EXHIBIT 1
EXECUTION COPY
$300,000,000
WESTPORT RESOURCES CORPORATION
8 1/4% SENIOR SUBORDINATED NOTES DUE 2011
PURCHASE AGREEMENT
December 11, 2002
CREDIT SUISSE FIRST BOSTON CORPORATION
J.P. MORGAN SECURITIES INC.
LEHMAN BROTHERS INC.,
As Representatives of the Several Purchasers,
c/o Credit Suisse First Boston Corporation,
Eleven Madison Avenue,
New York, N.Y. 10010-3629
Dear Sirs:
1. Introductory. Westport Resources Corporation, a Nevada corporation
(the "COMPANY"), proposes, subject to the terms and conditions stated herein, to
issue and sell to the several initial purchasers named in Schedule A hereto (the
"PURCHASERS") U.S. $300,000,000 principal amount of its 8 1/4% Senior
Subordinated Notes Due 2011 ("OFFERED SECURITIES") to be issued as additional
securities under the indenture dated as of November 5, 2001, by and among the
Company, the subsidiary guarantors from time to time parties thereto (the
"SUBSIDIARY GUARANTORS") and The Bank of New York, as Trustee (the "TRUSTEE")
("the "ORIGINAL INDENTURE"), as supplemented by the First Supplemental Indenture
thereto, dated as of December 31, 2001 (the "FIRST SUPPLEMENTAL INDENTURE") and
the Second Supplemental Indenture thereto, dated as of December 17, 2002 (the
"SECOND SUPPLEMENTAL INDENTURE"). The Original Indenture, as supplemented by the
First Supplemental Indenture and the Second Supplemental Indenture, is referred
to herein as the "INDENTURE". The Offered Securities will be guaranteed (the
"SUBSIDIARY GUARANTIES") by the Subsidiary Guarantors. The United States
Securities Act of 1933, as amended, is herein referred to as the "SECURITIES
ACT."
Holders (including subsequent transferees) of the Offered Securities
will have the registration rights set forth in the registration rights agreement
(the "REGISTRATION RIGHTS AGREEMENT"), to be dated the Closing Date (as defined
below), for so long as such Offered Securities constitute "TRANSFER RESTRICTED
SECURITIES" (as defined in the Registration Rights Agreement). Pursuant to the
Registration Rights Agreement, the Company and the Subsidiary Guarantors will
agree to file with the Securities and Exchange Commission (the "COMMISSION")
under the circumstances and upon the terms and subject to the conditions set
forth therein, (i) a registration statement under the Securities Act (the
"EXCHANGE OFFER REGISTRATION STATEMENT") relating to the Company's 8 1/4% Senior
Subordinated Notes in a like aggregate principal amount as the Offered
Securities, identical in all material respects to the Offered Securities and
registered under the Securities Act (the "EXCHANGE SECURITIES"), to be offered
in exchange for the Offered Securities (such offer to exchange being referred to
as the "EXCHANGE OFFER") and the Subsidiary Guaranties thereof and, if
applicable, (ii) a shelf registration statement pursuant to Rule 415 under the
Securities Act (the "SHELF REGISTRATION STATEMENT" and, together with the
Exchange Offer Registration Statement, the "REGISTRATION STATEMENTS") relating
to the resale by certain holders of the Offered Securities and to use its
reasonable best efforts to cause such Registration
Statements to be declared and remain effective and usable for the periods
specified in the Registration Rights Agreement and to consummate the Exchange
Offer. The Offered Securities and the Exchange Securities are referred to
collectively as the "SECURITIES".
The Offered Securities are being issued and sold in connection with the
consummation of the transactions contemplated by the purchase and sale agreement
dated as of November 6, 2002, as amended (the "ASSET PURCHASE AGREEMENT"),
between the Company and certain affiliates of El Paso Corporation (collectively,
"EL PASO"), pursuant to which the Company has agreed, subject to certain
conditions, to purchase (the "ACQUISITION") certain oil and natural gas
properties and midstream gathering and compression assets located in Utah (the
"EL PASO ASSETS"). In connection with the Acquisition, the Company will: (i)
shortly before the consummation of the issue and sale of the Offered Securities,
issue 10,000,000 shares of its common stock, par value $0.01 per share (the
"COMMON STOCK"), in an offering pursuant to Rule 415 of the Securities Act (the
"COMMON STOCK OFFERING") and (ii) concurrently with the consummation of the
issue and sale of the Offered Securities, enter into a new senior secured credit
facility with a maximum committed amount of $600,000,000 (the "SENIOR CREDIT
FACILITY AGREEMENTS").
The Company and the Subsidiary Guarantors hereby agree with the several
Purchasers as follows:
2. Representations and Warranties of the Company. The Company and the
Subsidiary Guarantors represent and warrant to, and agree with, the several
Purchasers that:
(a) A preliminary offering circular and an offering circular
relating to the Offered Securities to be offered by the Purchasers have
been prepared by the Company. Such preliminary offering circular (the
"PRELIMINARY OFFERING CIRCULAR") and offering circular (the "OFFERING
CIRCULAR"), as supplemented as of the date of this Agreement, together
with any other document approved by the Company for use in connection
with the contemplated resale of the Offered Securities are hereinafter
collectively referred to as the "OFFERING DOCUMENT". On the date of
this Agreement, the Offering Document does not include any untrue
statement of a material fact or omit to state any material fact
required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading. The preceding sentence does not apply to
statements in or omissions from the Offering Document based upon
written information furnished to the Company by any Purchaser through
Credit Suisse First Boston Corporation ("CSFBC") specifically for use
therein, it being understood and agreed that the only such information
is that described as such in Section 7(b) hereof. Except as disclosed
in the Offering Document, on the date of this Agreement, (i) the
Company's Annual Report on Form 10-K most recently filed with the
Securities and Exchange Commission (the "COMMISSION") and (ii) all
subsequent reports (items (i) and (ii) collectively, the "EXCHANGE ACT
REPORTS") which have been filed by the Company with the Commission or
sent to stockholders pursuant to the Securities Exchange Act of 1934
(the "EXCHANGE ACT") do not include any untrue statement of a material
fact or omit to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they
were made, not misleading. Such documents, when they were filed with
the Commission, conformed in all material respects to the requirements
of the Exchange Act and the rules and regulations of the Commission
thereunder.
(b) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Nevada,
with power and authority (corporate and other) to own its properties
and conduct its business as described in the Offering Document; and the
Company is duly qualified to do business as a foreign corporation in
good standing in all other jurisdictions in which its ownership or
lease of property or the conduct of its business requires such
qualification, except where the failure to be so qualified would not,
individually or in the
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aggregate, have a material adverse effect on the business condition
(financial or otherwise), properties or results of operations of the
Company and its subsidiaries taken as a whole ("MATERIAL ADVERSE
EFFECT").
(c) Each subsidiary of the Company has been duly incorporated
or organized and is an existing corporation, limited partnership,
partnership or limited liability company in good standing under the
laws of the jurisdiction of its incorporation or organization, with
power and authority (corporate or other) to own its properties and
conduct its business as described in the Offering Document; and each
subsidiary of the Company is duly qualified to do business as a foreign
corporation, limited partnership, partnership or limited liability
company in good standing in all other jurisdictions in which its
ownership or lease of property or the conduct of its business requires
such qualification, except where the failure to be so qualified would
not, individually or in the aggregate, have a Material Adverse Effect;
all of the issued and outstanding capital stock or similar ownership
interest of each subsidiary of the Company has been duly authorized and
validly issued and is fully paid and nonassessable; and the capital
stock of each subsidiary that is a corporation owned by the Company,
directly or through subsidiaries, is owned free from liens,
encumbrances and defects other than those liens listed in Schedule B
hereto.
(d) For purposes of this agreement, a "subsidiary" of the
Company shall mean any corporation, partnership, limited liability
company or other business entity in which the Company owns, directly or
indirectly, 50% or more of the voting or economic equity interest. A
list of all subsidiaries of the Company, indicating their respective
jurisdictions of formation or organization, the Company's direct or
indirect ownership therein and whether they are Subsidiary Guarantors
is attached as Schedule C.
(e) The Indenture has been duly authorized; the Offered
Securities have been duly authorized; and when the Offered Securities
are delivered and paid for pursuant to this Agreement on the Closing
Date (as defined below), the Indenture will have been duly executed and
delivered by the Company and the Subsidiary Guarantors, such Offered
Securities will have been duly executed, authenticated, issued and
delivered and will conform to the description thereof contained in the
Offering Document and the Indenture and such Offered Securities will
constitute valid and legally binding obligations of the Company and the
Subsidiary Guarantors, enforceable in accordance with their terms,
subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or
affecting creditors' rights and to general equity principles.
(f) The Indenture is duly qualified under the Trust Indenture
Act of 1939, as amended (the "TIA" or "TRUST INDENTURE ACT").
(g) Except as disclosed in the Offering Document, there are no
contracts, agreements or understandings between the Company and any
person that would give rise to a valid claim against the Company or any
Purchaser for a brokerage commission, finder's fee or other like
payment in connection with this offering.
(h) No consent, approval, authorization, or order of, or
filing with, any governmental agency or body or any court is required
under any of the "INCLUDED LAWS" (as defined in the opinion of Akin,
Gump, Strauss, Hauer & Feld, L.L.P. delivered pursuant to Section 6(d)
of this Agreement) for the consummation of the transactions
contemplated by this Agreement and the Registration Rights Agreement in
connection with the issuance and sale of the Offered Securities by the
Company and the Subsidiary Guarantors, except such as have been
obtained or made under
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the Securities Act or the Trust Indenture Act and such as may be
required under state securities laws and except for the orders of the
Commission declaring the Exchange Offer Registration Statement or the
Shelf Registration Statement effective.
(i) The execution, delivery and performance by the Company and
the Subsidiary Guarantors of the Indenture, this Agreement and the
Registration Rights Agreement, and the issuance and sale of the Offered
Securities and compliance with the terms and provisions thereof do not
and will not, (i) result in a violation of any law, rule or regulation
of any Included Law, (ii) result in a violation of any order, writ,
judgment or decree known to the Company and applicable to the Company
or any subsidiary of the Company or any of their properties, (iii)
result in a violation of the Articles of Incorporation or by-laws or
similar charter documents of the Company or of any subsidiary of the
Company, or (iv) breach or result in a default or result in the
acceleration of, or entitle any party to accelerate under any agreement
or instrument to which the Company or any subsidiary of the Company is
a party or by which the Company or any such subsidiary is bound or to
which any of the properties of the Company or any such subsidiary is
subject, except in the case of clauses (i), (ii) and (iv) for such
breaches, violations or defaults under as would not, individually or in
the aggregate, have a Material Adverse Effect.
(j) This Agreement has been duly authorized, executed and
delivered by the Company and the Subsidiary Guarantors.
(k) The execution, delivery and performance by the Company of
the Asset Purchase Agreement, the Senior Credit Facility Agreements and
the underwriting agreement for the Common Stock Offering (the "COMMON
STOCK AGREEMENT") and the issuance and sale of the Common Stock and
compliance with the terms and provisions thereof do not and will not,
(i) result in a violation of any law, rule or regulation of any
Included Law, (ii) result in a violation of any order, writ, judgment
or decree known to the Company and applicable to the Company or any
subsidiary of the Company or any of their properties, (iii) result in a
violation of the Articles of Incorporation or by-laws or similar
charter documents of the Company or of any subsidiary of the Company,
or (iv) breach or result in a default or result in the acceleration of,
or entitle any party to accelerate under any agreement or instrument to
which the Company or any subsidiary of the Company is a party or by
which the Company or any such subsidiary is bound or to which any of
the properties of the Company or any such subsidiary is subject, except
in the case of clauses (i), (ii) and (iv) for such breaches, violations
or defaults as would not, individually or in the aggregate, have a
Material Adverse Effect.
(l) The Asset Purchase Agreement, the Senior Credit Facility
Agreements and the Common Stock Agreement have been duly authorized,
executed and delivered by the Company. The Asset Purchase Agreement,
the Senior Credit Facility Agreements and the Common Stock Agreement,
assuming due execution and delivery by the other parties thereto,
constitute valid and legally binding obligations of the Company and are
enforceable against the Company in accordance with their terms, except
as may be limited by bankruptcy, insolvency, reorganization, moratorium
or similar laws affecting creditors' rights generally, and except that
the remedy of specific performance and injunctive and other forms of
equitable relief may be subject to equitable defenses and the
discretion of courts in granting equitable remedies and except that the
enforceability of any rights to indemnity or contribution may be
limited by federal or state securities laws or by public policy.
(m) The Company has delivered to CSFBC true and correct copies
of the Asset Purchase Agreement in the form as originally executed, and
there have been no amendments or waivers
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thereto or in the exhibits or schedules thereto other than those as to
which CSFBC shall have been advised.
(n) Except as disclosed in the Offering Document, the Company
and its subsidiaries have good and valid title to all real properties
and all other properties and assets owned by them, in each case free
from liens, encumbrances and defects that would materially affect the
value thereof or materially interfere with the use made or to be made
thereof by them; and except as disclosed in the Offering Document, the
Company and its subsidiaries hold any leased real or personal property
under valid and enforceable leases with no exceptions that would
materially interfere with the use made or to be made thereof by them.
(o) The Company and its subsidiaries possess adequate
certificates, authorities or permits issued by appropriate governmental
agencies or bodies necessary to conduct the business now operated by
them in any material respect and have not received any notice of
proceedings relating to the revocation or modification of any such
certificate, authority or permit that, if determined adversely to the
Company or any of its subsidiaries, would individually or in the
aggregate have a Material Adverse Effect.
(p) Except as disclosed in the Offering Document, no labor
dispute with the employees of the Company or any subsidiary exists or,
to the knowledge of the Company, is imminent that is reasonably likely
to have a Material Adverse Effect.
(q) The Company and its subsidiaries own or possess licenses
or other enforceable legal rights to use or can acquire on reasonable
terms, adequate trademarks, trade names and other rights to inventions,
know-how, patents, copyrights, confidential information and other
intellectual property (collectively, "INTELLECTUAL PROPERTY RIGHTS")
necessary to conduct the business now operated by them in any material
respect, or presently employed by them, and have not received any
notice of infringement of or conflict with asserted rights of others
with respect to any intellectual property rights that, if determined
adversely to the Company or any of its subsidiaries, would individually
or in the aggregate have a Material Adverse Effect.
(r) Except as disclosed in the Offering Document, neither the
Company nor any of its subsidiaries is in violation of any statute, any
rule, regulation, decision or order of any governmental agency or body
or any court, domestic or foreign, relating to the use, disposal or
release of hazardous or toxic substances or relating to the protection
or restoration of the environment or human exposure to hazardous or
toxic substances (collectively, "ENVIRONMENTAL LAWS"), owns or operates
any real property contaminated with any substance that is subject to
any environmental laws, is liable for any off-site disposal or
contamination pursuant to any environmental laws, or is subject to any
claim relating to any environmental laws, which violation,
contamination, liability or claim would individually or in the
aggregate have a Material Adverse Effect; and the Company is not aware
of any pending investigation which might lead to such a claim.
(s) Except as disclosed in the Offering Document, there are no
pending actions, suits or proceedings against or affecting the Company,
any of its subsidiaries or any of their respective properties that, if
determined adversely to the Company or any of its subsidiaries, would
individually or in the aggregate have a Material Adverse Effect, or
would materially and adversely affect the ability of the Company or the
Subsidiary Guarantors to perform their respective obligations under the
Indenture, this Agreement or the Registration Rights Agreement, or
which
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are otherwise material in the context of the sale of the Offered
Securities; and no such actions, suits or proceedings are, to the
Company's knowledge, threatened or contemplated.
(t) The financial statements included in the Offering Document
present fairly, in all material respects, the financial position of the
Company and its consolidated subsidiaries as of the dates shown and
their results of operations and cash flows for the periods shown, and,
except as otherwise disclosed in the Offering Document, such financial
statements have been prepared in conformity with the generally accepted
accounting principles in the United States applied on a consistent
basis; and the assumptions used in preparing the pro forma financial
statements included in the Offering Document provide a reasonable basis
for presenting the significant effects directly attributable to the
transactions or events described therein, the related pro forma
adjustments give appropriate effect to those assumptions, and the pro
forma columns therein reflect the proper application of those
adjustments to the corresponding historical financial statement
amounts.
(u) Except as disclosed in the Offering Document, since the
date of the latest audited financial statements included in the
Offering Document there has been no material adverse change, nor any
development or event involving a prospective material adverse change,
in the condition (financial or other), business, properties or results
of operations of the Company and its subsidiaries taken as a whole,
and, except as disclosed in or contemplated by the Offering Document,
there has been no dividend or distribution of any kind declared, paid
or made by the Company on any class of its capital stock.
(v) Neither the Company nor any Subsidiary Guarantor is an
open-end investment company, unit investment trust or face-amount
certificate company that is or is required to be registered under
Section 8 of the United States Investment Company Act of 1940 (the
"INVESTMENT COMPANY ACT"); and neither the Company nor any Subsidiary
Guarantor is, and after giving effect to the offering and sale of the
Offered Securities and the application of the proceeds thereof as
described in the Offering Document neither will be, an "investment
company" as defined in the Investment Company Act.
(w) No securities of the same class (within the meaning of
Rule 144A(d)(3) under the Securities Act) as the Offered Securities are
listed on any national securities exchange registered under Section 6
of the Exchange Act or quoted in a U.S. automated inter-dealer
quotation system.
(x) Assuming the accuracy of the representations and
warranties of the Purchasers set forth in Section 4 hereof, and the
performance by the Purchasers of the agreements made herein, the offer
and sale of the Offered Securities and the Subsidiary Guaranties and
the initial resale of the Offered Securities by the Purchasers in the
manner contemplated by this Agreement and the Offering Document will be
exempt from the registration requirements of the Securities Act by
reason of Section 4(2) thereof and Regulation S thereunder ("REGULATION
S"); and it is not necessary to qualify an indenture in respect of the
Offered Securities under the Trust Indenture Act.
(y) Neither the Company, nor any of its affiliates (as such
term is defined in Rule 144 under the Securities Act, an "AFFILIATE"),
nor any person acting on its or their behalf (other than the
Purchasers, as to whom the Company and the Subsidiary Guarantors make
no representation) (i) has, within the six-month period prior to the
date hereof, offered or sold in the United States or to any U.S. person
(as such terms are defined in Regulation S under the Securities Act)
the Offered Securities or any security of the same class or series as
the Offered Securities or (ii) has offered or will offer or sell the
Offered Securities (A) in the United States by means of any form of
general
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solicitation or general advertising within the meaning of Rule 502(c)
under the Securities Act or (B) with respect to any such securities
sold in reliance on Rule 903 of Regulation S under the Securities Act,
by means of any directed selling efforts within the meaning of Rule
902(c) of Regulation S. The Company, its Affiliates and any person
acting on its or their behalf (other than the Purchasers, as to whom
the Company and the Subsidiary Guarantors make no representation) have
complied and will comply with the offering restrictions requirement of
Regulation S. The Company has not entered and will not enter into any
contractual arrangement with respect to the distribution of the Offered
Securities except for this Agreement.
(z) On the Closing Date (as defined below), the Exchange
Securities and the Subsidiary Guaranty set forth in the Indenture will
have been duly authorized by the Company and the Subsidiary Guarantors;
and when the Exchange Securities are issued, executed and authenticated
in accordance with the terms of the Exchange Offer and the Indenture
(i) the Exchange Securities will be entitled to the benefits of the
Indenture including the Subsidiary Guaranty set forth in the Indenture,
(ii) the Exchange Securities will be the valid and legally binding
obligations of the Company, enforceable in accordance with their terms,
and (iii) the Subsidiary Guaranty set forth in the Indenture will be
the valid and binding obligation of each Subsidiary Guarantor and in
the case of clauses (ii) and (iii) subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of
general applicability relating to or affecting creditors' rights and to
general equity principles.
(aa) The Subsidiary Guaranty set forth in the Indenture has
been duly authorized by each Subsidiary Guarantor; and, when issued,
will have been duly executed and delivered by each such Subsidiary
Guarantor and will conform to the description thereof contained in the
Offering Document. When the Offered Securities have been issued,
executed and authenticated in accordance with the Indenture and
delivered to and paid for by the Purchasers in accordance with the
terms of this Agreement, the Subsidiary Guaranty of each Subsidiary
Guarantor set forth in the Indenture will constitute valid and legally
binding obligations of such Subsidiary Guarantor, enforceable in
accordance with its terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of
general applicability relating to or affecting creditors' rights and to
general equity principles.
(bb) The Registration Rights Agreement has been duly
authorized by the Company and each of the Subsidiary Guarantors and, on
the Closing Date (as defined below), will have been duly executed and
delivered by the Company and each of the Subsidiary Guarantors. When
the Registration Rights Agreement has been duly executed and delivered,
the Registration Rights Agreement will be a valid and binding agreement
of the Company and each of the Subsidiary Guarantors, enforceable
against the Company and each Subsidiary Guarantor in accordance with
its terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity
principles. On the Closing Date (as defined below), the Registration
Rights Agreement will conform as to legal matters to the description
thereof in the Offering Circular.
(cc) Neither the Company nor any of its subsidiaries is (i) in
violation of its respective charter or by-laws or similar
organizational documents or (ii) in default in the performance of any
obligation, agreement, covenant or condition contained in any
indenture, loan agreement, mortgage, lease or other agreement or
instrument that is material to the Company and its subsidiaries, taken
as a whole, to which the Company or any of its subsidiaries is a party
or by which the Company or any of its subsidiaries or their respective
properties are bound, except in the case of item (ii), where such
default would not, individually or in the aggregate, have a Material
Adverse Effect.
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(dd) Except as disclosed in the Offering Document, there are
no contracts, agreements or understandings between the Company or any
Subsidiary Guarantor and any person granting such person the right to
require the Company or such Subsidiary Guarantor to file a registration
statement under the Securities Act with respect to any securities of
the Company or such Subsidiary Guarantor or to require the Company or
such Subsidiary Guarantor to include such securities with the
Securities and Subsidiary Guaranties registered pursuant to any
Registration Statement.
(ee) Neither the Company nor any of its subsidiaries nor any
agent thereof acting on the behalf of them has taken, and none of them
will take, any action that might cause this Agreement or the issuance
or sale of the Offered Securities to violate Regulation T, Regulation U
or Regulation X of the Board of Governors of the Federal Reserve
System.
(ff) No "nationally recognized statistical rating
organization" as such term is defined for purposes of Rule 436(g)(2)
under the Securities Act (i) has imposed (or has informed the Company
or any Subsidiary Guarantor that it is considering imposing) any
condition (financial or otherwise) on the Company's or any Subsidiary
Guarantor's retaining any rating assigned to the Company or any
Subsidiary Guarantor or any securities of the Company or any Subsidiary
Guarantor or (ii) has indicated to the Company or any Subsidiary
Guarantor that it is considering (a) the downgrading, suspension, or
withdrawal of, or any review for a possible change that does not
indicate the direction of the possible change in, any rating so
assigned or (b) any change in the outlook for any rating of the
Company, any Subsidiary Guarantor or any securities of the Company or
any Subsidiary Guarantor.
(gg) No form of general solicitation or general advertising
(as defined in Regulation D under the Securities Act) was used by the
Company, the Subsidiary Guarantors or any of their respective
representatives (other than the Purchasers, as to whom the Company and
the Subsidiary Guarantors make no representation) in connection with
the offer and sale of the Offered Securities contemplated hereby,
including, but not limited to, articles, notices or other
communications published in any newspaper, magazine, or similar medium
or broadcast over television or radio, or any seminar or meeting whose
attendees have been invited by any general solicitation or general
advertising.
(hh) The Offered Securities offered by the Company and sold by
the Company in reliance on Regulation S have been offered and will be
offered and sold only in offshore transactions.
(ii) The sale of the Offered Securities by the Company
pursuant to Regulation S is not part of a plan or scheme to evade the
registration provisions of the Securities Act.
(jj) On the Closing Date (as defined below), the Indenture
will conform in all material respects to the requirements of the Trust
Indenture Act, and the rules and regulations of the Commission
applicable to an indenture which is qualified thereunder.
(kk) The Company is subject to Section 13 or 15(d) of the
Exchange Act.
3. Purchase, Sale and Delivery of Offered Securities. On the basis of
the representations, warranties and agreements herein contained, but subject to
the terms and conditions herein set forth, the Company agrees to sell to the
Purchasers, and the Purchasers agree, severally and not jointly, to purchase
from the Company, at a purchase price of 100.75% of the principal amount thereof
plus accrued interest from November 1, 2002 to the Closing Date (as defined
below), the respective amounts of the Offered Securities set forth opposite the
names of the several Purchasers in Schedule A hereto.
The Company will deliver against payment of the purchase price the
Offered Securities in the form of
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one or more permanent global securities in definitive form (the "GLOBAL
SECURITIES") deposited with the Trustee as custodian for The Depository Trust
Company ("DTC") and registered in the name of Cede & Co., as nominee for DTC.
Interests in any permanent Global Securities will be held only in book-entry
form through DTC, except in the limited circumstances described in the Offering
Document. Payment for the Offered Securities shall be made by the Purchasers in
Federal (same day) funds by wire transfer to an account specified by the Company
at a bank designated by the Company and reasonably acceptable to CSFBC at the
office of Cravath, Swaine & Moore at 10 A.M. (New York time), on December 17,
2002, or at such other time not later than seven full business days thereafter
as CSFBC and the Company mutually determine, such time being herein referred to
as the "CLOSING DATE", against delivery to the Trustee as custodian for DTC of
the Global Securities representing all of the Offered Securities. The Global
Securities will be made available for checking at the above office of Cravath,
Swaine & Moore at least 24 hours prior to the Closing Date.
4. Representations by Purchasers; Resale by Purchasers. (a) Each
Purchaser severally represents and warrants to the Company and the Subsidiary
Guarantors that it is an "accredited investor" within the meaning of Regulation
D under the Securities Act and a "qualified institutional buyer" within the
meaning of Rule 144A of the Securities Act.
(b) Each Purchaser severally acknowledges that the Offered
Securities have not been registered under the Securities Act and may
not be offered or sold within the United States or to, or for the
account or benefit of, U.S. persons except in accordance with
Regulation S or pursuant to an exemption from the registration
requirements of the Securities Act. Each Purchaser severally represents
and agrees that it has offered and sold the Offered Securities, and
will offer and sell the Offered Securities (i) as part of its
distribution at any time and (ii) otherwise until 40 days after the
later of the commencement of the offering and the Closing Date, only in
accordance with Rule 903 or Rule 144A under the Securities Act ("RULE
144A"). Accordingly, neither such Purchaser nor its Affiliates, nor any
persons acting on its or their behalf, have engaged or will engage in
any directed selling efforts with respect to the Offered Securities,
and such Purchaser, its Affiliates and all persons acting on its or
their behalf have complied and will comply with the offering
restrictions requirement of Regulation S. Each Purchaser severally
agrees that, at or prior to confirmation of sale of the Offered
Securities, other than a sale pursuant to Rule 144A, such Purchaser
will have sent to each distributor, dealer or person receiving a
selling concession, fee or other remuneration that purchases the
Offered Securities from it during the restricted period a confirmation
or notice to substantially the following effect:
"The Securities covered hereby have not been registered under
the U.S. Securities Act of 1933 (the "Securities Act") and may
not be offered or sold within the United States or to, or for
the account or benefit of, U.S. persons (i) as part of their
distribution at any time or (ii) otherwise until 40 days after
the later of the date of the commencement of the offering and
the closing date, except in either case in accordance with
Regulation S (or Rule 144A if available) under the Securities
Act. Terms used above have the meanings given to them by
Regulation S."
Other than the term "Affiliate" terms used in this subsection (b) have
the meanings given to them by Regulation S.
(c) Each Purchaser severally agrees that it and each of its
Affiliates has not entered and will not enter into any contractual
arrangement with respect to the distribution of the Offered Securities
except for any such arrangements with the other Purchasers or
Affiliates of the other Purchasers or with the prior written consent of
the Company.
9
(d) Each Purchaser severally agrees that it and each of its
Affiliates will not offer or sell the Offered Securities in the United
States by means of any form of general solicitation or general
advertising within the meaning of Rule 502(c) under the Securities Act,
including, but not limited to (i) any advertisement, article, notice or
other communication published in any newspaper, magazine or similar
media or broadcast over television or radio, or (ii) any seminar or
meeting whose attendees have been invited by any general solicitation
or general advertising. Each Purchaser severally agrees, with respect
to resales made in reliance on Rule 144A of any of the Offered
Securities, to deliver either with the confirmation of such resale or
otherwise prior to settlement of such resale a notice to the effect
that the resale of such Offered Securities has been made in reliance
upon the exemption from the registration requirements of the Securities
Act provided by Rule 144A.
(e) Each of the Purchasers severally represents and agrees
that (i) it has not offered or sold and prior to the date six months
after the date of issue of the Offered Securities will not offer or
sell any Offered Securities to persons in the United Kingdom except to
persons whose ordinary activities involve them in acquiring, holding,
managing or disposing of investments (as principal or agent) for the
purposes of their businesses or otherwise in circumstances which have
not resulted and will not result in an offer to the public in the
United Kingdom within the meaning of the Public Offers of Securities
Regulations 1995; (ii) it has only communicated or caused to be
communicated and will only communicate or cause to be communicated any
invitation or inducement to engage in investment activity (within the
meaning of Section 21 of the Financial Services and Markets Act 2000
(the "FSMA")) received by it in connection with the issue or sale of
any Offered Securities in circumstances in which Section 21(1) of the
FSMA does not apply to the Issuer or any Guarantor; and (iii) it has
complied and will comply with all applicable provisions of the FSMA
with respect to anything done by it in relation to the Offered
Securities in, from or otherwise involving the United Kingdom.
5. Certain Agreements of the Company. The Company agrees with the
several Purchasers that:
(a) The Company will advise CSFBC promptly of any proposal to
amend or supplement the Offering Document and will not effect such
amendment or supplementation without CSFBC's consent, which shall not
be unreasonably withheld or delayed. If, at any time prior to the
completion of the resale of the Offered Securities by the Purchasers,
any event occurs as a result of which the Offering Document as then
amended or supplemented would include an untrue statement of a material
fact or omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, or if is necessary at any such time to amend or supplement
the Offering Document to comply with any applicable law, not
misleading, the Company promptly will notify CSFBC of such event and
promptly will prepare, at its own expense, an amendment or supplement
which will correct such statement or omission or to effect such
compliance. Neither CSFBC's consent to, nor the Purchasers' delivery to
offerees or investors of, any such amendment or supplement shall
constitute a waiver of any of the conditions set forth in Section 6.
(b) The Company will furnish to CSFBC copies of any
preliminary offering circular, the Offering Document and all amendments
and supplements to such documents, in each case as soon as available
and in such quantities as CSFBC requests, and the Company will furnish
to CSFBC on the date hereof three copies of the Offering Document
signed by a duly authorized officer of the Company. At any time when
the Company is not subject to Section 13 or 15(d) of the Exchange Act,
the Company will promptly furnish or cause to be furnished to CSFBC
(and, upon request, to each of the other Purchasers) and, upon request
of holders and prospective purchasers of the Offered Securities, to
such holders and purchasers, copies of the information required to be
delivered to
10
holders and prospective purchasers of the Offered Securities pursuant
to Rule 144A(d)(4) under the Securities Act (or any successor provision
thereto) in order to permit compliance with Rule 144A in connection
with resales by such holders of the Offered Securities. The Company
will pay the expenses of printing and distributing to the Purchasers
all such documents.
(c) The Company will arrange for the qualification of the
Offered Securities for sale and the determination of their eligibility
for investment under the laws of such jurisdictions in the United
States and Canada as CSFBC designates and will continue such
qualifications in effect so long as required for the resale of the
Offered Securities by the Purchasers, provided that the Company will
not be required to qualify as a foreign corporation or to file a
general consent to service of process in any such jurisdiction.
(d) During the period of five years hereafter, the Company
will furnish to CSFBC and, upon request, to each of the other
Purchasers, as soon as practicable after the end of each fiscal year, a
copy of its annual report to stockholders for such year; and the
Company will furnish to CSFBC and, upon request, to each of the other
Purchasers (i) as soon as available, a copy of each report and any
definitive proxy statement of the Company filed with the Commission
under the Exchange Act or mailed to stockholders, and (ii) from time to
time, such other information concerning the Company as CSFBC may
reasonably request, which such other information shall be kept
confidential by the Purchasers to the extent so requested by the
Company in writing at the time of delivery of such information.
(e) During the period of two years after the Closing Date, the
Company will, upon request, furnish to CSFBC, each of the other
Purchasers and any holder of Offered Securities a copy of the
restrictions on transfer applicable to the Offered Securities.
(f) During the period of two years after the Closing Date, the
Company will not, and will not permit any of its Affiliates to, resell
any of the Offered Securities that have been reacquired by any of them.
(g) During the period of two years after the Closing Date,
neither the Company nor any Subsidiary Guarantor will be or become, an
open-end investment company, unit investment trust or face-amount
certificate company that is or is required to be registered under
Section 8 of the Investment Company Act.
(h) The Company will pay all expenses incidental to the
performance of its obligations under this Agreement, the Indenture, and
the Registration Rights Agreement, including (i) the fees and expenses
of the Trustee and its professional advisers; (ii) all expenses in
connection with the execution, issue, authentication, packaging and
initial delivery of the Offered Securities and, as applicable, the
Exchange Securities, the preparation and printing of this Agreement,
the Registration Rights Agreement, the Offered Securities, the
Indenture, the Offering Document and amendments and supplements
thereto, and any other document relating to the issuance, offer, sale
and delivery of the Offered Securities and as applicable, the Exchange
Securities; (iii) the cost of listing the Offered Securities and
qualifying the Offered Securities for trading in The Portal(SM) Market
("PORTAL") and any expenses incidental thereto; (iv) the cost of any
advertising approved by the Company in connection with the issue of the
Offered Securities; (v) for any expenses (including fees and
disbursements of counsel) incurred in connection with qualification of
the Offered Securities or the Exchange Securities for sale under the
laws of such jurisdictions in the United States and Canada as CSFBC
designates and the printing of memoranda relating thereto; (vi) for any
fees charged by investment rating agencies for the rating of the
Securities or the Exchange Securities; and (vii) for
11
expenses incurred in distributing preliminary offering circulars and
the Offering Document (including any amendments and supplements
thereto) to the Purchasers.
(i) In connection with the offering, until CSFBC shall have
notified the Company and the other Purchasers of the completion of the
resale of the Offered Securities, neither the Company nor any of its
Affiliates has or will, either alone or with one or more other persons,
bid for or purchase for any account in which it or any of its
Affiliates has a beneficial interest any Offered Securities or attempt
to induce any person to purchase any Offered Securities; and neither it
nor any of its Affiliates will make bids or purchases for the purpose
of creating actual, or apparent, active trading in, or of raising the
price of, the Offered Securities.
(j) For a period of 90 days after the date of the initial
offering of the Offered Securities by the Purchasers, the Company will
not offer, sell, contract to sell, pledge or otherwise dispose of,
directly or indirectly, any United States dollar-denominated debt
securities issued or guaranteed by the Company and having a maturity of
more than one year from the date of issue. The Company will not at any
time offer, sell, contract to sell, pledge or otherwise dispose of,
directly or indirectly, any securities under circumstances where such
offer, sale, pledge, contract or disposition would cause the exemption
afforded by Section 4(2) of the Securities Act or the safe harbor of
Regulation S thereunder to cease to be applicable to the offer and sale
of the Offered Securities.
6. Conditions of the Obligations of the Purchasers. The obligations of
the several Purchasers to purchase and pay for the Offered Securities will be
subject to the accuracy of the representations and warranties on the part of the
Company herein on the date hereof and on the Closing Date, to the accuracy of
the statements of officers of the Company made pursuant to the provisions
hereof, to the performance by the Company and the Subsidiary Guarantors of their
respective obligations hereunder and to the following additional conditions
precedent:
(a) The Purchasers shall have received a letter, dated the
date of this Agreement, of KPMG LLP confirming that they are
independent public accountants within the meaning of the Securities Act
and the applicable published rules and regulations thereunder ("RULES
AND REGULATIONS") and to the effect that:
(i) they have performed the procedures specified by
the American Institute of Certified Public Accountants for a
review of interim financial information as described in
Statement of Auditing Standards No. 71, Interim Financial
Information, on the unaudited consolidated financial
statements included in the Offering Document and in the
Exchange Act Reports;
(ii) on the basis of the review referred to in clause
(i) above, a reading of the latest available interim financial
statements of the Company, inquiries of officials of the
Company who have responsibility for financial and accounting
matters and other specified procedures, nothing came to their
attention that caused them to believe that:
(A) the unaudited consolidated financial
statements included in the Offering Document or in
the Exchange Act Reports do not comply as to form in
all material respects with the applicable accounting
requirements of the Securities Act and the related
published Rules and Regulations or any material
modifications should be made to such unaudited
financial statements for them to be in conformity
with generally accepted accounting principles;
12
(B) at the date of the latest available
balance sheet read by such accountants, or at a
subsequent specified date not more than three
business days prior to the date of this Agreement,
there was any change in the capital stock or any
increase in long-term debt of the Company and its
consolidated subsidiaries or, at the date of the
latest available balance sheet read by such
accountants, there was any decreases in consolidated
net current revenues or in the total or per-share
amounts of income before extraordinary items or of
net income, as compared with amounts shown on the
latest balance sheet included in the Offering
Document; or
(C) for the period from the closing date of
the latest income statement included in the Offering
Document to the closing date of the latest available
income statement read by such accountants there were
any decreases, as compared with the corresponding
period of the previous year, in consolidated net
sales, net operating income, consolidated net income
or in the ratio of earnings to fixed charges;
except in all cases set forth in clauses (B) and (C) above for
changes, increases or decreases which the Offering Document
discloses have occurred or may occur or which are described in
such letter;
(iii) they have compared specified dollar amounts (or
percentages derived from such dollar amounts) and other
financial information contained in the Offering Document and
the Exchange Act Reports (in each case to the extent that such
dollar amounts, percentages and other financial information
are derived from the general accounting records of the Company
and its subsidiaries subject to the internal controls of the
Company's accounting system or are derived directly from such
records by analysis or computation) with the results obtained
from inquiries, a reading of such general accounting records
and other procedures specified in such letter and have found
such dollar amounts, percentages and other financial
information to be in agreement with such results, except as
otherwise specified in such letter; and
(iv) on the basis of a reading of the pro forma
consolidated financial statements, carrying out certain
specified procedures, reading of minutes, inquiries of certain
officials of the Company who have responsibility for financial
and accounting matters and proving the arithmetic accuracy of
the application of the pro forma adjustments to the historical
amounts in the pro forma consolidated financial statements,
nothing came to their attention which caused them to believe
that the pro forma consolidated financial statements do not
comply as to form in all material respects with the applicable
accounting requirements of Rule 11-02 of Regulation S-X under
the Securities Act or that the pro forma adjustments have not
been properly applied to the historical amounts in the
compilations of such statements or on the pro forma basis
described in the notes thereto, except that the applicable
accounting requirements of Rule 11-02 of Regulations S-X
preclude the presentation of the pro forma adjustments related
to the offering of the Securities and the application of the
estimated net proceeds from the offering of the Securities.
(b) The Purchasers shall have received a letter, dated the
date of this Agreement, from Lon McCain, the Chief Financial Officer of
the Company, to the effect that:
(i) he and members of his staff are responsible for
the Company's financial and accounting matters and have
examined the Company's financial records and schedules
included in the Offering Document; and
13
(ii) on the basis of the review referred to in clause
(i) above, nothing came to his attention that caused him to
believe that:
(A) the consolidated balance sheets of the
Company and subsidiaries as of December 31, 2001 and
2000, and the consolidated statements of operations,
stockholders' equity, and cash flows for each of the
three years in the period ended December 31, 2001,
and the related financial statement schedules all
included or incorporated by reference in the Offering
Document do not fairly present the financial position
of the Company and subsidiaries at December 31, 2001,
and the results of their operations and cash flows
for each of the three years in the period ended
December 31, 2001 in conformity with generally
accepted accounting principles; or
(B) the interim historical data, the
unaudited consolidated statements of operations,
stockholders' equity, and cash flows for the
nine-month period ended September 30, 2001, and the
unaudited consolidated balance sheet as of September
30, 2001, included or incorporated by reference in
the Offering Document, are not in conformity with
generally accepted accounting principles.
(iii) he has compared specified dollar amounts (or
percentages derived from such dollar amounts) and other
financial information contained in the Offering Document and
the Exchange Act Reports with the results obtained from a
reading of the general accounting records of the Company and
its subsidiaries and other procedures specified in such letter
and have found such dollar amounts, percentages and other
financial information to be in agreement with such results,
except as otherwise specified in such letter.
(c) Subsequent to the execution and delivery of this
Agreement, there shall not have occurred (i) any change, or any
development or event involving a prospective change, in the condition
(financial or other), business, properties or results of operations of
the Company and its subsidiaries taken as one enterprise which, in the
reasonable judgment of a majority in interest of the Purchasers
including CSFBC, is material and adverse and makes it impractical or
inadvisable to proceed with completion of the public offering or the
sale of and payment for the Offered Securities; (ii) any downgrading in
the rating of any debt securities or preferred stock of the Company by
any "nationally recognized statistical rating organization" (as defined
for purposes of Rule 436(g) under the Act), or any public announcement
that any such organization has under surveillance or review its rating
of any debt securities or preferred stock of the Company (other than an
announcement with positive implications of a possible upgrading, and no
implication of a possible downgrading, of such rating) or any
announcement that the Company has been placed on negative outlook;
(iii) any change in U.S. or international financial, political or
economic conditions or currency exchange rates or exchange controls as
would, in the reasonable judgment of a majority in interest of the
Purchasers including CSFBC, be likely to prejudice materially the
success of the proposed issue, sale or distribution of the Offered
Securities, whether in the primary market or in respect of dealings in
the secondary market; (iv) any material suspension or material
limitation of trading in securities generally on the New York Stock
Exchange, or any setting of minimum prices for trading on such
exchange, or any suspension of trading of any securities of the Company
on any exchange or in the over-the-counter market; (v) any banking
moratorium declared by U.S. Federal or, New York authorities; (vi) any
major disruption of settlements of securities or (vii) any attack on,
outbreak or material escalation of hostilities or acts of terrorism
involving the United States, any declaration of war by Congress or any
other national or international calamity or emergency if, in the
reasonable judgment of a majority in interest of the Purchasers
including CSFBC, the effect of any such attack, outbreak, escalation,
act, declaration, calamity or emergency makes it impractical or
inadvisable to proceed with completion of the public
14
offering or the sale of and payment for the Offered Securities.
(d) The Purchasers shall have received an opinion, dated the
Closing Date, of Akin, Gump Strauss, Hauer & Feld, L.L.P., counsel for
the Company and the Subsidiary Guarantors, and from local counsel in
Nevada, Colorado and Wyoming to the collective effect that:
(i) The Company is a validly existing corporation in
good standing under the laws of the State of Nevada and each
Subsidiary Guarantor is a validly existing corporation,
limited partnership, partnership or limited liability company
in good standing under the laws of the state of its
incorporation or organization, in each case with corporate,
limited partnership, partnership or limited liability company
power and authority to own its properties and conduct its
business as described in the Offering Document and the
Exchange Act Reports, and each is duly qualified to do
business as a foreign entity in good standing in the
jurisdictions identified in a schedule to the opinion;
(ii) Except for those liens listed in Schedule B
hereto, all outstanding shares of capital stock or similar
ownership interest of the Subsidiary Guarantors are owned of
record by the Company either directly or through wholly-owned
subsidiaries;
(iii) Each of this Agreement, the Registration Rights
Agreement and the Indenture has been duly authorized, executed
and delivered by the Company and each Subsidiary Guarantor a
party thereto; and each of the Registration Rights Agreement
and the Indenture constitutes a valid and legally binding
obligation of the Company and the Subsidiary Guarantors,
enforceable in accordance with its terms, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating
to or affecting creditors' rights and to general equity
principles;
(iv) The Offered Securities have been duly
authorized, executed, issued and delivered and, assuming due
authentication, in accordance with this Agreement constitute
valid and binding obligations of the Company, enforceable
against the Company in accordance with their terms, and
entitled to the benefits of the Indenture, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating
to or affecting creditors' rights and to general equity
principles; and the Offered Securities are in the form
contemplated by the Indenture and conform in all material
respects to the description thereof in the Offering Document;
(v) No consent, approval, authorization or order of,
or filing with, any governmental agency or body or any court
is required under any of the Included Laws to be obtained or
made by the Company or the Subsidiary Guarantors for the due
execution and delivery of this Agreement, the Indenture or the
Registration Rights Agreement and the performance of their
respective obligations hereunder or thereunder in connection
with the issuance and sale of the Offered Securities by the
Company, except such as have been obtained or made and such as
may be required under state securities laws, the Securities
Act, the Exchange Act, the Trust Indenture Act in connection
with the issuance of the Exchange Securities or the various
rules and regulations under each of the foregoing;
(vi) The execution, delivery and performance by the
Company and the Subsidiary Guarantors of the Indenture, this
Agreement and the Registration Rights Agreement, and the
issuance and sale of the Offered Securities to the Purchasers
in the manner contemplated herein and compliance with the
terms and provisions thereof did not and will not, (1) result
in a violation of any law, rule or regulation of any Included
Law, (2) result in a violation of
15
any order, writ, judgment or decree known to such counsel and
applicable to the Company or any subsidiary of the Company or
any of their properties, (3) result in a violation of the
Articles of Incorporation or by-laws or similar charter
documents of the Company or of any Subsidiary Guarantor, or
(4) breach or result in a default under or result in the
acceleration of or entitle any party to accelerate under any
agreement or instrument filed as an exhibit to the Exchange
Act Reports, except in the case of clauses (1), (2) and (4)
for such violations, breaches, defaults and accelerations as
would not, individually or in the aggregate, have a Material
Adverse Effect;
(vii) The descriptions (A) in the Offering Document
under the captions "Notice to Investors", "Certain
Relationships and Related Transactions", "Description of
Certain Indebtedness", "Description of the Notes" and "Certain
Material United States Federal Income Tax Consequences" and
(B) in the Exchange Act Reports of statutes, legal and
governmental proceedings and contracts and other documents
fairly present, in all material respects, the information
required to be shown; it being understood that such counsel
need express no opinion as to the reserve data, reserve
reports, financial statements and related notes and schedules
and other financial data contained in the Offering Document;
(viii) Assuming the accuracy of the representations
and warranties of the parties to this Agreement and the
performance by such parties of their respective agreements
made herein, it is not necessary in connection with (i) the
offer, sale and delivery of the Offered Securities by the
Company and the Subsidiary Guarantors to the several
Purchasers pursuant to this Agreement or (ii) the resales of
the Offered Securities by the several Purchasers in the manner
contemplated hereby to register the Offered Securities and
Subsidiary Guaranties under the Securities Act;
(ix) The Indenture is duly qualified under the Trust
Indenture Act;
(x) The Subsidiary Guaranty set forth in the
Indenture conforms in all material respects to the description
thereof contained in the Offering Document. When the Offered
Securities have been issued, executed and authenticated in
accordance with the Indenture and delivered to and paid for by
the Purchasers in accordance with the terms of this Agreement,
the Subsidiary Guaranty of each Subsidiary Guarantor set forth
in the Indenture will constitute valid and legally binding
obligations of such Subsidiary Guarantor, enforceable in
accordance with its terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar
laws of general applicability relating to or affecting
creditors' rights and to general equity principles;
(xi) The Exchange Securities have been duly
authorized by the Company; and if and when the Exchange
Securities are issued, executed and authenticated in
accordance with the terms of the Exchange Offer, the
Registration Rights Agreement and the Indenture, (i) the
Exchange Securities will be entitled to the benefits of the
Indenture including the Subsidiary Guaranty set forth in the
Indenture, (ii) the Exchange Securities will be the valid and
legally binding obligations of the Company, enforceable in
accordance with their terms, and (iii) the Subsidiary Guaranty
set forth in the Indenture will be the valid and binding
obligation of each Subsidiary Guarantor, and in the case of
clauses (ii) and (iii) subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar
laws of general applicability relating to or affecting
creditors' rights and to general equity principles;
(xii) Except as disclosed in the Offering Document,
none of the agreements filed as exhibits to the Exchange Act
Reports include any contracts, agreements or understandings
16
between the Company or any Subsidiary Guarantor and any person
granting such person the right to require the Company or such
Subsidiary Guarantor to file a registration statement under
the Securities Act with respect to any securities of the
Company or such Subsidiary Guarantor or to require the Company
or such Subsidiary Guarantor to include such securities with
the Securities and Subsidiary Guaranties registered pursuant
to any Registration Statement;
In addition to the foregoing, such counsel shall also
provide a statement to the effect that such counsel has
participated in conferences with officers and representatives
of the Company, representatives of the independent public
accountants for the Company, the Purchasers and counsel for
the Purchasers at which the contents of the Offering Document
and related matters were discussed and, although such counsel
is not passing upon and does not assume any responsibility for
the accuracy, completeness or fairness of the statements
contained in the Offering Document, and has not made any
independent check or verification thereof (except as
specifically set forth in Section 6, paragraph d, item (vii)
above), based on such counsel's participation in such
conferences and conversations, their review of such records
and documents as described above, their understanding of the
U.S. federal securities laws and their experience they have
gained in their practice thereunder, they advise you that no
information has come to their attention that causes them to
believe that the Offering Document (except for reserve data,
reserve reports, financial statements and related notes and
schedules and other financial data included therein, as to
which they express no view), as of the date thereof, contained
or contains an untrue statement of a material fact or omitted
or omits to state a material fact necessary in order to make
the statements therein, in the light of the circumstances
under which they were made, not misleading.
The opinion of Akin, Gump, Strauss, Hauer and Feld,
L.L.P. described in this Section 6(d) shall be rendered to the
Purchasers at the request of the Company and shall so state
therein. Such opinion may, solely as it relates to the
application of laws other than the laws of the United States
and jurisdictions in which they are admitted, to the extent
such counsel deems proper and to the extent specified in such
opinion, be given directly from separate legal counsel
reasonably acceptable to CSFBC and its legal counsel, provided
that such opinions from separate legal counsel are in each
case addressed directly to the Representatives on behalf of
the Purchasers. Such counsel may also state that, insofar as
such opinion involves factual matters, they have relied, to
the extent they deem proper, upon certificates of officers of
the Company and it subsidiaries and certificated of public
officials, provided that copies of such certificates are
provided by such counsel to the Representatives;
For the purposes of the forgoing opinions and
statements the phrases "known to such counsel," "to such
counsel's knowledge" and words of similar meaning refer only
to the actual knowledge of the current lawyers of Akin, Gump
Strauss, Hauer & Feld, L.L.P. who have performed legal
services on behalf of the Company and the Subsidiary
Guarantors or the predecessors of such entities since October
26, 2000.
(e) The Purchasers shall have received an opinion, dated the
Closing Date, of Howard L. Boigon, Vice President and General Counsel
of the Company, to the effect that:
(i) All outstanding shares of capital stock or
similar ownership interest of each Subsidiary Guarantor have
been duly and validly authorized and issued and are fully paid
and non-assessable;
17
(ii) Neither the Company nor any of its subsidiaries
is in violation of its respective charter or by-laws or, to
the knowledge of such counsel after due inquiry, in default in
the performance of any obligation, agreement, covenant or
condition contained in any indenture, loan agreement,
mortgage, lease or other agreement or instrument that is
material to the Company and its subsidiaries, taken as a
whole, to which the Company or any of its subsidiaries is a
party or by which the Company or any of its subsidiaries or
their respective property is bound;
(iii) Except as disclosed in the Offering Document,
there are no contracts, agreements or understandings between
the Company or any Subsidiary Guarantor and any person
granting such person the right to require the Company or such
Subsidiary Guarantor to file a registration statement under
the Securities Act with respect to any securities of the
Company or such Subsidiary Guarantor or to require the Company
or such Subsidiary Guarantor to include such securities with
the Securities and Subsidiary Guaranties registered pursuant
to any Registration Statement;
(iv) To such counsel's knowledge, after due inquiry,
there are no pending actions, suits or proceedings against or
affecting the Company, any of its subsidiaries or any of their
respective properties that, if determined adversely to the
Company or any of its subsidiaries, would individually or in
the aggregate have a Material Adverse Effect, or would
materially and adversely affect the ability of the Company to
perform its obligations under the Indenture, this Agreement,
or the Registration Rights Agreement, or which are otherwise
material in the context of the sale of the Offered Securities;
and no such actions, suits or proceedings are, to such
counsel's knowledge, threatened or contemplated.
In addition to the foregoing, such counsel shall also
provide a statement to the effect that such counsel has no
reason to believe that the Offering Document, or any amendment
or supplement thereto, or any Exchange Act Report as of the
date hereof and as of the Closing Date, contained any untrue
statement of a material fact or omitted to state any material
fact necessary to make the statements therein not misleading,
it being understood that such counsel need express no belief
or opinion as to the reserve information, financial statements
or other financial data contained in the Offering Document and
the Exchange Act Reports.
(f) The Purchasers shall have received from Cravath, Swaine &
Moore, counsel for the Purchasers, such opinion or opinions, dated the
Closing Date, with respect to the incorporation of the Company, the
validity of the Offered Securities, the Offering Document, the
exemption from registration for the offer and sale of the Offered
Securities by the Company to the several Purchasers and the resales by
the several Purchasers as contemplated hereby and other related matters
as CSFBC may require, and the Company shall have furnished to such
counsel such documents as they request for the purpose of enabling them
to pass upon such matters.
(g) The Purchasers shall have received a certificate, dated
the Closing Date, of the President or any Vice President and a
principal financial or accounting officer of the Company in which such
officers, to their knowledge, shall state that the representations and
warranties of the Company in this Agreement are true and correct, that
the Company has complied with all agreements and satisfied all
conditions on its part to be performed or satisfied hereunder at or
prior to the Closing Date, and that, subsequent to the respective dates
of the most recent financial statements in the Offering Document there
has been no material adverse change, nor any development or event
involving a prospective material adverse change, in the condition
(financial or other), business, properties or results of operations of
the Company and its subsidiaries taken as a whole except as set forth
in or contemplated
18
by the Offering Document or as described in such certificate.
(h) The Purchasers shall have received a letter, dated the
Closing Date, of KPMG LLP which meets the requirements of subsection
(a) of this Section, except that the specified date referred to in such
subsection will be a date not more than three days prior to the Closing
Date for the purposes of this subsection.
(i) The Purchasers shall have received an executed copy of the
Registration Rights Agreement.
The Company will furnish the Purchasers with such conformed copies of such
opinions, certificates, letters and documents as the Purchasers reasonably
request. CSFBC may in its sole discretion waive on behalf of the Purchasers
compliance with any conditions to the obligations of the Purchasers hereunder.
7. Indemnification and Contribution. (a) Each of the Company and the
Subsidiary Guarantors will, jointly and severally, indemnify and hold harmless
each Purchaser, its partners, affiliates, directors and officers and each
person, if any, who controls such Purchaser within the meaning of Section 15 of
the Securities Act, against any losses, claims, damages or liabilities, joint or
several, to which such Purchaser may become subject, under the Securities Act or
the Exchange Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
the Offering Document, or any amendment or supplement thereto, or any related
preliminary offering circular or the Exchange Act Reports, or arise out of or
are based upon the omission or alleged omission to state therein a material fact
required to stated therein or necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not misleading,
including any losses, claims, damages or liabilities arising out of or based
upon the Company's failure to perform its obligations under Section 5(a) of this
Agreement, and will reimburse each Purchaser for any legal or other expenses
reasonably incurred by such Purchaser in connection with investigating or
defending any such loss, claim, damage, liability or action as such expenses are
incurred; provided, however, that the Company and the Subsidiary Guarantors will
not be liable in any such case to the extent that any such loss, claim, damage
or liability arises out of or is based upon an untrue statement or alleged
untrue statement in or omission or alleged omission from any of such documents
in reliance upon and in conformity with written information furnished to the
Company by any Purchaser through CSFBC specifically for use therein, it being
understood and agreed that the only such information consists of the information
described as such in subsection (b) below; and provided, further, that with
respect to any untrue statement or alleged untrue statement in or omission or
alleged omission from any Preliminary Offering Circular the indemnity agreement
contained in this subsection (a) shall not inure to the benefit of any Purchaser
from whom the person asserting any such losses, claims, damages or liabilities
purchased the Offered Securities concerned, to the extent that a offering
circular relating to such Offered Securities was required to be delivered by
such Purchaser under the Act in connection with such purchase and any such loss,
claim, damage or liability of such Purchaser results from the fact that there
was not sent or given to such person, at or prior to the written confirmation of
the sale of such Offered Securities to such person, a copy of the Offering
Document or any amendment or supplement thereto if the Company had previously
furnished copies thereof to such Purchaser.
(b) Each Purchaser will severally and not jointly indemnify
and hold harmless the Company and the Subsidiary Guarantors, their directors and
officers and each person, if any, who controls the Company and the Subsidiary
Guarantors within the meaning of Section 15 of the Securities Act, against any
losses, claims, damages or liabilities to which the Company or the Subsidiary
Guarantors may become subject, under the Securities Act or the Exchange Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in the Offering Document, or any
amendment or supplement thereto, or any related Preliminary Offering Circular,
or arise out of or are based upon the omission or the alleged omission to state
19
therein a material fact required to be stated therein or necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading, in each case to the extent, but only to the extent,
that such untrue statement or alleged untrue statement or omission or alleged
omission was made in reliance upon and in conformity with written information
furnished to the Company by such Purchaser through CSFBC specifically for use
therein, and will reimburse any legal or other expenses reasonably incurred by
the Company in connection with investigating or defending any such loss, claim,
damage, liability or action as such expenses are incurred, it being understood
and agreed that the only such information furnished by any Purchaser consists of
the following information in the Offering Document furnished on behalf of each
Purchaser: the third and fourth sentences of the ninth paragraph and the tenth,
eleventh and thirteenth paragraphs under the caption "Plan of Distribution";
provided, however, that the Purchasers shall not be liable for any losses,
claims, damages or liabilities arising out of or based upon the Company's
failure to perform its obligations under Section 5(a) of this Agreement.
(c) Promptly after receipt by an indemnified party under this
Section of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under subsection (a) or (b) above, notify the indemnifying party of the
commencement thereof; but the omission so to notify the indemnifying party will
not relieve it from any liability which it may have to any indemnified party
otherwise than under subsection (a) or (b) above. In case any such action is
brought against any indemnified party and it notifies the indemnifying party of
the commencement thereof, the indemnifying party will be entitled to participate
therein and, to the extent that it may wish, jointly with any other indemnifying
party similarly notified, to assume the defense thereof, with counsel
satisfactory to such indemnified party (who shall not, except with the consent
of the indemnified party, be counsel to the indemnifying party), and after
notice from the indemnifying party to such indemnified party of its election so
to assume the defense thereof, the indemnifying party will not be liable to such
indemnified party under this Section for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof other than reasonable costs of investigation. In any such proceeding,
any indemnified party shall have the right to retain its own counsel, but the
fees and expenses of such counsel shall be at the expense of such indemnified
party unless (i) the indemnifying party and the indemnified party shall have
mutually agreed to the contrary; (ii) the indemnifying party has failed within a
reasonable time to retain counsel reasonably satisfactory to the indemnified
party; (iii) the indemnified party shall have reasonably concluded that there
may be legal defenses available to it that are different from or in addition to
those available to the indemnifying party; or (iv) the named parties in any such
proceeding (including any impleaded parties) include both the indemnifying party
and the indemnified party and representation of both parties by the same counsel
would be inappropriate due to actual or potential differing interests between
them. It is understood and agreed that the indemnifying party shall not, in
connection with any proceeding or related proceeding in the same jurisdiction,
be liable for the fees and expenses of more than one separate firm (in addition
to any local counsel) for all indemnified parties, and that all such fees and
expenses shall be reimbursed as they are incurred. Any such separate firm for
any Purchaser, its affiliates, directors and officers and any control persons of
such Initial Purchaser shall be designated in writing by CSFBC and any such
separate firm for the Company, any Subsidiary Guarantor and any control persons
of the Company and any Subsidiary Guarantor shall be designated in writing by
the Company. No indemnifying party shall, without the prior written consent of
the indemnified party, effect any settlement of any pending or threatened action
in respect of which any indemnified party is or could have been a party and
indemnity could have been sought hereunder by such indemnified party unless such
settlement includes (i) an unconditional release of such indemnified party from
all liability on any claims that are the subject matter of such action and (ii)
does not include a statement as to or an admission of fault, culpability or
failure to act by or on behalf of any indemnified party.
(d) If the indemnification provided for in this Section is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above, then each indemnifying party shall contribute to
the amount paid or payable by such indemnified party as a result of the losses,
claims, damages or liabilities
20
referred to in subsection (a) or (b) above (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the one
hand and the Purchasers on the other from the offering of the Offered Securities
or (ii) if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of
the Company on the one hand and the Purchasers on the other in connection with
the statements or omissions which resulted in such losses, claims, damages or
liabilities as well as any other relevant equitable considerations. The relative
benefits received by the Company and the Subsidiary Guarantors on the one hand
and the Purchasers on the other shall be deemed to be in the same proportion as
the total net proceeds from the offering (before deducting expenses) received by
the Company bear to the total discounts and commissions received by the
Purchasers from the Company under this Agreement. The relative fault shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company and the
Subsidiary Guarantors or the Purchasers and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
untrue statement or omission. The amount paid by an indemnified party as a
result of the losses, claims, damages or liabilities referred to in the first
sentence of this subsection (d) shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any action or claim which is the subject of this
subsection (d). Notwithstanding the provisions of this subsection (d), no
Purchaser shall be required to contribute any amount in excess of the amount by
which the total discounts, fees and commissions received by such Purchaser
exceeds the amount of any damages which such Purchaser has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. The Purchasers' obligations in this subsection (d) are
several in proportion to their respective purchase obligations and not joint.
(e) The obligations of the Company and the Subsidiary
Guarantors under this Section shall be in addition to any liability which the
Company or the Subsidiary Guarantors may otherwise have and shall extend, upon
the same terms and conditions, to each person, if any, who controls any
Purchaser within the meaning of the Securities Act or the Exchange Act; and the
obligations of the Purchasers under this Section shall be in addition to any
liability which the respective Purchasers may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls the
Company and the Subsidiary Guarantors within the meaning of the Securities Act
or the Exchange Act.
8. Default of Purchasers. If any Purchaser or Purchasers default in
their obligations to purchase Offered Securities hereunder and the aggregate
principal amount of Offered Securities that such defaulting Purchaser or
Purchasers agreed but failed to purchase does not exceed 10% of the total
principal amount of Offered Securities, CSFBC may make arrangements satisfactory
to the Company for the purchase of such Offered Securities by other persons,
including any of the Purchasers, but if no such arrangements are made by the
Closing Date, the non-defaulting Purchasers shall be obligated severally, in
proportion to their respective commitments hereunder, to purchase the Offered
Securities that such defaulting Purchasers agreed but failed to purchase. If any
Purchaser or Purchasers so default and the aggregate principal amount of Offered
Securities with respect to which such default or defaults occur exceeds 10% of
the total principal amount of Offered Securities and arrangements satisfactory
to CSFBC and the Company for the purchase of such Offered Securities by other
persons are not made within 36 hours after such default, this Agreement will
terminate without liability on the part of any non-defaulting Purchaser or the
Company, except as provided in Section 9. As used in this Agreement, the term
"Purchaser" includes any person substituted for a Purchaser under this Section.
Nothing herein will relieve a defaulting Purchaser from liability for its
default.
9. Survival of Certain Representations and Obligations. The respective
indemnities, agreements, representations, warranties and other statements of the
Company or its officers and of the several Purchasers set forth in or made
pursuant to this Agreement will remain in full force and effect, regardless of
any investigation, or statement as to the results thereof, made by or on behalf
of any Purchaser, the Company or any of their respective representatives,
officers or directors or any controlling person, and will survive delivery of
and
21
payment for the Offered Securities. If this Agreement is terminated pursuant to
Section 8 or if for any reason the purchase of the Offered Securities by the
Purchasers is not consummated, the Company shall remain responsible for the
expenses to be paid or reimbursed by it pursuant to Section 5 and the respective
obligations of the Company, the Subsidiary Guarantors and the Purchasers
pursuant to Section 7 shall remain in effect. If the purchase of the Offered
Securities by the Purchasers is not consummated for any reason other than solely
because of the termination of this Agreement pursuant to Section 8 or the
occurrence of any event specified in clause (iii), (iv), (v), (vi) or (vii) of
Section 6(c), the Company and the Subsidiary Guarantors, jointly and severally,
will reimburse the Purchasers for all out-of-pocket expenses (including fees and
disbursements of counsel) reasonably incurred by them in connection with the
offering of the Offered Securities.
10. Notices. All communications hereunder will be in writing and, if
sent to the Purchasers will be mailed, delivered or telegraphed and confirmed to
the Purchasers, c/o Credit Suisse First Boston Corporation, Eleven Madison
Avenue, New York, N.Y. 10010-3629, Attention: Investment Banking Department -
Transactions Advisory Group, or, if sent to the Company or the Subsidiary
Guarantors, will be mailed, delivered or telegraphed and confirmed to it at
Westport Resources Corporation, 410 Seventeenth Street, Suite 2300, Denver,
Colorado, 80202-4436 Attention Donald D. Wolf; provided, however, that any
notice to a Purchaser pursuant to Section 7 will be mailed, delivered or
telegraphed and confirmed to such Purchaser.
11. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the
controlling persons referred to in Section 7, and no other person will have any
right or obligation hereunder, except that holders of Offered Securities shall
be entitled to enforce the agreements for their benefit contained in the second
and third sentences of Section 5(b) hereof against the Company as if such
holders were parties hereto.
12. Representation of Purchasers. You will act for the several
Purchasers in connection with this purchase, and any action under this Agreement
taken by you will be binding upon all the Purchasers.
13. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
14. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAWS.
Each of the Company and the Subsidiary Guarantors hereby submits to the
non-exclusive jurisdiction of the Federal and state courts in the Borough of
Manhattan in The City of New York in any suit or proceeding arising out of or
relating to this Agreement or the transactions contemplated hereby.
22
If the foregoing is in accordance with the Purchasers' understanding of
our agreement, kindly sign and return to us one of the counterparts hereof,
whereupon it will become a binding agreement among the Company, the Subsidiary
Guarantors and the several Purchasers in accordance with its terms.
Very truly yours,
WESTPORT RESOURCES CORPORATION
By: /s/ LON MCCAIN
-----------------------------------------
Name: Lon McCain
Title: Vice President, Treasurer and Chief
Financial Officer
SUBSIDIARY GUARANTORS:
WESTPORT OIL AND GAS COMPANY, L.P.
by WHG, INC.,
its general partner,
a Delaware corporation
By: /s/ LON MCCAIN
-----------------------------------------
Name: Lon McCain
Title: Vice President, Treasurer and Chief
Financial Officer
WHG, INC.
By: /s/ LON MCCAIN
-----------------------------------------
Name: Lon McCain
Title: Vice President, Treasurer and Chief
Financial Officer
WHL, INC.
By: /s/ LON MCCAIN
-----------------------------------------
Name: Lon McCain
Title: Vice President, Treasurer and Chief
Financial Officer
WESTPORT FINANCE CO.
By: /s/ LON MCCAIN
-----------------------------------------
Name: Lon McCain
Title: Treasurer
23
WESTPORT ARGENTINA LLC
by WESTPORT OIL AND GAS COMPANY, L.P.,
its member,
a Delaware limited partnership
by WHG, INC.,
its general partner,
a Delaware corporation
By: /s/ LON MCCAIN
-----------------------------------------
Name: Lon McCain
Title: Vice President, Treasurer and Chief
Financial Officer
WESTPORT CANADA LLC
by WESTPORT OIL AND GAS COMPANY, L.P.,
its member,
a Delaware limited partnership
by WHG, INC.,
its general partner,
a Delaware corporation
By: /s/ LON MCCAIN
-----------------------------------------
Name: Lon McCain
Title: Vice President, Treasurer and Chief
Financial Officer
WESTPORT OVERRIDING ROYALTY LLC
by WESTPORT OIL AND GAS COMPANY, L.P.,
its manager,
a Delaware limited partnership
by WHG, INC.,
its general partner,
a Delaware corporation
By: /s/ LON MCCAIN
-----------------------------------------
Name: Lon McCain
Title: Vice President, Treasurer and Chief
Financial Officer
24
JERRY CHAMBERS EXPLORATION COMPANY
by WESTPORT OIL AND GAS COMPANY, L.P.,
its general partner,
a Delaware limited partnership
by WHG, INC.,
its general partner,
a Delaware corporation
By: /s/ LON MCCAIN
-----------------------------------------
Name: Lon McCain
Title: Vice President, Treasurer and Chief
Financial Officer
HORSE CREEK TRADING & COMPRESSION LLC
by WESTPORT OIL AND GAS COMPANY, L.P.,
its member,
a Delaware limited partnership
by WHG, INC.,
its general partner,
a Delaware corporation
By: /s/ LON MCCAIN
-----------------------------------------
Name: Lon McCain
Title: Vice President, Treasurer and Chief
Financial Officer
WESTPORT FIELD SERVICES, LLC
by WESTPORT RESOURCES CORPORATION,
its manager,
a Delaware corporation
By: /s/ LON MCCAIN
-----------------------------------------
Name: Lon McCain
Title: Vice President, Treasurer and Chief
Financial Officer
25
The foregoing Purchase Agreement
is hereby confirmed and accepted
as of the date first above written.
CREDIT SUISSE FIRST BOSTON CORPORATION
J.P. MORGAN SECURITIES INC.
LEHMAN BROTHERS INC.,
Acting on behalf of themselves
and as the Representatives of
the several Purchasers
By CREDIT SUISSE FIRST BOSTON CORPORATION
By /s/ TIMOTHY PERRY
---------------------------------------------
Name: Timothy Perry
Title: Director
By J.P. MORGAN SECURITIES INC.
By /s/ LAWRENCE LANDRY
---------------------------------------------
Name: Lawrence Landry
Title: Managing Director
By LEHMAN BROTHERS INC.
By: /s/ MICHAEL KONIGSBERG
--------------------------------------------
Name: Michael Konigsberg
Title: Director
26
SCHEDULE A
<Table>
<Caption>
PRINCIPAL AMOUNT OF
MANAGER OFFERED SECURITIES
------- -------------------
Credit Suisse First Boston Corporation ..... $ 88,500,000
J.P. Morgan Securities Inc. ................ 88,500,000
Lehman Brothers Inc. ....................... 88,500,000
Wachovia Securities, Inc. .................. 30,000,000
Fleet Securities, Inc. ..................... 4,500,000
--------------
Total ........... $ 300,000,000
==============
</Table>
27
SCHEDULE B
Liens Affecting the Capital Stock of
Subsidiaries of the Company
1. Liens on the capital stock of subsidiaries owned directly or indirectly by
the Company and pledged pursuant to a pledge agreement in connection with the
Revolving Credit Facility and Replacement Credit Facility (as defined in the
Offering Circular).
2. Liens for taxes, assessments, fees and other governmental charges and claims
that are not yet due or which are being contested in good faith in appropriate
proceedings.
28
SCHEDULE C
List of Jurisdictions in Which the Company
or any subsidiary is Qualified
to do Business as a Foreign Corporation
1. THE COMPANY.
<Table>
<Caption>
STATE OF
COMPANY DOMESTICATION FOREIGN QUALIFICATION
WESTPORT RESOURCES CORPORATION Nevada Texas, Louisiana, Colorado
</Table>
2. THE SUBSIDIARIES.
<Table>
<Caption>
STATE OF
COMPANY DOMESTICATION FOREIGN QUALIFICATIONS OWNERSHIP
WESTPORT OIL AND GAS COMPANY, L.P.* Delaware Arkansas, Colorado, WHG, Inc. 99% GP
Kansas, Louisiana, WHL, Inc. 1%
Michigan, Montana,
Nebraska, New Mexico,
North Dakota,
Oklahoma, South
Dakota, Texas, Utah,
Wyoming
WESTPORT ARGENTINA LLC* Colorado -- Westport Oil and Gas Company, L.P., 100%
WESTPORT CANADA LLC* Delaware -- Westport Oil and Gas Company, L.P., 100%
WESTPORT OVERRIDING ROYALTY LLC* Colorado -- Westport Oil and Gas Company, L.P., 100%
WESTPORT FINANCE CO. Wyoming -- Westport Resources Corporation, 100%
JERRY CHAMBERS EXPLORATION COMPANY* Colorado -- Westport Oil and Gas Company, L.P., 99%
GP
Westport Canada LLC 1% GP
BELCO (CAYMAN ISLANDS) CORP. Cayman Islands -- Westport Resources Corporation, 100%
HORSE CREEK TRADING & COMPRESSION LLC* Colorado North Dakota Westport Oil and Gas Company, L.P., 100%
WESTPORT FIELD SERVICES, LLC* Delaware Utah Westport Resources Corporation, 100%
WHG, INC.* Delaware Colorado, North Westport Resources Corporation, 100%
Dakota, Texas, South
Dakota
WHL, INC.* Delaware Colorado Westport Resources Corporation, 100%
</Table>
- ----------
* Subsidiary Guarantor
29