AGREEMENT OF PURCHASE AND SALE
THIS AGREEMENT dated as of the 29th day of September, 2004
B E T W E E N:
POWERMAX ENERGY INC., a corporation registered to carry on business in the
Province of Saskatchewan and having an office in the City of Calgary, in
the Province of Alberta (hereinafter referred to as "Vendor")
- and -
808099 ALBERTA LTD. a corporation registered to carry on business in the
Province of British Columbia, having an office in the City of Vancouver,
in the Province of British Columbia (hereinafter referred to as
"Purchaser")
WHEREAS Vendor has agreed to sell and assign to Purchaser and Purchaser
has agreed to purchase and acquire from Vendor certain interests of Vendor in
the Assets herein more particularly described;
NOW THEREFORE in consideration of the premises hereto and the covenants
and agreements hereinafter set forth and contained, the parties hereto covenant
and agree as follows:
1. DEFINITIONS
In this Agreement, including the premises hereto, this clause and the
Appendices hereto, the words and phrases set forth below shall have the
meaning ascribed thereto below namely:
a) "Assets" means collectively the Petroleum and Natural Gas Rights,
and the Miscellaneous Interests;
b) "Closing" means the transfer of the Assets by Vendor to Purchaser
and the payment by Purchaser to Vendor of the purchase consideration
therefore, less the Prepaid Deposit paid by Purchaser and the
completion of all matters incidental thereto;
c) "Closing Time" means 2:00 PM local time at the Place of Closing, on
the 29th day of September, 2004, or such earlier time or date as may
be agreed to by Purchaser and Vendor;
d) "Conveyance" means an agreement in the form attached as Schedule
"B";
e) "Dollars" or "$" shall mean lawful currency of Canada, and all
payments and receipt shall be made and recorded in lawful currency
of Canada;
f) "Effective Time" means 12:01 a.m. Mountain Standard Time on the 29th
day of September, 2004;
g) "Lands" means the lands set forth and described in Schedule "A"
hereto and includes the Petroleum Substances within, upon or under
such lands, together with the right to explore for and recover same
insofar as such rights are granted by the Permits;
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h) "Miscellaneous Interests" means the interests of the Vendor (other
than the Petroleum and Natural Gas Rights and the Tangible
Interests) in all property, assets and rights relating to the
Petroleum and Natural Gas Rights;
i) "Permits" means collectively the leases, reservations, permits, and
licences and documents of title set forth and described in Schedule
"A" hereto or other similar documents of title by virtue of which
the holder thereof is entitled to drill for, win, take or remove the
Petroleum Substances underlying all or any part of the Lands;
j) "Petroleum and Natural Gas Rights" means the entire right, title,
estate and interest of Vendor, including the undivided percentage
working interests set forth in Schedule "A" hereto, in the Permits
and the Lands;
k) "Petroleum Substances" means petroleum, natural gas and related
hydrocarbons and all other substances, whether liquid, solid or
gaseous and whether hydrocarbons or not, the rights to which are
granted by the Permits;
l) "Place of Closing" means the Calgary offices of Powermax Energy
Inc.;
2. INTERPRETATION
a) Appended hereto are the following Appendices:
Schedule "A" - Description of Lands and Permits
Schedule "B" - Conveyance
All Appendices hereto are incorporated into and are part of this
Agreement by this reference as fully as though contained in the body
of this Agreement;
b) Wherever any provision of any Schedules to this Agreement conflicts
with any provision in the body of this Agreement, the provisions of
the body of this Agreement shall prevail. References herein to a
Schedule shall mean a reference to a Schedule to this Agreement.
References in any schedule to "the Agreement" shall mean a reference
to this Agreement. References in any Schedule to another Schedule
shall mean a reference to a schedule to this Agreement;
c) References herein to a clause shall mean a reference to a clause
within the body of this Agreement;
d) The headings of clauses and subclauses herein and in the Appendices
are inserted for convenience of reference only and shall not affect
or be considered to affect the construction of the provisions
hereof;
e) In this Agreement words importing persons include companies and vice
versa and words importing the masculine gender include the feminine
and neuter genders and vice versa.
3. CONVEYANCE
Vendor, for the price and sum of One Million ($1,000,000.00) Dollars and
other good and valuable consideration the receipt of which is hereby
acknowledged, hereby sells, assigns, transfers, conveys and sets over to
Purchaser the entire right, title, estate and interest of Vendor in and to
the Assets, TO HAVE AND TO HOLD the same, together with all benefit and
advantage to be derived therefrom, absolutely, subject only to the
respective terms and conditions of the Permits and those encumbrances set
forth on Schedule "A" hereto, and the obligations of Vendor thereunder.
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The purchase price shall be allocated as between such categories of the
assets in the following amounts:
Intangibles:
Petroleum and Natural Gas Rights $ 799,990.00
Initial Nonrefundable Deposit (July 30) 100,000.00
Second Nonrefundable Deposit (Aug 31) 100,000.00
-------------
Subtotal for P&NG Rights $ 999,990.00
Miscellaneous Interests: 10.00
-------------
Total Purchase Price $1,000,000.00
=============
The Vendor shall provide, at the Closing Time hereof, specific
assignments, transfers and further assurances as Purchaser may reasonably
require to acquire the Vendor's interest in any assets purchased herein.
4. ADJUSTMENTS
All benefits and obligations of every kind and nature accruing, payable or
paid in respect of the Assets, including, without limitation, operating
costs, capital costs, governmental incentives and proceeds from the sale
of production, shall be adjusted between the Vendor and the Purchaser as
of the Effective Time. Purchaser agrees to reimburse Vendor for all
authorized expenditures associated with the Assets on a net working
interest basis, provided such expenditures were incurred prior to the
Effective Date. Notwithstanding the foregoing, the Vendor and the
Purchaser acknowledge that:
a) all costs of whatever nature incurred in connection with work
performed or goods or services provided in respect of the Assets
prior to the Effective Time shall be borne by the Vendor, regardless
of the time at which the same become payable;
b) all costs of whatever nature incurred in connection with work
performed or goods or services provided in respect of the Assets
after the Effective Time shall be borne by the Purchaser, regardless
of the time at which the same become payable;
5. PAYMENTS
All payments pursuant hereto shall be made by bank draft or certified
cheque payable to Vendor.
6. EFFECTIVE TIME
The transfer and assignment of the Assets from Vendor to Purchaser shall
be effective as of the Effective Time.
7. CLOSING
Closing shall take place at the Place of Closing at the Closing Time.
8. CONVEYANCE DOCUMENTS
a) At Closing Vendor shall deliver to Purchaser such transfers,
assignments, conveyances (including the Conveyance), with respect to
the Assets as may be required. Purchaser shall cooperate with Vendor
to secure execution of such documents by the parties thereto other
than Vendor and Purchaser;
-4-
b) All documents executed and delivered pursuant to the provisions of
this clause or otherwise pursuant to this Agreement are subordinate
to the provisions of this Agreement and the provisions of this
Agreement shall govern and prevail in the event of a conflict
between the provisions of any such document and the provisions of
this Agreement.
9. COVENANTS, REPRESENTATIONS AND WARRANTIES OF VENDOR
Vendor covenants with and represents and warrants to Purchaser that:
a) Vendor is a corporation duly organized and validly existing under
the laws of its jurisdiction of incorporation, is authorized to
carry on business in the Province of Saskatchewan and now has good
right, full power and absolute authority to bargain, sell, transfer,
assign and convey the entire interest of Vendor in and to the Assets
for the purposes and in the manner herein provided for according to
the true intent and meaning of this Agreement;
b) The execution, delivery and performance of this Agreement (i) has
been duly and validly authorized by all requisite corporate,
shareholders' and directors' actions, and (ii) will not result in
any violation of, or be in conflict with, or constitute a default
under any charter, bylaw or governing document or any term or
provision of any agreement or instrument to which Vendor is a party
or by which Vendor is bound nor under any judgement, decree or
order, statute, regulation, rule or licence applicable to it;
c) This Agreement and other documents delivered in pursuance hereof
constitute valid and binding obligations of Vendor enforceable
against it in accordance with their respective terms;
d) The Vendor has not incurred any obligation or liability, contingent
or otherwise, for brokers' feees or finders' fees in respect of this
transaction for which Purchaser shall have any obligation or
liability.
e) Vendor does not purport to convey any better title than it now has,
but Vendor has done no act or thing and suffered or permitted no act
or omission whereby its title to the Assets may be cancelled or
determined, nor has Vendor encumbered or alienated the same or any
interest therein save as set forth on Schedule "A" hereto, nor is
Vendor aware of any lien or encumbrance relating to or affecting the
Assets save as set forth on Schedule "A" hereto;
f) Subject to the rents, covenants, conditions and stipulations in the
Permits reserved and contained and on the lessee's or holder's part
thereunder to be paid, performed and observed, Purchaser may enter
into and upon, and hold and enjoy the Assets for the residue of
their respective terms and all renewals or extensions thereof as to
the interests hereunder assigned for its own use and benefit without
any lawful interruption of or by Vendor or any other person
whomsoever claiming or to claim by, through or under Vendor and
Vendor binds itself to warrant and defend, at its cost and expense,
all and singular the Petroleum and Natural Gas Rights against all
persons whomsoever claiming or to claim the same or any part thereof
or any interest therein by, through or under Vendor;
-5-
g) To the best of its knowledge, no suit, action or other proceeding is
pending or threatened before any court or governmental agency which
might result in impairment or loss of Vendor's title to the Assets;
h) To the best of the knowledge, information and belief of Vendor the
Permits set out in Schedule "A" are the only agreements under and by
virtue of which Vendor acquired and holds the Petroleum and Natural
Gas Rights;
i) The Vendor has not failed to comply with, perform, observe or
satisfy any term, condition, or obligation or liablility which has
heretofor arisen under the provisions of any of the Permits,
documents of title and other agreements to which the Assets are
subject;
j) Vendor is not aware of any defaults, has not received any notice of
default and is not, to its knowledge, in any default under (i) any
applicable laws or regulations, or (ii) any agreement or obligation
by which it is bound or to which it is subject affecting the Assets;
k) No suit, action or other proceeding is pending or threatened before
any judicial authority or governmental authority which might result
in impairment or loss of Vendor's or Purchaser's title to the Assets
or its use or enjoyment thereof;
l) The Vendor has done no act or suffered or permitted no action to be
done whereby any person has acquired or may acquire any interest in
or to the Assets, and the Assets are not subject to reduction or
conversion by virtue of rights of first refusal, or preferential or
first prurchase rights, conversion rights or other similar rights by
virtue of this Agreement, or the transactions contemplated by it,
other than in respect of permitted encumbrances as disclosed in
Schedule "A" hereto;
m) The Vendor has made available for inspection by Purchaser, all
documents, instruments, records and books relevant to title to the
Lands and Permits, annd other documents of title in the possession
or control of the Vendor;
n) To the best of its knowledge all ad valorem, property, production,
severance and similar taxes and assessments based on or measured by
the ownership of the Assets or the production of Petroleum
Substances from the Lands or the receipt of proceeds therefrom
payable to the Effective Time and all prior years have been properly
paid;
o) All laws, regulations and orders of all governmental agencies,
having jurisdiction over the Assets requiring compliance by the
Vendor, have been complied with by the Vendor;
p) The Vendor has not received any claim or notice to the effect that,
nor to its knowledge are the Assets the subject of, any remedial,
preventative or control action, derection or order by any government
authorities or any investigation or evalutation by any government
authorities as wheter any remedial or preventive action in needed to
respond to an existing or potential environmental concern;
q) Vendor is not non- resident within the meaning of Section 116 of the
Income Tax Act (Canada);
10. COVENANTS, REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser covenants with and represents and warrants to Vendor that:
-6-
a) Purchaser is a corporation duly organized and validly existing under
the laws of its jurisdiction of incorporation and now has good
right, full power and absolute legal authority to enter into this
Agreement for the purposes and in the manner herein provided for
according to the true intent and meaning of this Agreement;
b) The execution, delivery and performance of this Agreement (i) has
been duly and validly authorized by all requisite corporate, and
directors' actions, and (ii) will not result in any violation of, or
be in conflict with, or constitute a default under any charter,
bylaw or governing document or any term or provision of any
agreement or instrument to which Purchaser is a party or by which
Purchaser is bound nor under any judgement, decree or order,
statute, regulation, rule or licence applicable to it;
c) This Agreement has been duly executed and delivered by the Purchaser
and, if properly executed and delivered by the Vendor, constitutes a
valid and binding obligation of the Purchaser enforceable in
accordance with its terms and subject to the qualification that such
enforceability may be limited by bankruptcy, insolvency,
liquidation, reorganization or other laws of general application
relating to or affecting the rights of creditors and that equitable
remedies, including specific performance, are discretionary or may
not be ordered;
d) It is not a non-Canadian person for the purposes of The Investment
Canada Act; and
e) It has not incurred any obligation or liability, contingent or
otherwise, for brokers' or finders' fees in respect of this
transaction for which Vendor shall have any obligation or liability.
11. CONDITION OF ASSETS
The Purchaser acknowledges that it is purchasing the Assets on an "as is,
where is" basis and that any and all costs attributable to the Assets now,
in the past or in the future shall be for the sole account of the
Purchaser. In this regard the Purchaser agrees that it shall:
a) be solely liable for all loss, costs, damages and expenses
whatsoever, which the Purchaser may suffer, sustain, pay or incur
and, in addition,
b) indemnify the Vendor against all actions, proceedings, claims,
demands, loss, costs, damages and expenses whatsoever which may be
brought against or suffered by the Vendor or which it may sustain,
pay or incur, as a result of any act, omission, matter or thing
relating to the Assets, done, omitted, occurring or accruing prior
to or after the Effective Date, with respect to any and all
environmental damage or reclamation costs howsoever and whenever
arising.
12. SURVIVAL OF COVENANTS
The covenants, representations and warranties contained herein shall
survive the purchase and sale herein provided for and shall continue and
remain in full force and effect for the benefit of Purchaser with respect
to Clause 9 and for the benefit of Vendor with respect to Clause 10 for a
period of one (1) year from the date hereof.
13. BREACH
Notwithstanding anything to the contrary herein expressed or implied, it
is expressly agreed and understood that the covenants, representations and
warranties set forth in Clauses 9 and 10 were true at the Effective Time,
are true on the date hereof and shall be repeated at the Closing Time as
being true in all material respect at the Effective Time and at the
Closing Time and, notwithstanding the Closing and/or deliveries of
covenants, representations and warranties in any other agreement at
Closing or prior or subsequent thereto or investigations by parties hereto
or their counsel, the covenants, representations and warranties set forth
in Clauses 9 and 10 shall survive Closing for the benefit of the parties
hereto.
-7-
14. INDEMNITY
Except as provided for in Clause 13 hereto, Vendor shall continue to
remain liable and indemnify Purchaser from and against any liability,
loss, costs, claims or damages arising out of or pertaining to the Assets
and occurring or arising prior to the Effective Time and Purchaser shall
indemnify Vendor from and against similar liability, loss, costs, claims
or damages arising out of or pertaining to the Assets subsequent to the
Effective Time excepting in each case any liability, loss, costs, claims
or damages to the extent that the same are reimbursed by insurance or
caused by the negligence of the other party hereto. Such indemnities shall
be deemed to apply to all assignments, transfers, conveyances, novations
and other documents conveying the Assets to the Purchaser. Each party
shall have full right of substitution and subrogation in and to all
covenants and warranties by others heretofore given or made in respect of
the Assets or any part thereof.
15. FURTHER ASSURANCES
Vendor and Purchaser will, from time to time and at all times hereafter,
at the request of the other, but without further consideration, do such
further acts and deliver all such further assurances, deeds and documents
as shall be reasonably required in order to fully perform and carry out
the terms of this Agreement.
16. GOVERNING LAW
This Agreement shall, in all respects, be subject to and interpreted,
construed and enforced in accordance with and under the laws of the
Province of Alberta and shall, in every regard, be treated as a contract
made in the Province of Alberta. The parties hereto irrevocably attorn and
submit to the jurisdiction of the courts of the Province of Alberta in
respect of all matters arising out of this Agreement.
17. ENUREMENT
This Agreement shall be binding upon and shall enure to the benefit of
each of the parties hereto and their respective administrators, trustees,
receivers, successors and assigns.
18. TIME OF ESSENCE
Time is of the essence of this Agreement.
19. NOTICES
The addresses for service of the parties hereto shall be as follows:
Vendor: Powermax Energy Inc.
1000, 330 - 5th Avenue SW
Calgary, Alberta T2M 0L4
Purchaser: 808099 Alberta Ltd
Suite 1250, 639 - 5th Avenue SW
Calgary, Alberta T2P 0M9
-8-
Any of the parties hereto may from time to time change its address for
service hereby by giving written notice to the other party hereto. Any
notice may be served by mailing the same by prepaid post in a properly
addressed envelope addressed to the other parties hereto at such parties'
address for service hereunder. Any notice so served shall be deemed to be
given to and received by the addressee on the third day, except Saturdays,
Sundays and holidays, after the mailing hereof.
20. PRIOR AGREEMENTS AND AMENDMENTS
This Agreement shall supersede and replace any and all prior agreements
between the parties hereto relating to the sale and purchase of the Assets
and may be amended only by written instrument signed by all parties
hereto.
21. FACSIMILE
This Agreement and any document or instrument to be executed and delivered
by the Parties hereunder or in connection herewith may be executed and
delivered in separate counterparts and delivered by one party to the other
by facsimile, each of which when so executed and delivered shall be deemed
an original and all such counterparts shall together constitute one and
the same agreement. If this Agreement or any such document or instument is
delivered by facsimile, the Party so delivering this Agreement or such
document or instrument shall within a reasonable time after Closing,
deliver an originally executed copy to the other.
22. ENTIRE AGREEMENT
This instrument states the entire agreement between the parties hereto.
IN WITNESS WHEREOF the parties hereto have executed this Agreement as of
the date first above written.
POWERMAX ENERGY INC. 808099 ALBERTA LTD
/s/ Neil K. Answorth- Director /s/
- ------------------------------------ ----------------------------------------
(Vendor) (Purchaser)
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SCHEDULE "A"
This is Schedule "A" attached to and forming part of an Agreement
of Purchase and Sale Dated September 29, 2004 between
Powermax Energy Inc. and 808099 Alberta Ltd.
- -----------------------------------------------------------------------------------------------------------------------------
Permits Lands Interest Conveyed Encumbrances
- -----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale Twp 92, Rge 22, W3M: Secs 1-36 49% Working Interest 2.5% Gross
Exploration Permit # PS00205 Twp 92, Rge 23, W3M: Secs 1-36 Overriding Royalty
Twp 92, Rge 24, W3M: Secs 1-36 reserved to
Twp 92, Rge 25, W3M: Secs 1-5, ptn6, ptn 7, Stripper Energy
secs 8-17, ptn18, ptn 19, secs 20-29, ptn 30, Services Limited
ptn 31, secs 32-36 based on 100%
(containing 88,782 acres) Working Interest
- -----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale Twp 93, Rge 22, W3M: Secs 1-36 49% Working Interest 2.5% Gross
Exploration Permit # PS00206 Twp 93, Rge 23, W3M: Secs 1-36 Overriding Royalty
Twp 93, Rge 24, W3M: Secs 1-36 reserved to Twp
93, Rge 25, W3M: Secs 1-5, ptn6, ptn 7, Stripper Energy
secs 8-17, ptn18, ptn 19, secs 20-29, ptn 30, Services Limited
ptn 31, secs 32-36 based on 100%
(containing 88,782 acres) Working Interest
- -----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale Twp 93, Rge 18, W3M: Secs 1-36 49% Working Interest 2.5% Gross
Exploration Permit # PS00207 Twp 93, Rge 19, W3M: Secs 1-36 Overriding Royalty
Twp 93, Rge 20, W3M: Secs 1-36 reserved to
Twp 93, Rge 21, W3M: Secs 1-36 Stripper Energy
(containing 92,160 acres) Services Limited
based on 100%
Working Interest
- -----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale Twp 94, Rge 22, W3M: Secs 1-36 49% Working Interest 2.5% Gross
Exploration Permit # PS00208 Twp 94, Rge 23, W3M: Secs 1-36 Overriding Royalty
Twp 94, Rge 24, W3M: Secs 1-36 reserved to Twp
94, Rge 25, W3M: Secs 1-5, ptn6, ptn 7, Stripper Energy
secs 8-17, ptn18, ptn 19, secs 20-29, ptn 30, Services Limited
ptn 31, secs 32-36 based on 100%
(containing 88,692 acres) Working Interest
- -----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale Twp 94, Rge 19, W3M: Secs 1-36 49% Working Interest 2.5% Gross
Exploration Permit # PS00209 Twp 95, Rge 19, W3M: Secs 1-36 Overriding Royalty
Twp 94, Rge 20, W3M: Secs 1-36 reserved to
Twp 94, Rge 21, W3M: Secs 1-36 Stripper Energy
(containing 92,160 acres) Services Limited
based on 100%
Working Interest
- -----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale Twp 95, Rge 22, W3M: Secs 1-36 49% Working Interest 2.5% Gross
Exploration Permit # PS00210 Twp 95, Rge 23, W3M: Secs 1-36 Overriding Royalty
Twp 95, Rge 24, W3M: Secs 1-36 reserved to
Twp 95, Rge 25, W3M: Secs 1-3, ptn4, ptn 9, Stripper Energy
secs 10-15, ptn 16, ptn 21, secs 22-27, ptn Services Limited
28, ptn 33, secs 34-36. based on 100%
(containing 83,460 acres) Working Interest
- -----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale Twp 95, Rge 20,W3M: Secs 1-36 49% Working Interest 2.5% Gross
Exploration Permit # PS00211 Twp 96, Rge 20,W3M: Secs 1-36 Overriding Royalty
Twp 95, Rge 21,W3M: Secs 1-36 reserved to
Twp 96, Rge 21,W3M: Secs 1-36 Stripper Energy
(containing 92,160 acres) Services Limited
based on 100%
Working Interest
- -----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale Twp 96, Rge 22, W3M: Secs 1-36 49% Working Interest 2.5% Gross
Exploration Permit # PS00212 Twp 96, Rge 23, W3M: Secs 1-36 Overriding Royalty
Twp 96, Rge 24, W3M: Secs 1-36 reserved to
Twp 96, Rge 25, W3M: Secs 1-3, ptn4, ptn 9, Stripper Energy
secs 10-15, ptn 16, ptn 21, secs 22-27, ptn Services Limited
28, ptn 33, secs 34-36. based on 100%
(containing 83,432 acres) Working Interest
- -----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale Twp 97, Rge 22, W3M: Secs 1-36 49% Working Interest 2.5% Gross
Exploration Permit # PS00213 Twp 97, Rge 23, W3M: Secs 1-36 Overriding Royalty
Twp 97, Rge 24, W3M: Secs 1-36 reserved to
Twp 97, Rge 25, W3M: Secs 1-3, ptn4, ptn 9, Stripper Energy
secs 10-15, ptn 16, ptn 21, secs 22-27, ptn Services Limited
28, ptn 33, secs 34-36. based on 100%
(containing 83,360 acres) Working Interest
- -----------------------------------------------------------------------------------------------------------------------------
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- -----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale Twp 97, Rge 21, W3M: Secs 1-36 49% Working Interest 2.5% Gross
Exploration Permit # PS00214 Twp 98, Rge 21, W3M: Secs 1-36 Overriding Royalty
Twp 99, Rge 21, W3M: Secs 1-36 reserved to
Twp 100, Rge 21, W3M: Secs 1-36 Stripper Energy
(containing 92,160 acres) Services Limited
based on 100%
Working Interest
- -----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale Twp 98, Rge 22, W3M: Secs 1-36 49% Working Interest 2.5% Gross
Exploration Permit # PS00215 Twp 98, Rge 23, W3M: Secs 1-36 Overriding Royalty
Twp 98, Rge 24, W3M: Secs 1-36 reserved to
Twp 98, Rge 25, W3M: Secs 1-3, ptn4, ptn 9, Stripper Energy
secs 10-15, ptn 16, ptn 21, secs 22-27, ptn Services Limited
28, ptn 33, secs 34-36. based on 100%
(containing 83,340 acres) Working Interest
- -----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale Twp 99, Rge 22, W3M: Secs 1-36 49% Working Interest 2.5% Gross
Exploration Permit # PS00216 Twp 99, Rge 23, W3M: Secs 1-36 Overriding Royalty
Twp 99, Rge 24, W3M: Secs 1-36 reserved to Twp
99, Rge 25, W3M: Secs 1-2, ptn 3, ptn Stripper Energy
10, secs 11-14, ptn 15, ptn 22, secs 23-26, Services Limited
ptn 27, ptn 34, secs 35-36 based on 100%
(containing 78,006 acres) Working Interest
- -----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale Twp 100, Rge 22, W3M: Secs 1-12 49% Working Interest 2.5% Gross
Exploration Permit # PS00217 Twp 100, Rge 22, W3M: Secs 14-36 Overriding Royalty
Twp 100, Rge 23, W3M: Secs 1-36 reserved to
Twp 100, Rge 24, W3M: Secs 1-36 Stripper Energy
Twp 100, Rge 25, W3M: Secs 1-2, ptn 3, ptn Services Limited
10, secs 11-14, ptn 15, ptn 22, secs 23-26, based on 100%
ptn 27, ptn 34, secs 35-36 Working Interest
(containing 78,360 acres)
- -----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale Twp 101, Rge 22, W3M: Secs 1-36 49% Working Interest 2.5% Gross
Exploration Permit # PS00218 Twp 101, Rge 23, W3M: Secs 1-36 Overriding Royalty
Twp 101, Rge 24, W3M: Secs 1-36 reserved to Twp
101, Rge 25, W3M: Secs 1-2, ptn 3, ptn Stripper Energy
10, secs 11-14, ptn 15, ptn 22, secs Services Limited
23-26, ptn 27, ptn 34, secs based on 100%
35-36 (containing 77,958 acres) Working Interest
- -----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale Twp 102, Rge 22, W3M: Secs 1-36 49% Working Interest 2.5% Gross
Exploration Permit # PS00219 Twp 102, Rge 23, W3M: Secs 3-10, 15-22, 25, Overriding Royalty
27-34, 36 reserved to
Twp 102, Rge 24, W3M: Secs 1-36 Stripper Energy
Twp 102, Rge 25, W3M: Secs 1-2, ptn 3, ptn Services Limited
10, secs 11-14, ptn 15, ptn 22, secs 23-26, based on 100%
ptn 27, ptn 34, secs 35-36 Working Interest
(containing 71,552 acres)
- -----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale Twp 101, Rge 21, W3M: Secs 1-36 49% Working Interest 2.5% Gross
Exploration Permit # PS00220 Twp 102, Rge 21, W3M: Secs 1-36 Overriding Royalty
Twp 103, Rge 21, W3M: Secs 1-36 reserved to
(containing 69,120 acres) Stripper Energy
Services Limited
based on 100%
Working Interest
- -----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale Twp 103, Rge 22, W3M: Secs 1-36 49% Working Interest 2.5% Gross
Exploration Permit # PS00221 Twp 103, Rge 23, W3M: Secs 14-36 Overriding Royalty
Twp 103, Rge 24, W3M: Secs 1-20,23-26, reserved to
29-32, 35, 36 Stripper Energy
Twp 103, Rge 25, W3M: Ptn 1, ptn 12, ptn 13, Services Limited
ptn 24, ptn 25, ptn 36. based on 100%
(containing 68,754 acres) Working Interest
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SCHEDULE "B"
THIS IS SCHEDULE "B" ATTACHED TO AND FORMING PART OF A PETROLEUM, NATURAL GAS
AND GENERAL RIGHTS CONVEYANCE DATED SEPTEMBER 29, 2004 BETWEEN POWERMAX ENERGY
INC. AND 808099 ALBERTA LTD.
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PETROLEUM, NATURAL GAS AND GENERAL RIGHTS CONVEYANCE
(A) Vendor and Purchaser entered into that Agreement made as of the 16th day of
July, 2004 (the "Purchase and Sale Agreement") with respect to the Assets,
(which term, when used in this Agreement, has the same meaning as in the Sale
Agreement):
(B) All of the conditions precedent to the obligations of the parties hereto to
close the transactions contemplated by the Sale Agreement have either been
fulfilled or waived in the manner provided for waiver in the Sale Agreement;
NOW THEREFORE in consideration of the premises hereto and the covenants
and agreements hereinafter set forth and contained, the parties hereto covenant
and agree as follows:
1. Vendor hereby sells, assigns, transfers, conveys and sets over to the
Purchaser, and Purchaser hereby purchases from Vendor, a portion of the right,
title, estate and interest of Vendor (whether absolute or contingent, legal or
beneficial) in and to the Assets, TO HAVE AND TO HOLD the same, together with
all benefit and advantage to be derived therefrom, absolutely, subject to the
terms of the Sale Agreement.
2. The covenants, representations, warranties and indemnities contained in the
Sale Agreement are incorporated herein as fully and effectively as if they were
set out herein and there shall not be any merger of any covenant,
representation, warranty or indemnity contained in the Sale Agreement by virtue
of the execution and delivery hereof, any rule of law, equity or statute to the
contrary notwithstanding.
3. If any term or provision hereof should conflict with any term or provision of
the Sale Agreement, the term and provision of the latter shall prevail and this
Agreement shall at all times be read subject to all terms and conditions of the
Sale Agreement.
4. The assignment and conveyance effected by this Agreement is made with full
right of substitution of Purchaser in and to all covenants, representations,
warranties and indemnities by others heretofore given or made in respect of the
Assets or any part thereof.
5. This Agreement shall, in all respects, be subject to and interpreted,
construed and enforced in accordance with and under the laws of the Province of
Alberta and shall, in every regard, be treated as a contract made in the
Province of Alberta. The parties hereto irrevocably attorn and submit to the
jurisdiction of the courts of the Province of Alberta in respect of all matters
arising out of or in connection with this Agreement.
6. This Agreement shall be binding upon and shall enure to the benefit of each
of the parties hereto and their respective administrators, trustees, receivers,
successors and assigns.
IN WITNESS WHEREOF the parties hereto have executed this Agreement as of
the 21st day of September, 2004.
POWERMAX ENERGY INC. 808099 ALBERTA LTD
(VENDOR) (PURCHASER)
___________________________________ /s/_____________________________________
/s/ Neil K. Answorth- Director
___________________________________ ________________________________________