PURCHASE AND SALE AGREEMENT
THIS AGREEMENT, made and entered into this 28th day of June, 2002 by
and between AMERICAN RESOURCES OFFSHORE, INC., whose address is 801 Travis
Street, Suite 2100, Houston, TX 77002 ("Seller"), and NEWFIELD EXPLORATION
COMPANY ("Buyer"), whose address is 363 N. Sam Houston Parkway East, Suite 2020,
Houston, Texas, 77060.
ARTICLE 1
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PURCHASE AND SALE
1.01 Purchase and Sale. Subject to the terms of this Agreement, Seller
agrees to sell the hereinafter described Interests to Buyer and Buyer agrees to
purchase the Interests from Seller.
1.02 Interests. The following items comprise the Interests:
(a) the interest in the oil and gas leases and lands described
in Exhibit A hereof and in the wells located in and on such oil and gas
leases including, without limitation, operating rights and record
title, working, leasehold, mineral, royalty, overriding royalty, net
revenue, net profits or reversionary interests and any other interests
of a similar nature expressed, as a percentage, on Exhibit A
("Leases");
(b) all of Seller's right, title and interest in all wells,
equipment, fixtures, platforms, personal property and improvements
(including, without limitation, materials, plants, pipelines, gathering
and processing systems and salt water disposal systems) which are
located on, appurtenant to or used in connection with the Leases now,
as of the Effective Time or as of the Closing Date ("Equipment");
(c) all of Seller's right, title and interests in all
contracts, escrowed funds for the abandonment of Interests, agreements,
instruments, payout balances, commitments, licenses, permits,
easements, rights-of-way and other rights of Seller relating to the
items described in this Section 1.02, together with all of Seller's
rights, claims and causes of action under such items arising after the
Effective Time ("Contracts");
(d) all of Seller's right, title and interest in oil, gas,
condensate, related hydrocarbons and other minerals produced from the
Leases after the Effective Time ("Substances");
(e) all accounts including Seller's share of any gas
imbalance, makeup obligations, abandonment escrow account, instruments,
general intangibles, liens and security interests arising from the sale
or other disposition of the items described in this Section 1.02 on or
after the Effective Time ("Accounts").
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(f) all of Seller's information relating to the Interests,
reservoir, land, operation and production files and other data
including geological, engineering and proprietary geophysical data
(both "2-D" and "3-D"), maps, logs, core analysis, formation tests,
production records and legal, title, accounting and contract files.
("Technical Files")
1.03 Effective Time. The purchase and sale of the Interests shall be
effective for all purposes on July 1, 2002, at 7:00 a.m., Central Standard Time
("Effective Time").
ARTICLE 2
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PURCHASE PRICE
2.01 Purchase Price. The purchase price for the Interests is U.S. TWO
MILLION, THREE HUNDRED THOUSAND DOLLARS ($2,300,000.00) (the "Purchase Price").
2.02 Deposit. Intentionally omitted.
2.03 Adjustments to Purchase Price. The Purchase Price shall be
adjusted as provided in this Section 2.03 and the resulting amount shall be
referred to as the "Adjusted Purchase Price". Not less than five (5) days prior
to the Closing Date, Seller shall deliver to Buyer a Preliminary Closing
Statement, substantially in the form attached hereto as Schedule 2.03, setting
forth adjustments to the Purchase Price using the best information then
available and prepared in accordance with customary accounting principles used
in the oil and gas industry.
(a) The Purchase Price shall be increased by the following:
(1) an amount equal to the quantity of merchantable
oil produced from the Leases and in storage at the Effective
Time, and not sold or disposed of prior to Closing, multiplied
by the market price for such oil at the Effective Time, net of
all taxes and gravity adjustments and transportation expenses
necessary to market such production.
(2) the amount of the operating and capital
expenditures together with any lease operating expenses
charged under applicable operating agreements and general and
administrative costs charged as overhead charges under
applicable operating agreements, that are (i) attributable to
the Interests during the period between the Effective Time and
Closing, (ii) incurred and paid by Seller, including without
limitation capital expenditures approved in accordance with
Section 4.01 or otherwise made in compliance with this
Agreement.
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(3) taxes paid by Seller for assessments based on
ownership of the Interests after the Effective Time, the
production of hydrocarbons therefrom, or the receipt of
proceeds attributable thereto (excluding income taxes) after
the Effective Time.
(4) an amount equal to all prepaid expenses
attributable to the Interests paid by Seller and attributable
to the period from and after the Effective Time, including
without limitation prepaid insurance and prepaid ad valorem,
property, production and other taxes accruing to the benefit
of Buyer subsequent to the Effective Time.
(b) The Purchase Price shall be decreased by the following:
(1) the Deposit;
(2) the amount of net proceeds or other value
received by Seller for the sale or disposition of Substances,
as defined herein, including net proceeds from the sale of
liquids and other constituents removed in gas plants or other
processing facilities for production occurring after the
Effective Time;
(3) the amount of proceeds or other value received by
Seller for the sale or disposition after the Effective Time of
any portion of the Interests;
(4) an amount equal to the value of all uncured Title
Defects as determined under Section 5.08; and
(5) the amount of all unpaid taxes and assessments
based on the ownership of property, the production of
hydrocarbons or the receipt of proceeds, excluding income
taxes, accruing to the Interests prior to the Effective Time
and for the payment of which Buyer assumes liability
subsequent to Closing. If possible, this adjustment shall be
computed using the tax rate and values for the tax period in
question. If this is not possible, the adjustment shall be
based on the taxes assessed for the immediately preceding tax
period. If taxes assessed for the preceding tax period are
determined to be more or less than the actual taxes, the
difference shall be a Post-Closing Adjustment or Subsequent
Adjustment under Sections 9.01 and 9.02.
2.04 Payment of Adjusted Purchase Price. At Closing, Buyer shall pay
Seller an amount equal to the Adjusted Purchase Price in immediately available
funds.
2.05 Allocation of Purchase Price/Tangibles-Intangibles. The Purchase
Price shall be allocated among tangibles and intangibles comprising the
Interests as follows: Ninety (90%) of the Purchase Price shall be attributed to
the Leases and associated Contracts and Ten Percent (10%) of the Purchase Price
shall be attributed to Equipment and other personal property. Buyer and Seller
agree to be bound by the allocation of the Purchase Price among tangibles and
intangibles set forth herein for all purposes; to consistently report such
allocations for all federal, state and local income tax purposes; and to timely
file all reports required by the Internal Revenue Code of 1986, as amended,
concerning the Purchase Price allocation.
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ARTICLE 3
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REPRESENTATIONS AND DISCLAIMERS
3.01 Seller's Representations. Seller represents to Buyer that:
(a) Seller is a corporation organized, existing and in good
standing under the laws of the State of Delaware and is qualified to do
business in, and is in good standing under the laws of the States of
Louisiana and Texas. Seller is qualified under applicable law and
regulation to own the Interests. With respect to all persons claiming
by through or under Seller but not otherwise, Seller has, and will
convey to Buyer, Defensible Title (as defined in Section 5.06 below) to
the Interests. Seller warrants and agrees to defend title to the
Interests against the lawful claims of all persons claiming by, through
or under Seller, but not otherwise.
(b) Seller has the authority to carry on its business as
presently conducted, to enter into this Agreement and to perform its
obligations under this Agreement.
(c) The execution and delivery of this Agreement have been
authorized by all necessary action, corporate and otherwise, on the
part of Seller. Execution and delivery of this Agreement does not, and
the consummation of the transactions contemplated by this Agreement
will not, violate or be in conflict with any agreement, instrument,
judgment, order, decree, law or regulation by which Seller is bound.
(d) Subject to laws and equitable principles affecting the
rights of creditors, this Agreement is a binding obligation of Seller
enforceable according to its terms.
(e) Except as set forth on Schedule 3.01(e), no suit, claim,
demand or investigation, of which Seller has received notice, is
pending or, to the best of Seller's knowledge, threatened that might
result in impairment or loss or diminution of Seller's title to the
Interests or otherwise adversely affect the Interests in any material
respect. There are no bankruptcy or reorganization proceedings pending
or threatened against Seller. As used in this Section 3.01, the
expression "best of Seller's knowledge" means actual knowledge acquired
by the management of Seller in the ordinary course and operation of
Seller's business without special or particular investigation or review
of Seller's business affairs in connection with the transaction
contemplated herein or otherwise.
(f) Contracts which burden or will burden or encumber or are
otherwise material to the ownership, use or operation of the Interests
are described on Exhibit A hereof, were entered into in the ordinary
course of business and, if executed by Seller, were duly executed and
delivered by Seller and are in force according to their terms. Neither
Seller, nor any other party to Seller's knowledge, is in breach of any
obligation which might adversely affect the Interests in any material
respect.
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(g) This section is intentionally omitted.
(h) This section is intentionally omitted.
(i) This section is intentionally omitted.
(j) To the best of Seller's knowledge taxes based on or
measured by the ownership of property, the production or removal of
hydrocarbons and the receipt of proceeds which are due and relating to
the Interests have been properly paid, subject to possible adjustment
for volume or price corrections.
(k) Seller is timely receiving its share of proceeds from the
sale of hydrocarbons produced from the Leases without suspense,
counterclaim or set-off. To the best of Seller's knowledge, there has
been no production of hydrocarbons from the Leases in excess of the
allowable production established pursuant to applicable state or
federal law or regulation that would result in a restriction on
production from the Leases subsequent to the Effective Time.
(l) This section is intentionally omitted.
(m) Seller has incurred no liability for brokers' or finders'
fees related to the transactions contemplated by this Agreement for
which Buyer shall be liable.
(n) To the best of Seller's knowledge, there are no
outstanding authorities for expenditures or any oral or written
commitments or proposals to conduct operations on the Leases which are
required to be approved by non-operators under the terms of the
applicable joint operating agreement.
(o) Except as set forth on Schedule 3.01(o), as of the
Effective Time, no portion of the Interests is over produced, under
produced or otherwise subject to an imbalance in respect of substances
produced from the Leases.
3.02 Buyer's Representations. Buyer represents to Seller as follows:
(a) Buyer is a corporation organized, existing and in good
standing under the laws of the State of Delaware and is qualified to do
business and is in good standing under the laws of the States of Texas
and Louisiana. Buyer is qualified under applicable law and regulation
to own the Interests and, in particular, Buyer is qualified to do
business in each of the States and on the Continental Shelf, Gulf of
Mexico, in which the Interests are located to the extent the laws of
such place require Buyer to so qualify.
(b) Buyer has the authority to carry on its business as
presently conducted, to enter into this Agreement and to perform its
obligations under this Agreement.
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(c) The execution and delivery of this Agreement has been
authorized by all necessary action, corporate and otherwise, on the
part of Buyer. Execution and delivery of this Agreement does not, and
the consummation of the transactions contemplated by this Agreement
will not, violate or be in conflict with any agreement, instrument,
judgment, order, decree, law or regulation by which Buyer is bound.
(d) Subject to laws and equitable principles affecting the
rights of creditors, this Agreement is a binding obligation of Buyer
enforceable according to its terms. There are no bankruptcy nor
reorganization proceedings pending or, to Buyer's knowledge, threatened
against Buyer.
(e) Buyer has incurred no liability for brokers' or finders'
fees related to the transactions contemplated by this Agreement for
which Seller shall be liable.
(f) There are no pending suits, actions or other proceedings
in which Buyer is a party (or, to Buyer's knowledge, which have been
threatened to be instituted against Buyer) which affect the execution
and delivery of this Agreement or the consummation of the transactions
contemplated hereby.
(g) Buyer is a knowledgeable purchaser, owner and operator of
oil and gas properties, has the ability to evaluate the Interests for
purchase, and is acquiring the Interests for its own account and not
with the intent to make a distribution in violation of the Securities
Act of 1933 as amended.
ARTICLE 4
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COVENANTS
4.01 Seller's Covenants. Seller covenants and agrees with Buyer as
follows:
(a) Following execution of this Agreement and until Closing,
Seller shall (i) continue to operate the Interests or cause the
Interests to be operated, in a good and workmanlike manner; (ii)
maintain insurance now in force with respect to the Interests; (iii)
notify Buyer of any suit, claim or demand within Seller's knowledge
which might adversely affect the Interests; (iv) pay or cause to be
paid all costs, taxes and expenses which Seller is obligated to pay in
connection with the Interests as they become due; (v) pay or cause to
be paid all rentals and other payments necessary to maintain the Leases
in force according to their terms and comply with all express and
implied covenants contained in the Leases or Contracts; (vi) exercise
due diligence in safeguarding the Interests and maintaining the
confidentiality of all data and other confidential or proprietary
materials relating to the Interests; (vii) promptly notify Buyer of all
significant operations which are proposed with respect to the
Interests; and (viii) use efforts, consistent with the standards
expected of a reasonably prudent operator but without any obligation to
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pay money to obtain any consents, waivers (including waiver of
preferential purchase rights) and approvals required of third parties
or governmental authorities in connection with consummation of the
transactions contemplated by this Agreement. Buyer acknowledges that
Seller owns undivided interests in the Leases and that acts or
omissions of other owners of undivided interests in the Leases shall
not be a breach of any covenant in this Agreement. Seller shall not be
obligated to perform any act which would be in breach of a provision
in, or its duties under, a Lease, Contract or applicable law, rule or
regulation.
(b) Following execution of this Agreement, Seller shall not,
without Buyer's consent; (i) abandon any well capable of commercial
production; (ii) release all or a portion of a Lease; (iii) commence or
consent to an operation estimated to cost an amount in excess of the
amount an operator is entitled to expend without non-operator approval
under the applicable operating agreement(s) (excluding emergency
operations and operations undertaken to avoid a penalty or forfeiture
provision of any applicable agreement or order); (iv) create a lien,
security Interest or other encumbrance on the Interests; (v) sell or
dispose of the Interests (except in connection with preferential rights
to purchase) other than Interests sold, consumed or produced in the
ordinary course of business; (vi) amend a Lease or amend a Contract or
Account or enter into new contracts affecting the Interests other than
in the ordinary course of business; (vii) waive, compromise or settle
any claim that diminishes or adversely burdens an Interests.
(c) Following the execution of this Agreement and until
Closing, Seller will provide Buyer and its attorneys, employees,
accountants, engineers, consultants and agents (collectively
"representatives"), at Buyer's sole expense, risk and cost, reasonable
access, during business hours, to the Contracts and other records of
Seller pertaining to the ownership and/or operation of the Interest
(including, without limitation, title files, division order files, and
production, severance and ad valorem tax records) for the purpose of
Buyer's conducting a due diligence review of the Interests insofar as
the same are in Seller's possession or control, or insofar as Seller
has access to the same, and to the extent, in each case, that Seller
may do so without violating legal constraints or any legal obligation.
Seller shall not be obligated to furnish any updated abstracts, title
opinions or additional title information which are not in Seller's or
its attorney's possession, but shall cooperate with Buyer in Buyer's
efforts to obtain (at Buyer's expense) such additional title
information as Buyer may reasonably require.
BUYER RECOGNIZES AND AGREES THAT ALL MATERIALS MADE AVAILABLE TO BUYER
AND ITS REPRESENTATIVES IN CONNECTION WITH THE TRANSACTION CONTEMPLATED
HEREBY, WHETHER MADE AVAILABLE PURSUANT TO THIS SECTION OR OTHERWISE,
ARE MADE AVAILABLE TO BUYER AS AN ACCOMMODATION, AND WITHOUT
REPRESENTATION OR WARRANTY OF ANY KIND AS TO THE ACCURACY AND
COMPLETENESS OF SUCH MATERIALS. NO WARRANTY OF ANY KIND IS MADE BY
SELLER AS TO THE INFORMATION SUPPLIED TO BUYER OR WITH RESPECT TO THE
INTERESTS TO WHICH THE INFORMATION RELATES, AND BUYER EXPRESSLY AGREES
THAT ANY CONCLUSIONS DRAWN THEREFROM SHALL BE THE RESULT OF ITS OWN
INDEPENDENT REVIEW AND JUDGMENT.
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(d) Seller will identify, with respect to all Interests, (A)
all preferential rights to purchase ("Preferential Rights") which would
be applicable to the transaction contemplated hereby and (B) the names
and addresses of parties holding such rights (it being agreed that, in
attempting to identify such Preferential Rights, and the names and
addresses of such parties holding the same, Seller shall not be
obligated to go beyond its own records), and (ii) request, from the
parties so identified (and in accordance with the documents creating
such rights), execution of waivers of Preferential Rights so
identified. Seller shall have no obligation other than to attempt to
identify such Preferential Rights and to so request such waivers of
Preferential Rights (including, without limitation, Seller shall have
no obligation to assure that such waivers of Preferential Rights are
obtained). Except to the extent that Buyer can establish that Seller
failed to fulfill the obligations set forth above in this Section,
Buyer shall indemnify and hold Seller (and its officers, directors,
employees, attorneys, contractors and agents) harmless from and against
all claims, actions, causes of action, liabilities, damages, losses,
costs or expenses (including, without limitation, court costs and
attorney's fees) whatsoever that arise out of the failure to obtain
consent or waivers of Preferential Rights with respect to any of the
Interests. If a party from whom a waiver of a Preferential Right is
requested refuses to give such waiver, Seller will tender to such party
the required Interest (at a price equal to the amount specified in
Exhibit A hereto for such Interest, reduced appropriately, as
determined by mutual agreement of Buyer and the Seller, if less than
the entire Interest must be tendered), and to the extent that such
Preferential Right is exercised by such party, and such Interest is
actually sold to such party so exercising such right, such Interest
will be excluded from the transaction contemplated hereby and the
Purchase Price will be adjusted downward by the amount actually paid to
Seller by the party exercising such right.
If the holder of Preferential Rights fails to fully exercise such
rights and purchase the Interests, or part thereof, pursuant to the
terms of this Agreement within 30 days of the Closing Date provided for
herein then Buyer will purchase such Interests as originally
contemplated herein before the holder of such Preferential Rights
failed to consummate the purchase transaction.
4.02 Buyer's Covenants. Buyer covenants and agrees with Seller as
follows:
(a) Buyer and Seller, and their respective representatives
shall keep confidential all terms and provisions of this Agreement, the
transaction contemplated by this Agreement, and all information and
data concerning the Interests, Seller's and Buyer's business, financial
condition, operations, strategies and prospects.
(b) Buyer shall take or cause to be taken all such actions as
may be necessary or advisable to consummate and make effective the
purchase of the Interests and the transactions contemplated by this
Agreement and to assure that as of the Closing Date it will not be
under any material corporate, legal or contractual restriction that
would prohibit or delay the timely consummation of such transactions.
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(c) Buyer shall cause all the representations and warranties
of Buyer contained in this Agreement to be true and correct on and as
of the Closing Date. To the extent the conditions precedent to the
obligations of Seller are within the control of Buyer, Buyer shall
cause such conditions to be satisfied on or prior to the Closing Date
and, to the extent the conditions precedent to the obligations of
Seller are not within the control of Buyer, Buyer shall take or cause
to be taken all such commercially reasonable actions as may be
necessary to cause such conditions to be satisfied on or prior to the
Closing Date.
(d) Buyer shall promptly notify Seller (i) if any
representation or warranty of Buyer contained in this Agreement is
discovered to be or becomes untrue, or (ii) if Buyer fails to perform
or comply with any covenant or agreement contained in this Agreement or
it is reasonably anticipated that Buyer will be unable to perform or
comply with any covenant or agreement contained in this Agreement.
ARTICLE 5
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Buyer's REVIEW AND TITLE
5.01 Due Diligence. Buyer may, prior to Closing and at its cost, review
data and information, title examination and other examinations and
investigations in respect of the Interests. Should, as a result of examinations
and investigations, or otherwise, one or more matters come to Buyer's attention
which would constitute a Title Defect, as described below, and should there be
one or more of such Title Defects which Buyer is unwilling to waive and close
the transaction contemplated herein notwithstanding the fact that such Title
Defects exist, Buyer shall notify Seller in writing of such Title Defects as
soon as the same are identified by Buyer, but in no event later than 10 days
prior to the Closing Date. Such notification shall include for each asserted
Title Defect (i) a description of the Title Defect and the Interest to which it
applies; (ii) an explanation of the basis for the claim of a Title Defect and
(iii) the amount by which Buyer would propose to adjust the Purchase Price in
view of such Title Defect. Buyer's failure to give notice of a Title Defect
within the time and in the manner required by this Section 5.01 shall constitute
a waiver by Buyer of the Title Defect and the Title Defect will be treated as a
Permitted Encumbrance as set forth below.
5.02 Access to Interests. Following the execution of this Agreement and
until Closing, subject to the consent and cooperation of operators and other
third parties, Seller shall provide Buyer and its representatives access to the
Interests and the right to observe operations and inspect any and all of the
Interests, Equipment, improvements and fixtures included in the Interests, to
the extent that Seller has the legal right to grant such access and right. All
visits to Seller's facilities by Buyer, and on Buyer's behalf, will be scheduled
by mutual consent of the Parties, subject to Buyer's providing Seller at least
five days written notice of the locations that Buyer wishes to visit and the
proposed times. Seller may accompany Buyer and its representatives during their
site visits. Entry onto the Interests will (i) subject Buyer to third party
restrictions, if any, and to Seller's industrial safety, hygiene, and drug and
alcohol requirements and (ii) be at Buyer's sole risk and expense.
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5.03 Environmental Assessment. Buyer may conduct an environmental
assessment of the Interests, including investigations to identify wetlands and
sensitive and protected habitats. If Buyer undertakes an environmental
assessment, both the consultant (if consultants are employed) and the scope of
the proposed assessment, including testing protocols, must be acceptable to
Seller before the work may begin. If Buyer and Seller cannot agree on Buyer's
proposed environmental assessment plan, then Seller may at its sole option,
withdraw from this Agreement any of the Interests that Buyer proposes to assess,
or all of the Interests, and the Purchase Price will be adjusted for each
withdrawn Interest. If Seller withdraws all the Interests pursuant to this
Section, this Agreement will terminate, and Seller will refund the Deposit to
Buyer.
If Buyer takes samples from the Interests, Seller may require splitting of each
sample. Buyer will deliver copies of all draft and final reports, results, data,
and analyses of site visits, inspections, and assessments to Seller within five
days of Buyer's receipt of them, at Buyer's cost. Seller will have no
confidentiality obligation with regard to this information and may disclose it
to third parties or use it for any purpose.
Notwithstanding anything in the foregoing that may appear to the contrary, the
presence of naturally occurring radioactive materials ("NORM") will not
constitute a Title Defect (hereinafter defined). IT IS EXPRESSLY RECOGNIZED THAT
THE LANDS AND/OR WATER BOTTOMS ALONG WITH SURFACE FACILITIES AND PRODUCTION
EQUIPMENT LOCATED THEREON, HAVING BEEN USED IN CONNECTION WITH OIL AND GAS
PRODUCTION ACTIVITIES, MAY CONTAIN NORM AS A RESULT OF THESE OPERATIONS.
ACCORDINGLY, LANDS AND/OR WATER BOTTOMS, THE WELLS, AND THE EQUIPMENT
TRANSFERRED HEREIN ARE TRANSFERRED WITH THE RESTRICTION THAT THEY WILL BE USED
ONLY IN CONNECTION WITH OIL AND GAS PRODUCING ACTIVITIES ASSOCIATED WITH THE
LEASES, AND WILL NOT BE SUBSEQUENTLY TRANSFERRED FOR UNRESTRICTED USE UNLESS THE
CONCENTRATIONS OF NORM ASSOCIATED THEREWITH ARE BELOW THE LEVELS SPECIFIED AS
ALLOWABLE FOR UNRESTRICTED TRANSFER AS SET FORTH IN ANY AND ALL APPLICABLE LAWS,
ORDERS, RULES OR REGULATIONS OF ANY GOVERNMENTAL AGENCY OR COURT HAVING
JURISDICTION. ADDITIONALLY, BUYER AGREES TO COMPLY WITH ALL PROVISIONS OF SUCH
LAWS, ORDERS RULES OR REGULATIONS APPLICABLE TO SAID LANDS AND/OR WATER BOTTOMS,
THE WELLS, AND THE PERSONAL PROPERTY. BUYER FURTHER AGREES TO INCLUDE THE
PROVISIONS OF THIS CLAUSE IN ANY SUBSEQUENT SALE OR ASSIGNMENT OF ANY INTEREST
THEREIN TRANSFERRED.
5.04 Gas Imbalance. Upon the occurrence of Closing, but effective as of
the Effective Time, Buyer shall succeed to and assume the position of Seller
with respect to all gas imbalances and make-up obligations related to the
Interests (regardless of whether such imbalances or make-up obligations arise at
the wellhead, pipeline, gathering system or other level, and regardless of
whether the same arise under contract or otherwise). As a result of such
succession, Buyer shall (i) be entitled to receive any and all benefits which
Seller would have been entitled to receive by virtue of such position
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(including, without limitation, rights to produce and receive volumes of
production in excess of volumes which it would otherwise be entitled to produce
and receive by virtue of ownership of the Interest rights to receive cash
balancing payments), and (ii) be obligated to suffer any detriments which Seller
would have been obligated to suffer by virtue of such position (including,
without limitation, the obligation to deliver to others production volumes which
would have otherwise been attributable to its ownership of the Interests, to
deliver production to purchasers hereof without receiving full payment therefor,
or to make cash balancing payments or to repay take or pay payments) and (iii)
shall be responsible for any and all royalty obligations with respect to such
imbalances (including, without limitation, any of the same arising out of
royalties having been paid on an "entitlements" basis rather than a "receipts"
basis).
5.05 Title Defects. "Title Defect" means any encumbrance, irregularity
or defect in Seller's title to an Interest which , alone or in combination with
other defects, causes Seller's title to be less than Defensible Title. Title
Defects shall include a Casualty Loss treated as a Title Defect under Section
5.07.
5.06 Defensible Title.
(a) "Defensible Title" means such right, title or interest
held by Seller that (i) will entitle Buyer, as Seller's successor, to
receive not less than the Net Revenue Interests described in Exhibit A
of all oil, gas, condensate, related hydrocarbons and other minerals
produced under the terms of the Leases (or other property denominated
in Exhibit A); (ii) will obligate Buyer, as Seller's successor to bear
a percentage of costs and expenses related to the maintenance,
operation and development of the Leases (or other property denominated
in Exhibit A) not greater than the Working Interest (or Operating
Rights interest, as the case may be) shown in Exhibit A, unless the
circumstances causing the Working Interest to be greater will cause the
corresponding Net Revenue interest to increase in the same proportion;
and (iii) is free of all liens, security interests, encumbrances and
defects, except for Permitted Encumbrances.
(b) "Permitted Encumbrances" are:
(1) lessor's royalties, overriding royalties,
production payments, net profits, interests, reversionary
interests and similar burdens on production that do not, and
will not, reduce the Interests more particularly described in
the Assignments of Record Title, Assignments of Operating
Rights and Assignments of Overriding Royalty Interests
attached hereto as Exhibits B-1 through B-12;
(2) preferential rights to purchase and third party
consents with respect to which, prior to Closing, (i) waivers
or consents are obtained from the appropriate parties or (ii)
the time for asserting such rights has expired without
exercise;
(3) mechanics', materialmen's, operators', tax and
similar liens or charges arising in the ordinary course of
business related to an Interest, if such liens secure payments
not yet due;
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(4) all consents from, notices to, approvals by or
other actions by governmental authority in connection with
sale or transfer of properties such as the Interests if such
matters are customarily and appropriately obtained after the
sale or transfer;
(5) liens, security interests or other encumbrances
to be released at or prior to Closing;
(6) rights of a governmental entity to control or
regulate the Interests, together with all applicable laws,
rules and regulations;
(7) easements, rights-of-way, surface leases and
other surface use restrictions if such restrictions will not
materially adversely affect the use, value or operation of the
Interests;
(8) title matters waived or deemed to be waived by
Buyer and described on Schedule 5.06(b)(8);
(9) the presence of NORM; and
(10) the Contracts
5.07 Casualty Loss. If, prior to Closing, all or any portion of an
Interest is destroyed or taken under the right of eminent domain ("Casualty
Loss"), Buyer may elect (i) to treat the Casualty Loss as a Title Defect or (ii)
purchase the affected Interest notwithstanding the Casualty Loss. If Buyer so
purchases the affected Interest, there shall be no reduction of the Purchase
Price and Seller shall, at Closing, pay to Buyer all sums paid to Seller which
are associated with the Casualty Loss and shall assign to Buyer all of Seller's
interest in any unpaid payments or causes of action associated with the Casualty
Loss. Prior to Closing, Seller shall not compromise or settle a Casualty Loss
without Buyer's consent.
5.08 Disposition of Title Defects. In the event that Buyer gives Seller
notice of Title Defects:
(a) Seller may (but shall have no obligation to) attempt to
cure, prior to Closing, Title Defects.
(b) Whether or not Seller has then begun to, or ever begins
to, cure asserted Title Defects, Seller may postpone the Closing by
designating a new Closing Date to be a date not later than 30 days
after Seller's receipt of a Defect notice. Notwithstanding any such
election to postpone Closing, there shall still be no obligation to
cure Title Defects.
12
(c) Notwithstanding any other election made under this Section
(without limitation, it being expressly recognized that attempts to
cure asserted Title Defects may continue while the parties are acting
under this election), Seller may elect to have one or more asserted
Title Defects handled under the following Section.
5.09 Purchase Price Adjustments.
(a) Except as provided in Section 5.09(b) below, in the event
that, as a part of Buyer's due diligence review, Title Defects are
presented to Seller and Seller is unable (or unwilling) to cure such
Title Defects prior to Closing, then:
(i) Buyer and Seller shall, with respect to each
Interests affected by such matters, attempt to agree upon an
appropriate adjustment of the Purchase Price to account for
such matters; and
(ii) with respect to Interests as to which Buyer and
Seller are unable to agree upon an adjustment for an asserted
Title Defect, such Interests will be excluded from the
transaction contemplated hereby and the Purchase Price will be
reduced by the amount attributed to such Interest on Exhibit
A; provided, however, in the event an adjustment is required,
pursuant to this paragraph, but such Interest is to be
excluded as provided herein, Seller may, at its sole
discretion, elect to not close and such election shall be
considered as a failure to close that is permitted in Section
6.01 hereof.
(b) If an asserted Title Defect reflects (or Seller otherwise
determines) that Seller's share of Substances produced and saved from
the Leases comprising an Interest is less than, or greater than, the
decimal share set forth as the Net Revenue Interest in Exhibit A or
causes Seller to be obligated to pay a share of costs of operations
greater than the percentage share of Working Interest set forth on
Exhibit A hereof (without at least a proportionate increase in the
corresponding Net Revenue Interest) then the Purchase Price for the
Interest shall be adjusted downward, or upward as the case may be,
proportionately, by multiplying such Purchase Price by a fraction (A)
the numerator of which is the amount of the actual Net Revenue Interest
and (B) the denominator of which is the Net Revenue Interest shown on
Exhibit A.
(c) If the aggregate Purchase Price reduction (or increase)
with respect to a Title Defect, which would result from the above
provided for procedure does not exceed $5,000, no adjustment shall me
made for such Title Defects, and the Interests affected thereby will
not be excluded as a result of the existence of such Title Defect. If
the Purchase Price reduction (or increase) which would result from the
above provided for procedure, as applied to all Title Defects for which
an adjustment is to be made, does not exceed five percent (5%) of the
Purchase Price, then no adjustment of the Purchase Price shall occur,
and none of the Interests which would be otherwise excluded by such
procedure shall be excluded. If the Purchase Price reduction (or
increase) which would result from the above provided for procedure
exceeds five percent (5%) of the Purchase Price, the Purchase Price
shall be adjusted by the amount by which such reduction (or increase)
exceeds five percent (5%).
13
5.10 NO WARRANTY OF MERCHANTABILITY OR FITNESS. EXCEPT AS OTHERWISE
SPECIFICALLY SET FORTH IN THIS AGREEMENT, SELLER MAKES NO WARRANTIES, EXPRESS OR
IMPLIED, INCLUDING THE WARRANTY OF MERCHANTABILITY AND THE IMPLIED WARRANTY OF
FITNESS FOR A PARTICULAR PURPOSE, REGARDING THE EQUIPMENT AND OTHER LIKE
PERSONAL PROPERTY LOCATED ON OR INCLUDED IN THE INTERESTS AND THE SAME ARE TO BE
SOLD ON AN "AS IS, WHERE IS" BASIS AND CONDITION.
5.11 WAIVER OF CONSUMER RIGHTS. BUYER WAIVES ITS RIGHTS UNDER THE TEXAS
DECEPTIVE TRADE PRACTICES-CONSUMER PROTECTION ACT, SECTION 17.41 ET SEQ., TEXAS
BUSINESS & COMMERCE CODE, A LAW THAT GIVES CONSUMERS SPECIAL RIGHTS AND
PROTECTIONS. AFTER CONSULTATION WITH AN ATTORNEY OF BUYER'S OWN SELECTION, BUYER
VOLUNTARILY CONSENTS TO THIS WAIVER. IN ORDER TO EVIDENCE ITS ABILITY TO GRANT
SUCH WAIVER, BUYER HEREBY REPRESENTS AND WARRANTS TO SELLER THAT BUYER (I) IS IN
THE BUSINESS OF SEEKING OR ACQUIRING, BY PURCHASE OR LEASE, GOODS OR SERVICES
FOR COMMERCIAL OR BUSINESS USE, (II) HAS KNOWLEDGE AND EXPERIENCE IN FINANCIAL
AND BUSINESS MATTERS THAT ENABLE IT TO EVALUATE THE MERITS AND RISKS OF THE
TRANSACTION CONTEMPLATED HEREBY AND (III) IS NOT IN SIGNIFICANTLY DISPARATE
BARGAINING POSITION.
5.12 WAIVER OF LOUISIANA RIGHTS IN REDHIBITION. BUYER EXPRESSLY WAIVES
THE WARRANTY OF FITNESS FOR INTENDED PURPOSES OR GUARANTEE AGAINST HIDDEN OR
LATENT REDHIBITORY VICES UNDER LOUISIANA LAW, INCLUDING LOUISIANA CIVIL CODE
ARTICLES 2520 (1870) THROUGH 2548, AND THE WARRANTY IMPOSED BY LOUISIANA CIVIL
CODE ARTICLES 2476; WAIVES ALL RIGHTS IN REDHIBITION PURSUANT TO LOUISIANA CIVIL
CODE ARTICLES 2520, ET SEQ.; OR FOR RESTITUTION OR OTHER DIMINUTION OF THE
PURCHASE PRICE; ACKNOWLEDGES THAT THIS EXPRESS WAIVER SHALL BE CONSIDERED A
MATERIAL AND INTEGRAL PART OF THIS SALE AND THE CONSIDERATION THEREOF; AND
ACKNOWLEDGES THAT THIS WAIVER HAS BEEN BROUGHT TO THE ATTENTION OF BUYER AND
EXPLAINED IN DETAIL AND THAT BUYER HAS VOLUNTARILY AND KNOWINGLY CONSENTED TO
THIS WAIVER OF WARRANTY OF FITNESS AND/OR WARRANTY AGAINST REDHIBITORY VICES AND
DEFECTS FOR THE INTERESTS. SELLER MAKES THIS SALE OF THE INTERESTS TO BUYER
WITHOUT ANY WARRANTY AS TO THE CONDITION OF THE INTERESTS, INCLUDING ABSENCE OF
VICES OR DEFECTS (WHETHER APPARENT OR LATENT, KNOWN OR UNKNOWN, EASILY
DISCOVERABLE OR HIDDEN), FITNESS FOR ANY ORDINARY USE, OR FITNESS FOR ANY
INTENDED USE OR PARTICULAR PURPOSE, EVEN FOR RETURN OR REDUCTION OF THE PURCHASE
PRICE OR OTHERWISE, IT BEING UNDERSTOOD THAT BUYER TAKES THE INTERESTS "AS IS"
AND "WHERE IS"; BUYER HEREBY ACKNOWLEDGING RELIANCE SOLELY ON ITS OWN INSPECTION
14
OF THE INTERESTS, AND NOT ON ANY WARRANTIES OR REPRESENTATIONS FROM SELLER WITH
RESPECT TO THE CONDITION OF THE INTERESTS. IN ADDITION, BUYER ACKNOWLEDGES THAT
SELLER HAS MADE NO REPRESENTATIONS OR WARRANTIES OF ANY KIND OR CHARACTER,
EXPRESS OR IMPLIED, WITH RESPECT TO THE CONDITION OF THE INTERESTS, INCLUDING,
WITHOUT LIMITATION, ANY WARRANTIES OR REPRESENTATIONS AS TO ABSENCE OF VICES OR
DEFECTS (WHETHER APPARENT OR LATENT, KNOWN OR UNKNOWN, EASILY DISCOVERABLE OR
HIDDEN), FITNESS FOR ANY ORDINARY USE, FITNESS FOR ANY INTENDED USE OR
PARTICULAR PURPOSE, TAX CONSEQUENCES, ENVIRONMENTAL CONDITION. ALL WARRANTIES
WITH RESPECT TO THE CONDITION OF THE INTERESTS ARE HEREBY DISCLAIMED BY SELLER
AND EXPRESSLY WAIVED BY BUYER. BUYER HAS NOT RELIED AND WILL NOT RELY ON, AND
SELLER IS NOT LIABLE FOR OR BOUND BY, AN EXPRESS OR IMPLIED WARRANTIES,
GUARANTIES, STATEMENTS, REPRESENTATIONS OR INFORMATION PERTAINING TO THE
CONDITION OF THE INTERESTS OR RELATING THERETO MADE OR FURNISHED BY SELLER, ANY
PARTY ACTING OR PURPORTING TO ACT FOR SELLER, OR ANY BROKER OR AGENT
REPRESENTING OR PURPORTING TO REPRESENT SELLER, TO WHOMEVER MADE OR GIVEN,
DIRECTLY OR INDIRECTLY, ORALLY OR IN WRITING.
ARTICLE 6
---------
CONDITIONS TO CLOSING
6.01 Seller's Conditions. Seller's obligations at Closing are subject
to the satisfaction at or prior to Closing of the following conditions:
(a) Buyer's representations under Section 3.02 shall be true
in all material respects on the date of this Agreement and as of
Closing.
(b) Buyer shall have performed in all material respects the
covenants and agreements which Buyer was required to perform or satisfy
at or prior to Closing.
(c) Except for matters not customarily and appropriately
obtained prior to Closing, Seller has received evidence, in form
reasonably satisfactory to its counsel, that all permits, consents,
approvals, licenses, qualifications and orders required by governmental
authority, or the terms of the Interests, to be obtained prior to
Closing have been obtained or waived.
(d) The aggregate downward adjustment (if any) of the Purchase
Price which results from the procedures set forth in Section 5.09 does
not exceed ten percent (10%) of the Purchase Price.
(e) There is no action or proceeding pending or threatened
before a court, arbitrator or governmental authority seeking to
restrain or prohibit the consummation of the transactions contemplated
by this Agreement or to obtain substantial damages from Seller related
to this Agreement.
6.02 Buyer's Conditions. Buyer's obligations at Closing are subject to
the satisfaction at or prior to Closing of the following conditions:
(a) Seller's representations under Section 3.01 shall be true
in all material respects on the date of this Agreement and as of
Closing.
(b) Seller shall have performed in all material respects the
covenants and agreements which Seller was required to perform or
satisfy at or prior to Closing.
(c) Except for matters not customarily and appropriately
obtained prior to Closing, Buyer has received evidence, in form
reasonably satisfactory to its counsel, that all permits, consents,
approvals, licenses, qualifications and orders required by governmental
authority, or the terms of the Interests, to be obtained prior to
Closing have been obtained or waived.
(d) The aggregate upward adjustment (if any) of the Purchase
Price which results from the procedures set forth in and Section 5.09
does not exceed ten percent (10%) of the Purchase Price.
(e) There is no action or proceeding pending or threatened
before a court, arbitrator or governmental authority seeking to
restrain or prohibit the consummation of the transactions contemplated
by this Agreement or to obtain substantial damages from Buyer related
to this Agreement.
15
ARTICLE 7
---------
CLOSING
7.01 Closing Date. Subject to the terms of this Agreement, the
consummation of the transactions contemplated by this Agreement ("Closing"),
shall occur at Seller's office listed above (or at such other place and time as
the Parties may agree) on or before July 31, 2002 at 10:00 a.m. ("Closing
Date").
7.02 Closing Obligations. At Closing, the following shall occur, each
being a condition precedent to the others and each being deemed to have occurred
simultaneously:
(a) Seller shall execute and deliver to Buyer assignments
conveying the Interests to Buyer in the forms attached to this
Agreement as Exhibits B-1 through B-12. Seller shall also execute and
deliver such other assignments on appropriate forms as may be required
by governmental authority, subject to the terms of the assignment forms
attached as Exhibits B-1 thru B-12.
16
(b) Seller and Buyer shall execute and deliver to each other
the Preliminary Closing Statement.
(c) Buyer shall deliver the Adjusted Purchase Price to Seller
by direct bank or wire transfer, as directed by Seller.
(d) Seller shall deliver to Buyer possession of the Interests.
(e) Seller shall execute transfer orders or letters-in-lieu on
forms prepared by Buyer, and reasonably satisfactory to Seller,
directing purchasers of production to make payment to Buyer as
contemplated by this Agreement.
(f) Seller shall deliver releases of all liens, security
interests and encumbrances affecting the interests to be released at
Closing.
(g) Seller and Buyer will coordinate the filing and/or
recording of assignment and conveyancing documents in the appropriate
governmental records. The recording party (Buyer) will provide either
the original or photocopies of the filed and/or recorded documents as
agreed by the parties, to the non-recording party. All costs of filing,
recording and other reasonable fees will be borne by Buyer.
ARTICLE 8
---------
TERMINATION
8.01 Termination. This Agreement and the transactions contemplated by
this Agreement may be terminated in the following situations:
(a) by Seller or Buyer if Closing does not occur on or before
the Closing Date provided, however, that a party cannot so terminate if
it is in breach of this Agreement;
(b) by Seller if the conditions contained in Section 6.01 are
not satisfied or waived as of the Closing Date;
(c) by Buyer if the conditions contained in Section 6.02 are
not satisfied or waived as of the Closing Date; and
(d) by Seller and Buyer pursuant to written Agreement.
8.02 Liabilities Upon Termination.
If this Agreement is terminated for any reason or is breached, nothing
contained herein shall be construed to limit Seller's or Buyer's legal or
equitable remedies, including damages for the breach of failure of any
representation, warranty covenant or agreement contained herein and the right to
enforce specific performance of this Agreement.
17
ARTICLE 9
---------
OBLIGATIONS AFTER CLOSING
9.01 Post-Closing Adjustments. Seller and Buyer acknowledge that the
amount of all adjustments under Section 2.03 may not be available prior to
Closing. As soon as practicable after Closing, Seller shall prepare and submit
to Buyer a statement containing adjustments contemplated by Section 2.03 that
were not finally determined as of Closing ("Final Settlement Statement"). Seller
shall promptly notify Buyer of any changes Seller proposes and the parties shall
negotiate in good faith to agree on these adjustments within ninety (90) days
after the Closing Date. Payment to the appropriate party shall be made within
five (5) days after agreement is reached ("Final Settlement Date").
9.02 Subsequent Adjustments. Seller and Buyer recognize that either
party may receive funds or pay expenses after the Final Settlement Date which
are properly the property or obligation of the other party. Upon receipt of net
proceeds or net expenses due to or payable by the other party, whichever occurs
first, such party shall submit a statement showing the items of income and
expense. Payment by the appropriate party shall be made within ten (10) days of
receipt of the statement.
9.03 Reservation of Claims. Except as provided in this Agreement,
Seller is entitled to all claims related to the Interests prior to the Effective
Time regardless of when payment is made. Except as provided in this Agreement,
Buyer is entitled to all claims related to the Interests which arise after the
Effective Time.
9.04 Files and Records. Upon Closing, Seller shall permit Buyer, at
Buyer's expense, to take possession of originals of all files, records and data
in Seller's possession relating to the Interests. Seller shall have the right to
copy (at Buyer's expense) and retain a copy of all such files, records and data.
9.05 Further Assurances. After Closing, Seller and Buyer agree to
execute and deliver such instruments and take such other action as may be
necessary or advisable to carry out their obligations under this Agreement.
9.06 Survival and Indemnity.
(a) The representations, covenants, agreements and indemnities
(the "obligations") of or by Seller and Buyer shall survive the
Closing.
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(b) Allocation of Liability.
(i) Liabilities. Buyer agrees to assume, pay,
perform, fulfill, discharge and be liable for all Assumed
Liabilities, and Seller agrees to retain, pay, perform,
fulfill, discharge and be and remain liable for all Retained
Liabilities.
(ii) Definitions. The term "Assumed Liabilities"
shall mean and include:
(x) all costs, expenses, liabilities and
obligations assumed or otherwise agreed to be paid by
Buyer pursuant to the terms of this Agreement; and
(y) all costs, expenses, liabilities, claims
and obligations arising out of, in connection with,
or resulting directly or indirectly from the
ownership or operation of the Interests, including
environmental cleanup liabilities and plugging and
abandonment liabilities for existing wells,
platforms, facilities, or pipelines arising out of,
in connection with, or resulting directly or
indirectly from the ownership or operation of the
Interests (the "Abandonment and Clean-up Liability")
but excluding Retained Liabilities.
The term "Retained Liabilities" shall mean and include:
(x) all costs, expenses, liabilities and obligations
assumed or otherwise agreed to be paid by Seller pursuant to
the terms of this Agreement; and
(y) all costs, expenses, liabilities, claims and
obligations (except Abandonment and Clean-up Liability and
related costs, expenses, liabilities, claims and obligations)
arising out of, in connection with, or resulting directly or
indirectly from production or sale of hydrocarbons
attributable to the Interests or the proper accounting or
payment to parties for their interest therein insofar as such
claims relate to periods of time prior to the Effective Time.
(c) In the event that the Closing occurs, (i) Buyer shall
protect, defend, indemnify and hold Seller harmless from any and all
damages, claims, losses, demands, fines, penalties, judgments
(including interest), costs, expenses, environmental liabilities, and
other liabilities, direct, contingent, or otherwise, including
consulting and attorneys' fees and costs of court ("Damages") arising
or accruing with respect to the Assumed Liabilities and (ii) Seller
shall protect, defend, indemnify and hold Buyer harmless from any
Damages arising or accruing with respect to the Retained Liabilities.
The term "Damages," as used herein, shall not include (i) any amount
19
which was taken into account as an adjustment to the Purchase Price
pursuant to this Agreement or (ii) either party's costs and expenses as
described in Section 10.02. Buyer and Seller agree that their sole and
exclusive remedies with respect to claims arising, after closing, under
this Agreement, shall be limited to remedies set forth in this Section
9.06.
9.07 CONSPICUOUSNESS/EXPRESS NEGLIGENCE. THE DEFENSE, INDEMNIFICATION
AND HOLD HARMLESS PROVISIONS PROVIDED FOR IN THIS AGREEMENT SHALL BE APPLICABLE
WHETHER OR NOT THE DAMAGES, LOSSES, INJURIES, LIABILITIES, COSTS OR EXPENSES IN
QUESTION AROSE SOLELY OR IN PART FROM THE ACTIVE, PASSIVE OR CONCURRENT
NEGLIGENCE, OR OTHER FAULT OF ANY INDEMNIFIED PARTY. BUYER AND SELLER
ACKNOWLEDGE THAT THIS STATEMENT COMPLIES WITH THE EXPRESS NEGLIGENCE RULE AND IS
CONSPICUOUS.
9.08 Allocation of Proceeds. Seller shall receive all proceeds from the
sale of Substances physically produced or allocable to the Interest prior to the
Effective Time. Buyer shall receive all proceeds from the sale of Substances
physically produced or allocable to the Interest on or after the Effective Time.
ARTICLE 10
----------
MISCELLANEOUS
10.01 Notices. All notices required or permitted under this Agreement
shall be effective upon receipt if personally delivered, if mailed by registered
or certified mail, postage prepaid, or if delivered by telegram, telecopy or
facsimile if directed to the parties as follows:
TO BUYER: TO SELLER:
Newfield Exploration Company American Resources Offshore, Inc.
363 N. Sam Houston Pkwy. E, 801 Travis Street, 2100
Suite 2020 Houston, TX 77002
Houston, Texas 77060 Telephone: 713-227-7218, ext. 129
Telephone: (713) 847-6000 Fax: 713-227-7626
Fax: (713) 847-6006 Attn: John P. Atwood
Attn.: Land Department
Any party may give written notice of a change in the address or individual to
whom delivery shall be made.
10.02 Expenses. Except as otherwise provided in this Agreement, all
fees, costs and expenses incurred by the parties in negotiating this Agreement
or in consummating the transactions contemplated by this Agreement shall be paid
by the party incurring them.
20
10.03 Amendment. This Agreement may not be altered or amended, nor any
rights waived, except by a written instrument executed by the party to be
charged with the amendment or waiver. No waiver of any provision of this
Agreement shall be construed as a continuing waiver of the provision.
10.04 Assignment. Buyer shall not have the right to assign its rights
and delegate its duties under this Agreement without written consent of Seller.
10.05 Conditions. The inclusion in this Agreement of Conditions to
Seller's and Buyer's obligations at Closing shall not, in and of itself, be a
covenant of either party to satisfy the conditions to the other party's
obligations at Closing.
10.06 Headings. The headings are for convenience only and do not limit
or otherwise affect the provisions of this Agreement.
10.07 Counterparts. This Agreement may be executed in counterparts,
each of which shall be an original and which, taken together, shall constitute
the same instrument.
10.08 References. References, including use of a pronoun, shall
include, where applicable, masculine, feminine, singular or plural individuals
or legal entities.
10.09 Governing Law. This Agreement and the transactions contemplated
by this Agreement shall be governed and construed in accordance with the
internal laws of the State of Texas without giving effect to any principles of
conflicts of laws.
10.10 Announcements. Notwithstanding the other provisions of this
Agreement, except as otherwise provided for herein or as required by
governmental agency or law, prior to Closing, neither Seller nor Buyer shall
announce or otherwise publicize this Agreement or the transactions contemplated
by this Agreement without the prior written consent of the other party.
10.11 Entire Agreement. This Agreement is the entire understanding
between Seller and Buyer concerning the subject matter of this Agreement. This
Agreement supersedes all negotiations, discussions, representations, prior
agreements and understandings, whether oral or written.
10.12 Parties in Interest. This Agreement is binding upon and shall
inure to the benefit of Seller and Buyer and, except where prohibited, their
heirs, successors, representatives and assigns. No other party is intended to
have any benefits, rights or remedies under this Agreement. There are no
third-party beneficiaries.
10.13 Exhibits. All Exhibits and Schedules attached to this Agreement
are incorporated into this Agreement for all purposes.
21
10.14 Severance. If any provision of this Agreement is found to be
illegal or unenforceable, the other terms of this Agreement shall remain in
effect and this Agreement shall be construed as if the illegal or unenforceable
provision had not been included.
BUYER: SELLER:
NEWFIELD EXPLORATION COMPANY AMERICAN RESOURCES OFFSHORE, INC.
By: ________________________________ By: ______________________________
Name: ______________________________ Name: ____________________________
Its: _______________________________ Its: _____________________________
22
EXHIBIT "A"
-----------
Attached to and made apart of that certain
Purchase and Sale Agreement among
American Resources Offshore, Inc., as "Seller"
and
Newfield Exploration Company, as "Buyer"
I
LEASE
OCS-G 1898, Oil and Gas Lease dated effective March 1, 1969, granted by the
United States of America, as Lessor, in favor of Continental Oil Company and
Cities Service Oil Company, as Lessee, covering Block 148, West Half, South
Timbalier Area, as shown on OCS Official Leasing Map, Louisiana Map No. 6,
containing approximately 2,500 acres.
II
INTEREST CONVEYED
The Interest conveyed by American Resources Offshore, Inc., as Seller, to
Newfield Exploration Company, as Buyer, in the Lease described above and
pursuant to this Purchase and Sale Agreement, is more particularly described in
the Assignments of Record Title, Assignments of Operating Rights and Assignments
of Overriding Royalty Interests attached to said Purchase and Sale Agreement as
Exhibits B-1 through B-12, inclusive.
III
CONTRACTS
a) The Lease;
b) Declaration of Rights III dated effective September 27, 1993,
by and between Settle Oil and Gas Company, Century Offshore
Management Corporation, PNC Bank National Associates and
Newfield Exploration Company, regarding OCS-G 1898;
c) Declaration of Rights dated effective July 1, 1993, by and
between Settle Oil and Gas Company, Century Offshore
Management Corporation, BMO Financial Inc. and Bank of
Montreal, regarding OCS-G 1898;
d) Declaration of Rights II dated effective November 22, 1993, by
and between Settle Oil and Gas Company, Century Offshore
Management Corporation, BMO Financial Inc., Bank of Montreal
and Newfield Exploration Company, regarding OCS-G l898;
Exhibit A Page 1
e) Farmout Agreement dated June 21, 1994 between Century Offshore
Management Corporation and Settle Oil and Gas Company,
regarding OCS-G 1898;
f) Farmout Agreement dated June 13, 1991 by and between Conoco
Inc. and Century Offshore Management Corporation covering
OCS-G 1898;
g) Farmout Agreement dated June 13, 1991 by and between OXY
U.S.A. Inc, and Century Offshore Management Corporation
covering OCS-G 1898;
h) Joint Operating Agreement dated August 1, 1994, between
Newfield Exploration Company (Operator), and Century Offshore
Management Corporation., et al (Non-Operators), covering W/2
Block 148, South Timbalier Area, Offshore, Louisiana;
i) Operating Agreement dated January 1, 1989, by and between
Conoco Inc. and OXY U.S.A., Inc. covering the West-half (1/2)
of South Timbalier Block 148;
j) Ownership and Operating Agreement dated November 25, 1980, by
and between Conoco Inc., OXY U.S.A., Inc. and Texaco Producing
Company covering South Timbalier Field 176 production
facilities;
k) Agreement dated June 21, 1994 by and among Newfield
Exploration Company, Settle Oil and Gas Company and Century
Offshore Management Corporation, regarding OCS-G 1898;
l) Participation Agreement dated effective as of September 27,
1993 by and among Newfield Exploration Company, Settle Oil and
Gas Company and Century Management Corporation covering OCS-G
1898;
m) Letter Agreement entered into March 25, 1988, by and between
Conoco Inc. and OXY U.S., addressing OXY's approval to utilize
gas produced from South Timbalier Block 146 "A" platform to
provide Gas-Lift gas to South Timbalier 148 "A" platform;
n) Letter Agreement entered into July 7, 1983, by and between
Conoco Inc., Texaco Producing Co., and OXY U.S.A., Inc.
regarding Texaco's use of the 4 1/2" OD pipeline;
o) Crude Oil Contract with Cities Service Oil and Gas
Corporation, as Seller, and Citgo Petroleum Corporation, as
Buyer, effective September 1, 1983, and covering oil and field
separated liquids;
p) Operating Agreement effective September 1, 1972, by and
between Amoco Production Company, Conoco Inc. and OXY U.S.A.,
Inc. regarding that 4 1/2" OD pipeline commencing at Amoco's
South Timbalier Block 161 "A" Platform and extending to and
tied into Chevron's 10" pipeline in South Timbalier Block 161;
q) Purchase and Sale Agreement, dated effective July 1, 1996, by
and between Century Offshore Management Corporation (seller)
and Southern Gas Company of Delaware, Inc. (buyer), covering
the sale of interest in OCS-G 1898, Block 148 W/2, South
Timbalier Area, Offshore Louisiana;
Exhibit A Page 2
r) Purchase and Sale Agreement dated May 31, 1991, effective
November 1, 1990, executed by and between Oxy U.S.A. Inc. and
Century Offshore Management Corporation, covering OCS-G 1898,
in which a preferential right to purchase the liquids from the
lease was reserved, and which contains a limitation on
assignment provisions;
s) Purchase and Sale Agreement dated May 31, 1991, effective
November 1, 1990, executed by and between Cities Service Oil
Company and Century Offshore Management Corporation, covering
OCS-G 1898, in which a preferential right to purchase the
liquids from the lease was reserved, and which contains a
limitation on assignment provisions.
t) Agreement dated effective February 1, 1997 by and between
Newfield Exploration Company and Southern Gas Co. of Delaware,
Inc. covering the drilling of and ownership in the OCS-G 1898
#D-4 well.
Exhibit A Page 3
EXHIBIT "B-1"
-------------
Attached to and made apart of that certain Purchase and Sale Agreement among
American Resources Offshore, Inc., as "Seller"
and
Newfield Exploration Company, as "Buyer"
ASSIGNMENT OF RECORD TITLE
- --------------------------------------------------------------------------------
South Timbalier Area Block 148
OCS-G 1898
ASSIGNMENT OF RECORD TITLE
--------------------------
UNITED STATES OF AMERICA ss.
OUTER CONTINENTAL SHELF ss. KNOW ALL MEN BY THESE PRESENTS:
OFFSHORE LOUISIANA ss.
SOUTH TIMBALIER AREA ss.
This Assignment of Record Title ("Assignment") is made by AMERICAN
RESOURCES OFFSHORE, INC., a Delaware corporation, whose address is 801 Travis
Street, Suite 2100, Houston, Texas 77002 (hereinafter referred to as "Assignor")
in favor of NEWFIELD EXPLORATION COMPANY, a Delaware corporation, whose address
is 363 N. Sam Houston Pkwy. E. Suite 2020, Houston, Texas 77060 (hereinafter
referred to as "Assignee").
WITNESSETH
In consideration of One Hundred Dollars ($100.00) and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Assignor by these presents does hereby CONVEY, TRANSFER and ASSIGN
to Assignee, subject to the further provisions hereof, all of Assignor's right,
title and interest, being an undivided 1.00000% record title interest ("Assigned
Interests") in the following described oil and gas lease:
Exhibit B-1 page 1
OCS-G 1898, Oil and Gas Lease dated effective March 1, 1969, granted by
the United States Department of the Interior, Bureau of Land
Management, as Lessor, in favor of Continental Oil Company and Cities
Service Oil Company, as Lessee, covering Block 148, West Half, South
Timbalier Area, as shown on OCS Official Leasing Map, Louisiana Map No.
6, containing approximately 2,500 acres, INSOFAR AND ONLY INSOFAR AS it
covers the NE/4 of the NW/4 of the SW/4; SE/4 of the NW/4 of the SW/4;
NE/4 of the SW/4 of the SW/4; and the SW/4 of the NE/4 of the SW/4 of
the Block 148, South Timbalier Area (the "Lease");
and all right, title and interest in and to the following;
a) all platforms that are located on, or presently used in
connection with the drilling for, or operation, production,
treatment or transportation of gas, oil, casinghead gas, drip
gasoline, natural gasoline and all other liquid and gaseous
hydrocarbons from the Lease (the "Platforms");
b) all wells, wellbores, pipes, pipelines, gathering lines,
compressors, materials, inventory, facilities, supplies and
equipment and any and all other personal, real, movable and
immovable property, fixtures or equipment that are located on,
or presently used in connection with, the drilling for, or
operation, production, treatment or transportation of,
Hydrocarbons from the Lease, and any replacements, attachments
or accessories now or hereafter attached, added or affixed
(the "Equipment");
c) all Hydrocarbons attributable to the Assigned Interests
produced on and after the Effective Date, as hereinafter
defined ("Production");
d) all contracts and agreements (other than the Lease) to the
extent transferable that are attributable to the ownership or
operation of the Assigned Interests, including, without
limitation, the following (collectively, the "Contracts"):
(i) any and all agreements, operating agreements,
participation agreements, unit, pooling and
communitization agreement and declarations,
hydrocarbon purchase and sale agreements, farmin or
farmout agreements, bottom-hole contribution
agreements, balancing agreements, processing
agreements, gathering agreements, compression
agreements, transportation agreements, gathering
agreements, compression agreements, transportation
agreements, and any other contracts and agreements
that are attributable to the ownership or operation
of the Assigned Interests;
e) all orders, permits and easements that are attributable to the
Assigned Interests ("Permits");
Exhibit B-1 page 2
f) all other rights, privileges, benefits, powers and obligations
conferred or imposed upon Assignor as the owner of the
Assigned Interests ("Rights"); and
g) to the extent attributable to the Assigned Interests and not
prohibited by law or an agreement to which Assignor is a
party, the rights to the original records in the possession of
Assignor: (i) lease and land records, (ii) geological and
geophysical records, (iii) operations, production and
engineering records, (iv) accounting records, and (v) facility
and well records (collectively the "Records").
For purposes of this Assignment the Assigned Interests, Platforms,
Equipment, Production, Contracts, Permits, Rights and Records are collectively
referred to as the "Assets".
By acceptance of this Assignment, Assignee acknowledges the existence
of, and agrees to be bound by all of the terms and conditions contained in the
following:
a) The Lease;
b) Purchase and Sale Agreement dated June 28, 2002 and effective
July 1, 2002 at 7:00 a.m. Central Standard Time, by and
between American Resources Offshore, Inc., as Seller, and
Newfield Exploration Company, as Buyer (the "PSA");
c) Declaration of Rights III dated effective September 27, 1993,
by and between Settle Oil and Gas Company, Century Offshore
Management Corporation, PNC Bank National Associates and
Newfield Exploration Company, regarding OCS-G 1898;
d) Declaration of Rights dated effective July 1, 1993, by and
between Settle Oil and Gas Company, Century Offshore
Management Corporation, BMO Financial Inc. and Bank of
Montreal, regarding OCS-G 1898;
e) Declaration of Rights II dated effective November 22, 1993, by
and between Settle Oil and Gas Company, Century Offshore
Management Corporation, BMO Financial Inc., Bank of Montreal
and Newfield Exploration Company, regarding OCS-G 1898;
f) Farmout Agreement dated June 21, 1994, between Century
Offshore Management Corporation and Settle Oil and Gas
Company, regarding OCS-G 1898;
g) Farmout Agreement dated June 13, 1991, by and between Conoco
Inc. and Century Offshore Management Corporation covering
OCS-G 1898;
h) Farmout Agreement dated June 13, 1991, by and between OXY
U.S.A., Inc. and Century Offshore Management Corporation
covering OCS-G 1898;
i) Joint Operating Agreement dated August 1, 1994, between
Newfield Exploration Company (Operator), and Century Offshore
Management Corporation, et al. (Non-Operators), covering W/2
Block 148, South Timbalier Area, Offshore, Louisiana;
Exhibit B-1 page 8
j) Operating Agreement dated January 1, 1989, by and between
Conoco Inc. and OXY U.S.A., Inc. covering the West-half (1/2)
of South Timbalier Block 148;
k) Ownership and Operating Agreement dated November 25, 1980, by
and between Conoco Inc., OXY U.S.A., Inc. and Texaco Producing
Company covering South Timbalier Field 176 production
facilities;
l) Agreement dated June 21,1994, by and among Newfield
Exploration Company, Settle Oil and Gas Company and Century
Offshore Management Corporation, regarding OCS-G l898;
m) Participation Agreement dated effective as of September 27,
1993, by and among Newfield Exploration Company, Settle Oil
and Gas Company and Century Management Corporation covering
OCS-G 1898;
n) Letter Agreement entered into March 25, 1988, by and between
Conoco Inc. and OXY U.S., addressing OXY's approval to utilize
gas produced from South Timbalier Block 146 "A" platform to
provide Gas-Lift gas to South Timbalier 148 "A" platform;
o) Letter Agreement entered into July 7, 1983, by and between
Conoco Inc., Texaco Producing Co., and OXY U.S.A., Inc.
regarding Texaco's use of the 4 1/2" OD pipeline;
p) Crude Oil Contract with Cities Service Oil and Gas
Corporation, as Seller, and Citgo Petroleum Corporation, as
Buyer, effective September 1, 1983, and covering oil and field
separated liquids;
q) Operating Agreement effective September 1, 1972, by and
between Amoco Production Company, Conoco Inc. and OXY U.S.A.,
Inc. regarding that 4 1/2" OD pipeline commencing at Amoco's
South Timbalier Block 161 "A" Platform and extending to and
tied into Chevron's 10" pipeline in South Timbalier Block 161;
r) Purchase and Sale Agreement, dated effective July 1, 1996, by
and between Century Offshore Management Corporation (seller)
and Southern Gas Company of Delaware, Inc. (buyer), covering
the sale of interest in OCS-G 1898, Block 148 W/2, South
Timbalier Area, Offshore Louisiana;
s) Purchase and Sale Agreement dated May 31, 1991, effective
November 1, 1990, executed by and between Oxy U.S.A., Inc. and
Century Offshore Management Corporation, covering OCS-G l898,
in which a preferential right to purchase the liquids from the
lease was reserved, and which contains a limitation on
assignment provisions;
t) Purchase and Sale Agreement dated May 31, 1991, effective
November 1, 1990, executed by and between Cities Service Oil
Exhibit B-1 page 4
Company and Century Offshore Management Corporation, covering
OCS-G l898, in which a preferential right to purchase the
liquids from the lease was reserved, and which contains a
limitation on assignment provisions.
This Assignment is made without any warranty of title, express, implied
or statutory, even for return of any consideration paid therefor; provided only
that subject to the permitted encumbrances (if any), Assignor shall warrant and
defend title against all claims and demands of all persons whomever claiming
title to the Assigned Interests by, through or under Assignor, but not
otherwise, and only to the extent set forth in the PSA. Assignee acknowledges
that (i) it has had access to the Assets and the employees of Assignor and the
opportunity to inspect the Assets, and (ii) in making its decision to enter into
the PSA and consummate the transactions contemplated thereby, Assignee has
relied solely on the basis of its own independent investigation of the Assets
and upon the representations and warranties of Assignor set forth in the PSA and
the special warranty of title made herein. Accordingly, Assignee acknowledges
that Assignor has not made, AND ASSIGNOR HEREBY EXPRESSLY DISCLAIMS AND NEGATES,
ANY REPRESENTATION OR WARRANTY, EXPRESSED (ORALLY OR IN WRITING), IMPLIED, AT
COMMON LAW, BY STATUTE, OR OTHERWISE, OR OTHER RIGHT OF RECOURSE (EVEN AS TO
RETURN OF THE PURCHASE PRICE) RELATING TO (A) THE CONDITION OF THE ASSETS
(INCLUDING ANY IMPLIED OR EXPRESSED WARRANTY OF MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE, ABSENCE OF LATENT DEFECTS OR REDHIBITORY VICES, OR OF
CONFORMITY TO MODELS OR SAMPLES OF MATERIALS, OR ENVIRONMENTAL CONDITION), (B)
ANY INFRINGEMENT BY ASSIGNOR OF ANY PATENT OR PROPRIETARY RIGHT OF ANY THIRD
PARTY, AND (C) ACCURACY, COMPLETENESS OR MATERIALITY OF ANY INFORMATION, DATA OR
Exhibit B-1 page 5
OTHER MATERIALS (WRITTEN OR ORAL) FURNISHED TO ASSIGNEE BY OR ON BEHALF OF
ASSIGNOR (INCLUDING WITH RESPECT TO RESERVE MATTERS, SUCCESS OF WELLS (INCLUDING
WELLS THAT ARE DRILLED AFTER THE EFFECTIVE DATE), COMPLIANCE WITH LAWS,
ENVIRONMENTAL CONDITIONS AND OTHER MATTERS); IT BEING AGREED BY ASSIGNEE THAT IT
IS ACQUIRING THE ASSETS "AS-IS," "WHERE-IS", WITH ALL FAULTS.
This Assignment is
made in accordance with the PSA and all provisions of said PSA are incorporated
herein by reference for all purposes as if copied in extenso. In the event of a
conflict between the terms of this Assignment and the PSA, the terms of the PSA
shall control. T
his Assignment may be executed in any number of counterparts,
all of which taken together shall constitute one and the same instrument by
signing any such counterpart.
This Assignment shall bind and inure to the
benefit of and be binding upon Assignor and Assignee and their respective
successors and assigns.
IN WITNESS WHEREOF, this Assignment is executed before
the undersigned competent witnesses by the parties on the dates set forth in
their respective acknowledgements hereinbelow, but shall be effective for all
purposes on the 1st day of July, 2002, at 7:00 a.m. Central Standard Time
("Effective Date").
ASSIGNOR:
WITNESSES: AMERICAN RESOURCES OFFSHORE, INC.
GOM No. 1937
By: _____________________________
_____________________________ Name:____________________________
Title:___________________________
_____________________________
Exhibit B-1 page 6
ASSIGNEE:
WITNESSES: NEWFIELD EXPLORATION COMPANY
GOM No. 1364
By: _____________________________
_____________________________ W. M. Blumenshine
Attorney in Fact
_____________________________
Exhibit B-1 page 7
STATE OF TEXAS ss.
ss.
COUNTY OF HARRIS ss.
BEFORE ME, the undersigned authority, on this day personally appeared
__________________, known to me to be the person whose name is subscribed to the
foregoing instrument as _______________ of AMERICAN RESOURCES OFFSHORE, INC., a
Delaware corporation, and acknowledged to me that he executed the same for and
on behalf of said corporation, for the purposes and consideration therein
expressed, and in the capacity therein stated.
GIVEN under my hand and seal of office this ___ day of ________, 2002.
___________________________________________
Notary Public, State of Texas
My Commission Expires:_____________________
STATE OF TEXAS ss.
ss.
COUNTY OF HARRISss.
BEFORE ME, the undersigned authority, on this day personally appeared
W. M. Blumenshine, known to me to be the person whose name is subscribed to the
foregoing instrument as Attorney in Fact of NEWFIELD EXPLORATION COMPANY, a
Delaware corporation, and acknowledged to me that he executed the same for and
on behalf of said corporation, for the purposes and consideration therein
expressed, and in the capacity therein stated.
GIVEN under my hand and seal of office this ___ day of July, 2002.
Notary Public, State of Texas
My Commission Expires:_____________________
Exhibit B-1 page 8
EXHIBIT "B-2"
-------------
Attached to and made apart of that certain Purchase and Sale Agreement among
American Resources Offshore, Inc., as "Seller"
and
Newfield Exploration Company, as "Buyer"
- --------------------------------------------------------------------------------
South Timbalier Area Block 148
OCS-G 1898
ASSIGNMENT OF RECORD TITLE
--------------------------
UNITED STATES OF AMERICA ss.
OUTER CONTINENTAL SHELF ss. KNOW ALL MEN BY THESE PRESENTS:
OFFSHORE LOUISIANA ss.
SOUTH TIMBALIER AREA ss.
This Assignment of Record Title ("Assignment") is made by AMERICAN
RESOURCES OFFSHORE, INC., a Delaware corporation, whose address is 801 Travis
Street, Suite 2100, Houston, Texas 77002 (hereinafter referred to as "Assignor")
in favor of NEWFIELD EXPLORATION COMPANY, a Delaware corporation, whose address
is 363 N. Sam Houston Pkwy. E. Suite 2020, Houston, Texas 77060 (hereinafter
referred to as "Assignee").
WITNESSETH
In consideration of One Hundred Dollars ($100.00) and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Assignor by these presents does hereby CONVEY, TRANSFER and ASSIGN
to Assignee, subject to the further provisions hereof, all of Assignor's right,
title and interest, being an undivided 4.50000% record title interest ("Assigned
Interests") in the following described oil and gas lease:
Exhibit B-2 page 1
OCS-G 1898, Oil and Gas Lease dated effective March 1, 1969, granted by
the United States Department of the Interior, Bureau of Land
Management, as Lessor, in favor of Continental Oil Company and Cities
Service Oil Company, as Lessee, covering Block 148, West Half, South
Timbalier Area, as shown on OCS Official Leasing Map, Louisiana Map No.
6, containing approximately 2,500 acres, INSOFAR AND ONLY INSOFAR AS it
covers the NW/4 of the Block 148, South Timbalier Area (the "Lease");
and all right, title and interest in and to the following;
a) all platforms that are located on, or presently used in
connection with the drilling for, or operation, production,
treatment or transportation of gas, oil, casinghead gas, drip
gasoline, natural gasoline and all other liquid and gaseous
hydrocarbons from the Lease (the "Platforms");
b) all wells, wellbores, pipes, pipelines, gathering lines,
compressors, materials, inventory, facilities, supplies and
equipment and any and all other personal, real, movable and
immovable property, fixtures or equipment that are located on,
or presently used in connection with, the drilling for, or
operation, production, treatment or transportation of,
Hydrocarbons from the Lease, and any replacements, attachments
or accessories now or hereafter attached, added or affixed
(the "Equipment");
c) all Hydrocarbons attributable to the Assigned Interests
produced on and after the Effective Date, as hereinafter
defined ("Production");
d) all contracts and agreements (other than the Lease) to the
extent transferable that are attributable to the ownership or
operation of the Assigned Interests, including, without
limitation, the following (collectively, the "Contracts"):
(i) any and all agreements, operating agreements,
participation agreements, unit, pooling and
communitization agreement and declarations,
hydrocarbon purchase and sale agreements, farmin or
farmout agreements, bottom-hole contribution
agreements, balancing agreements, processing
agreements, gathering agreements, compression
agreements, transportation agreements, gathering
agreements, compression agreements, transportation
agreements, and any other contracts and agreements
that are attributable to the ownership or operation
of the Assigned Interests;
e) all orders, permits and easements that are attributable to the
Assigned Interests ("Permits");
f) all other rights, privileges, benefits, powers and obligations
conferred or imposed upon Assignor as the owner of the
Assigned Interests ("Rights"); and
Exhibit B-2 page 2
g) to the extent attributable to the Assigned Interests and not
prohibited by law or an agreement to which Assignor is a
party, the rights to the original records in the possession of
Assignor: (i) lease and land records, (ii) geological and
geophysical records, (iii) operations, production and
engineering records, (iv) accounting records, and (v) facility
and well records (collectively the "Records").
For purposes of this Assignment the Assigned Interests, Platforms,
Equipment, Production, Contracts, Permits, Rights and Records are collectively
referred to as the "Assets".
By acceptance of this Assignment, Assignee acknowledges the existence
of, and agrees to be bound by all of the terms and conditions contained in the
following:
a) The Lease;
b) Purchase and Sale Agreement dated June 28, 2002 and effective
July 1, 2002 at 7:00 a.m. Central Standard Time, by and
between American Resources Offshore, Inc., as Seller, and
Newfield Exploration Company, as Buyer (the "PSA");
c) Declaration of Rights III dated effective September 27, 1993,
by and between Settle Oil and Gas Company, Century Offshore
Management Corporation, PNC Bank National Associates and
Newfield Exploration Company, regarding OCS-G 1898;
d) Declaration of Rights dated effective July 1, 1993, by and
between Settle Oil and Gas Company, Century Offshore
Management Corporation, BMO Financial Inc. and Bank of
Montreal, regarding OCS-G 1898;
e) Declaration of Rights II dated effective November 22, 1993, by
and between Settle Oil and Gas Company, Century Offshore
Management Corporation, BMO Financial Inc., Bank of Montreal
and Newfield Exploration Company, regarding OCS-G 1898;
f) Farmout Agreement dated June 21, 1994, between Century
Offshore Management Corporation and Settle Oil and Gas
Company, regarding OCS-G 1898;
g) Farmout Agreement dated June 13, 1991, by and between Conoco
Inc. and Century Offshore Management Corporation covering
OCS-G 1898;
h) Farmout Agreement dated June 13, 1991, by and between OXY
U.S.A., Inc. and Century Offshore Management Corporation
covering OCS-G 1898;
i) Joint Operating Agreement dated August 1, 1994, between
Newfield Exploration Company (Operator), and Century Offshore
Management Corporation, et al. (Non-Operators), covering W/2
Block 148, South Timbalier Area, Offshore, Louisiana;
j) Operating Agreement dated January 1, 1989, by and between
Conoco Inc. and OXY U.S.A., Inc. covering the West-half (1/2)
of South Timbalier Block 148;
Exhibit B-2 page 3
k) Ownership and Operating Agreement dated November 25, 1980, by
and between Conoco Inc., OXY U.S.A., Inc. and Texaco Producing
Company covering South Timbalier Field 176 production
facilities;
l) Agreement dated June 21,1994, by and among Newfield
Exploration Company, Settle Oil and Gas Company and Century
Offshore Management Corporation, regarding OCS-G l898;
m) Participation Agreement dated effective as of September 27,
1993, by and among Newfield Exploration Company, Settle Oil
and Gas Company and Century Management Corporation covering
OCS-G 1898;
n) Letter Agreement entered into March 25, 1988, by and between
Conoco Inc. and OXY U.S., addressing OXY's approval to utilize
gas produced from South Timbalier Block 146 "A" platform to
provide Gas-Lift gas to South Timbalier 148 "A" platform;
o) Letter Agreement entered into July 7, 1983, by and between
Conoco Inc., Texaco Producing Co., and OXY U.S.A., Inc.
regarding Texaco's use of the 4 1/2" OD pipeline;
p) Crude Oil Contract with Cities Service Oil and Gas
Corporation, as Seller, and Citgo Petroleum Corporation, as
Buyer, effective September 1, 1983, and covering oil and field
separated liquids;
q) Operating Agreement effective September 1, 1972, by and
between Amoco Production Company, Conoco Inc. and OXY U.S.A.,
Inc. regarding that 4 1/2" OD pipeline commencing at Amoco's
South Timbalier Block 161 "A" Platform and extending to and
tied into Chevron's 10" pipeline in South Timbalier Block 161;
r) Purchase and Sale Agreement, dated effective July 1, 1996, by
and between Century Offshore Management Corporation (seller)
and Southern Gas Company of Delaware, Inc. (buyer), covering
the sale of interest in OCS-G 1898, Block 148 W/2, South
Timbalier Area, Offshore Louisiana;
s) Purchase and Sale Agreement dated May 31, 1991, effective
November 1, 1990, executed by and between Oxy U.S.A., Inc. and
Century Offshore Management Corporation, covering OCS-G l898,
in which a preferential right to purchase the liquids from the
lease was reserved, and which contains a limitation on
assignment provisions;
t) Purchase and Sale Agreement dated May 31, 1991, effective
November 1, 1990, executed by and between Cities Service Oil
Company and Century Offshore Management Corporation, covering
OCS-G l898, in which a preferential right to purchase the
liquids from the lease was reserved, and which contains a
limitation on assignment provisions.
Exhibit B-2 page 4
This Assignment is made without any warranty of title, express, implied
or statutory, even for return of any consideration paid therefor; provided only
that subject to the permitted encumbrances (if any), Assignor shall warrant and
defend title against all claims and demands of all persons whomever claiming
title to the Assigned Interests by, through or under Assignor, but not
otherwise, and only to the extent set forth in the PSA. Assignee acknowledges
that (i) it has had access to the Assets and the employees of Assignor and the
opportunity to inspect the Assets, and (ii) in making its decision to enter into
the PSA and consummate the transactions contemplated thereby, Assignee has
relied solely on the basis of its own independent investigation of the Assets
and upon the representations and warranties of Assignor set forth in the PSA and
the special warranty of title made herein. Accordingly, Assignee acknowledges
that Assignor has not made, AND ASSIGNOR HEREBY EXPRESSLY DISCLAIMS AND NEGATES,
ANY REPRESENTATION OR WARRANTY, EXPRESSED (ORALLY OR IN WRITING), IMPLIED, AT
COMMON LAW, BY STATUTE, OR OTHERWISE, OR OTHER RIGHT OF RECOURSE (EVEN AS TO
RETURN OF THE PURCHASE PRICE) RELATING TO (A) THE CONDITION OF THE ASSETS
(INCLUDING ANY IMPLIED OR EXPRESSED WARRANTY OF MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE, ABSENCE OF LATENT DEFECTS OR REDHIBITORY VICES, OR OF
CONFORMITY TO MODELS OR SAMPLES OF MATERIALS, OR ENVIRONMENTAL CONDITION), (B)
ANY INFRINGEMENT BY ASSIGNOR OF ANY PATENT OR PROPRIETARY RIGHT OF ANY THIRD
PARTY, AND (C) ACCURACY, COMPLETENESS OR MATERIALITY OF ANY INFORMATION, DATA OR
OTHER MATERIALS (WRITTEN OR ORAL) FURNISHED TO ASSIGNEE BY OR ON BEHALF OF
Exhibit B-2 page 5
ASSIGNOR (INCLUDING WITH RESPECT TO RESERVE MATTERS, SUCCESS OF WELLS (INCLUDING
WELLS THAT ARE DRILLED AFTER THE EFFECTIVE DATE), COMPLIANCE WITH LAWS,
ENVIRONMENTAL CONDITIONS AND OTHER MATTERS); IT BEING AGREED BY ASSIGNEE THAT IT
IS ACQUIRING THE ASSETS "AS-IS," "WHERE-IS", WITH ALL FAULTS.
This Assignment is made in accordance with the PSA and all provisions
of said PSA are incorporated herein by reference for all purposes as if copied
in extenso. In the event of a conflict between the terms of this Assignment and
the PSA, the terms of the PSA shall control.
This Assignment may be executed in any number of counterparts, all of
which taken together shall constitute one and the same instrument by signing any
such counterpart.
This Assignment shall bind and inure to the benefit of and be binding
upon Assignor and Assignee and their respective successors and assigns.
IN WITNESS WHEREOF, this Assignment is executed before the undersigned
competent witnesses by the parties on the dates set forth in their respective
acknowledgements hereinbelow, but shall be effective for all purposes on the 1st
day of July, 2002, at 7:00 a.m. Central Standard Time ("Effective Date").
ASSIGNOR:
WITNESSES: AMERICAN RESOURCES OFFSHORE, INC.
GOM No. 1937
By: _____________________________
_____________________________ Name:____________________________
Title:___________________________
_____________________________
Exhibit B-2 page 6
ASSIGNEE:
WITNESSES: NEWFIELD EXPLORATION COMPANY
GOM No. 1364
By: _____________________________
_____________________________ W. M. Blumenshine
Attorney in Fact
_____________________________
Exhibit B-2 page 7
STATE OF TEXAS ss.
ss.
COUNTY OF HARRIS ss.
BEFORE ME, the undersigned authority, on this day personally appeared
__________________, known to me to be the person whose name is subscribed to the
foregoing instrument as _______________ of AMERICAN RESOURCES OFFSHORE, INC., a
Delaware corporation, and acknowledged to me that he executed the same for and
on behalf of said corporation, for the purposes and consideration therein
expressed, and in the capacity therein stated.
GIVEN under my hand and seal of office this ___ day of _________, 2002.
__________________________________
Notary Public, State of Texas
My Commission Expires:____________
STATE OF TEXAS ss.
ss.
COUNTY OF HARRIS ss.
BEFORE ME, the undersigned authority, on this day personally appeared
W. M. Blumenshine, known to me to be the person whose name is subscribed to the
foregoing instrument as Attorney in Fact of NEWFIELD EXPLORATION COMPANY, a
Delaware corporation, and acknowledged to me that he executed the same for and
on behalf of said corporation, for the purposes and consideration therein
expressed, and in the capacity therein stated.
GIVEN under my hand and seal of office this ___ day of July, 2002..
__________________________________
Notary Public, State of Texas
My Commission Expires:____________
Exhibit B-2 page 8
EXHIBIT "B-3"
-------------
Attached to and made apart of that certain Purchase and Sale Agreement among
American Resources Offshore, Inc., as "Seller"
and
Newfield Exploration Company, as "Buyer"
- --------------------------------------------------------------------------------
South Timbalier Area Block 148
OCS-G 1898
ASSIGNMENT OF RECORD TITLE
--------------------------
UNITED STATES OF AMERICA ss.
OUTER CONTINENTAL SHELF ss. KNOW ALL MEN BY THESE PRESENTS:
OFFSHORE LOUISIANA ss.
SOUTH TIMBALIER AREA ss.
This Assignment of Record Title ("Assignment") is made by AMERICAN
RESOURCES OFFSHORE, INC., a Delaware corporation, whose address is 801 Travis
Street, Suite 2100, Houston, Texas 77002 (hereinafter referred to as "Assignor")
in favor of NEWFIELD EXPLORATION COMPANY, a Delaware corporation, whose address
is 363 N. Sam Houston Pkwy. E. Suite 2020, Houston, Texas 77060 (hereinafter
referred to as "Assignee").
WITNESSETH
In consideration of One Hundred Dollars ($100.00) and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Assignor by these presents does hereby CONVEY, TRANSFER and ASSIGN
to Assignee, subject to the further provisions hereof, all of Assignor's right,
title and interest, being an undivided 2.00000% record title interest ("Assigned
Interests") in the following described oil and gas lease:
Exhibit B-3 page 1
OCS-G 1898, Oil and Gas Lease dated effective March 1, 1969, granted by
the United States Department of the Interior, Bureau of Land
Management, as Lessor, in favor of Continental Oil Company and Cities
Service Oil Company, as Lessee, covering Block 148, West Half, South
Timbalier Area, as shown on OCS Official Leasing Map, Louisiana Map No.
6, containing approximately 2,500 acres, INSOFAR AND ONLY INSOFAR AS it
covers the NW/4 of the NW/4 of the SW/4; NW/4 of the NE/4 of the SW/4;
NW/4 of the SE/4 of the SW/4 of Block 148, South Timbalier Area (the
Lease");
and all right, title and interest in and to the following;
a) all platforms that are located on, or presently used in
connection with the drilling for, or operation, production,
treatment or transportation of gas, oil, casinghead gas, drip
gasoline, natural gasoline and all other liquid and gaseous
hydrocarbons from the Lease (the "Platforms");
b) all wells, wellbores, pipes, pipelines, gathering lines,
compressors, materials, inventory, facilities, supplies and
equipment and any and all other personal, real, movable and
immovable property, fixtures or equipment that are located on,
or presently used in connection with, the drilling for, or
operation, production, treatment or transportation of,
Hydrocarbons from the Lease, and any replacements, attachments
or accessories now or hereafter attached, added or affixed
(the "Equipment");
c) all Hydrocarbons attributable to the Assigned Interests
produced on and after the Effective Date, as hereinafter
defined ("Production");
d) all contracts and agreements (other than the Lease) to the
extent transferable that are attributable to the ownership or
operation of the Assigned Interests, including, without
limitation, the following (collectively, the "Contracts"):
(i) any and all agreements, operating agreements,
participation agreements, unit, pooling and
communitization agreement and declarations,
hydrocarbon purchase and sale agreements, farmin or
farmout agreements, bottom-hole contribution
agreements, balancing agreements, processing
agreements, gathering agreements, compression
agreements, transportation agreements, gathering
agreements, compression agreements, transportation
agreements, and any other contracts and agreements
that are attributable to the ownership or operation
of the Assigned Interests;
e) all orders, permits and easements that are attributable to the
Assigned Interests ("Permits");
Exhibit B-3 page 2
f) all other rights, privileges, benefits, powers and obligations
conferred or imposed upon Assignor as the owner of the
Assigned Interests ("Rights"); and
g) to the extent attributable to the Assigned Interests and not
prohibited by law or an agreement to which Assignor is a
party, the rights to the original records in the possession of
Assignor: (i) lease and land records, (ii) geological and
geophysical records, (iii) operations, production and
engineering records, (iv) accounting records, and (v) facility
and well records (collectively the "Records").
For purposes of this Assignment the Assigned Interests, Platforms,
Equipment, Production, Contracts, Permits, Rights and Records are collectively
referred to as the "Assets".
By acceptance of this Assignment, Assignee acknowledges the existence
of, and agrees to be bound by all of the terms and conditions contained in the
following:
a) The Lease;
b) Purchase and Sale Agreement dated June 28, 2002 and effective
July 1, 2002 at 7:00 a.m. Central Standard Time, by and
between American Resources Offshore, Inc., as Seller, and
Newfield Exploration Company, as Buyer (the "PSA");
c) Declaration of Rights III dated effective September 27, 1993,
by and between Settle Oil and Gas Company, Century Offshore
Management Corporation, PNC Bank National Associates and
Newfield Exploration Company, regarding OCS-G 1898;
d) Declaration of Rights dated effective July 1, 1993, by and
between Settle Oil and Gas Company, Century Offshore
Management Corporation, BMO Financial Inc. and Bank of
Montreal, regarding OCS-G 1898;
e) Declaration of Rights II dated effective November 22, 1993, by
and between Settle Oil and Gas Company, Century Offshore
Management Corporation, BMO Financial Inc., Bank of Montreal
and Newfield Exploration Company, regarding OCS-G 1898;
f) Farmout Agreement dated June 21, 1994, between Century
Offshore Management Corporation and Settle Oil and Gas
Company, regarding OCS-G 1898;
g) Farmout Agreement dated June 13, 1991, by and between Conoco
Inc. and Century Offshore Management Corporation covering
OCS-G 1898;
h) Farmout Agreement dated June 13, 1991, by and between OXY
U.S.A., Inc. and Century Offshore Management Corporation
covering OCS-G 1898;
i) Joint Operating Agreement dated August 1, 1994, between
Newfield Exploration Company (Operator), and Century Offshore
Management Corporation, et al. (Non-Operators), covering W/2
Block 148, South Timbalier Area, Offshore, Louisiana;
Exhibit B-3 page 3
j) Operating Agreement dated January 1, 1989, by and between
Conoco Inc. and OXY U.S.A., Inc. covering the West-half (1/2)
of South Timbalier Block 148;
k) Ownership and Operating Agreement dated November 25, 1980, by
and between Conoco Inc., OXY U.S.A., Inc. and Texaco Producing
Company covering South Timbalier Field 176 production
facilities;
l) Agreement dated June 21,1994, by and among Newfield
Exploration Company, Settle Oil and Gas Company and Century
Offshore Management Corporation, regarding OCS-G l898;
m) Participation Agreement dated effective as of September 27,
1993, by and among Newfield Exploration Company, Settle Oil
and Gas Company and Century Management Corporation covering
OCS-G 1898;
n) Letter Agreement entered into March 25, 1988, by and between
Conoco Inc. and OXY U.S., addressing OXY's approval to utilize
gas produced from South Timbalier Block 146 "A" platform to
provide Gas-Lift gas to South Timbalier 148 "A" platform;
o) Letter Agreement entered into July 7, 1983, by and between
Conoco Inc., Texaco Producing Co., and OXY U.S.A., Inc.
regarding Texaco's use of the 4 1/2" OD pipeline;
p) Crude Oil Contract with Cities Service Oil and Gas
Corporation, as Seller, and Citgo Petroleum Corporation, as
Buyer, effective September 1, 1983, and covering oil and field
separated liquids;
q) Operating Agreement effective September 1, 1972, by and
between Amoco Production Company, Conoco Inc. and OXY U.S.A.,
Inc. regarding that 4 1/2" OD pipeline commencing at Amoco's
South Timbalier Block 161 "A" Platform and extending to and
tied into Chevron's 10" pipeline in South Timbalier Block 161;
r) Purchase and Sale Agreement, dated effective July 1, 1996, by
and between Century Offshore Management Corporation (seller)
and Southern Gas Company of Delaware, Inc. (buyer), covering
the sale of interest in OCS-G 1898, Block 148 W/2, South
Timbalier Area, Offshore Louisiana;
s) Purchase and Sale Agreement dated May 31, 1991, effective
November 1, 1990, executed by and between Oxy U.S.A., Inc. and
Century Offshore Management Corporation, covering OCS-G l898,
in which a preferential right to purchase the liquids from the
lease was reserved, and which contains a limitation on
assignment provisions;
t) Purchase and Sale Agreement dated May 31, 1991, effective
November 1, 1990, executed by and between Cities Service Oil
Company and Century Offshore Management Corporation, covering
OCS-G l898, in which a preferential right to purchase the
liquids from the lease was reserved, and which contains a
limitation on assignment provisions.
Exhibit B-3 page 4
This Assignment is made without any warranty of title, express, implied
or statutory, even for return of any consideration paid therefor; provided only
that subject to the permitted encumbrances (if any), Assignor shall warrant and
defend title against all claims and demands of all persons whomever claiming
title to the Assigned Interests by, through or under Assignor, but not
otherwise, and only to the extent set forth in the PSA. Assignee acknowledges
that (i) it has had access to the Assets and the employees of Assignor and the
opportunity to inspect the Assets, and (ii) in making its decision to enter into
the PSA and consummate the transactions contemplated thereby, Assignee has
relied solely on the basis of its own independent investigation of the Assets
and upon the representations and warranties of Assignor set forth in the PSA and
the special warranty of title made herein. Accordingly, Assignee acknowledges
that Assignor has not made, AND ASSIGNOR HEREBY EXPRESSLY DISCLAIMS AND NEGATES,
ANY REPRESENTATION OR WARRANTY, EXPRESSED (ORALLY OR IN WRITING), IMPLIED, AT
COMMON LAW, BY STATUTE, OR OTHERWISE, OR OTHER RIGHT OF RECOURSE (EVEN AS TO
RETURN OF THE PURCHASE PRICE) RELATING TO (A) THE CONDITION OF THE ASSETS
(INCLUDING ANY IMPLIED OR EXPRESSED WARRANTY OF MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE, ABSENCE OF LATENT DEFECTS OR REDHIBITORY VICES, OR OF
CONFORMITY TO MODELS OR SAMPLES OF MATERIALS, OR ENVIRONMENTAL CONDITION), (B)
ANY INFRINGEMENT BY ASSIGNOR OF ANY PATENT OR PROPRIETARY RIGHT OF ANY THIRD
PARTY, AND (C) ACCURACY, COMPLETENESS OR MATERIALITY OF ANY INFORMATION, DATA OR
OTHER MATERIALS (WRITTEN OR ORAL) FURNISHED TO ASSIGNEE BY OR ON BEHALF OF
Exhibit B-3 page 5
ASSIGNOR (INCLUDING WITH RESPECT TO RESERVE MATTERS, SUCCESS OF WELLS (INCLUDING
WELLS THAT ARE DRILLED AFTER THE EFFECTIVE DATE), COMPLIANCE WITH LAWS,
ENVIRONMENTAL CONDITIONS AND OTHER MATTERS); IT BEING AGREED BY ASSIGNEE THAT IT
IS ACQUIRING THE ASSETS "AS-IS," "WHERE-IS", WITH ALL FAULTS.
This Assignment is made in accordance with the PSA and all provisions
of said PSA are incorporated herein by reference for all purposes as if copied
in extenso. In the event of a conflict between the terms of this Assignment and
the PSA, the terms of the PSA shall control.
This Assignment may be executed in any number of counterparts, all of
which taken together shall constitute one and the same instrument by signing any
such counterpart.
This Assignment shall bind and inure to the benefit of and be binding
upon Assignor and Assignee and their respective successors and assigns.
IN WITNESS WHEREOF, this Assignment is executed before the undersigned
competent witnesses by the parties on the dates set forth in their respective
acknowledgements hereinbelow, but shall be effective for all purposes on the 1st
day of July, 2002, at 7:00 a.m. Central Standard Time ("Effective Date").
ASSIGNOR:
WITNESSES: AMERICAN RESOURCES OFFSHORE, INC.
GOM No. 1937
By: _____________________________
_____________________________ Name:____________________________
Title:___________________________
_____________________________
Exhibit B-3 page 6
ASSIGNEE:
WITNESSES: NEWFIELD EXPLORATION COMPANY
GOM No. 1364
By: _____________________________
_____________________________ W. M. Blumenshine
Attorney in Fact
_____________________________
Exhibit B-3 page 7
STATE OF TEXAS ss.
ss.
COUNTY OF HARRIS ss.
BEFORE ME, the undersigned authority, on this day personally appeared
__________________, known to me to be the person whose name is subscribed to the
foregoing instrument as _______________ of AMERICAN RESOURCES OFFSHORE, INC., a
Delaware corporation, and acknowledged to me that he executed the same for and
on behalf of said corporation, for the purposes and consideration therein
expressed, and in the capacity therein stated.
GIVEN under my hand and seal of office this ___ day of _________, 2002.
__________________________________
Notary Public, State of Texas
My Commission Expires:____________
STATE OF TEXAS ss.
ss.
COUNTY OF HARRIS ss.
BEFORE ME, the undersigned authority, on this day personally appeared
W. M. Blumenshine, known to me to be the person whose name is subscribed to the
foregoing instrument as Attorney in Fact of NEWFIELD EXPLORATION COMPANY, a
Delaware corporation, and acknowledged to me that he executed the same for and
on behalf of said corporation, for the purposes and consideration therein
expressed, and in the capacity therein stated.
GIVEN under my hand and seal of office this ___ day of July, 2002.
__________________________________
Notary Public, State of Texas
My Commission Expires:____________
Exhibit B-3 page 8
EXHIBIT "B-4"
-------------
Attached to and made apart of that certain Purchase and Sale Agreement among
American Resources Offshore, Inc., as "Seller"
and
Newfield Exploration Company, as "Buyer"
- --------------------------------------------------------------------------------
South Timbalier Area Block 148
OCS-G 1898
ASSIGNMENT OF RECORD TITLE
--------------------------
UNITED STATES OF AMERICA ss.
OUTER CONTINENTAL SHELF ss. KNOW ALL MEN BY THESE PRESENTS:
OFFSHORE LOUISIANA ss.
SOUTH TIMBALIER AREA ss.
This Assignment of Record Title ("Assignment") is made by AMERICAN
RESOURCES OFFSHORE, INC., a Delaware corporation, whose address is 801 Travis
Street, Suite 2100, Houston, Texas 77002 (hereinafter referred to as "Assignor")
in favor of NEWFIELD EXPLORATION COMPANY, a Delaware corporation, whose address
is 363 N. Sam Houston Pkwy. E. Suite 2020, Houston, Texas 77060 (hereinafter
referred to as "Assignee").
WITNESSETH
In consideration of One Hundred Dollars ($100.00) and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Assignor by these presents does hereby CONVEY, TRANSFER and ASSIGN
to Assignee, subject to the further provisions hereof, all of Assignor's right,
title and interest, being an undivided 9.00000% record title interest ("Assigned
Interests") in the following described oil and gas lease:
Exhibit B-4 page 1
OCS-G 1898, Oil and Gas Lease dated effective March 1, 1969, granted by
the United States Department of the Interior, Bureau of Land
Management, as Lessor, in favor of Continental Oil Company and Cities
Service Oil Company, as Lessee, covering Block 148, West Half, South
Timbalier Area, as shown on OCS Official Leasing Map, Louisiana Map No.
6, containing approximately 2,500 acres, INSOFAR AND ONLY INSOFAR AS it
covers the E/2 of the NE/4 of the SW/4; E/2 of the SE/4 of the SW/4;
SW/4 of the SE/4 of the SW/4; S/2 of the SW/4 of the SW/4; NW/4 of the
SW/4 of the SW/4; SW/4 of the NW/4 of the SW/4 of Block 148, South
Timbalier Area (the "Lease");
and all right, title and interest in and to the following;
a) all platforms that are located on, or presently used in
connection with the drilling for, or operation, production,
treatment or transportation of gas, oil, casinghead gas, drip
gasoline, natural gasoline and all other liquid and gaseous
hydrocarbons from the Lease (the "Platforms");
b) all wells, wellbores, pipes, pipelines, gathering lines,
compressors, materials, inventory, facilities, supplies and
equipment and any and all other personal, real, movable and
immovable property, fixtures or equipment that are located on,
or presently used in connection with, the drilling for, or
operation, production, treatment or transportation of,
Hydrocarbons from the Lease, and any replacements, attachments
or accessories now or hereafter attached, added or affixed
(the "Equipment");
c) all Hydrocarbons attributable to the Assigned Interests
produced on and after the Effective Date, as hereinafter
defined ("Production");
d) all contracts and agreements (other than the Lease) to the
extent transferable that are attributable to the ownership or
operation of the Assigned Interests, including, without
limitation, the following (collectively, the "Contracts"):
(i) any and all agreements, operating agreements,
participation agreements, unit, pooling and
communitization agreement and declarations,
hydrocarbon purchase and sale agreements, farmin or
farmout agreements, bottom-hole contribution
agreements, balancing agreements, processing
agreements, gathering agreements, compression
agreements, transportation agreements, gathering
agreements, compression agreements, transportation
agreements, and any other contracts and agreements
that are attributable to the ownership or operation
of the Assigned Interests;
e) all orders, permits and easements that are attributable to the
Assigned Interests ("Permits");
Exhibit B-4 page 2
f) all other rights, privileges, benefits, powers and obligations
conferred or imposed upon Assignor as the owner of the
Assigned Interests ("Rights"); and
g) to the extent attributable to the Assigned Interests and not
prohibited by law or an agreement to which Assignor is a
party, the rights to the original records in the possession of
Assignor: (i) lease and land records, (ii) geological and
geophysical records, (iii) operations, production and
engineering records, (iv) accounting records, and (v) facility
and well records (collectively the "Records").
For purposes of this Assignment the Assigned Interests, Platforms,
Equipment, Production, Contracts, Permits, Rights and Records are collectively
referred to as the "Assets".
By acceptance of this Assignment, Assignee acknowledges the existence
of, and agrees to be bound by all of the terms and conditions contained in the
following:
a) The Lease;
b) Purchase and Sale Agreement dated June 28, 2002 and effective
July 1, 2002 at 7:00 a.m. Central Standard Time, by and
between American Resources Offshore, Inc., as Seller, and
Newfield Exploration Company, as Buyer (the "PSA");
c) Declaration of Rights III dated effective September 27, 1993,
by and between Settle Oil and Gas Company, Century Offshore
Management Corporation, PNC Bank National Associates and
Newfield Exploration Company, regarding OCS-G 1898;
d) Declaration of Rights dated effective July 1, 1993, by and
between Settle Oil and Gas Company, Century Offshore
Management Corporation, BMO Financial Inc. and Bank of
Montreal, regarding OCS-G 1898;
e) Declaration of Rights II dated effective November 22, 1993, by
and between Settle Oil and Gas Company, Century Offshore
Management Corporation, BMO Financial Inc., Bank of Montreal
and Newfield Exploration Company, regarding OCS-G l898;
f) Farmout Agreement dated June 21, 1994 between Century Offshore
Management Corporation and Settle Oil and Gas Company,
regarding OCS-G 1898;
g) Farmout Agreement dated June 13, 1991 by and between Conoco
Inc. and Century Offshore Management Corporation covering
OCS-G 1898;
h) Farmout Agreement dated June 13, 1991 by and between OXY
U.S.A. Inc, and Century Offshore Management Corporation
covering OCS-G 1898;
Exhibit B-4 page 3
i) Joint Operating Agreement dated August 1, 1994, between
Newfield ExplorationCompany (Operator), and Century Offshore
Management Corporation., et al (Non-Operators), covering W/2
Block 148, South Timbalier Area, Offshore, Louisiana;
j) Operating Agreement dated January 1, 1989, by and between
Conoco Inc. and OXY U.S.A., Inc. covering the West-half (1/2)
of South Timbalier Block 148;
k) Ownership and Operating Agreement dated November 25, 1980, by
and between Conoco Inc., OXY U.S.A., Inc. and Texaco Producing
Company covering South Timbalier Field 176 production
facilities;
1) Agreement dated June 21, 1994 by and among Newfield
Exploration Company, Settle Oil and Gas Company and Century
Offshore Management Corporation, regarding OCS-G 1898;
m) Participation Agreement dated effective as of September 27,
1993 by and among Newfield Exploration Company, Settle Oil and
Gas Company and Century Management Corporation covering OCS-G
1898;
n) Letter Agreement entered into March 25, 1988, by and between
Conoco Inc. and OXY U.S., addressing OXY's approval to utilize
gas produced from South Timbalier Block 146 "A" platform to
provide Gas-Lift gas to South Timbalier 148 "A" platform;
o) Letter Agreement entered into July 7, 1983, by and between
Conoco Inc., Texaco Producing Co., and OXY U.S.A., Inc.
regarding Texaco's use of the 4 1/2" OD pipeline;
p) Crude Oil Contract with Cities Service Oil and Gas
Corporation, as Seller, and Citgo Petroleum Corporation, as
Buyer, effective September 1, 1983, and covering oil and field
separated liquids;
q) Operating Agreement effective September 1, 1972, by and
between Amoco Production Company, Conoco Inc. and OXY U.S.A.,
Inc. regarding that 4 1/2" OD pipeline commencing at Amoco's
South Timbalier Block 161 "A" Platform and extending to and
tied into Chevron's 10" pipeline in South Timbalier Block 161;
r) Purchase and Sale Agreement, dated effective July 1, 1996, by
and between Century Offshore Management Corporation (seller)
and Southern Gas Company of Delaware, Inc. (buyer), covering
the sale of interest in OCS-G 1898, Block 148 W/2, South
Timbalier Area, Offshore Louisiana;
s) Purchase and Sale Agreement dated May 31, 1991, effective
November 1, 1990, executed by and between Oxy U.S.A. Inc. and
Century Offshore Management Corporation, covering OCS-G 1898,
in which a preferential right to purchase the liquids from the
lease was reserved, and which contains a limitation on
assignment provisions;
Exhibit B-4 page 4
t) Purchase and Sale Agreement dated May 31, 1991, effective
November 1, 1990, executed by and between Cities Service Oil
Company and Century Offshore Management Corporation, covering
OCS-G 1898, in which a preferential right to purchase the
liquids from the lease was reserved, and which contains a
limitation on assignment provisions;
This Assignment is made without any warranty of title, express, implied
or statutory, even for return of any consideration paid therefor; provided only
that subject to the permitted encumbrances (if any), Assignor shall warrant and
defend title against all claims and demands of all persons whomever claiming
title to the Assigned Interests by, through or under Assignor, but not
otherwise, and only to the extent set forth in the PSA. Assignee acknowledges
that (i) it has had access to the Assets and the employees of Assignor and the
opportunity to inspect the Assets, and (ii) in making its decision to enter into
the PSA and consummate the transactions contemplated thereby, Assignee has
relied solely on the basis of its own independent investigation of the Assets
and upon the representations and warranties of Assignor set forth in the PSA and
the special warranty of title made herein. Accordingly, Assignee acknowledges
that Assignor has not made, AND ASSIGNOR HEREBY EXPRESSLY DISCLAIMS AND NEGATES,
ANY REPRESENTATION OR WARRANTY, EXPRESSED (ORALLY OR IN WRITING), IMPLIED, AT
COMMON LAW, BY STATUTE, OR OTHERWISE, OR OTHER RIGHT OF RECOURSE (EVEN AS TO
RETURN OF THE PURCHASE PRICE) RELATING TO (A) THE CONDITION OF THE ASSETS
(INCLUDING ANY IMPLIED OR EXPRESSED WARRANTY OF MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE, ABSENCE OF LATENT DEFECTS OR REDHIBITORY VICES, OR OF
CONFORMITY TO MODELS OR SAMPLES OF MATERIALS, OR ENVIRONMENTAL CONDITION), (B)
Exhibit B-4 page 6
ANY INFRINGEMENT BY ASSIGNOR OF ANY PATENT OR PROPRIETARY RIGHT OF ANY THIRD
PARTY, AND (C) ACCURACY, COMPLETENESS OR MATERIALITY OF ANY INFORMATION, DATA OR
OTHER MATERIALS (WRITTEN OR ORAL) FURNISHED TO ASSIGNEE BY OR ON BEHALF OF
ASSIGNOR (INCLUDING WITH RESPECT TO RESERVE MATTERS, SUCCESS OF WELLS (INCLUDING
WELLS THAT ARE DRILLED AFTER THE EFFECTIVE DATE), COMPLIANCE WITH LAWS,
ENVIRONMENTAL CONDITIONS AND OTHER MATTERS); IT BEING AGREED BY ASSIGNEE THAT IT
IS ACQUIRING THE ASSETS "AS-IS," "WHERE-IS", WITH ALL FAULTS.
This Assignment is made in accordance with the PSA and all provisions
of said PSA are incorporated herein by reference for all purposes as if copied
in extenso. In the event of a conflict between the terms of this Assignment and
the PSA, the terms of the PSA shall control.
This Assignment may be executed in any number of counterparts, all of
which taken together shall constitute one and the same instrument by signing any
such counterpart.
This Assignment shall bind and inure to the benefit of and be binding
upon Assignor and Assignee and their respective successors and assigns.
IN WITNESS WHEREOF, this Assignment is executed before the undersigned
competent witnesses by the parties on the dates set forth in their respective
acknowledgements hereinbelow, but shall be effective for all purposes on the 1st
day of July, 2002, at 7:00 a.m. Central Standard Time ("Effective Date").
ASSIGNOR:
WITNESSES: AMERICAN RESOURCES OFFSHORE, INC.
GOM No. 1937
By: _____________________________
_____________________________ Name:____________________________
Title:___________________________
_____________________________
Exhibit B-4 page 6
ASSIGNEE:
WITNESSES: NEWFIELD EXPLORATION COMPANY
GOM No. 1364
By: _____________________________
_____________________________ W. M. Blumenshine
Attorney in Fact
_____________________________
Exhibit B-4 page 7
STATE OF TEXAS ss.
ss.
COUNTY OF HARRIS ss.
BEFORE ME, the undersigned authority, on this day personally appeared
__________________, known to me to be the person whose name is subscribed to the
foregoing instrument as _______________ of AMERICAN RESOURCES OFFSHORE, INC., a
Delaware corporation, and acknowledged to me that he executed the same for and
on behalf of said corporation, for the purposes and consideration therein
expressed, and in the capacity therein stated.
GIVEN under my hand and seal of office this ___ day of _________, 2002.
__________________________________
Notary Public, State of Texas
My Commission Expires:____________
STATE OF TEXAS ss.
ss.
COUNTY OF HARRIS ss.
BEFORE ME, the undersigned authority, on this day personally appeared
W. M. Blumenshine, known to me to be the person whose name is subscribed to the
foregoing instrument as Attorney in Fact of NEWFIELD EXPLORATION COMPANY, a
Delaware corporation, and acknowledged to me that he executed the same for and
on behalf of said corporation, for the purposes and consideration therein
expressed, and in the capacity therein stated.
GIVEN under my hand and seal of office this ___ day of July, 2002.
__________________________________
Notary Public, State of Texas
My Commission Expires:____________
Exhibit B-4 page 8
EXHIBIT "B-5"
-------------
Attached to and made apart of that certain Purchase and Sale Agreement among
American Resources Offshore, Inc., as "Seller"
and
Newfield Exploration Company, as "Buyer"
- --------------------------------------------------------------------------------
South Timbalier Area Block 148
OCS-G 1898
ASSIGNMENT OF OPERATING RIGHTS
------------------------------
UNITED STATES OF AMERICA ss.
OUTER CONTINENTAL SHELF ss. KNOW ALL MEN BY THESE PRESENTS:
OFFSHORE LOUISIANA ss.
SOUTH TIMBALIER AREA ss.
This Assignment of Operating Rights ("Assignment") is made by AMERICAN
RESOURCES OFFSHORE, INC., a Delaware corporation, whose address is 801 Travis
Street, Suite 2100, Houston, Texas 77002 (hereinafter referred to as "Assignor")
in favor of NEWFIELD EXPLORATION COMPANY, a Delaware corporation, whose address
is 363 N. Sam Houston Pkwy. E. Suite 2020, Houston, Texas 77060 (hereinafter
referred to as "Assignee").
WITNESSETH
----------
In consideration of One Hundred Dollars ($100.00) and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Assignor by these presents does hereby CONVEY, TRANSFER and ASSIGN
to Assignee, subject to the further provisions hereof, all of Assignor's
operating rights interest, being an undivided 9.00000% operating rights interest
("Assigned Interests"), in the following described oil and gas lease:
Exhibit B-5 page 1
OCS-G 1898, Oil and Gas Lease dated effective March 1, 1969, granted by
the United States Department of the Interior, Bureau of Land
Management, as Lessor, in favor of Continental Oil Company and Cities
Service Oil Company, as Lessee, covering Block 148, West Half, South
Timbalier Area, as shown on OCS Official Leasing Map, Louisiana Map No.
6, containing approximately 2,500 acres, INSOFAR AND ONLY INSOFAR AS it
covers the operating rights of NW/4 of the NE/4 of the SW/4 Block 148,
and further limited to those depths from the surface down to 14,000
feet SUBSEA (the "Lease");
and a like interest in and to the following, insofar and only insofar
as same pertains to the Assigned Interests:
a) all platforms that are located on, or presently used in
connection with the drilling for, or operation, production,
treatment or transportation of gas, oil, casinghead gas, drip
gasoline, natural gasoline and all other liquid and gaseous
hydrocarbons from the Lease (the "Platforms");
b) all wells, wellbores, pipes, pipelines, gathering lines,
compressors, materials, inventory, facilities, supplies and
equipment and any and all other personal, real, movable and
immovable property, fixtures or equipment that are located on,
or presently used in connection with, the drilling for, or
operation, production, treatment or transportation of,
Hydrocarbons from the Lease, and any replacements, attachments
or accessories now or hereafter attached, added or affixed
(the "Equipment");
c) all Hydrocarbons attributable to the Assigned Interests
produced on and after the Effective Date, as hereinafter
defined ("Production");
d) all contracts and agreements (other than the Lease) to the
extent transferable that are attributable to the ownership or
operation of the Assigned Interests, including, without
limitation, the following (collectively, the "Contracts"):
(i) any and all contracts and agreements, operating
agreements, participation agreements, unit, pooling
and communitization agreement and declarations,
hydrocarbon purchase and sale agreements, farmin or
farmout agreements, bottom-hole contribution
agreements, balancing agreements, processing
agreements, gathering agreements, compression
agreements, transportation agreements, gathering
agreements, compression agreements, transportation
agreements, and any other contracts and agreements
that are attributable to the ownership or operation
of the Assigned Interests;
e) all orders, permits and easements that are attributable to the
Assigned Interests ("Permits");
Exhibit B-5 page 2
f) all other rights, privileges, benefits, powers and obligations
conferred or imposed upon Assignor as the owner of the
Assigned Interests ("Rights"); and
g) to the extent attributable to the Assigned Interests and not
prohibited by law or an agreement to which Assignor is a
party, the rights to the original records in the possession of
Assignor: (i) lease and land records, (ii) geological and
geophysical records, (iii) operations, production and
engineering records, (iv) accounting records, and (v) facility
and well records (collectively the "Records").
For purposes of this Assignment, the Assigned Interests, Platforms,
Equipment, Production, Contracts, Permits, Rights and Records are collectively
referred to as the "Assets".
By acceptance of this Assignment, Assignee acknowledges the existence
of, and agrees to be bound by all of the terms and conditions contained in the
following:
a) The Lease;
b) Purchase and Sale Agreement dated June 28, 2002 and effective
July 1, 2002 at 7:00 a.m. Central Standard Time, by and
between American Resources Offshore, Inc., as Seller, and
Newfield Exploration Company, as Buyer (the "PSA");
c) Declaration of Rights III dated effective September 27, 1993,
by and between Settle Oil and Gas Company, Century Offshore
Management Corporation, PNC Bank National Associates and
Newfield Exploration Company, regarding OCS-G 1898;
d) Declaration of Rights dated effective July 1, 1993, by and
between Settle Oil and Gas Company, Century Offshore
Management Corporation, BMO Financial Inc. and Bank of
Montreal, regarding OCS-G 1898;
e) Declaration of Rights II dated effective November 22, 1993, by
and between Settle Oil and Gas Company, Century Offshore
Management Corporation, BMO Financial Inc., Bank of Montreal
and Newfield Exploration Company, regarding OCS-G 1898;
f) Farmout Agreement dated June 21, 1994, between Century
Offshore Management Corporation and Settle Oil and Gas
Company, regarding OCS-G 1898;
g) Farmout Agreement dated June 13, 1991, by and between Conoco
Inc. and Century Offshore Management Corporation covering
OCS-G 1898;
h) Farmout Agreement dated June 13, 1991, by and between OXY
U.S.A., Inc. and Century Offshore Management Corporation
covering OCS-G 1898;
Exhibit B-5 page 3
i) Joint Operating Agreement dated August 1, 1994, between
Newfield Exploration Company (Operator), and Century Offshore
Management Corporation, et al. (Non-Operators), covering W/2
Block 148, South Timbalier Area, Offshore, Louisiana;
j) Operating Agreement dated January 1, 1989, by and between
Conoco Inc. and OXY U.S.A., Inc. covering the West-half (1/2)
of South Timbalier Block 148;
k) Ownership and Operating Agreement dated November 25, 1980, by
and between Conoco Inc., OXY U.S.A., Inc. and Texaco Producing
Company covering South Timbalier Field 176 production
facilities;
l) Agreement dated June 21,1994, by and among Newfield
Exploration Company, Settle Oil and Gas Company and Century
Offshore Management Corporation, regarding OCS-G l898;
m) Participation Agreement dated effective as of September 27,
1993, by and among Newfield Exploration Company, Settle Oil
and Gas Company and Century Management Corporation covering
OCS-G 1898;
n) Letter Agreement entered into March 25, 1988, by and between
Conoco Inc. and OXY U.S., addressing OXY's approval to utilize
gas produced from South Timbalier Block 146 "A" platform to
provide Gas-Lift gas to South Timbalier 148 "A" platform;
o) Letter Agreement entered into July 7, 1983, by and between
Conoco Inc., Texaco Producing Co., and OXY U.S.A., Inc.
regarding Texaco's use of the 4 1/2" OD pipeline;
p) Crude Oil Contract with Cities Service Oil and Gas
Corporation, as Seller, and Citgo Petroleum Corporation, as
Buyer, effective September 1, 1983, and covering oil and field
separated liquids;
q) Operating Agreement effective September 1, 1972, by and
between Amoco Production Company, Conoco Inc. and OXY U.S.A.,
Inc. regarding that 4 1/2" OD pipeline commencing at Amoco's
South Timbalier Block 161 "A" Platform and extending to and
tied into Chevron's 10" pipeline in South Timbalier Block 161;
r) Purchase and Sale Agreement, dated effective July 1, 1996, by
and between Century Offshore Management Corporation (seller)
and Southern Gas Company of Delaware, Inc. (buyer), covering
the sale of interest in OCS-G 1898, Block 148 W/2, South
Timbalier Area, Offshore Louisiana;
s) Purchase and Sale Agreement dated May 31, 1991, effective
November 1, 1990, executed by and between Oxy U.S.A. Inc. and
Century Offshore Management Corporation, covering OCS-G 1898,
in which a preferential right to purchase the liquids from the
lease was reserved, and which contains a limitation on
assignment provisions;
Exhibit B-5 page 4
t) Purchase and Sale Agreement dated May 31, 1991, effective
November 1, 1990, executed by and between Cities Service Oil
Company and Century Offshore Management Corporation, covering
OCS-G 1898, in which a preferential right to purchase the
liquids from the lease was reserved, and which contains a
limitation on assignment provisions;
This Assignment is made without any warranty of title, express, implied
or statutory, even for return of any consideration paid therefor; provided only
that subject to the permitted encumbrances (if any), Assignor shall warrant and
defend title against all claims and demands of all persons whomever claiming
title to the Assigned Interests by, through or under Assignor, but not
otherwise, and only to the extent set forth in the PSA. Assignee acknowledges
that (i) it has had access to the Assets and the employees of Assignor and the
opportunity to inspect the Assets, and (ii) in making its decision to enter into
the PSA and consummate the transactions contemplated thereby, Assignee has
relied solely on the basis of its own independent investigation of the Assets
and upon the representations and warranties of Assignor set forth in the PSA and
the special warranty of title made herein. Accordingly, Assignee acknowledges
that Assignor has not made, AND ASSIGNOR HEREBY EXPRESSLY DISCLAIMS AND NEGATES,
ANY REPRESENTATION OR WARRANTY, EXPRESSED (ORALLY OR IN WRITING), IMPLIED, AT
COMMON LAW, BY STATUTE, OR OTHERWISE, OR OTHER RIGHT OF RECOURSE (EVEN AS TO
RETURN OF THE PURCHASE PRICE) RELATING TO (A) THE CONDITION OF THE ASSETS
(INCLUDING ANY IMPLIED OR EXPRESSED WARRANTY OF MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE, ABSENCE OF LATENT DEFECTS OR REDHIBITORY VICES, OR OF
CONFORMITY TO MODELS OR SAMPLES OF MATERIALS, OR ENVIRONMENTAL CONDITION), (B)
ANY INFRINGEMENT BY ASSIGNOR OF ANY PATENT OR PROPRIETARY RIGHT OF ANY THIRD
PARTY, AND (C) ACCURACY, COMPLETENESS OR MATERIALITY OF ANY INFORMATION, DATA OR
Exhibit B-5 page 9
OTHER MATERIALS (WRITTEN OR ORAL) FURNISHED TO ASSIGNEE BY OR ON BEHALF OF
ASSIGNOR (INCLUDING WITH RESPECT TO RESERVE MATTERS, SUCCESS OF WELLS (INCLUDING
WELLS THAT ARE DRILLED AFTER THE EFFECTIVE DATE), COMPLIANCE WITH LAWS,
ENVIRONMENTAL CONDITIONS AND OTHER MATTERS); IT BEING AGREED BY ASSIGNEE THAT IT
IS ACQUIRING THE ASSETS "AS-IS," "WHERE-IS", WITH ALL FAULTS.
This Assignment is made in accordance with the PSA and all provisions
of said PSA are incorporated herein by reference for all purposes as if copied
in extenso. In the event of a conflict between the terms of this Assignment and
the PSA, the terms of the PSA shall control.
This Assignment may be executed in any number of counterparts, all of
which taken together shall constitute one and the same instrument by signing any
such counterpart.
This Assignment shall bind and inure to the benefit of and be binding
upon Assignor and Assignee and their respective successors and assigns.
IN WITNESS WHEREOF, this Assignment is executed before the undersigned
competent witnesses by the parties on the dates set forth in their respective
acknowledgements hereinbelow; but shall be effective for all purposes on the 1st
day of July 2002, at 7:00 a.m., Central Standard Time ("Effective Date").
ASSIGNOR:
WITNESSES: AMERICAN RESOURCES OFFSHORE, INC.
GOM No. 1937
By: _____________________________
_____________________________ Name:____________________________
Title:___________________________
_____________________________
Exhibit B-5 page 6
ASSIGNEE:
WITNESSES: NEWFIELD EXPLORATION COMPANY
GOM No. 1364
By: _____________________________
_____________________________ W. M. Blumenshine
Attorney in Fact
_____________________________
Exhibit B-5 page 7
STATE OF TEXAS ss.
ss.
COUNTY OF HARRIS ss.
BEFORE ME, the undersigned authority, on this day personally appeared
__________________, known to me to be the person whose name is subscribed to the
foregoing instrument as _______________ of AMERICAN RESOURCES OFFSHORE, INC., a
Delaware corporation, and acknowledged to me that he executed the same for and
on behalf of said corporation, for the purposes and consideration therein
expressed, and in the capacity therein stated.
GIVEN under my hand and seal of office this ___ day of _________, 2002.
__________________________________
Notary Public, State of Texas
My Commission Expires:____________
STATE OF TEXAS ss.
ss.
COUNTY OF HARRIS ss.
BEFORE ME, the undersigned authority, on this day personally appeared
W. M. Blumenshine, known to me to be the person whose name is subscribed to the
foregoing instrument as Attorney in Fact of NEWFIELD EXPLORATION COMPANY, a
Delaware corporation, and acknowledged to me that he executed the same for and
on behalf of said corporation, for the purposes and consideration therein
expressed, and in the capacity therein stated.
GIVEN under my hand and seal of office this ___ day of July, 2002.
__________________________________
Notary Public, State of Texas
My Commission Expires:____________
Exhibit B-5 page 8
EXHIBIT "B-6"
-------------
Attached to and made apart of that certain Purchase and Sale Agreement among
American Resources Offshore, Inc., as "Seller"
and
Newfield Exploration Company, as "Buyer"
- --------------------------------------------------------------------------------
South Timbalier Area Block 148
OCS-G 1898
ASSIGNMENT OF OPERATING RIGHTS
------------------------------
UNITED STATES OF AMERICA ss.
OUTER CONTINENTAL SHELF ss. KNOW ALL MEN BY THESE PRESENTS:
OFFSHORE LOUISIANA ss.
SOUTH TIMBALIER AREA ss.
This Assignment of Operating Rights ("Assignment") is made by AMERICAN
RESOURCES OFFSHORE, INC., a Delaware corporation, whose address is 801 Travis
Street, Suite 2100, Houston, Texas 77002 (hereinafter referred to as "Assignor")
in favor of NEWFIELD EXPLORATION COMPANY, a Delaware corporation, whose address
is 363 N. Sam Houston Pkwy. E. Suite 2020, Houston, Texas 77060 (hereinafter
referred to as "Assignee").
WITNESSETH
----------
In consideration of One Hundred Dollars ($100.00) and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Assignor by these presents does hereby CONVEY, TRANSFER and ASSIGN
to Assignee, subject to the further provisions hereof, all of Assignor's
operating rights interest, being an undivided 1.00000% operating rights interest
("Assigned Interests"), in the following described oil and gas lease:
Exhibit B-6 page 1
OCS-G 1898, Oil and Gas Lease dated effective March 1, 1969, granted by
the United States Department of the Interior, Bureau of Land
Management, as Lessor, in favor of Continental Oil Company and Cities
Service Oil Company, as Lessee, covering Block 148, West Half, South
Timbalier Area, as shown on OCS Official Leasing Map, Louisiana Map No.
6, containing approximately 2,500 acres, INSOFAR AND ONLY INSOFAR AS it
covers the operating rights of NW/4 of the NW/4 of the SW/4 Block 148,
and further limited to those depths below 14,000 feet SUBSEA (the
"Lease").
and a like interest in and to the following, insofar and only insofar
as same pertains to the Assigned Interests:
a) all platforms that are located on, or presently used in
connection with the drilling for, or operation, production,
treatment or transportation of gas, oil, casinghead gas, drip
gasoline, natural gasoline and all other liquid and gaseous
hydrocarbons from the Lease (the "Platforms");
b) all wells, wellbores, pipes, pipelines, gathering lines,
compressors, materials, inventory, facilities, supplies and
equipment and any and all other personal, real, movable and
immovable property, fixtures or equipment that are located on,
or presently used in connection with, the drilling for, or
operation, production, treatment or transportation of,
Hydrocarbons from the Lease, and any replacements, attachments
or accessories now or hereafter attached, added or affixed
(the "Equipment");
c) all Hydrocarbons attributable to the Assigned Interests
produced on and after the Effective Date, as hereinafter
defined ("Production");
d) all contracts and agreements (other than the Lease) to the
extent transferable that are attributable to the ownership or
operation of the Assigned Interests, including, without
limitation, the following (collectively, the "Contracts"):
(i) any and all contracts and agreements, operating
agreements, participation agreements, unit, pooling
and communitization agreement and declarations,
hydrocarbon purchase and sale agreements, farmin or
farmout agreements, bottom-hole contribution
agreements, balancing agreements, processing
agreements, gathering agreements, compression
agreements, transportation agreements, gathering
agreements, compression agreements, transportation
agreements, and any other contracts and agreements
that are attributable to the ownership or operation
of the Assigned Interests;
e) all orders, permits and easements that are attributable to the
Assigned Interests ("Permits");
Exhibit B-6 page 2
f) all other rights, privileges, benefits, powers and obligations
conferred or imposed upon Assignor as the owner of the
Assigned Interests ("Rights"); and
g) to the extent attributable to the Assigned Interests and not
prohibited by law or an agreement to which Assignor is a
party, the rights to the original records in the possession of
Assignor: (i) lease and land records, (ii) geological and
geophysical records, (iii) operations, production and
engineering records, (iv) accounting records, and (v) facility
and well records (collectively the "Records").
For purposes of this Assignment, the Assigned Interests, Platforms,
Equipment, Production, Contracts, Permits, Rights and Records are collectively
referred to as the "Assets".
By acceptance of this Assignment, Assignee acknowledges the existence
of, and agrees to be bound by all of the terms and conditions contained in the
following:
a) The Lease;
b) Purchase and Sale Agreement dated June 28, 2002 and effective
July 1, 2002 at 7:00 a.m. Central Standard Time, by and
between American Resources Offshore, Inc., as Seller, and
Newfield Exploration Company, as Buyer (the "PSA");
c) Declaration of Rights III dated effective September 27, 1993,
by and between Settle Oil and Gas Company, Century Offshore
Management Corporation, PNC Bank National Associates and
Newfield Exploration Company, regarding OCS-G 1898;
d) Declaration of Rights dated effective July 1, 1993, by and
between Settle Oil and Gas Company, Century Offshore
Management Corporation, BMO Financial Inc. and Bank of
Montreal, regarding OCS-G 1898;
e) Declaration of Rights II dated effective November 22, 1993, by
and between Settle Oil and Gas Company, Century Offshore
Management Corporation, BMO Financial Inc., Bank of Montreal
and Newfield Exploration Company, regarding OCS-G 1898;
f) Farmout Agreement dated June 21, 1994, between Century
Offshore Management Corporation and Settle Oil and Gas
Company, regarding OCS-G 1898;
g) Farmout Agreement dated June 13, 1991, by and between Conoco
Inc. and Century Offshore Management Corporation covering
OCS-G 1898;
h) Farmout Agreement dated June 13, 1991, by and between OXY
U.S.A., Inc. and Century Offshore Management Corporation
covering OCS-G 1898;
Exhibit B-6 page 3
i) Joint Operating Agreement dated August 1, 1994, between
Newfield Exploration Company (Operator), and Century Offshore
Management Corporation, et al. (Non-Operators), covering W/2
Block 148, South Timbalier Area, Offshore, Louisiana;
j) Operating Agreement dated January 1, 1989, by and between
Conoco Inc. and OXY U.S.A., Inc. covering the West-half (1/2)
of South Timbalier Block 148;
k) Ownership and Operating Agreement dated November 25, 1980, by
and between Conoco Inc., OXY U.S.A., Inc. and Texaco Producing
Company covering South Timbalier Field 176 production
facilities;
l) Agreement dated June 21,1994, by and among Newfield
Exploration Company, Settle Oil and Gas Company and Century
Offshore Management Corporation, regarding OCS-G l898;
m) Participation Agreement dated effective as of September 27,
1993, by and among Newfield Exploration Company, Settle Oil
and Gas Company and Century Management Corporation covering
OCS-G 1898;
n) Letter Agreement entered into March 25, 1988, by and between
Conoco Inc. and OXY U.S., addressing OXY's approval to utilize
gas produced from South Timbalier Block 146 "A" platform to
provide Gas-Lift gas to South Timbalier 148 "A" platform;
o) Letter Agreement entered into July 7, 1983, by and between
Conoco Inc., Texaco Producing Co., and OXY U.S.A., Inc.
regarding Texaco's use of the 4 1/2" OD pipeline;
p) Crude Oil Contract with Cities Service Oil and Gas
Corporation, as Seller, and Citgo Petroleum Corporation, as
Buyer, effective September 1, 1983, and covering oil and field
separated liquids;
q) Operating Agreement effective September 1, 1972, by and
between Amoco Production Company, Conoco Inc. and OXY U.S.A.,
Inc. regarding that 4 1/2" OD pipeline commencing at Amoco's
South Timbalier Block 161 "A" Platform and extending to and
tied into Chevron's 10" pipeline in South Timbalier Block 161;
r) Purchase and Sale Agreement, dated effective July 1, 1996, by
and between Century Offshore Management Corporation (seller)
and Southern Gas Company of Delaware, Inc. (buyer), covering
the sale of interest in OCS-G 1898, Block 148 W/2, South
Timbalier Area, Offshore Louisiana;
s) Purchase and Sale Agreement dated May 31, 1991, effective
November 1, 1990, executed by and between Oxy U.S.A. Inc. and
Century Offshore Management Corporation, covering OCS-G 1898,
in which a preferential right to purchase the liquids from the
lease was reserved, and which contains a limitation on
assignment provisions;
Exhibit B-6 page 4
t) Purchase and Sale Agreement dated May 31, 1991, effective
November 1, 1990, executed by and between Cities Service Oil
Company and Century Offshore Management Corporation, covering
OCS-G 1898, in which a preferential right to purchase the
liquids from the lease was reserved, and which contains a
limitation on assignment provisions;
This Assignment is made without any warranty of title, express, implied or
statutory, even for return of any consideration paid therefor; provided only
that subject to the permitted encumbrances (if any), Assignor shall warrant and
defend title against all claims and demands of all persons whomever claiming
title to the Assigned Interests by, through or under Assignor, but not
otherwise, and only to the extent set forth in the PSA. Assignee acknowledges
that (i) it has had access to the Assets and the employees of Assignor and the
opportunity to inspect the Assets, and (ii) in making its decision to enter into
the PSA and consummate the transactions contemplated thereby, Assignee has
relied solely on the basis of its own independent investigation of the Assets
and upon the representations and warranties of Assignor set forth in the PSA and
the special warranty of title made herein. Accordingly, Assignee acknowledges
that Assignor has not made, AND ASSIGNOR HEREBY EXPRESSLY DISCLAIMS AND NEGATES,
ANY REPRESENTATION OR WARRANTY, EXPRESSED (ORALLY OR IN WRITING), IMPLIED, AT
COMMON LAW, BY STATUTE, OR OTHERWISE, OR OTHER RIGHT OF RECOURSE (EVEN AS TO
RETURN OF THE PURCHASE PRICE) RELATING TO (A) THE CONDITION OF THE ASSETS
(INCLUDING ANY IMPLIED OR EXPRESSED WARRANTY OF MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE, ABSENCE OF LATENT DEFECTS OR REDHIBITORY VICES, OR OF
CONFORMITY TO MODELS OR SAMPLES OF MATERIALS, OR ENVIRONMENTAL CONDITION), (B)
ANY INFRINGEMENT BY ASSIGNOR OF ANY PATENT OR PROPRIETARY RIGHT OF ANY THIRD
PARTY, AND (C) ACCURACY, COMPLETENESS OR MATERIALITY OF ANY INFORMATION, DATA OR
Exhibit B-6 page 5
OTHER MATERIALS (WRITTEN OR ORAL) FURNISHED TO ASSIGNEE BY OR ON BEHALF OF
ASSIGNOR (INCLUDING WITH RESPECT TO RESERVE MATTERS, SUCCESS OF WELLS (INCLUDING
WELLS THAT ARE DRILLED AFTER THE EFFECTIVE DATE), COMPLIANCE WITH LAWS,
ENVIRONMENTAL CONDITIONS AND OTHER MATTERS); IT BEING AGREED BY ASSIGNEE THAT IT
IS ACQUIRING THE ASSETS "AS-IS," "WHERE-IS", WITH ALL FAULTS.
This Assignment is made in accordance with the PSA and all provisions
of said PSA are incorporated herein by reference for all purposes as if copied
in extenso. In the event of a conflict between the terms of this Assignment and
the PSA, the terms of the PSA shall control.
This Assignment may be executed in any number of counterparts, all of
which taken together shall constitute one and the same instrument by signing any
such counterpart.
This Assignment shall bind and inure to the benefit of and be binding
upon Assignor and Assignee and their respective successors and assigns.
IN WITNESS WHEREOF, this Assignment is executed before the undersigned
competent witnesses by the parties on the dates set forth in their respective
acknowledgements hereinbelow; but shall be effective for all purposes on the 1st
day of July 2002, at 7:00 a.m., Central Standard Time ("Effective Date").
ASSIGNOR:
WITNESSES: AMERICAN RESOURCES OFFSHORE, INC.
GOM No. 1937
By: _____________________________
_____________________________ Name:____________________________
Title:___________________________
_____________________________
Exhibit B-6 page 6
ASSIGNEE:
WITNESSES: NEWFIELD EXPLORATION COMPANY
GOM No. 1364
By: _____________________________
_____________________________ W. M. Blumenshine
Attorney in Fact
_____________________________
Exhibit B-6 page 7
STATE OF TEXAS ss.
ss.
COUNTY OF HARRIS ss.
BEFORE ME, the undersigned authority, on this day personally appeared
__________________, known to me to be the person whose name is subscribed to the
foregoing instrument as _______________ of AMERICAN RESOURCES OFFSHORE, INC., a
Delaware corporation, and acknowledged to me that he executed the same for and
on behalf of said corporation, for the purposes and consideration therein
expressed, and in the capacity therein stated.
GIVEN under my hand and seal of office this ___ day of July, 2002.
__________________________________
Notary Public, State of Texas
My Commission Expires:____________
STATE OF TEXAS ss.
ss.
COUNTY OF HARRIS ss.
BEFORE ME, the undersigned authority, on this day personally appeared
W. M. Blumenshine, known to me to be the person whose name is subscribed to the
foregoing instrument as Attorney in Fact of NEWFIELD EXPLORATION COMPANY, a
Delaware corporation, and acknowledged to me that he executed the same for and
on behalf of said corporation, for the purposes and consideration therein
expressed, and in the capacity therein stated.
GIVEN under my hand and seal of office this ___ day of July, 2002.
__________________________________
Notary Public, State of Texas
My Commission Expires:____________
Exhibit B-6 page 8
EXHIBIT "B-7"
-------------
Attached to and made apart of that certain Purchase and Sale Agreement among
American Resources Offshore, Inc., as "Seller"
and
Newfield Exploration Company, as "Buyer"
- --------------------------------------------------------------------------------
South Timbalier Area Block 148
OCS-G 1898
ASSIGNMENT OF OPERATING RIGHTS
------------------------------
UNITED STATES OF AMERICA ss.
OUTER CONTINENTAL SHELF ss. KNOW ALL MEN BY THESE PRESENTS:
OFFSHORE LOUISIANA ss.
SOUTH TIMBALIER AREA ss.
This Assignment of Operating Rights ("Assignment") is made by AMERICAN
RESOURCES OFFSHORE, INC., a Delaware corporation, whose address is 801 Travis
Street, Suite 2100, Houston, Texas 77002 (hereinafter referred to as "Assignor")
in favor of NEWFIELD EXPLORATION COMPANY, a Delaware corporation, whose address
is 363 N. Sam Houston Pkwy. E. Suite 2020, Houston, Texas 77060 (hereinafter
referred to as "Assignee").
WITNESSETH
----------
In consideration of One Hundred Dollars ($100.00) and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Assignor by these presents does hereby CONVEY, TRANSFER and ASSIGN
to Assignee, subject to the further provisions hereof, all of Assignor's
operating rights interest, being an undivided 9.00000% operating rights interest
("Assigned Interests"), in the following described oil and gas lease:
Exhibit B-7 page 1
OCS-G 1898, Oil and Gas Lease dated effective March 1, 1969, granted by
the United States Department of the Interior, Bureau of Land
Management, as Lessor, in favor of Continental Oil Company and Cities
Service Oil Company, as Lessee, covering Block 148, West Half, South
Timbalier Area, as shown on OCS Official Leasing Map, Louisiana Map No.
6, containing approximately 2,500 acres, INSOFAR AND ONLY INSOFAR as it
covers the NW/4 SE/4 SW/4 of Block 148, and further limited to those
depths below 14,000 feet SUBSEA (the "Lease").
and a like interest in and to the following, insofar and only insofar
as same pertains to the Assigned Interests:
a) all platforms that are located on, or presently used in
connection with the drilling for, or operation, production,
treatment or transportation of gas, oil, casinghead gas, drip
gasoline, natural gasoline and all other liquid and gaseous
hydrocarbons from the Lease (the "Platforms");
b) all wells, wellbores, pipes, pipelines, gathering lines,
compressors, materials, inventory, facilities, supplies and
equipment and any and all other personal, real, movable and
immovable property, fixtures or equipment that are located on,
or presently used in connection with, the drilling for, or
operation, production, treatment or transportation of,
Hydrocarbons from the Lease, and any replacements, attachments
or accessories now or hereafter attached, added or affixed
(the "Equipment");
c) all Hydrocarbons attributable to the Assigned Interests
produced on and after the Effective Date, as hereinafter
defined ("Production");
d) all contracts and agreements (other than the Lease) to the
extent transferable that are attributable to the ownership or
operation of the Assigned Interests, including, without
limitation, the following (collectively, the "Contracts"):
(i) any and all contracts and agreements, operating
agreements, participation agreements, unit, pooling
and communitization agreement and declarations,
hydrocarbon purchase and sale agreements, farmin or
farmout agreements, bottom-hole contribution
agreements, balancing agreements, processing
agreements, gathering agreements, compression
agreements, transportation agreements, gathering
agreements, compression agreements, transportation
agreements, and any other contracts and agreements
that are attributable to the ownership or operation
of the Assigned Interests;
e) all orders, permits and easements that are attributable to the
Assigned Interests ("Permits");
Exhibit B-7 page 2
f) all other rights, privileges, benefits, powers and obligations
conferred or imposed upon Assignor as the owner of the
Assigned Interests ("Rights"); and
g) to the extent attributable to the Assigned Interests and not
prohibited by law or an agreement to which Assignor is a
party, the rights to the original records in the possession of
Assignor: (i) lease and land records, (ii) geological and
geophysical records, (iii) operations, production and
engineering records, (iv) accounting records, and (v) facility
and well records (collectively the "Records").
For purposes of this Assignment, the Assigned Interests, Platforms,
Equipment, Production, Contracts, Permits, Rights and Records are collectively
referred to as the "Assets".
By acceptance of this Assignment, Assignee acknowledges the existence
of, and agrees to be bound by all of the terms and conditions contained in the
following:
a) The Lease;
b) Purchase and Sale Agreement dated June 28, 2002 and effective
July 1, 2002 at 7:00 a.m. Central Standard Time, by and
between American Resources Offshore, Inc., as Seller, and
Newfield Exploration Company, as Buyer (the "PSA");
c) Declaration of Rights III dated effective September 27, 1993,
by and between Settle Oil and Gas Company, Century Offshore
Management Corporation, PNC Bank National Associates and
Newfield Exploration Company, regarding OCS-G 1898;
d) Declaration of Rights dated effective July 1, 1993, by and
between Settle Oil and Gas Company, Century Offshore
Management Corporation, BMO Financial Inc. and Bank of
Montreal, regarding OCS-G 1898;
e) Declaration of Rights II dated effective November 22, 1993, by
and between Settle Oil and Gas Company, Century Offshore
Management Corporation, BMO Financial Inc., Bank of Montreal
and Newfield Exploration Company, regarding OCS-G 1898;
f) Farmout Agreement dated June 21, 1994, between Century
Offshore Management Corporation and Settle Oil and Gas
Company, regarding OCS-G 1898;
g) Farmout Agreement dated June 13, 1991, by and between Conoco
Inc. and Century Offshore Management Corporation covering
OCS-G 1898;
h) Farmout Agreement dated June 13, 1991, by and between OXY
U.S.A., Inc. and Century Offshore Management Corporation
covering OCS-G 1898;
Exhibit B-7 page 3
i) Joint Operating Agreement dated August 1, 1994, between
Newfield Exploration Company (Operator), and Century Offshore
Management Corporation, et al. (Non-Operators), covering W/2
Block 148, South Timbalier Area, Offshore, Louisiana;
j) Operating Agreement dated January 1, 1989, by and between
Conoco Inc. and OXY U.S.A., Inc. covering the West-half (1/2)
of South Timbalier Block 148;
k) Ownership and Operating Agreement dated November 25, 1980, by
and between Conoco Inc., OXY U.S.A., Inc. and Texaco Producing
Company covering South Timbalier Field 176 production
facilities;
l) Agreement dated June 21,1994, by and among Newfield
Exploration Company, Settle Oil and Gas Company and Century
Offshore Management Corporation, regarding OCS-G l898;
m) Participation Agreement dated effective as of September 27,
1993, by and among Newfield Exploration Company, Settle Oil
and Gas Company and Century Management Corporation covering
OCS-G 1898;
n) Letter Agreement entered into March 25, 1988, by and between
Conoco Inc. and OXY U.S., addressing OXY's approval to utilize
gas produced from South Timbalier Block 146 "A" platform to
provide Gas-Lift gas to South Timbalier 148 "A" platform;
o) Letter Agreement entered into July 7, 1983, by and between
Conoco Inc., Texaco Producing Co., and OXY U.S.A., Inc.
regarding Texaco's use of the 4 1/2" OD pipeline;
p) Crude Oil Contract with Cities Service Oil and Gas
Corporation, as Seller, and Citgo Petroleum Corporation, as
Buyer, effective September 1, 1983, and covering oil and field
separated liquids;
q) Operating Agreement effective September 1, 1972, by and
between Amoco Production Company, Conoco Inc. and OXY U.S.A.,
Inc. regarding that 4 1/2" OD pipeline commencing at Amoco's
South Timbalier Block 161 "A" Platform and extending to and
tied into Chevron's 10" pipeline in South Timbalier Block 161;
r) Purchase and Sale Agreement, dated effective July 1, 1996, by
and between Century Offshore Management Corporation (seller)
and Southern Gas Company of Delaware, Inc. (buyer), covering
the sale of interest in OCS-G 1898, Block 148 W/2, South
Timbalier Area, Offshore Louisiana;
s) Purchase and Sale Agreement dated May 31, 1991, effective
November 1, 1990, executed by and between Oxy U.S.A. Inc. and
Century Offshore Management Corporation, covering OCS-G 1898,
in which a preferential right to purchase the liquids from the
lease was reserved, and which contains a limitation on
assignment provisions;
Exhibit B-7 page 4
t) Purchase and Sale Agreement dated May 31, 1991, effective
November 1, 1990, executed by and between Cities Service Oil
Company and Century Offshore Management Corporation, covering
OCS-G 1898, in which a preferential right to purchase the
liquids from the lease was reserved, and which contains a
limitation on assignment provisions;
This Assignment is made without any warranty of title, express, implied
or statutory, even for return of any consideration paid therefor; provided only
that subject to the permitted encumbrances (if any), Assignor shall warrant and
defend title against all claims and demands of all persons whomever claiming
title to the Assigned Interests by, through or under Assignor, but not
otherwise, and only to the extent set forth in the PSA. Assignee acknowledges
that (i) it has had access to the Assets and the employees of Assignor and the
opportunity to inspect the Assets, and (ii) in making its decision to enter into
the PSA and consummate the transactions contemplated thereby, Assignee has
relied solely on the basis of its own independent investigation of the Assets
and upon the representations and warranties of Assignor set forth in the PSA and
the special warranty of title made herein. Accordingly, Assignee acknowledges
that Assignor has not made, AND ASSIGNOR HEREBY EXPRESSLY DISCLAIMS AND NEGATES,
ANY REPRESENTATION OR WARRANTY, EXPRESSED (ORALLY OR IN WRITING), IMPLIED, AT
COMMON LAW, BY STATUTE, OR OTHERWISE, OR OTHER RIGHT OF RECOURSE (EVEN AS TO
RETURN OF THE PURCHASE PRICE) RELATING TO (A) THE CONDITION OF THE ASSETS
(INCLUDING ANY IMPLIED OR EXPRESSED WARRANTY OF MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE, ABSENCE OF LATENT DEFECTS OR REDHIBITORY VICES, OR OF
CONFORMITY TO MODELS OR SAMPLES OF MATERIALS, OR ENVIRONMENTAL CONDITION), (B)
ANY INFRINGEMENT BY ASSIGNOR OF ANY PATENT OR PROPRIETARY RIGHT OF ANY THIRD
PARTY, AND (C) ACCURACY, COMPLETENESS OR MATERIALITY OF ANY INFORMATION, DATA OR
Exhibit B-7 page 5
OTHER MATERIALS (WRITTEN OR ORAL) FURNISHED TO ASSIGNEE BY OR ON BEHALF OF
ASSIGNOR (INCLUDING WITH RESPECT TO RESERVE MATTERS, SUCCESS OF WELLS (INCLUDING
WELLS THAT ARE DRILLED AFTER THE EFFECTIVE DATE), COMPLIANCE WITH LAWS,
ENVIRONMENTAL CONDITIONS AND OTHER MATTERS); IT BEING AGREED BY ASSIGNEE THAT IT
IS ACQUIRING THE ASSETS "AS-IS," "WHERE-IS", WITH ALL FAULTS.
This Assignment is made in accordance with the PSA and all provisions
of said PSA are incorporated herein by reference for all purposes as if copied
in extenso. In the event of a conflict between the terms of this Assignment and
the PSA, the terms of the PSA shall control.
This Assignment may be executed in any number of counterparts, all of
which taken together shall constitute one and the same instrument by signing any
such counterpart.
This Assignment shall bind and inure to the benefit of and be binding
upon Assignor and Assignee and their respective successors and assigns.
IN WITNESS WHEREOF, this Assignment is executed before the undersigned
competent witnesses by the parties on the dates set forth in their respective
acknowledgements hereinbelow; but shall be effective for all purposes on the 1st
day of July 2002, at 7:00 a.m., Central Standard Time ("Effective Date").
ASSIGNOR:
WITNESSES: AMERICAN RESOURCES OFFSHORE, INC.
GOM No. 1937
By: _____________________________
_____________________________ Name:____________________________
Title:___________________________
_____________________________
Exhibit B-7 page 6
ASSIGNEE:
WITNESSES: NEWFIELD EXPLORATION COMPANY
GOM No. 1364
By: _____________________________
_____________________________ W. M. Blumenshine
Attorney in Fact
_____________________________
Exhibit B-7 page 7
STATE OF TEXAS ss.
ss.
COUNTY OF HARRIS ss.
BEFORE ME, the undersigned authority, on this day personally appeared
__________________, known to me to be the person whose name is subscribed to the
foregoing instrument as _______________ of AMERICAN RESOURCES OFFSHORE, INC., a
Delaware corporation, and acknowledged to me that he executed the same for and
on behalf of said corporation, for the purposes and consideration therein
expressed, and in the capacity therein stated.
GIVEN under my hand and seal of office this ___ day of July, 2002.
__________________________________
Notary Public, State of Texas
My Commission Expires:____________
STATE OF TEXAS ss.
ss.
COUNTY OF HARRIS ss.
BEFORE ME, the undersigned authority, on this day personally appeared
W. M. Blumenshine, known to me to be the person whose name is subscribed to the
foregoing instrument as Attorney in Fact of NEWFIELD EXPLORATION COMPANY, a
Delaware corporation, and acknowledged to me that he executed the same for and
on behalf of said corporation, for the purposes and consideration therein
expressed, and in the capacity therein stated.
GIVEN under my hand and seal of office this ___ day of July, 2002.
__________________________________
Notary Public, State of Texas
My Commission Expires:____________
Exhibit B-7 page 8
EXHIBIT "B-8"
-------------
Attached to and made apart of that certain Purchase and Sale Agreement among
American Resources Offshore, Inc., as "Seller"
and
Newfield Exploration Company, as "Buyer"
- --------------------------------------------------------------------------------
South Timbalier Area Block 148
OCS-G 1898
ASSIGNMENT OF OPERATING RIGHTS
------------------------------
UNITED STATES OF AMERICA ss.
OUTER CONTINENTAL SHELF ss. KNOW ALL MEN BY THESE PRESENTS:
OFFSHORE LOUISIANA ss.
SOUTH TIMBALIER AREA ss.
This Assignment of Operating Rights ("Assignment") is made by AMERICAN
RESOURCES OFFSHORE, INC., a Delaware corporation, whose address is 801 Travis
Street, Suite 2100, Houston, Texas 77002 (hereinafter referred to as "Assignor")
in favor of NEWFIELD EXPLORATION COMPANY, a Delaware corporation, whose address
is 363 N. Sam Houston Pkwy. E. Suite 2020, Houston, Texas 77060 (hereinafter
referred to as "Assignee").
WITNESSETH
----------
In consideration of One Hundred Dollars ($100.00) and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Assignor by these presents does hereby CONVEY, TRANSFER and ASSIGN
to Assignee, subject to the further provisions hereof, all of Assignor's
operating rights interest, being an undivided 9.00000% operating rights interest
("Assigned Interests"), in the following described oil and gas lease:
Exhibit B-8 page 1
OCS-G 1898, Oil and Gas Lease dated effective March 1, 1969, granted by
the United States Department of the Interior, Bureau of Land
Management, as Lessor, in favor of Continental Oil Company and Cities
Service Oil Company, as Lessee, covering Block 148, West Half, South
Timbalier Area, as shown on OCS Official Leasing Map, Louisiana Map No.
6, containing approximately 2,500 acres, INSOFAR AND ONLY INSOFAR as it
covers the NW/4 SE/4 SW/4 of Block 148, and further limited to those
depths from the surface down to 14,000 feet SUBSEA (the "Lease").
and a like interest in and to the following, insofar and only insofar
as same pertains to the Assigned Interests:
a) all platforms that are located on, or presently used in
connection with the drilling for, or operation, production,
treatment or transportation of gas, oil, casinghead gas, drip
gasoline, natural gasoline and all other liquid and gaseous
hydrocarbons from the Lease (the "Platforms");
b) all wells, wellbores, pipes, pipelines, gathering lines,
compressors, materials, inventory, facilities, supplies and
equipment and any and all other personal, real, movable and
immovable property, fixtures or equipment that are located on,
or presently used in connection with, the drilling for, or
operation, production, treatment or transportation of,
Hydrocarbons from the Lease, and any replacements, attachments
or accessories now or hereafter attached, added or affixed
(the "Equipment");
c) all Hydrocarbons attributable to the Assigned Interests
produced on and after the Effective Date, as hereinafter
defined ("Production");
d) all contracts and agreements (other than the Lease) to the
extent transferable that are attributable to the ownership or
operation of the Assigned Interests, including, without
limitation, the following (collectively, the "Contracts"):
(i) any and all contracts and agreements, operating
agreements, participation agreements, unit, pooling
and communitization agreement and declarations,
hydrocarbon purchase and sale agreements, farmin or
farmout agreements, bottom-hole contribution
agreements, balancing agreements, processing
agreements, gathering agreements, compression
agreements, transportation agreements, gathering
agreements, compression agreements, transportation
agreements, and any other contracts and agreements
that are attributable to the ownership or operation
of the Assigned Interests;
e) all orders, permits and easements that are attributable to the
Assigned Interests ("Permits");
Exhibit B-8 page 2
f) all other rights, privileges, benefits, powers and obligations
conferred or imposed upon Assignor as the owner of the
Assigned Interests ("Rights"); and
g) to the extent attributable to the Assigned Interests and not
prohibited by law or an agreement to which Assignor is a
party, the rights to the original records in the possession of
Assignor: (i) lease and land records, (ii) geological and
geophysical records, (iii) operations, production and
engineering records, (iv) accounting records, and (v) facility
and well records (collectively the "Records").
For purposes of this Assignment, the Assigned Interests, Platforms,
Equipment, Production, Contracts, Permits, Rights and Records are collectively
referred to as the "Assets".
By acceptance of this Assignment, Assignee acknowledges the existence
of, and agrees to be bound by all of the terms and conditions contained in the
following:
a) The Lease;
b) Purchase and Sale Agreement dated June 28, 2002 and effective
July 1, 2002 at 7:00 a.m. Central Standard Time, by and
between American Resources Offshore, Inc., as Seller, and
Newfield Exploration Company, as Buyer (the "PSA");
c) Declaration of Rights III dated effective September 27, 1993,
by and between Settle Oil and Gas Company, Century Offshore
Management Corporation, PNC Bank National Associates and
Newfield Exploration Company, regarding OCS-G 1898;
d) Declaration of Rights dated effective July 1, 1993, by and
between Settle Oil and Gas Company, Century Offshore
Management Corporation, BMO Financial Inc. and Bank of
Montreal, regarding OCS-G 1898;
e) Declaration of Rights II dated effective November 22, 1993, by
and between Settle Oil and Gas Company, Century Offshore
Management Corporation, BMO Financial Inc., Bank of Montreal
and Newfield Exploration Company, regarding OCS-G 1898;
f) Farmout Agreement dated June 21, 1994, between Century
Offshore Management Corporation and Settle Oil and Gas
Company, regarding OCS-G 1898;
g) Farmout Agreement dated June 13, 1991, by and between Conoco
Inc. and Century Offshore Management Corporation covering
OCS-G 1898;
h) Farmout Agreement dated June 13, 1991, by and between OXY
U.S.A., Inc. and Century Offshore Management Corporation
covering OCS-G 1898;
Exhibit B-8 page 3
i) Joint Operating Agreement dated August 1, 1994, between
Newfield Exploration Company (Operator), and Century Offshore
Management Corporation, et al. (Non-Operators), covering W/2
Block 148, South Timbalier Area, Offshore, Louisiana;
j) Operating Agreement dated January 1, 1989, by and between
Conoco Inc. and OXY U.S.A., Inc. covering the West-half (1/2)
of South Timbalier Block 148;
k) Ownership and Operating Agreement dated November 25, 1980, by
and between Conoco Inc., OXY U.S.A., Inc. and Texaco Producing
Company covering South Timbalier Field 176 production
facilities;
l) Agreement dated June 21,1994, by and among Newfield
Exploration Company, Settle Oil and Gas Company and Century
Offshore Management Corporation, regarding OCS-G l898;
m) Participation Agreement dated effective as of September 27,
1993, by and among Newfield Exploration Company, Settle Oil
and Gas Company and Century Management Corporation covering
OCS-G 1898;
n) Letter Agreement entered into March 25, 1988, by and between
Conoco Inc. and OXY U.S., addressing OXY's approval to utilize
gas produced from South Timbalier Block 146 "A" platform to
provide Gas-Lift gas to South Timbalier 148 "A" platform;
o) Letter Agreement entered into July 7, 1983, by and between
Conoco Inc., Texaco Producing Co., and OXY U.S.A., Inc.
regarding Texaco's use of the 4 1/2" OD pipeline;
p) Crude Oil Contract with Cities Service Oil and Gas
Corporation, as Seller, and Citgo Petroleum Corporation, as
Buyer, effective September 1, 1983, and covering oil and field
separated liquids;
q) Operating Agreement effective September 1, 1972, by and
between Amoco Production Company, Conoco Inc. and OXY U.S.A.,
Inc. regarding that 4 1/2" OD pipeline commencing at Amoco's
South Timbalier Block 161 "A" Platform and extending to and
tied into Chevron's 10" pipeline in South Timbalier Block 161;
r) Purchase and Sale Agreement, dated effective July 1, 1996, by
and between Century Offshore Management Corporation (seller)
and Southern Gas Company of Delaware, Inc. (buyer), covering
the sale of interest in OCS-G 1898, Block 148 W/2, South
Timbalier Area, Offshore Louisiana;
s) Purchase and Sale Agreement dated May 31, 1991, effective
November 1, 1990, executed by and between Oxy U.S.A. Inc. and
Century Offshore Management Corporation, covering OCS-G 1898,
in which a preferential right to purchase the liquids from the
lease was reserved, and which contains a limitation on
assignment provisions;
Exhibit B-8 page 4
t) Purchase and Sale Agreement dated May 31, 1991, effective
November 1, 1990, executed by and between Cities Service Oil
Company and Century Offshore Management Corporation, covering
OCS-G 1898, in which a preferential right to purchase the
liquids from the lease was reserved, and which contains a
limitation on assignment provisions;
This Assignment is made without any warranty of title, express, implied
or statutory, even for return of any consideration paid therefor; provided only
that subject to the permitted encumbrances (if any), Assignor shall warrant and
defend title against all claims and demands of all persons whomever claiming
title to the Assigned Interests by, through or under Assignor, but not
otherwise, and only to the extent set forth in the PSA. Assignee acknowledges
that (i) it has had access to the Assets and the employees of Assignor and the
opportunity to inspect the Assets, and (ii) in making its decision to enter into
the PSA and consummate the transactions contemplated thereby, Assignee has
relied solely on the basis of its own independent investigation of the Assets
and upon the representations and warranties of Assignor set forth in the PSA and
the special warranty of title made herein. Accordingly, Assignee acknowledges
that Assignor has not made, AND ASSIGNOR HEREBY EXPRESSLY DISCLAIMS AND NEGATES,
ANY REPRESENTATION OR WARRANTY, EXPRESSED (ORALLY OR IN WRITING), IMPLIED, AT
COMMON LAW, BY STATUTE, OR OTHERWISE, OR OTHER RIGHT OF RECOURSE (EVEN AS TO
RETURN OF THE PURCHASE PRICE) RELATING TO (A) THE CONDITION OF THE ASSETS
(INCLUDING ANY IMPLIED OR EXPRESSED WARRANTY OF MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE, ABSENCE OF LATENT DEFECTS OR REDHIBITORY VICES, OR OF
CONFORMITY TO MODELS OR SAMPLES OF MATERIALS, OR ENVIRONMENTAL CONDITION), (B)
ANY INFRINGEMENT BY ASSIGNOR OF ANY PATENT OR PROPRIETARY RIGHT OF ANY THIRD
PARTY, AND (C) ACCURACY, COMPLETENESS OR MATERIALITY OF ANY INFORMATION, DATA OR
Exhibit B-8 page 5
OTHER MATERIALS (WRITTEN OR ORAL) FURNISHED TO ASSIGNEE BY OR ON BEHALF OF
ASSIGNOR (INCLUDING WITH RESPECT TO RESERVE MATTERS, SUCCESS OF WELLS (INCLUDING
WELLS THAT ARE DRILLED AFTER THE EFFECTIVE DATE), COMPLIANCE WITH LAWS,
ENVIRONMENTAL CONDITIONS AND OTHER MATTERS); IT BEING AGREED BY ASSIGNEE THAT IT
IS ACQUIRING THE ASSETS "AS-IS," "WHERE-IS", WITH ALL FAULTS.
This Assignment is made in accordance with the PSA and all provisions
of said PSA are incorporated herein by reference for all purposes as if copied
in extenso. In the event of a conflict between the terms of this Assignment and
the PSA, the terms of the PSA shall control.
This Assignment may be executed in any number of counterparts, all of
which taken together shall constitute one and the same instrument by signing any
such counterpart.
This Assignment shall bind and inure to the benefit of and be binding
upon Assignor and Assignee and their respective successors and assigns.
IN WITNESS WHEREOF, this Assignment is executed before the undersigned
competent witnesses by the parties on the dates set forth in their respective
acknowledgements hereinbelow; but shall be effective for all purposes on the 1st
day of July 2002, at 7:00 a.m., Central Standard Time ("Effective Date").
ASSIGNOR:
WITNESSES: AMERICAN RESOURCES OFFSHORE, INC.
GOM No. 1937
By: _____________________________
_____________________________ Name:____________________________
Title:___________________________
_____________________________
Exhibit B-8 page 6
ASSIGNEE:
WITNESSES: NEWFIELD EXPLORATION COMPANY
GOM No. 1364
By: _____________________________
_____________________________ W. M. Blumenshine
Attorney in Fact
_____________________________
Exhibit B-8 page 7
STATE OF TEXAS ss.
ss.
COUNTY OF HARRIS ss.
BEFORE ME, the undersigned authority, on this day personally appeared
__________________, known to me to be the person whose name is subscribed to the
foregoing instrument as _______________ of AMERICAN RESOURCES OFFSHORE, INC., a
Delaware corporation, and acknowledged to me that he executed the same for and
on behalf of said corporation, for the purposes and consideration therein
expressed, and in the capacity therein stated.
GIVEN under my hand and seal of office this ___ day of July, 2002.
__________________________________
Notary Public, State of Texas
My Commission Expires:____________
STATE OF TEXAS ss.
ss.
COUNTY OF HARRIS ss.
BEFORE ME, the undersigned authority, on this day personally appeared
W. M. Blumenshine, known to me to be the person whose name is subscribed to the
foregoing instrument as Attorney in Fact of NEWFIELD EXPLORATION COMPANY, a
Delaware corporation, and acknowledged to me that he executed the same for and
on behalf of said corporation, for the purposes and consideration therein
expressed, and in the capacity therein stated.
GIVEN under my hand and seal of office this ___ day of July, 2002.
__________________________________
Notary Public, State of Texas
My Commission Expires:____________
Exhibit B-8 page 8
EXHIBIT "B-9"
-------------
Attached to and made apart of that certain Purchase and Sale Agreement among
American Resources Offshore, Inc., as "Seller"
and
Newfield Exploration Company, as "Buyer"
- --------------------------------------------------------------------------------
South Timbalier Area Block 148
OCS-G 1898
ASSIGNMENT OF OPERATING RIGHTS
------------------------------
UNITED STATES OF AMERICA ss.
OUTER CONTINENTAL SHELF ss. KNOW ALL MEN BY THESE PRESENTS:
OFFSHORE LOUISIANA ss.
SOUTH TIMBALIER AREA ss.
This Assignment of Operating Rights ("Assignment") is made by AMERICAN
RESOURCES OFFSHORE, INC., a Delaware corporation, whose address is 801 Travis
Street, Suite 2100, Houston, Texas 77002 (hereinafter referred to as "Assignor")
in favor of NEWFIELD EXPLORATION COMPANY, a Delaware corporation, whose address
is 363 N. Sam Houston Pkwy. E. Suite 2020, Houston, Texas 77060 (hereinafter
referred to as "Assignee").
WITNESSETH
----------
In consideration of One Hundred Dollars ($100.00) and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Assignor by these presents does hereby CONVEY, TRANSFER and ASSIGN
to Assignee, subject to the further provisions hereof, all of Assignor's
operating rights interest, being an undivided 9.00000% operating rights interest
("Assigned Interests"), in the following described oil and gas lease:
Exhibit B-9 page 1
OCS-G 1898, Oil and Gas Lease dated effective March 1, 1969, granted by
the United States Department of the Interior, Bureau of Land
Management, as Lessor, in favor of Continental Oil Company and Cities
Service Oil Company, as Lessee, covering Block 148, West Half, South
Timbalier Area, as shown on OCS Official Leasing Map, Louisiana Map No.
6, containing approximately 2,500 acres, INSOFAR AND ONLY INSOFAR AS it
covers the operating rights of NW/4 of the NE/4 of the SW/4 Block 148,
and further limited to those depths below 14,000 feet SUBSEA (the
"Lease").
and a like interest in and to the following, insofar and only insofar
as same pertains to the Assigned Interests:
a) all platforms that are located on, or presently used in
connection with the drilling for, or operation, production,
treatment or transportation of gas, oil, casinghead gas, drip
gasoline, natural gasoline and all other liquid and gaseous
hydrocarbons from the Lease (the "Platforms");
b) all wells, wellbores, pipes, pipelines, gathering lines,
compressors, materials, inventory, facilities, supplies and
equipment and any and all other personal, real, movable and
immovable property, fixtures or equipment that are located on,
or presently used in connection with, the drilling for, or
operation, production, treatment or transportation of,
Hydrocarbons from the Lease, and any replacements, attachments
or accessories now or hereafter attached, added or affixed
(the "Equipment");
c) all Hydrocarbons attributable to the Assigned Interests
produced on and after the Effective Date, as hereinafter
defined ("Production");
d) all contracts and agreements (other than the Lease) to the
extent transferable that are attributable to the ownership or
operation of the Assigned Interests, including, without
limitation, the following (collectively, the "Contracts"):
(i) any and all contracts and agreements, operating
agreements, participation agreements, unit, pooling
and communitization agreement and declarations,
hydrocarbon purchase and sale agreements, farmin or
farmout agreements, bottom-hole contribution
agreements, balancing agreements, processing
agreements, gathering agreements, compression
agreements, transportation agreements, gathering
agreements, compression agreements, transportation
agreements, and any other contracts and agreements
that are attributable to the ownership or operation
of the Assigned Interests;
e) all orders, permits and easements that are attributable to the
Assigned Interests ("Permits");
Exhibit B-9 page 2
f) all other rights, privileges, benefits, powers and obligations
conferred or imposed upon Assignor as the owner of the
Assigned Interests ("Rights"); and
g) to the extent attributable to the Assigned Interests and not
prohibited by law or an agreement to which Assignor is a
party, the rights to the original records in the possession of
Assignor: (i) lease and land records, (ii) geological and
geophysical records, (iii) operations, production and
engineering records, (iv) accounting records, and (v) facility
and well records (collectively the "Records").
For purposes of this Assignment, the Assigned Interests, Platforms,
Equipment, Production, Contracts, Permits, Rights and Records are collectively
referred to as the "Assets".
By acceptance of this Assignment, Assignee acknowledges the existence
of, and agrees to be bound by all of the terms and conditions contained in the
following:
a) The Lease;
b) Purchase and Sale Agreement dated June 28, 2002 and effective
July 1, 2002 at 7:00 a.m. Central Standard Time, by and
between American Resources Offshore, Inc., as Seller, and
Newfield Exploration Company, as Buyer (the "PSA");
c) Declaration of Rights III dated effective September 27, 1993,
by and between Settle Oil and Gas Company, Century Offshore
Management Corporation, PNC Bank National Associates and
Newfield Exploration Company, regarding OCS-G 1898;
d) Declaration of Rights dated effective July 1, 1993, by and
between Settle Oil and Gas Company, Century Offshore
Management Corporation, BMO Financial Inc. and Bank of
Montreal, regarding OCS-G 1898;
e) Declaration of Rights II dated effective November 22, 1993, by
and between Settle Oil and Gas Company, Century Offshore
Management Corporation, BMO Financial Inc., Bank of Montreal
and Newfield Exploration Company, regarding OCS-G 1898;
f) Farmout Agreement dated June 21, 1994, between Century
Offshore Management Corporation and Settle Oil and Gas
Company, regarding OCS-G 1898;
g) Farmout Agreement dated June 13, 1991, by and between Conoco
Inc. and Century Offshore Management Corporation covering
OCS-G 1898;
h) Farmout Agreement dated June 13, 1991, by and between OXY
U.S.A., Inc. and Century Offshore Management Corporation
covering OCS-G 1898;
Exhibit B-9 page 3
i) Joint Operating Agreement dated August 1, 1994, between
Newfield Exploration Company (Operator), and Century Offshore
Management Corporation, et al. (Non-Operators), covering W/2
Block 148, South Timbalier Area, Offshore, Louisiana;
j) Operating Agreement dated January 1, 1989, by and between
Conoco Inc. and OXY U.S.A., Inc. covering the West-half (1/2)
of South Timbalier Block 148;
k) Ownership and Operating Agreement dated November 25, 1980, by
and between Conoco Inc., OXY U.S.A., Inc. and Texaco Producing
Company covering South Timbalier Field 176 production
facilities;
l) Agreement dated June 21,1994, by and among Newfield
Exploration Company, Settle Oil and Gas Company and Century
Offshore Management Corporation, regarding OCS-G l898;
m) Participation Agreement dated effective as of September 27,
1993, by and among Newfield Exploration Company, Settle Oil
and Gas Company and Century Management Corporation covering
OCS-G 1898;
n) Letter Agreement entered into March 25, 1988, by and between
Conoco Inc. and OXY U.S., addressing OXY's approval to utilize
gas produced from South Timbalier Block 146 "A" platform to
provide Gas-Lift gas to South Timbalier 148 "A" platform;
o) Letter Agreement entered into July 7, 1983, by and between
Conoco Inc., Texaco Producing Co., and OXY U.S.A., Inc.
regarding Texaco's use of the 4 1/2" OD pipeline;
p) Crude Oil Contract with Cities Service Oil and Gas
Corporation, as Seller, and Citgo Petroleum Corporation, as
Buyer, effective September 1, 1983, and covering oil and field
separated liquids;
q) Operating Agreement effective September 1, 1972, by and
between Amoco Production Company, Conoco Inc. and OXY U.S.A.,
Inc. regarding that 4 1/2" OD pipeline commencing at Amoco's
South Timbalier Block 161 "A" Platform and extending to and
tied into Chevron's 10" pipeline in South Timbalier Block 161;
r) Purchase and Sale Agreement, dated effective July 1, 1996, by
and between Century Offshore Management Corporation (seller)
and Southern Gas Company of Delaware, Inc. (buyer), covering
the sale of interest in OCS-G 1898, Block 148 W/2, South
Timbalier Area, Offshore Louisiana;
s) Purchase and Sale Agreement dated May 31, 1991, effective
November 1, 1990, executed by and between Oxy U.S.A. Inc. and
Century Offshore Management Corporation, covering OCS-G 1898,
in which a preferential right to purchase the liquids from the
lease was reserved, and which contains a limitation on
assignment provisions;
Exhibit B-9 page 4
t) Purchase and Sale Agreement dated May 31, 1991, effective
November 1, 1990, executed by and between Cities Service Oil
Company and Century Offshore Management Corporation, covering
OCS-G 1898, in which a preferential right to purchase the
liquids from the lease was reserved, and which contains a
limitation on assignment provisions;
This Assignment is made without any warranty of title, express, implied
or statutory, even for return of any consideration paid therefor; provided only
that subject to the permitted encumbrances (if any), Assignor shall warrant and
defend title against all claims and demands of all persons whomever claiming
title to the Assigned Interests by, through or under Assignor, but not
otherwise, and only to the extent set forth in the PSA. Assignee acknowledges
that (i) it has had access to the Assets and the employees of Assignor and the
opportunity to inspect the Assets, and (ii) in making its decision to enter into
the PSA and consummate the transactions contemplated thereby, Assignee has
relied solely on the basis of its own independent investigation of the Assets
and upon the representations and warranties of Assignor set forth in the PSA and
the special warranty of title made herein. Accordingly, Assignee acknowledges
that Assignor has not made, AND ASSIGNOR HEREBY EXPRESSLY DISCLAIMS AND NEGATES,
ANY REPRESENTATION OR WARRANTY, EXPRESSED (ORALLY OR IN WRITING), IMPLIED, AT
COMMON LAW, BY STATUTE, OR OTHERWISE, OR OTHER RIGHT OF RECOURSE (EVEN AS TO
RETURN OF THE PURCHASE PRICE) RELATING TO (A) THE CONDITION OF THE ASSETS
(INCLUDING ANY IMPLIED OR EXPRESSED WARRANTY OF MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE, ABSENCE OF LATENT DEFECTS OR REDHIBITORY VICES, OR OF
CONFORMITY TO MODELS OR SAMPLES OF MATERIALS, OR ENVIRONMENTAL CONDITION), (B)
ANY INFRINGEMENT BY ASSIGNOR OF ANY PATENT OR PROPRIETARY RIGHT OF ANY THIRD
PARTY, AND (C) ACCURACY, COMPLETENESS OR MATERIALITY OF ANY INFORMATION, DATA OR
Exhibit B-9 page 5
OTHER MATERIALS (WRITTEN OR ORAL) FURNISHED TO ASSIGNEE BY OR ON BEHALF OF
ASSIGNOR (INCLUDING WITH RESPECT TO RESERVE MATTERS, SUCCESS OF WELLS (INCLUDING
WELLS THAT ARE DRILLED AFTER THE EFFECTIVE DATE), COMPLIANCE WITH LAWS,
ENVIRONMENTAL CONDITIONS AND OTHER MATTERS); IT BEING AGREED BY ASSIGNEE THAT IT
IS ACQUIRING THE ASSETS "AS-IS," "WHERE-IS", WITH ALL FAULTS.
This Assignment is made in accordance with the PSA and all provisions
of said PSA are incorporated herein by reference for all purposes as if copied
in extenso. In the event of a conflict between the terms of this Assignment and
the PSA, the terms of the PSA shall control.
This Assignment may be executed in any number of counterparts, all of
which taken together shall constitute one and the same instrument by signing any
such counterpart.
This Assignment shall bind and inure to the benefit of and be binding
upon Assignor and Assignee and their respective successors and assigns.
IN WITNESS WHEREOF, this Assignment is executed before the undersigned
competent witnesses by the parties on the dates set forth in their respective
acknowledgements hereinbelow; but shall be effective for all purposes on the 1st
day of July 2002, at 7:00 a.m., Central Standard Time ("Effective Date").
ASSIGNOR:
WITNESSES: AMERICAN RESOURCES OFFSHORE, INC.
GOM No. 1937
By: _____________________________
_____________________________ Name:____________________________
Title:___________________________
_____________________________
Exhibit B-9 page 6
ASSIGNEE:
WITNESSES: NEWFIELD EXPLORATION COMPANY
GOM No. 1364
By: _____________________________
_____________________________ W. M. Blumenshine
Attorney in Fact
_____________________________
Exhibit B-9 page 7
STATE OF TEXAS ss.
ss.
COUNTY OF HARRIS ss.
BEFORE ME, the undersigned authority, on this day personally appeared
__________________, known to me to be the person whose name is subscribed to the
foregoing instrument as _______________ of AMERICAN RESOURCES OFFSHORE, INC., a
Delaware corporation, and acknowledged to me that he executed the same for and
on behalf of said corporation, for the purposes and consideration therein
expressed, and in the capacity therein stated.
GIVEN under my hand and seal of office this ___ day of July, 2002.
__________________________________
Notary Public, State of Texas
My Commission Expires:____________
STATE OF TEXAS ss.
ss.
COUNTY OF HARRIS ss.
BEFORE ME, the undersigned authority, on this day personally appeared
W. M. Blumenshine, known to me to be the person whose name is subscribed to the
foregoing instrument as Attorney in Fact of NEWFIELD EXPLORATION COMPANY, a
Delaware corporation, and acknowledged to me that he executed the same for and
on behalf of said corporation, for the purposes and consideration therein
expressed, and in the capacity therein stated.
GIVEN under my hand and seal of office this ___ day of July, 2002.
__________________________________
Notary Public, State of Texas
My Commission Expires:____________
Exhibit B-9 page 8
EXHIBIT "B-10"
--------------
Attached to and made apart of that certain Purchase and Sale Agreement among
American Resources Offshore, Inc., as "Seller"
and
Newfield Exploration Company, as "Buyer"
- --------------------------------------------------------------------------------
South Timbalier Area Block 148
OCS-G 1898
ASSIGNMENT OF OPERATING RIGHTS
------------------------------
UNITED STATES OF AMERICA ss.
OUTER CONTINENTAL SHELF ss. KNOW ALL MEN BY THESE PRESENTS:
OFFSHORE LOUISIANA ss.
SOUTH TIMBALIER AREA ss.
This Assignment of Operating Rights ("Assignment") is made by AMERICAN
RESOURCES OFFSHORE, INC., a Delaware corporation, whose address is 801 Travis
Street, Suite 2100, Houston, Texas 77002 (hereinafter referred to as "Assignor")
in favor of NEWFIELD EXPLORATION COMPANY, a Delaware corporation, whose address
is 363 N. Sam Houston Pkwy. E. Suite 2020, Houston, Texas 77060 (hereinafter
referred to as "Assignee").
WITNESSETH
----------
In consideration of One Hundred Dollars ($100.00) and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Assignor by these presents does hereby CONVEY, TRANSFER and ASSIGN
to Assignee, subject to the further provisions hereof, all of Assignor's
operating rights interest, being an undivided 1.00000% operating rights interest
("Assigned Interests"), in the following described oil and gas lease:
Exhibit B-10 page 1
OCS-G 1898, Oil and Gas Lease dated effective March 1, 1969, granted by
the United States Department of the Interior, Bureau of Land
Management, as Lessor, in favor of Continental Oil Company and Cities
Service Oil Company, as Lessee, covering Block 148, West Half, South
Timbalier Area, as shown on OCS Official Leasing Map, Louisiana Map No.
6, containing approximately 2,500 acres, INSOFAR AND ONLY INSOFAR AS it
covers the operating rights of NW/4 of the NW/4 of the SW/4 Block 148,
and further limited to those depths from the surface down to 14,000
feet SUBSEA (the "Lease").
and a like interest in and to the following, insofar and only insofar
as same pertains to the Assigned Interests:
a) all platforms that are located on, or presently used in
connection with the drilling for, or operation, production,
treatment or transportation of gas, oil, casinghead gas, drip
gasoline, natural gasoline and all other liquid and gaseous
hydrocarbons from the Lease (the "Platforms");
b) all wells, wellbores, pipes, pipelines, gathering lines,
compressors, materials, inventory, facilities, supplies and
equipment and any and all other personal, real, movable and
immovable property, fixtures or equipment that are located on,
or presently used in connection with, the drilling for, or
operation, production, treatment or transportation of,
Hydrocarbons from the Lease, and any replacements, attachments
or accessories now or hereafter attached, added or affixed
(the "Equipment");
c) all Hydrocarbons attributable to the Assigned Interests
produced on and after the Effective Date, as hereinafter
defined ("Production");
d) all contracts and agreements (other than the Lease) to the
extent transferable that are attributable to the ownership or
operation of the Assigned Interests, including, without
limitation, the following (collectively, the "Contracts"):
(i) any and all contracts and agreements, operating
agreements, participation agreements, unit, pooling
and communitization agreement and declarations,
hydrocarbon purchase and sale agreements, farmin or
farmout agreements, bottom-hole contribution
agreements, balancing agreements, processing
agreements, gathering agreements, compression
agreements, transportation agreements, gathering
agreements, compression agreements, transportation
agreements, and any other contracts and agreements
that are attributable to the ownership or operation
of the Assigned Interests;
e) all orders, permits and easements that are attributable to the
Assigned Interests ("Permits");
Exhibit B-10 page 2
f) all other rights, privileges, benefits, powers and obligations
conferred or imposed upon Assignor as the owner of the
Assigned Interests ("Rights"); and
g) to the extent attributable to the Assigned Interests and not
prohibited by law or an agreement to which Assignor is a
party, the rights to the original records in the possession of
Assignor: (i) lease and land records, (ii) geological and
geophysical records, (iii) operations, production and
engineering records, (iv) accounting records, and (v) facility
and well records (collectively the "Records").
For purposes of this Assignment, the Assigned Interests, Platforms,
Equipment, Production, Contracts, Permits, Rights and Records are collectively
referred to as the "Assets".
By acceptance of this Assignment, Assignee acknowledges the existence
of, and agrees to be bound by all of the terms and conditions contained in the
following:
a) The Lease;
b) Purchase and Sale Agreement dated June 28, 2002 and effective
July 1, 2002 at 7:00 a.m. Central Standard Time, by and
between American Resources Offshore, Inc., as Seller, and
Newfield Exploration Company, as Buyer (the "PSA");
c) Declaration of Rights III dated effective September 27, 1993,
by and between Settle Oil and Gas Company, Century Offshore
Management Corporation, PNC Bank National Associates and
Newfield Exploration Company, regarding OCS-G 1898;
d) Declaration of Rights dated effective July 1, 1993, by and
between Settle Oil and Gas Company, Century Offshore
Management Corporation, BMO Financial Inc. and Bank of
Montreal, regarding OCS-G 1898;
e) Declaration of Rights II dated effective November 22, 1993, by
and between Settle Oil and Gas Company, Century Offshore
Management Corporation, BMO Financial Inc., Bank of Montreal
and Newfield Exploration Company, regarding OCS-G 1898;
f) Farmout Agreement dated June 21, 1994, between Century
Offshore Management Corporation and Settle Oil and Gas
Company, regarding OCS-G 1898;
g) Farmout Agreement dated June 13, 1991, by and between Conoco
Inc. and Century Offshore Management Corporation covering
OCS-G 1898;
h) Farmout Agreement dated June 13, 1991, by and between OXY
U.S.A., Inc. and Century Offshore Management Corporation
covering OCS-G 1898;
Exhibit B-10 page 3
i) Joint Operating Agreement dated August 1, 1994, between
Newfield Exploration Company (Operator), and Century Offshore
Management Corporation, et al. (Non-Operators), covering W/2
Block 148, South Timbalier Area, Offshore, Louisiana;
j) Operating Agreement dated January 1, 1989, by and between
Conoco Inc. and OXY U.S.A., Inc. covering the West-half (1/2)
of South Timbalier Block 148;
k) Ownership and Operating Agreement dated November 25, 1980, by
and between Conoco Inc., OXY U.S.A., Inc. and Texaco Producing
Company covering South Timbalier Field 176 production
facilities;
l) Agreement dated June 21,1994, by and among Newfield
Exploration Company, Settle Oil and Gas Company and Century
Offshore Management Corporation, regarding OCS-G l898;
m) Participation Agreement dated effective as of September 27,
1993, by and among Newfield Exploration Company, Settle Oil
and Gas Company and Century Management Corporation covering
OCS-G 1898;
n) Letter Agreement entered into March 25, 1988, by and between
Conoco Inc. and OXY U.S., addressing OXY's approval to utilize
gas produced from South Timbalier Block 146 "A" platform to
provide Gas-Lift gas to South Timbalier 148 "A" platform;
o) Letter Agreement entered into July 7, 1983, by and between
Conoco Inc., Texaco Producing Co., and OXY U.S.A., Inc.
regarding Texaco's use of the 4 1/2" OD pipeline;
p) Crude Oil Contract with Cities Service Oil and Gas
Corporation, as Seller, and Citgo Petroleum Corporation, as
Buyer, effective September 1, 1983, and covering oil and field
separated liquids;
q) Operating Agreement effective September 1, 1972, by and
between Amoco Production Company, Conoco Inc. and OXY U.S.A.,
Inc. regarding that 4 1/2" OD pipeline commencing at Amoco's
South Timbalier Block 161 "A" Platform and extending to and
tied into Chevron's 10" pipeline in South Timbalier Block 161;
r) Purchase and Sale Agreement, dated effective July 1, 1996, by
and between Century Offshore Management Corporation (seller)
and Southern Gas Company of Delaware, Inc. (buyer), covering
the sale of interest in OCS-G 1898, Block 148 W/2, South
Timbalier Area, Offshore Louisiana;
s) Purchase and Sale Agreement dated May 31, 1991, effective
November 1, 1990, executed by and between Oxy U.S.A. Inc. and
Century Offshore Management Corporation, covering OCS-G 1898,
in which a preferential right to purchase the liquids from the
lease was reserved, and which contains a limitation on
assignment provisions;
Exhibit B-10 page 4
t) Purchase and Sale Agreement dated May 31, 1991, effective
November 1, 1990, executed by and between Cities Service Oil
Company and Century Offshore Management Corporation, covering
OCS-G 1898, in which a preferential right to purchase the
liquids from the lease was reserved, and which contains a
limitation on assignment provisions;
This Assignment is made without any warranty of title, express, implied
or statutory, even for return of any consideration paid therefor; provided only
that subject to the permitted encumbrances (if any), Assignor shall warrant and
defend title against all claims and demands of all persons whomever claiming
title to the Assigned Interests by, through or under Assignor, but not
otherwise, and only to the extent set forth in the PSA. Assignee acknowledges
that (i) it has had access to the Assets and the employees of Assignor and the
opportunity to inspect the Assets, and (ii) in making its decision to enter into
the PSA and consummate the transactions contemplated thereby, Assignee has
relied solely on the basis of its own independent investigation of the Assets
and upon the representations and warranties of Assignor set forth in the PSA and
the special warranty of title made herein. Accordingly, Assignee acknowledges
that Assignor has not made, AND ASSIGNOR HEREBY EXPRESSLY DISCLAIMS AND NEGATES,
ANY REPRESENTATION OR WARRANTY, EXPRESSED (ORALLY OR IN WRITING), IMPLIED, AT
COMMON LAW, BY STATUTE, OR OTHERWISE, OR OTHER RIGHT OF RECOURSE (EVEN AS TO
RETURN OF THE PURCHASE PRICE) RELATING TO (A) THE CONDITION OF THE ASSETS
(INCLUDING ANY IMPLIED OR EXPRESSED WARRANTY OF MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE, ABSENCE OF LATENT DEFECTS OR REDHIBITORY VICES, OR OF
CONFORMITY TO MODELS OR SAMPLES OF MATERIALS, OR ENVIRONMENTAL CONDITION), (B)
ANY INFRINGEMENT BY ASSIGNOR OF ANY PATENT OR PROPRIETARY RIGHT OF ANY THIRD
PARTY, AND (C) ACCURACY, COMPLETENESS OR MATERIALITY OF ANY INFORMATION, DATA OR
Exhibit B-10 page 5
OTHER MATERIALS (WRITTEN OR ORAL) FURNISHED TO ASSIGNEE BY OR ON BEHALF OF
ASSIGNOR (INCLUDING WITH RESPECT TO RESERVE MATTERS, SUCCESS OF WELLS (INCLUDING
WELLS THAT ARE DRILLED AFTER THE EFFECTIVE DATE), COMPLIANCE WITH LAWS,
ENVIRONMENTAL CONDITIONS AND OTHER MATTERS); IT BEING AGREED BY ASSIGNEE THAT IT
IS ACQUIRING THE ASSETS "AS-IS," "WHERE-IS", WITH ALL FAULTS.
This Assignment is made in accordance with the PSA and all provisions
of said PSA are incorporated herein by reference for all purposes as if copied
in extenso. In the event of a conflict between the terms of this Assignment and
the PSA, the terms of the PSA shall control.
This Assignment may be executed in any number of counterparts, all of
which taken together shall constitute one and the same instrument by signing any
such counterpart.
This Assignment shall bind and inure to the benefit of and be binding
upon Assignor and Assignee and their respective successors and assigns.
IN WITNESS WHEREOF, this Assignment is executed before the undersigned
competent witnesses by the parties on the dates set forth in their respective
acknowledgements hereinbelow; but shall be effective for all purposes on the 1st
day of July 2002, at 7:00 a.m., Central Standard Time ("Effective Date").
ASSIGNOR:
WITNESSES: AMERICAN RESOURCES OFFSHORE, INC.
GOM No. 1937
By: _____________________________
_____________________________ Name:____________________________
Title:___________________________
_____________________________
Exhibit B-10 page 6
ASSIGNEE:
WITNESSES: NEWFIELD EXPLORATION COMPANY
GOM No. 1364
By: _____________________________
_____________________________ W. M. Blumenshine
Attorney in Fact
_____________________________
Exhibit B-10 page 7
STATE OF TEXAS ss.
ss.
COUNTY OF HARRIS ss.
BEFORE ME, the undersigned authority, on this day personally appeared
__________________, known to me to be the person whose name is subscribed to the
foregoing instrument as _______________ of AMERICAN RESOURCES OFFSHORE, INC., a
Delaware corporation, and acknowledged to me that he executed the same for and
on behalf of said corporation, for the purposes and consideration therein
expressed, and in the capacity therein stated.
GIVEN under my hand and seal of office this ___ day of July, 2002.
__________________________________
Notary Public, State of Texas
My Commission Expires:____________
STATE OF TEXAS ss.
ss.
COUNTY OF HARRIS ss.
BEFORE ME, the undersigned authority, on this day personally appeared
W. M. Blumenshine, known to me to be the person whose name is subscribed to the
foregoing instrument as Attorney in Fact of NEWFIELD EXPLORATION COMPANY, a
Delaware corporation, and acknowledged to me that he executed the same for and
on behalf of said corporation, for the purposes and consideration therein
expressed, and in the capacity therein stated.
GIVEN under my hand and seal of office this ___ day of July, 2002.
__________________________________
Notary Public, State of Texas
My Commission Expires:____________
Exhibit B-10 page 8
EXHIBIT "B-11"
--------------
Attached to and made apart of that certain Purchase and Sale Agreement among
American Resources Offshore, Inc., as "Seller"
and
Newfield Exploration Company, as "Buyer"
- --------------------------------------------------------------------------------
South Timbalier Area Block 148
OCS-G 1898
ASSIGNMENT OF OVERRIDING ROYALTY INTEREST
-----------------------------------------
UNITED STATES OF AMERICA ss.
OUTER CONTINENTAL SHELF ss. KNOW ALL MEN BY THESE PRESENTS:
OFFSHORE LOUISIANA ss.
SOUTH TIMBALIER AREA ss.
This Assignment of Overriding Royalty Interest ("Assignment") is made
by AMERICAN RESOURCES OFFSHORE, INC., a Delaware corporation, whose address is
801 Travis Street, Suite 2100, Houston, Texas 77002 (hereinafter referred to as
"Assignor") in favor of NEWFIELD EXPLORATION COMPANY, a Delaware corporation,
whose address is 363 N. Sam Houston Pkwy. E. Suite 2020, Houston, Texas 77060
(hereinafter referred to as "Assignee").
WITNESSETH
In consideration of One Hundred Dollars ($100.00) and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Assignor by these presents does hereby CONVEY, TRANSFER and ASSIGN
to Assignee, subject to the further provisions hereof, an undivided 0.2500%
Overriding Royalty Interest ("Assigned Interests") in the following described
oil and gas lease:
OCS-G 1898, Oil and Gas Lease dated effective March 1, 1969, granted by
the United States Department of the Interior, Bureau of Land
Management, as Lessor, in favor of Continental Oil Company and Cities
Service Oil Company, as Lessee, covering Block 148, West Half, South
Timbalier Area, as shown on OCS Official Leasing Map, Louisiana Map No.
6, containing approximately 2,500 acres, INSOFAR AND ONLY INSOFAR AS it
Exhibit B-11 page 1
covers the NE/4 of the NW/4 of the SW/4, SE/4 of the NW/4 of the SW/4,
NE/4 of the SW/4 of the SW/4 and SW/4 of the SW/4 of the NE/4 of the
SW/4 of Block 148, South Timbalier Area, Offshore Louisiana (the
"Lease");
and a like interest in and to the following, insofar and only insofar
as same pertains to the Assigned Interests:
(a) all Hydrocarbons attributable to the Assigned
Interests produced on and after the Effective Date,
as hereinafter defined ("Production").
By acceptance of this Assignment, Assignee acknowledges the existence
of, and agrees to be bound by all of the terms and conditions contained in the
following:
a) The Lease; and
b) Purchase and Sale Agreement dated June 28, 2002 and effective
July 1, 2002 at 7:00 a.m. Central Standard Time, by and
between American Resources Offshore, Inc., as Seller, and
Newfield Exploration Company, as Buyer (the "PSA");
This Assignment is made without any warranty of title, express, implied
or statutory, even for return of any consideration paid therefor; provided only
that subject to the permitted encumbrances (if any) as defined in the PSA,
Assignor shall warrant and defend title against all claims and demands of all
persons whomever claiming title to the Assigned Interests by, through or under
Assignor, but not otherwise, and only to the extent set forth in the PSA.
Assignee acknowledges that (i) it has had access to the Assets and the employees
of Assignor and the opportunity to inspect the Assets, and (ii) in making its
decision to enter into the PSA and consummate the transactions contemplated
thereby, Assignee has relied solely on the basis of its own independent
investigation of the Assets and upon the representations and warranties of
Assignor set forth in the PSA and the special warranty of title made herein.
Accordingly, Assignee acknowledges that Assignor has not made, AND ASSIGNOR
HEREBY EXPRESSLY DISCLAIMS AND NEGATES, ANY REPRESENTATION OR WARRANTY,
EXPRESSED (ORALLY OR IN WRITING), IMPLIED, AT COMMON LAW, BY STATUTE, OR
Exhibit B-11 page 2
OTHERWISE, OR OTHER RIGHT OF RECOURSE (EVEN AS TO RETURN OF THE PURCHASE PRICE)
RELATING TO (A) THE CONDITION OF THE ASSETS (INCLUDING ANY IMPLIED OR EXPRESSED
WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, ABSENCE OF LATENT
DEFECTS OR REDHIBITORY VICES, OR OF CONFORMITY TO MODELS OR SAMPLES OF
MATERIALS, OR ENVIRONMENTAL CONDITION), (B) ANY INFRINGEMENT BY ASSIGNOR OF ANY
PATENT OR PROPRIETARY RIGHT OF ANY THIRD PARTY, AND (C) ACCURACY, COMPLETENESS
OR MATERIALITY OF ANY INFORMATION, DATA OR OTHER MATERIALS (WRITTEN OR ORAL)
FURNISHED TO ASSIGNEE BY OR ON BEHALF OF ASSIGNOR (INCLUDING WITH RESPECT TO
RESERVE MATTERS, SUCCESS OF WELLS (INCLUDING WELLS THAT ARE DRILLED AFTER THE
EFFECTIVE DATE), COMPLIANCE WITH LAWS, ENVIRONMENTAL CONDITIONS AND OTHER
MATTERS); IT BEING AGREED BY ASSIGNEE THAT IT IS ACQUIRING THE ASSETS "AS-IS,"
"WHERE-IS", WITH ALL FAULTS.
This Assignment is made in accordance with the PSA and all provisions
of said PSA are incorporated herein by reference for all purposes as if copied
in extenso. In the event of a conflict between the terms of this Assignment and
the PSA, the terms of the PSA shall control.
This Assignment may be executed in any number of counterparts, all of
which taken together shall constitute one and the same instrument by signing any
such counterpart.
This Assignment shall bind and inure to the benefit of and be binding
upon Assignor and Assignee and their respective successors and assigns.
Exhibit B-11 page 3
IN WITNESS WHEREOF, this Assignment is executed before the undersigned
competent witnesses by the parties on the dates set forth in their respective
acknowledgements hereinbelow, but shall be effective for all purposes on the 1st
day of July 2002, at 7:00 a.m. Central Standard Time ("Effective Date").
ASSIGNOR:
WITNESSES: AMERICAN RESOURCES OFFSHORE, INC.
GOM No. 1937
By: _____________________________
_____________________________ Name:____________________________
Title:___________________________
_____________________________
ASSIGNEE:
WITNESSES: NEWFIELD EXPLORATION COMPANY
GOM No. 1364
By: _____________________________
_____________________________ W. M. Blumenshine
Attorney in Fact
_____________________________
Exhibit B-11 page 4
STATE OF TEXAS ss.
ss.
COUNTY OF HARRIS ss.
BEFORE ME, the undersigned authority, on this day personally appeared
__________________, known to me to be the person whose name is subscribed to the
foregoing instrument as _______________ of AMERICAN RESOURCES OFFSHORE, INC., a
Delaware corporation, and acknowledged to me that he executed the same for and
on behalf of said corporation, for the purposes and consideration therein
expressed, and in the capacity therein stated.
GIVEN under my hand and seal of office this ___ day of July, 2002.
__________________________________
Notary Public, State of Texas
My Commission Expires:____________
STATE OF TEXAS ss.
ss.
COUNTY OF HARRIS ss.
BEFORE ME, the undersigned authority, on this day personally appeared
W. M. Blumenshine, known to me to be the person whose name is subscribed to the
foregoing instrument as Attorney in Fact of NEWFIELD EXPLORATION COMPANY, a
Delaware corporation, and acknowledged to me that he executed the same for and
on behalf of said corporation, for the purposes and consideration therein
expressed, and in the capacity therein stated.
GIVEN under my hand and seal of office this ___ day of July, 2002.
__________________________________
Notary Public, State of Texas
My Commission Expires:____________
Exhibit B-11 page 5
EXHIBIT "B-12"
--------------
Attached to and made apart of that certain Purchase and Sale Agreement among
American Resources Offshore, Inc., as "Seller"
and
Newfield Exploration Company, as "Buyer"
- --------------------------------------------------------------------------------
South Timbalier Area Block 148
OCS-G 1898
ASSIGNMENT OF OVERRIDING ROYALTY INTEREST
UNITED STATES OF AMERICA ss.
OUTER CONTINENTAL SHELF ss. KNOW ALL MEN BY THESE PRESENTS:
OFFSHORE LOUISIANA ss.
SOUTH TIMBALIER AREA ss.
This Assignment of Overriding Royalty Interest ("Assignment") is made
by AMERICAN RESOURCES OFFSHORE, INC., a Delaware corporation, whose address is
801 Travis Street, Suite 2100, Houston, Texas 77002 (hereinafter referred to as
"Assignor") in favor of NEWFIELD EXPLORATION COMPANY, a Delaware corporation,
whose address is 363 N. Sam Houston Pkwy. E. Suite 2020, Houston, Texas 77060
(hereinafter referred to as "Assignee").
WITNESSETH
----------
In consideration of One Hundred Dollars ($100.00) and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Assignor by these presents does hereby CONVEY, TRANSFER and ASSIGN
to Assignee, subject to the further provisions hereof, an undivided 0.800%
Overriding Royalty Interest ("Assigned Interests") in the following described
oil and gas lease:
OCS-G 1898, Oil and Gas Lease dated effective March 1, 1969, granted by
the United States Department of the Interior, Bureau of Land
Management, as Lessor, in favor of Continental Oil Company and Cities
Service Oil Company, as Lessee, covering Block 148, West Half, South
Timbalier Area, as shown on OCS Official Leasing Map, Louisiana Map No.
6, containing approximately 2,500 acres, INSOFAR AND ONLY INSOFAR AS it
covers the NW/4 of the NW/4 of the SW/4 (the "Lease");
Exhibit B-12 page 1
and a like interest in and to the following, insofar and only insofar
as same pertains to the Assigned Interests:
(b) all Hydrocarbons attributable to the Assigned
Interests produced on and after the Effective Date,
as hereinafter defined ("Production").
By acceptance of this Assignment, Assignee acknowledges the existence
of, and agrees to be bound by all of the terms and conditions contained in the
following:
a) The Lease; and
b) Purchase and Sale Agreement dated June 28, 2002 and effective
July 1, 2002 at 7:00 a.m. Central Standard Time, by and
between American Resources Offshore, Inc., as Seller, and
Newfield Exploration Company, as Buyer (the "PSA");
This Assignment is made without any warranty of title, express, implied
or statutory, even for return of any consideration paid therefor; provided only
that subject to the permitted encumbrances (if any) as defined in the PSA,
Assignor shall warrant and defend title against all claims and demands of all
persons whomever claiming title to the Assigned Interests by, through or under
Assignor, but not otherwise, and only to the extent set forth in the PSA.
Assignee acknowledges that (i) it has had access to the Assets and the employees
of Assignor and the opportunity to inspect the Assets, and (ii) in making its
decision to enter into the PSA and consummate the transactions contemplated
thereby, Assignee has relied solely on the basis of its own independent
investigation of the Assets and upon the representations and warranties of
Assignor set forth in the PSA and the special warranty of title made herein.
Accordingly, Assignee acknowledges that Assignor has not made, AND ASSIGNOR
HEREBY EXPRESSLY DISCLAIMS AND NEGATES, ANY REPRESENTATION OR WARRANTY,
EXPRESSED (ORALLY OR IN WRITING), IMPLIED, AT COMMON LAW, BY STATUTE, OR
OTHERWISE, OR OTHER RIGHT OF RECOURSE (EVEN AS TO RETURN OF THE PURCHASE PRICE)
Exhibit B-12 page 2
RELATING TO (A) THE CONDITION OF THE ASSETS (INCLUDING ANY IMPLIED OR EXPRESSED
WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, ABSENCE OF LATENT
DEFECTS OR REDHIBITORY VICES, OR OF CONFORMITY TO MODELS OR SAMPLES OF
MATERIALS, OR ENVIRONMENTAL CONDITION), (B) ANY INFRINGEMENT BY ASSIGNOR OF ANY
PATENT OR PROPRIETARY RIGHT OF ANY THIRD PARTY, AND (C) ACCURACY, COMPLETENESS
OR MATERIALITY OF ANY INFORMATION, DATA OR OTHER MATERIALS (WRITTEN OR ORAL)
FURNISHED TO ASSIGNEE BY OR ON BEHALF OF ASSIGNOR (INCLUDING WITH RESPECT TO
RESERVE MATTERS, SUCCESS OF WELLS (INCLUDING WELLS THAT ARE DRILLED AFTER THE
EFFECTIVE DATE), COMPLIANCE WITH LAWS, ENVIRONMENTAL CONDITIONS AND OTHER
MATTERS); IT BEING AGREED BY ASSIGNEE THAT IT IS ACQUIRING THE ASSETS "AS-IS,"
"WHERE-IS", WITH ALL FAULTS.
This Assignment is made in accordance with the PSA and all provisions
of said PSA are incorporated herein by reference for all purposes as if copied
in extenso. In the event of a conflict between the terms of this Assignment and
the PSA, the terms of the PSA shall control.
This Assignment may be executed in any number of counterparts, all of
which taken together shall constitute one and the same instrument by signing any
such counterpart.
This Assignment shall bind and inure to the benefit of and be binding
upon Assignor and Assignee and their respective successors and assigns.
Exhibit B-12 page 3
IN WITNESS WHEREOF, this Assignment is executed before the undersigned
competent witnesses by the parties on the dates set forth in their respective
acknowledgements hereinbelow, but shall be effective for all purposes on the 1st
day of July 2002, at 7:00 a.m. Central Standard Time ("Effective Date").
ASSIGNOR:
WITNESSES: AMERICAN RESOURCES OFFSHORE, INC.
GOM No. 1937
By: _____________________________
_____________________________ Name:____________________________
Title:___________________________
_____________________________
ASSIGNEE:
WITNESSES: NEWFIELD EXPLORATION COMPANY
GOM No. 1364
By: _____________________________
_____________________________ W. M. Blumenshine
Attorney in Fact
_____________________________
Exhibit B-12 page 4
STATE OF TEXAS ss.
ss.
COUNTY OF HARRIS ss.
BEFORE ME, the undersigned authority, on this day personally appeared
__________________, known to me to be the person whose name is subscribed to the
foregoing instrument as _______________ of AMERICAN RESOURCES OFFSHORE, INC., a
Delaware corporation, and acknowledged to me that he executed the same for and
on behalf of said corporation, for the purposes and consideration therein
expressed, and in the capacity therein stated.
GIVEN under my hand and seal of office this ___ day of July, 2002.
__________________________________
Notary Public, State of Texas
My Commission Expires:____________
STATE OF TEXAS ss.
ss.
COUNTY OF HARRIS ss.
BEFORE ME, the undersigned authority, on this day personally appeared
W. M. Blumenshine, known to me to be the person whose name is subscribed to the
foregoing instrument as Attorney in Fact of NEWFIELD EXPLORATION COMPANY, a
Delaware corporation, and acknowledged to me that he executed the same for and
on behalf of said corporation, for the purposes and consideration therein
expressed, and in the capacity therein stated.
GIVEN under my hand and seal of office this ___ day of July, 2002.
__________________________________
Notary Public, State of Texas
My Commission Expires:____________
Exhibit B-12 page 5
Schedule 2.03
Attached to and made apart of that certain
Purchase and Sale Agreement among
American Resources Offshore, Inc., as "Seller"
and
Newfield Exploration Company, as "Buyer"
PRELIMINARY
CLOSING STATEMENT
AMERICAN RESOURCES OFFSHORE INC. / NEWFIELD
1. AGREEMENT Purchase and Sale Agreement dated June 28, 2002
--------- by and between American Resources Offshore Inc.
as Seller and Newfield Exploration Company as
Buyer (the "Agreement")
2. ASSETS SOLD All of Seller's right, title and interest in
----------- and to Oil and Gas Lease dated March 1, 1969
pertaining to OCS-G 1898 at South Timbalier
Block 148 and other property (the "Interests")
more particularly described in the Agreement.
3. EFFECTIVE TIME July 1, 2002 at 7:00 a.m. C.S.T.
--------------
4. PURCHASE PRICE Section 2.01 $ 2,300,000.00
--------------
Section 2.03(a)(1) Value of oil in storage at (1)
Effective Time............... ----------------
PLUS
Section 2.03(a)(2)
Post Effective Time operating
and capital expenditures paid
by Seller.................... (1)
----------------
PLUS
Section 2.03(a)(3) Post Effective Time Taxes paid
by Seller.................... (1)
----------------
PLUS
Section 2.03(a)(4) Post Effective Time prepaid
expenses paid by Seller...... (1)
----------------
LESS
Section 2.03(b)(1) The Deposit.................. -0-
----------------
LESS
Section 2.03(b)(2) Proceeds received by Seller
from the sale of substances
produced after the Effective
Time......................... (1)
----------------
Schedule 2.03 page 1
LESS
Section 2.03(b)(3) Proceeds received by Seller
from the sale of Interests
after the Effective Time..... (1)
----------------
LESS
Section 2.03(b)(4) Value of uncured Title
Defects ..................... -0-
----------------
LESS
Section 2.03(b)(5) Pre-Effective Time Taxes on
production to be paid by
Buyer ....................... -0-
----------------
Section 2.04 ADJUSTED PURCHASE PRICE $2,300,000.00(2)
----------------
(1) Estimate subject to confirmation on a post closing basis pursuant to
Section 1.05
(2) To Be Paid by Wire Transfer:
5. The wiring instructions for American Resources Offshore Inc.:
Bank: Bank One
Transit Routing Number (ABA): 111000614
Bank Account Number: 157-183-4629
Bank Account Name: American Resources Offshore Inc.
6. DOCUMENTS TO BE SIGNED AND DELIVERED
BY SELLER AND BUYER AT CLOSING
7.02(a) Four Assignments of Record Title 1788,1800,1802,
1803
Six Assignments of Operating Rights 1786,1804,1805
1806,1807,1808
Two Assignments of Overriding
Royalty Interest 1781, 1809
7.02(f) Partial Release of Mortgages and Security
Interests
UCC Release
Such other instruments as are reasonably necessary to
effectuate the conveyance of the Properties to the Buyer
BUYER SELLER
NEWFIELD EXPLORATION COMPANY AMERICAN RESOURCES OFFSHORE INC.
By: _______________________________ By: _______________________________
Its: _______________________________ Its: _____________________________
U.S. Tax ID No.: ____________________ U.S. Tax ID No.: ___________________
363 N. Sam Houston Pkwy E., Suite 2020 801 Travis Street, Suite 2100
Houston, TX 77060 Houston, TX 77002
Schedule 2.03 page 2
Schedule 3.01(e)
Attached to and made apart of that certain
Purchase and Sale Agreement among
American Resources Offshore, Inc., as "Seller"
and
Newfield Exploration Company, as "Buyer"
Suits, Claims, Demands or Investigations
----------------------------------------
None
Schedule 3.01(e) - Page 1
Schedule 3.01(n)
Attached to and made apart of that certain
Purchase and Sale Agreement among
American Resources Offshore, Inc., as "Seller"
and
Newfield Exploration Company, as "Buyer"
Outstanding AFE's and Commitments
---------------------------------
None
Schedule 3.01(n) - Page 1
Schedule 3.01(o)
Attached to and made apart of that certain
Purchase and Sale Agreement among
American Resources Offshore, Inc., as "Seller"
and
Newfield Exploration Company, as "Buyer"
Gas Imbalances
--------------
None
Schedule 5.06(b)(8)
Attached to and made apart of that certain
Purchase and Sale Agreement among
American Resources Offshore, Inc., as "Seller"
and
Newfield Exploration Company, as "Buyer"
Title Matters Waived
--------------------
None