Exhibit 10.1 Mutual Termination and Release
Agreement dated September 15, 1998, by
and among the Company, Saba
Acquisition, Inc., Omimex Resources,
Inc., the Omimex Resources, Inc.
stockholders and Ilyas Chaudhary.
MUTUAL TERMINATION AND RELEASE AGREEMENT
This Mutual Termination and Release Agreement (this "Agreement") is
made and entered into this 15th day of September, 1998, by and among Saba
Petroleum Company, a Delaware corporation ("Saba"), Saba Acquisition, Inc., a
Delaware corporation and a wholly owned subsidiary of Saba ("Acquisition"),
Omimex Resources, Inc., a Delaware corporation ("Omimex"), the holders of all of
Omimex's outstanding common stock identified on the signature pages hereto (the
"Stockholders") and Mr. Ilyas Chaudhary (the "Saba Major Stockholder").
WITNESSETH:
WHEREAS, Saba, Acquisition, Omimex, the Stockholders and the Saba Major
Stockholder(collectively the "Contract Parties") entered into that certain
Agreement and Plan of Reorganization dated as of June 1, 1998 (the "Merger
Agreement");
WHEREAS, pursuant to Section 11. 1 of the Merger Agreement, Saba and Omimex
desire to terminate the Merger Agreement;
WHEREAS, in connection with such termination of the Merger Agreement,
each of the Contract Parties desires to be released from, and to release each of
the other Contract Parties from, any liability under the Merger Agreement and
the Rose Glen Agreement (herein defined as that certain Letter Agreement dated
June 1, 1998, by and among Saba, Omimex and RCG International Investors, LDC);
and
WHEREAS, in connection with such termination of the Merger Agreement,
pursuant to the terms of Section 1.7 of the Merger Agreement, Saba and Omimex
desire to establish the procedures for securing the loan from Omimex to Saba, as
evidenced by that certain Promissory Note dated June5, 1998 in the original
principal amount of $4,190,000 (respectively, the "Loan" and the "Note").
NOW, THEREFORE, for and in consideration of the premises and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby agreed as follows:
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1. Termination of the Merger Agreement. Effective as of the date of this
Agreement, the Merger Agreement and all rights and obligations of the
Contract Parties thereunder including those pursuant to Article 12 and
Sections 11.3, 11.4 and 13.13 thereof will terminate without liability
to any of the Contract Parties, and will be of no further force or
effect.
2. Assignment of the Rose Glen Agreement. Effective as of the date of this
Agreement, all of Omimex's rights, duties, liabilities and obligations
under the Rose Glen Agreement will be assigned to Saba
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3. Amendment to the Note. Saba's obligations to repay and secure the Loan
shall continue in accordance with the terms of the Note. Effective as of
the date of the Note, the interest rate on the Loan shall be reduced
from prime plus 2% to prime.
3. Security for the Loan.
a. To secure payment and performance of the Loan, Saba hereby agrees to:
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i. execute, through Sabacol's legal representative in
Colombia, but not present for notarial inscription, a
Public Deed to transfer to Omimex all right, title
and interest of Sabacol, Inc., a Delaware corporation
and a wholly owned subsidiary of Saba ("Sabacol"), in
and to the Velasquez-Galan Pipeline (the "Pipeline");
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ii provide Sabacol's legal representative in Colombia
with an irrevocable letter of authority authorizing
the completion of the execution of the Public Deed
for the Pipeline before a Colombian notary public;
and
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ii enter into a trust agreement with Omimex and a
trustee mutually acceptable to Saba and Omimex
providing for the Public Deed for the Pipeline and
their revocable letter of authority to be held in
trust in accordance with the terms of the trust
agreement.
bb. The trust agreement shall provide that, pursuant to the Loan, repayment
of$4,151,288 principal plus accrued interest shall be made to Omimex and
delivered to the trustee within ninety (90) days of the date of termination,
which shall be the date first stated herein. In the event payment in full is
delivered within said 90 day period, then the trustee shall immediately deliver
to Omimex the payment and to Saba the Public Deed for the Pipeline and the
irrevocable letter of authority relatingt hereto for cancellation. In the event
payment in full is not delivered within said 90day period, then the trustee
shall immediately deliver to Omimex the Public Deed for the Pipeline and the
irrevocable letter of authority relating thereto. Thereafter, Omimex shall
deliver the Public Deed for the Pipeline and the irrevocable letter of authority
to Omimex de Colombia, Ltd., a Delaware corporation and a wholly owned
subsidiary of Omimex ("Omimex Colombia"), for completion of the execution of the
Public Deed for the Pipeline ---------------- before a Colombian notary public
by Sabacol's legal representative. Saba shall cause Sabacol and Sabacol's legal
representative to complete execution of the Public Deed for the Pipeline before
a Colombian notary public in accordance with the terms of the irrevocable letter
of authority.
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c. The Public Deed for the Pipeline, the irrevocable letter of
authority authorizing the completion of the execution thereof
and the trust agreement relating thereto shall be in form and
substance reasonably satisfactory to Saba and Omimex. At any
time and from time to time, upon request of the other party,
Saba and Omimex shall do, execute, acknowledge and deliver or
shall cause to be done, executed, acknowledged and delivered
such further acts, deeds, assignments, transfers, conveyances
and assurances as may be reasonably required in order to
consummate the transactions contemplated hereby.
5. Termination of Confidential Agreements. The Confidentiality Agreements
dated April 21,1998 between Saba and Omimex and Omimex and Saba shall
terminate, except as to any obligations to disclose or return data, upon
execution of this Agreement.
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6. Releases.
a. Subject to the Contract Parties' full and complete compliance with the
aforementioned terms of this Agreement, for the purposes and consideration
set forth herein, each Contracting Party, for itself and its divisions,
affiliates, parents, subsidiaries, stockholders, officers, directors,
agents, attorneys, employees, trustees, independent contractors, successors
and assigns does hereby expressly, voluntarily, knowingly and irrevocably
release, relinquish, acquit and discharge the other Contract Parties and
their respective divisions, affiliates, parents, subsidiaries,
stockholders, officers, directors, agents, attorneys, employees, trustees,
independent contractors, successors and assigns of and from any and all
charges, complaints, liabilities, obligations (including those pursuant to
Article 12 and Sections 11.3, 11.4and 13.13 of the Merger Agreement),
promises, agreements, controversies, damages, actions, losses, expenses
(including attorneys' fees and costs), claims, rights, demands, causes of
action or suits in equity, of any and every kind or character, in contract
or tort, whether known or unknown, whether heretofore or hereafter
occurring, arising under, or in connection with the negotiation, execution,
performance or termination of the Merger Agreement or in connection with
the negotiation, execution or performance of the Rose Glen Agreement,
including claims for breach of contract, fraud, negligent
misrepresentation, omission, fraud in the inducement and deceptive trade
practices or for any other loss, expense and/or detriment, of any kind or
character whatsoever, growing out of or in any way connected with or in any
way resulting from the acts, actions or omissions of the other Contract
Parties released herein relating to the Merger Agreement or the Rose Glen
Agreement.
a. It is the intent of the Contract Parties that the foregoing
general mutual release shall be effective as a bar to all
actions, causes of actions, suits in equity, obligations,
costs, expenses, attorneys' fees, damages, losses, claims or
liabilities, known or unknown, to the extent set forth above,
and in furtherance of this intention, the Contract Parties
expressly waive any and all rights and benefits conferred upon
them by the following provision of ss. 1542 of the California
Civil Code:
A general release does not extend to claims which the
creditor does not know or suspect to exist in his
favor at the time of executing the release which, if
known by him, must have materially affected his
settlement with the debtor.
The Contract Parties, being aware of said code section, hereby
expressly waive any rights they may have thereunder, as well
as under any other statute or common law principle of similar
effect.
7. Entire Agreement. This Agreement constitutes the entire agreement and
supersedes all prior agreements and understandings, both written and
oral, among the parties hereto with respect to the subject matter
hereof.
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8. Successors and Assigns. The terms and conditions of this Agreement
shall inure to the benefit of and be binding upon the parties hereto
and their respective successors and permitted assigns. Neither this
Agreement nor any rights, interests or obligations hereunder may be
assigned by any party hereto without the prior written consent of all
other parties hereto, and any purported assignment in violation of this
Section shall be null and void.
9. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall for all purposes be deemed to be an
original and all of which shall constitute the same instrument.
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10. Headlines. The headings of the sections of this Agreement are inserted
for convenience only and shall not be deemed to constitute part of this
Agreement or to affect the construction hereof.
10. Modification and Waiver. Any of the terms or conditions of this
Agreement may be waived in writing at any time by the party which is
entitled to the benefits thereof, and this Agreement may be modified or
amended by a written instrument executed by Saba, Acquisition, Omimex
and the Stockholders. No supplement, modification or amendment of this
Agreement shall be binding unless executed in writing by all of the
parties hereto. No waiver of any of the provisions of this Agreement
shall be deemed or shall constitute a waiver of any other provision
hereof (whether or not similar) nor shall such waiver constitute a
continuing waiver.
10. Notices. Any notice, request, instruction, document or other
communication to be given hereunder by any party hereto to any other
party hereto shall be in writing and validly given if (a) delivered
personally, (b) sent by telecopy, (c) delivered by overnight express or
(d) sent by registered or certified mail, postage prepaid, as follows:
If to Saba or Acquisition, to: If to Omimex, to:
Saba Petroleum Company Omimex Resources, Inc.
3201 Skyway Drive 5608 Malvey, Penthouse Suite
Santa Maria, California 93455 Ft. Worth, Texas 76107
Telecopier: (805) 347-1072 Telecopier: (817) 735-8033
Attention: Ilyas Chaudhary Attention: Naresh K. Vashisht
with a copy to: with a copy to:
Rodney Hill, Esq. Don Glendenning, Esq,
2010 Birnam Wood Drive Locke Purnell Rain Harrell
Montecito, California 93018-2206 2200 Ross Avenue, Suite 2200
Telecopier: (805) 565-5893 Dallas, Texas 75201-6776
Telecopier: (214) 740-8800
or at such other address for a party as shall be specified by like
notice. Any notice which is delivered personally, or sent by telecopy
or overnight express in the manner provided herein shall be deemed to
have been duly given to the party to whom it is directed upon actual
receipt by such party. Any notice which is addressed and mailed in the
manner herein provided shall be conclusively presumed to have been
given to the party to whom it is addressed at the close of business,
local time of the recipient, on the third day after the day it is so
placed in the mail.
13. GOVERNING LAW; CHOICE OF FORUM. THIS AGREEMENT SHALL BE
CONSTRUED, ENFORCED, AND GOVERNED BY THE INTERNAL LAWS OF THESTATE OF
CALIFORNIA (WITHOUT REGARD TO ITS CHOICE OF LAWPRINCIPLES), EXCEPT THAT
THE LAWS OF THE STATE OF DELAWARE SHALLAPPLY AS TO MATTERS OF ORGAN IC
CORPORATE LAW.
AS PART OF THE CONSIDERATION FOR VALUE RECEIVED PURSUANT TO
THISAGREEMENT, AND REGARDLESS OF THE LOCATION OF ANY PRESENT ORFUTURE
DOMICILE OR PRINCIPAL PLACE OF BUSINESS OF THE PARTIES, EACHPARTY
HEREBY IRREVOCABLY CONSENTS AND AGREES TO THE EXCLUSIVEJURISDICTION OF
ANY FEDERAL OR STATE COURT SITTING IN THE SOUTHERNDISTRICT OF
CALIFORNIA OR THE COUNTY OF SANTA BARBARA IN ANY SUIT,ACTION OR
PROCEEDING BROUGHT AGAINST SUCH PARTY BY ANY OTHERPARTY AND PERTAINING
TO THIS AGREEMENT OR TO ANY MATTER ARISINGOUT OF OR RELATED TO THIS
AGREEMENT AND AGREES THAT EITHER OFTHE AFORESAID COURTS SHALL BE AN
APPROPRIATE FORUM FOR SUCHACTION.
14. Invalid Provisions. If any provision of this Agreement is held to be
illegal, invalid, orunenforceable under present or future laws, such
provision shall be fully severable, this Agreement shall be construed
and enforced as if such illegal, invalid or unenforceable provision had
never comprised a part of this Agreement, and the remaining provisions
of this Agreement shall remain in full force and effect and shall not
be affected by the illegal, invalid or unenforceable provision or by
its severance from this Agreement.
14. Number and Gender of Words. Whenever the singular number is used, the
same shall include the plural where appropriate, and words of any
gender shall include each other gender where appropriate.
THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.
IN WITNESS WHEREOF, the parties have executed and delivered this Agreement as of
the date first above written.
SABA PETROLEUM COMPANY
By: /s/ Ilyas Chaudhary
Ilyas Chaudhary
President
SABA ACQUISITION, INC.
By: /s/ Ilyas Chaudhary
Ilyas Chaudhary
President
SABA PETROLEUM, INC.
By: /s/ Ilyas Chaudhary
Ilyas Chaudhary
President
OMIMEX RESOURCES, INC.
By: /s/ Naresh K. Vashisht
Naresh K. Vashisht
President
STOCKHOLDERS OF OMIMEX
RESOURCES, INC.
/s/ Naresh K. Vashisht
Naresh K. Vashisht
/s/ Jogesh Kumar
Jogesh Kumar
/s/ Romesh Sharma
Romesh Sharma
Neha Vashisht Trust
By: /s/ Jogesh Kumar
Jogesh Kumar
Trustee
Niti Vashisht Trust
By: /s/ Jogesh Kumar
Jogesh Kumar
Trustee
SABA MAJOR STOCKHOLDER
/s/ Ilyas Chaudhary
Ilyas Chaudhary