in accordance with their terms, subject to
the legal doctrines of bankruptcy, insolvency or similar legal doctrines
affecting creditors’ rights generally and general principles of
equity.
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(c)
|
No
event has occurred which constitutes, or which with the giving of notice
and/or the lapse of time and/or a relevant determination would constitute,
a contravention of, or default under, any agreement or instrument by which
Gulf or any of its assets is bound or affected, being a contravention or
default which would have a material adverse effect on the business,
assets, or condition of Gulf and which would materially and adversely
affect its ability to observe or perform its obligations under this
Agreement and the transactions contemplated
hereby.
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(d)
|
No
litigation, arbitration or administrative proceeding or claim which might
by itself or together with any other such proceedings or claims materially
and adversely affect Gulf’s ability to observe or perform its obligations
under this Agreement and the agreements contemplated hereby, is presently
in progress or pending or, to the best of the knowledge, information and
belief of Gulf, threatened against Gulf or any Affiliate of
Gulf.
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6.2
|
Operator
hereby represents and warrants to Gulf that as of the date hereof and the
Execution Date and as of the Transfer
Date:
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(a)
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Operator
is a Contractor under the Block XXIV License
Contract.
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(b)
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Operator
holds not less than eighty percent (80%) of the rights and obligations of
the Contractor under the Block XXIV License Contract, free and clear of
all liens, claims and encumbrances other than the License Override and the
Pollack Net Production Interest, and it has not received any notice or
other communication from PeruPetro S.A., any other Governmental Entity or
any other Person to terminate the Block XXIV License Contract or which
would reduce Operator’s Participating Interest in the Block XXIV License
Contract.
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-14-
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(c)
|
The
Block XXIV License Contract and all rights and interest thereunder or
deriving therefrom of Operator are in full force and effect and no default
or act or omission of Operator, or, as far as Operator is aware, of any
other person, has occurred thereunder nor is there any notice or
intimation to Operator in respect thereof whether as a result of its
default, act or omission or those of any other person or
otherwise. Operator has provided Gulf with a complete and
correct copy of the Block XXIV License
Contract.
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(d)
|
The
Block XXIV JOA is in full force and effect and no default or act or
omission of Operator, or, as far as Operator is aware, except as provided
in Exhibit G, of any other Person, has occurred
thereunder. Operator has not received any notice or intimation
that it is in default in the performance of any of its obligations under
the Block XXIV JOA. Except as provided in Exhibit G, Operator
has not delivered any notice or demand with respect to any default by any
other Person in the performance of its obligations under the Block XXIV
JOA. Operator has provided Gulf with a complete and correct
copy of the Block XXIV JOA. Operator has validly exercised all
of its rights under Article 8 of the Block XXIV JOA to cause East Cameron
Partners del Peru S.A.C. and Endevco Eureka del Peru S.A.C. to forfeit
their rights and interests in and to the Block XXIV License Contract, the
Block XXIV JOA and the Contract Area as a result of defaults by such
parties under the Block XXIV JOA, and such actions by Operator have been
effective to cause such parties to forfeit all of their rights, titles and
interests in and to the Block XXIV License Contract, the Block XXIV JOA
and the Contract Area.
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(e)
|
Operator
is The Company under the TEA
Agreement.
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(f)
|
Operator
holds one hundred percent (100%) of the rights and obligations of The
Company under the TEA Agreement, free and clear of all liens, claims and
encumbrances other than the TEA Override, by means of the Petron
Assignment, but which has not yet been formally approved by the
appropriate regulatory authorities, and it has not received any notice or
other communication from PeruPetro S.A., any other Governmental Entity or
any other Person to terminate the TEA Agreement or which would reduce
Operator’s Participating Interest in the TEA
Agreement.
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(g)
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The
TEA Agreement and all rights and interest thereunder or deriving therefrom
of Operator are in full force and effect and no default or act or omission
of Operator, or, as far as Operator is aware, of any other person, has
occurred thereunder nor is there any notice or intimation to Operator in
respect thereof whether as a result of its default, act or omission or
those of any other person or otherwise. Operator has provided
Gulf with a complete and correct copy of the TEA
Agreement.
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(h)
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Operator
has all necessary corporate power and authority to enter into this
Agreement and the Assignments and to perform its obligations hereunder and
thereunder. All necessary corporate action has been taken to
authorize Operator to sign and deliver, and perform, the transactions
contemplated by this Agreement and the Assignments. This
Agreement has been duly executed and delivered by Operator and constitutes
a legal, valid and binding obligation of Operator, enforceable against
Operator in accordance with its terms, subject to the legal doctrines of
bankruptcy, insolvency or similar legal doctrines affecting creditors’
rights generally and general principles of equity. The
Assignments, once executed by Operator and the Gulf, will have been duly
executed and delivered by Operator and constitute legal, valid and binding
obligations of Operator, enforceable against Operator in accordance with
their terms, subject to the legal doctrines of bankruptcy, insolvency or
similar legal doctrines affecting creditors’ rights generally and general
principles of equity.
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-15-
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(i)
|
No
event has occurred which constitutes, or which with the giving of notice
and/or the lapse of time and/or a relevant determination would constitute,
a contravention of, or default under, any agreement (including, for the
avoidance of doubt, the Block XXIV License Contract or TEA Agreement) or
instrument by which Operator or any of its assets is bound or affected,
being a contravention or default which would have a material adverse
effect on the business, assets, or condition of Operator and which would
materially and adversely affect its ability to observe or perform its
obligations under this Agreement and the transactions contemplated
hereby.
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(j)
|
No
litigation, arbitration or administrative proceeding or claim which might
by itself or together with any other such proceedings or claims materially
and adversely affect Operator’s ability to observe or perform its
obligations under this Agreement and the agreements contemplated hereby,
is presently in progress or pending or, to the best of the knowledge,
information and belief of Operator, threatened against Operator or any
Affiliate of Operator.
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6.3
|
Each Party
Acknowledges and Agrees
that:
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(a)
|
The
representations and warranties contained in this Agreement are the only
representations or warranties of any kind given by or on behalf of the
other Party and on which it may rely in entering into this
Agreement;
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(b)
|
Other
than the representations and warranties given in this Agreement, no
statement, promise or forecast made by or on behalf of any other Party or
any other person may form the basis of, or be pleaded in connection with,
any claim by such Party under or in connection with this Agreement;
and
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(c)
|
The
Parties’ respective representations and warranties set out in this Clause
6 shall be also true and accurate at the date the Assignments are
effective pursuant to Clause 2.3.
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6.4
|
Disclaimer of Other
Representations and Warranties. Except for the
representations and warranties provided in this Clause 6, Operator and
Gulf make no, and disclaim any, warranty or representation of any kind,
either express, implied, statutory, or otherwise, including, without
limitation, the accuracy or completeness of any data, reports, records,
projections, information, or materials now, heretofore furnished or made
available to Gulf in connection with this
Agreement.
|
-16-
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7.
|
Term and
Termination.
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|
7.1
|
This
Agreement shall become effective on the Execution Date and shall remain in
full force until termination of this Agreement pursuant to this Clause
7.
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|
7.2
|
This
Agreement shall terminate at the earlier to occur of (i) the date upon
which the Parties agree in writing to terminate this Agreement or (ii) the
date upon which the Block XXIV License Contract, the TEA Agreement and all
Licenses and License Contracts issued pursuant to the TEA Agreement have
been terminated, provided however the terms of Clause 3.1 shall survive
termination of this Agreement.
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7.3
|
If
any of the Required Approvals have not been obtained by the Cut-off Date,
then the Parties shall meet and discuss, within thirty (30) days after the
Cut-off Date (such thirty (30) day period being the “Restructuring
Period”), possible amendments to the transaction envisaged by this
Agreement which would facilitate, or avoid the need for, obtaining such
Required Approvals. If, during the Restructuring Period, the
Parties are unable agree to such amendments, then provided that no Default
exists, Gulf shall elect one of the following by notice in writing to
Operator within thirty (30) days after the end of the Restructuring
Period: (a) terminate this Agreement, or (b) convert the Gulf
Participating Interests into an equivalent economic interest in Operator
as provided in Clause 7.4. If, during the Restructuring Period,
the Parties are unable to agree to such amendments, and a Default exists,
Operator shall elect one of the following by notice in writing to Gulf
within thirty (30) days after the end of the Restructuring Period: (a)
terminate this Agreement, or (b) convert the Gulf Participating Interests
into an equivalent economic interest in Operator as provided in Clause
7.4. Failure of the applicable Party to make an election under
this Clause 7.3 within thirty (30) days following the end of the
Restructuring Period shall constitute an election to terminate this
Agreement. In the event that this Agreement is terminated
pursuant to this Clause 7.3,
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(i)
|
Operator
shall return to Gulf any amounts paid to date under the terms of Clause 2
herein without interest; and
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(ii)
|
Both
Parties shall terminate the JOAs and any other transaction agreements
specified herein.
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7.4
|
Equivalent Economic
Interest. In the event that an election is made under
Clause 7.3 to convert the Gulf Participating Interests into an equivalent
economic interest in Operator, the Gulf Participating Interests shall be
converted into a preferred equity interest in Operator having distribution
rights equivalent to Gulf’s rights under Clause 4.1 and common equity
interests in Operator having a value equivalent to the balance of Gulf’s
rights under this Agreement, the Gulf Participating Interests and the
JOAs. In determining the preferred and common equity interests
in Operator that Gulf would be entitled to under the terms of this Clause
7.4, all relevant facts and circumstances will be taken into account,
including without limitation, differences in value between the direct
interests in the Block XXIV License Contract and the TEA provided under
this Agreement and the indirect interest represented by an interest in
Operator. In the event that the Parties are unable to agree
upon the equivalent economic interests in Operator into which the Gulf
Participating Interests would be converted, then at the request of either
Party such equivalent economic interests shall be determined pursuant to
Clause 9.2. When such equivalent economic interest have been
finally determined pursuant to Clause 9.2 or agreed upon by the Parties,
Operator and Gulf shall execute and deliver, and Operator shall cause its
equity owners to execute and deliver, such instruments as are necessary or
appropriate to convert the Gulf Participating Interests into such
equivalent economic interests in Operator, free and clear of all
Encumbrances. Prior to the time the Required Approvals have
been obtained, Operator shall not create or issue any preferred equity
interests in itself, will not incur any indebtedness and will fund all of
its operations with capital contributions from its equity
owners.
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-17-
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8.
|
Further Assistance and
Business Ethics. Each of the Parties shall perform such
further acts and execute and deliver such further documents as shall be
reasonably required to perform its obligations pursuant to the terms of
this Agreement; provided, however, each of the Parties represents to the
other and agrees:
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8.1
|
No Improper
Payments. It has not made nor shall it make in
connection with the performance of this Agreement any payments, loans or
gifts or promises or offers of payments, loans or gifts of any money or
anything of value directly or indirectly to or for the use or benefit of
any official or employee of any government or the agency or
instrumentality of any government or to any political party or official or
candidate thereof or to any other person if such Party knows or has reason
to suspect that any part of such payment, loan or gift will be directly or
indirectly given or paid to any such governmental official or employee or
political party or candidate or official thereof or to any other person or
entity the making of which would violate the laws or policies of the
Republic of Peru or the United
States.
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8.2
|
Compliance
Information. It shall answer, in reasonable detail, any
written or oral questionnaire from the other Party to the extent such
questionnaire pertains to compliance with its representations provided in
Clause 8.1.
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9.
|
Governing Law and
Arbitration.
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|
9.1
|
Governing
Law. This Agreement shall be governed by and interpreted
in accordance with the laws of the State of Texas, United States except to
the extent the laws of any other jurisdiction are mandatorily
applicable.
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|
9.2
|
Arbitration. Any
dispute arising out of this Agreement which any Party determines in its
sole discretion cannot be settled by mutual agreement shall be settled by
arbitration in accordance with the Rules of the International Chamber of
Commerce (“ICC”). The place of arbitration shall be Houston,
Texas. The number of arbitrators shall be three (3), one (1)
appointed by each of the Parties and the third appointed by mutual
agreement of the Parties. The award rendered by the arbitration
tribunal shall be final and binding upon the Parties
concerned. The proceedings shall be in English and the award
shall be final, binding and not subject to appeal. Judgment
upon the award rendered may be entered in any court having jurisdiction
thereof.
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-18-
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|
9.3
|
Specific
Performance. Each Party acknowledges and
agrees that the other Parties would be damaged irreparably, and in a
manner for which monetary damages would not be an adequate remedy, in the
event any of the provisions of this Agreement are not performed in
accordance with its specific terms or otherwise are
breached. Accordingly, each Party agrees that the other Parties
shall be entitled to enforce specifically this Agreement and the terms and
provisions hereof in any proceeding instituted pursuant to Clause 9.2, in
addition to any other remedy to which they may be entitled, at Law or in
equity.
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10.
|
Waiver of Sovereign
Immunity. Any Party that now or hereafter has a right to
claim sovereign immunity for itself or any of its assets hereby waives any
such immunity to the fullest extent permitted by the laws of any
applicable jurisdiction. This waiver includes immunity from (i)
any expert determination, mediation, or arbitration proceeding commenced
pursuant to this Agreement; (ii) any judicial, administrative or other
proceedings to aid the expert determination, mediation, or arbitration
commenced pursuant to this Agreement; and (iii) any effort to confirm,
enforce, or execute any decision, settlement, award, judgment, service of
process, execution order or attachment (including pre-judgment attachment)
that results from an expert determination, mediation, arbitration or any
judicial or administrative proceedings commenced pursuant to this
Agreement. Each Party acknowledges that its rights and
obligations hereunder are of a commercial and not a governmental
nature.
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11.
|
Notices. Any
notice required or permitted to be given under this Agreement shall be
given in writing in the English language and shall be deemed to have been
sufficiently given when received whether delivered personally, mailed or
couriered (postage prepaid), or sent by fax, with written confirmation of
complete transmission, in accordance with the address information
applicable to the receiving Party as set forth below or such other address
or the attention of such other person as such Party may have designated by
notice given in accordance with this Clause
11.
|
Upland
Oil and Gas LLC Sucursal del Peru
Attention: Jorge
Rivera c/o Thomas E. Kelly
505 N.
Big Spring, Suite 101
Midland,
TX 79701
Tel: 0 +
51 1 4346270, 4346271, 4346272, 4346273
Fax: 0 +
51 1 4366319
-19-
With copy
to (which shall not constitute notice):
Davis,
Gerald & Cremer, PC
Attention: David
H. Smith
400 W.
Illinois, Suite 1400
Midland,
TX 79701
Tel: 432-687-0011
Fax: 432-687-1735
and
BARRIOS
FUENTES GALLO
Attention: Germán
Barrios
Abogados
Arias
Araguez 250, Miraflores, Lima 18, Perú
Tel: (511)
610-6100
Fax: (511)
445-1015 / 242-2403
Gulf
United Energy del Peru Ltd.
Attention:
Heath C. Trisdale
Address:
3 Riverway, Suite 1800
Houston,
TX 77056
Tel: (713)
209-2917
Fax: (713)
209-2927
|
12.
Public
Announcements.
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12.1
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Consent of
Parties. No Party shall without written consent of the
other Party, which consent shall not be unreasonably withheld, no Party
will issue, or permit any of its Affiliates to issue, any press release or
otherwise make any public statement relating to the subject matter of this
Agreement unless such release or statement is deemed in good faith by the
disclosing Party to be required by any law, rule or regulation of any
Governmental Entity or the rules and regulations of a stock exchange on
which the shares of such Party or any of its Affiliates are
listed. In each case to which such exception applies,
prior to making such press release or public statement, the releasing
Party will provide a copy of such press release or public statement to the
other Party. To the extent feasible under the circumstances,
the Parties will coordinate with each other on the issuance of press
releases and public statements regarding the subject matter of this
Agreement.
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12.2
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Consent of
PeruPetro. Without limiting the generality of what is
stated in Clause 12.1, any consent requested by Gulf from Operator
pursuant to Clause 12.1 shall not be considered unreasonably withheld so
long as Operator is endeavoring to obtain the consent of PeruPetro S.A.
for the making of any such public announcement, which consent Operator
determines in its good faith judgment is reasonably required or
desirable.
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12.3
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Entire
Agreement. This Agreement represents the entire
agreement of the Parties and supersedes all prior written or oral
agreements. The terms are contractual and not mere
recitals. In entering into this Agreement, each Party
stipulates, warrants, and represents that it has relied on the advice of
its own attorneys and financial advisors concerning the legal and tax
consequences of the Agreement; that its, his, or her own attorneys have
completely read and explained to it the terms of the Agreement; that each
is a sophisticated business person with experience negotiating these types
of transactions; that no special relationship of influence or trust
existed among the Parties prior to the entry into this Agreement that
caused it to enter this Agreement; that each fully understands and
voluntarily accepts the terms of the Agreement without any duress or undue
persuasion put upon it by the other or any other person, specifically
including, but not limited to, counsel or accountants for either Party;
and that no representations, promises, or statements outside the four
comers of this Agreement by the opposite Party, nor any agent, employee,
attorney, accountant, or other representative of the opposite Party has
influenced it into entering this Agreement. Each Party has had
access to counsel and an opportunity to read, review, and revise this
Agreement. This Agreement is the result of the joint efforts of
the Parties and each of the same’s counsel. Therefore, the
Parties agree that this Agreement, and any given provision of it, should
not be construed against either Party. Each of the Parties
hereto recognize and stipulate that this provision is binding as a matter
of law and fact and shall preclude said Party from asserting that it was
wrongfully induced to enter into this Agreement by any representation,
promise, or agreement, or statement of a past or existing fact, which is
not found within the four corners of this
Agreement.
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13.
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Headings. The
headings in this Agreement are for convenient reference only and shall not
be used in the interpretation of this
Agreement.
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14.
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No Brokers or
Finders. Neither Party, nor any of their respective
Affiliates, has employed or retained any broker, agent or finder in
connection with this Agreement, or incurred any liability for, paid or
agreed to pay any brokerage fee, finder’s fee, commission or similar
payment to any person or entity on account of this Agreement or
transactions contemplated hereby.
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15.
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Amendment of this
Agreement. This Agreement may be amended only by written
agreement signed by the Parties.
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16.
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Each Party’s
Expenses. Each Party shall bear its own expenses with
respect to the Assignments contemplated under this
Agreement.
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17.
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Each Party’s
Taxes. Each Party shall be responsible for any taxes
assessed against it as a result of the
Assignments.
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18.
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Conflict. To
the extent any provision in this Agreement conflicts with any provision of
the License Agreement or the TEA Agreement, this Agreement
controls.
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IN
WITNESS WHEREOF, the Parties have caused this Agreement to be signed by their
respective, duly authorized representatives.
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Upland
Oil and Gas LLC
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Upland
Oil and Gas LLC Sucursal de Peru
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Gulf
United Energy del Peru Ltd.
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By:
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By:
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Name:
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Name:
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Title:
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Title:
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Date:
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Date:
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