SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No.__8__)
Xplor Corporation
-----------------------------------------------------
(Name of Issuer)
Common Stock, $.01 par value
--------------------------------------------------------
(Title of Class of Securities)
984127100
----------------------------------------------------------
(CUSIP Number)
Nadine Shaoul, D.H. Blair Investment Banking Corp.
44 Wall Street, New York, NY 10005 (212) 495-4163
------------------------------------------------------------
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
May 21, 1997
-----------------------------------------------------------
(Date of Event which Requires FIling of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b) (3) or (4), check the following box [ ].
Check the following box if a fee is being paid with this statement [ ].(A fee is
not required only if the reporting person: (1) has a previous statement on file
reporting beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such class.)
(See Rule 13d-7.)
Note: Six copies of this statement, including all exhibits, should be filed
with the Commission. See Rule 13d-1(a) for other parties to whom copies are
to be sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter the
disclosures provided in a prior cover page.
The information required in the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
Page 1 of 89 pages
<PAGE>
CUSIP No. 984127100 13D Page 2 of 89 pages
- --------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
J. Morton Davis
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [ ]
(b) [X ]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- -------------------------------------------------------------------------------
4 Source of Funds
0
- -------------------------------------------------------------------------------
5 Check Box if Disclosure of Legal Proceedings is required pursuant to
Items 2(d) or 2(e)
- -------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES 0
BENEFICIALLY --------------------------------------------------------------
OWNED BY 8 SHARED VOTING POWER
EACH 832,147
REPORTING --------------------------------------------------------------
PERSON 9 SOLE DISPOSITIVE POWER
WITH 796,307
--------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
35,840
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
7,118,963
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
X
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
70.5%
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT
<PAGE>
CUSIP No. 984127100 13D Page 3 of 89 pages
- --------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
D.H. Blair Investment Banking Corp.
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [ ]
(b) [X ]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- -------------------------------------------------------------------------------
4 Source of Funds
0
- -------------------------------------------------------------------------------
5 Check Box if Disclosure of Legal Proceedings is required pursuant to
Items 2(d) or 2(e)
- -------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
New York
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES 0
BENEFICIALLY --------------------------------------------------------------
OWNED BY 8 SHARED VOTING POWER
EACH 796,307
REPORTING --------------------------------------------------------------
PERSON 9 SOLE DISPOSITIVE POWER
WITH 0
--------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
796,307
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
7,118,963
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
X
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
70.5%
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
BD
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT
<PAGE>
CUSIP No. 984127100 13D Page 4 of 89 pages
- --------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Rosalind Davidowitz
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [ ]
(b) [X ]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- -------------------------------------------------------------------------------
4 Source of Funds
00
- -------------------------------------------------------------------------------
5 Check Box if Disclosure of Legal Proceedings is required pursuant to
Items 2(d) or 2(e)
- -------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES 0
BENEFICIALLY --------------------------------------------------------------
OWNED BY 8 SHARED VOTING POWER
EACH 270,205
REPORTING --------------------------------------------------------------
PERSON 9 SOLE DISPOSITIVE POWER
WITH 234,365
--------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
35,840
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
7,118,963
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
70.5%
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT
<PAGE>
CUSIP No. 984127100 13D Page 5 of 89 pages
- --------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Rivkalex Corporation
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [ ]
(b) [X ]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- -------------------------------------------------------------------------------
4 Source of Funds
0
- -------------------------------------------------------------------------------
5 Check Box if Disclosure of Legal Proceedings is required pursuant to
Items 2(d) or 2(e)
- -------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
New York
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES 0
BENEFICIALLY --------------------------------------------------------------
OWNED BY 8 SHARED VOTING POWER
EACH 163,411
REPORTING --------------------------------------------------------------
PERSON 9 SOLE DISPOSITIVE POWER
WITH 0
--------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
163,411
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
7,118,963
- -------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
70.5%
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
CO.
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT
<PAGE>
CUSIP No. 984127100 13D Page 6 of 89 pages
- --------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Parliament Hill Corporation
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [ ]
(b) [X ]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- -------------------------------------------------------------------------------
4 Source of Funds
0
- -------------------------------------------------------------------------------
5 Check Box if Disclosure of Legal Proceedings is required pursuant to
Items 2(d) or 2(e)
- -------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES 0
BENEFICIALLY --------------------------------------------------------------
OWNED BY 8 SHARED VOTING POWER
EACH 35,840
REPORTING --------------------------------------------------------------
PERSON 9 SOLE DISPOSITIVE POWER
WITH 0
--------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
35,840
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
7,118,963
- -------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
70.5%
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
CO.
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT
<PAGE>
Page 7 of 89 pages
J. Morton Davis, D.H. Blair Investment Banking Corp. ("Blair
Investment"), Rosalind Davidowitz, Rivkalex Corporation ("Rivkalex"),
and Parliament Hill Corporation ("PHC", joining as a joint filer),
(collectively, the "Reporting Parties") hereby amend the following
Items in their statement on Schedule 13D relating to the common stock,
$.01 par value ("shares") of Xplor Corporation (the "Issuer") as
follows:
Item 2. (a) is hereby amended by adding the following sentence thereto:
This statement is also filed on behalf of Parliament Hill
Corporation ("PHC").
Item 2. (b) is hereby amended by adding the following sentence thereto:
PHC's business address is P.O. Box 1522, New York, NY 10268.
Item 2. (c) is amended in its entirety as follows:
Mr. Davis is an investment banker and sole shareholder of Blair
Investment, a broker-dealer registered under the Securities
Exchange Act of 1934.
Rivkalex (4) is a privately-held New York corporation formed to
invest in, hold, and sell securities of other companies. It is owned
by Rosalind Davidowitz, Mr. Davis' wife, who is President.
PHC is a private corporation of which Rosalind Davidowitz owns
approximately 72.6% and Blair Investment owns approximately 13.4%.
Item 2. (d) and 2 (e) are hereby amended by inserting PHC, after Ms. Davidowitz.
Item 4. is hereby partially amended by deleting the first sentence therein and
adding the following at the beginning of Item 4.:
On May 21, 1997, the Issuer closed the transactions contemplated
by a certain Property Acquisition Agreement (the "PAA") entered into
on April 29, 1997, an unexecuted copy of which is filed as Exhibit G
hereto and is incorporated herein by reference, with the New Venus
Exploration, Inc. ("Venus") and Lomak Production I L.P. and Lomak
Resources, L.L.C. (together, the "Lomak Parties"), pursuant to which
the Issuer purchased substantially all of the assets of Venus and
certain properties from the Lomak Parties in exchange for shares of
the Issuer to be distributed to the stockholders of Venus and to the
Lomak Parties. As a result of the transaction, Venus received
5,626,473 shares of the Issuer and warrants to purchase an additional
272,353 shares. Venus will hold such shares until it is distributed to
its stockholders. The date of such distribution has not yet been
determined, but is expected to occur within a reasonable time after
the date thereof. This statement assumes such distribution by Venus
has been completed. The Lomak Parties received 2,037,171 shares and
warrants to purchase an additional 272,353 shares. Pursuant to the
terms of the PAA, Eugene L. Ames, Jr., Ellen R.Y. Ames, John Y. Ames,
Elizabeth A. Jones, Eugene L. Ames, III, Stephen J. Ames, George J.
Ames, Carl Oliver, Patrick A. Garcia, Raymond M. Koger, Gloria Barret,
Venus Oil Company, James W. Gorman, and Jere W. McKenney
(collectively, the "Ames Parties"), the Reporting Parties and the
Lomak Parties (collectively, the "SA Parties") entered into a certain
Stockholders' Agreement dated May 21, 1997 (the "SA"), an unexecuted
copy of which is filed as Exhibit H hereto and incorporated herein by
reference, pursuant to which, among other things, the SA Parties
agreed to vote together on the election of directors and agreed to
certain restrictions upon the sale of shares held by the SA Parties.
The descriptions of the PAA and the SA contained herein do not purport
to be complete and are qualified in their entirety by reference to the
terms of the PAA and the SA, and which are attached hereto as Exhibit
G and Exhibit H, respectively, and are incorporated herein by
reference.
<PAGE>
Page 8 of 89 pages
Item 4 (continued)
The Reporting Parties will review on a continuous basis their
investment in the Issuer's shares and the Issuer's business affairs
and financial condition, as well as conditions in the securities
markets and general economic and industry conditions. The Reporting
Parties may in the future take such actions in respect of their
investment in the Issuer's shares as they deem appropriate in light of
the circumstances existing from time to time. Currently, these actions
include continuing to hold the shares they now beneficially own,
exercising their respective warrants, or disposing of shares. Any
sales or any other dispositions by the Reporting Parties could be
effected in private transactions, through a public offering or, upon
compliance with the rules under the Securities Act of 1933, as amended
(the "Securities Act"), in the open market. Additionally, it is
possible that the Reporting Parties could seek to acquire additional
shares, although they have no current plans to do so. Any acquisition
of shares could be effected in the open market, in privately
negotiated transactions, or otherwise. Any sales, purchases or
transfers or other actions described herein may be made at any time
without further prior notice. In reaching any conclusion as to the
foregoing matters, the Reporting Parties and the Lomak Parties may
take into consideration various factors, such as the Issuer's business
and prospects, other developments concerning the Issuer, the
obligations of, cash and financial resources of and other business
opportunities available to the Reporting Parties, general economic
conditions, the market price for shares and stock market conditions.
In connection with the closing of the PAA, the parties thereto agreed
that the name of the Issuer should be changed. It is expected that the
name of the Issuer will be changed to Venus Exploration, Inc., within
a reasonable time after the date hereof.
Item 5. (a)(b) is hereby amended in its entirety as follows:
Because of the arrangements among the SA Parties described in this
statement, the SA Parties may be deemed to constitute a group pursuant
to Section 13(d)(3) of the Securities Exchange Act of 1934, as
amended; and pursuant to Rule 13d-5(b)(1) each of the SA Parties may
be deemed to beneficially own all of the shares owned by any of the
other SA Parties.
Therefore, the Reporting Parties each may be deemed to
beneficially own an aggregate of 7,118,963 shares (approximately 70.5%
of the 9,700,815 shares issued and outstanding as a result of the
closing of the PAA, as reported in the Company's Information Statement
pursuant to Section 14(f) of the Securities Exchange Act of 1934 and
Rule 14f-1 thereunder filed May 21, 1997, plus 394,376 Warrants owned
by the SA Parties. A description of the direct beneficial ownership of
the SA Parties (in the aggregate 7,118,963 shares) is found in
Exhibits 1, 2, and 3 to the SA attached hereto as Exhibit H, and
incorporated by reference herein.
<PAGE>
Page 9 of 89 pages
Item 5 (a) (b) continued
Blair Investment, and J. Morton Davis as its sole shareholder,
may be deemed to share voting power with respect to the election of
the directors of the Issuer with the other SA Parties, and Mr. Davis
has sole dispositive power with respect to 796,307 shares (5) owned
directly by Blair Investment, described as follows; (i) 766,307
shares, (ii) warrants to purchase 10,000 shares at $2.125 per share
expiring June 10, 1997; and (iii) warrants to purchase 20,000 shares
at $3.29 per share expiring September 1, 1999. Mr. Davis shares
dispositive power over 35,840 shares owned by PHC with its Board of
Directors, of which Mr. Davis is a director and Chairman.
Rosalind Davidowitz may be deemed to share voting power with
respect to the election of directors of the Issuer with the other SA
Parties, and has sole dispositive power with respect to 70,954 shares
owned directly by her, and 163,411 shares owned directly by Rivkalex
Corporation. She may be deemed to share dispositive power over 35,840
shares owned by PHC with its Board of Directors, by virtue of her
ownership of PHC.
Rivkalex may be deemed to share voting power with respect to the
election of the directors of the Issuer with the other SA Parties, and
Rosalind Davidowitz, its sole shareholder, has sole dispositive power
over 163,411 shares owned directly by Rivkalex.
PHC may be deemed to share voting power with respect to the
election of the directors of the Issuer with the other SA parties, and
its Board of Directors has shared dispositive power with respect to
35,840 shares owned directly by PHC.
Each of the Reporting Parties disclaims beneficial ownership of
shares owned by the other SA Parties for any other purpose other than
described in the SA.
Item 5.(c) is hereby amended by adding the following paragraphs:
Except as set forth in Item 4. above, to the best of the
Reporting Parties' knowledge, none of the Reporting Parties has
effected any transactions in the previous sixty days.
- ------------------------------------------------------------------------------
(4) Although Mr. Davis has included securities owned by Rosalind Davidowitz
and Rivkalex in the aggregate amount of shares owned by him, filing of this
statement shall not be deemed an admission by J. Morton Davis that he
beneficially owns the securities attributed to Rosalind Davidowitz or Rivkalex
for any purpose. J. Morton Davis expressly disclaims beneficial ownership of all
securities held by Rosalind Davidowitz and Rivkalex.
(5) Not included herein are 3,000 shares and a warrant to purchase 500,000
shares owned by Kinder Investments, L.P. ("Kinder"). Kenton E. Wood, the general
partner of Kinder, is the Chairman and Chief Executive Officer of D.H. Blair &
Co., Inc. ("Blair") and a stockholder and director of Blair. Certain limited
partners of Kinder are also stockholders of Blair. The limited partners of
Kinder are the children and grandchildren of Mr. Davis and Ms. Davidowitz. Mr.
Davis, Ms. Davidowitz, Rivkalex, PHC, and Blair Investment disclaim for purposes
of Section 13 or otherwise beneficial ownership of any Xplor Corporation shares
owned by Kinder or Blair. Kinder disclaims for purposes of Section 13 or
otherwise ownership of any Xplor Corporation shares owned by Blair, Blair
Investment, Mr. Davis, Ms. Davidowitz, PHC, or Rivkalex.
<PAGE>
Page 10 of 89 pages
Item 6. is hereby amended by adding the following paragraph thereto:
See Item 4. above for a description of a Property Acquisition
Agreement and a Stockholders Agreement entered into by the Reporting
Parties. Both agreements are attached hereto as Exhibits G and H,
respectively, and each is incorporated herein by reference in its
entirety.
The Reporting Parties have entered into a Joint Filing Agreement
regarding the filing of this statement and subsequent amendments
thereto. A copy of such Joint Filing Agreement is attached hereto as
Exhibit E and is incorporated herein by reference in its entirety.
Item 7 is hereby amended by adding the following thereto:
Exhibit E - Joint Filing Agreement.
Exhibit F - List of Officers and directors of PHC and information
called for by Items 2-6 of this statement relating to said
officers and directors.
Exhibit G - Property Acquisition Agreement dated April 29, 1997.
Exhibit H - Stockholders Agreement dated May 21, 1997.
SIGNATURES
----------
After reasonable inquiry and to the best of my knowledge and belief, we certify
that the information set forth in this statement is true, complete and correct.
/s/ J. Morton Davis
Date: May 29, 1997 _____________________________
New York, New York J. Morton Davis
/s/ Rosalind Davidowitz
Date: May 29, 1997 _____________________________
New York, New York Rosalind Davidowitz
RIVKALEX CORPORATION
/s/ Rosalind Davidowitz
Date: May 29, 1997 By:_____________________________
New York, New York Rosalind Davidowitz
D.H. BLAIR INVESTMENT BANKING CORP.
/s/ David Nachamie
Date: May 29, 1997 By:_____________________________
New York, New York David Nachamie
Treasurer
PARLIAMENT HILL CORPORATION
/s/ David Nachamie
Date: May 29, 1997 By:_____________________________
New York, New York David Nachamie
President
Page 11 of 89 pages
EXHIBIT E
AGREEMENT
JOINT FILING OF SCHEDULE
The undersigned hereby agree to jointly prepare and file with Regulatory
authorities a Schedule 13G and any future amendments thereto reporting each of
the undersigned's ownership of securities of Xplor Corporation and hereby affirm
that such Schedule 13D is being filed on behalf of each of the undersigned.
/s/ J. Morton Davis
Date: May 29, 1997 _____________________________
New York, New York J. Morton Davis
/s/ Rosalind Davidowitz
Date: May 29, 1997 _____________________________
New York, New York Rosalind Davidowitz
RIVKALEX CORPORATION
/s/ Rosalind Davidowitz
Date: May 29, 1997 By:_____________________________
New York, New York Rosalind Davidowitz
D.H. BLAIR INVESTMENT BANKING CORP.
/s/ David Nachamie
Date: May 29, 1997 By:_____________________________
New York, New York David Nachamie
Treasurer
PARLIAMENT HILL CORPORATION
/s/ David Nachamie
Date: May 29, 1997 By:_____________________________
New York, New York David Nachamie
President
Page 12 of 89 pages
EXHIBIT F
The name and principal occupation or employment, which in each instance
is with Parliament Hill Corporation ("PHC") located at P.O. Box 1522, New
York, NY 10268, of each executive officer and director of PHC is as follows:
NAME PRINCIPAL OCCUPATION OR EMPLOYMENT
Davis, Joseph Morton Investment Banker,
Director Chairman, D.H. Blair Investment Banking Corp.
Nachamie, David Treasurer, D.H. Blair Investment Banking Corp.
President
Item 2.
During the last five years, none of the above persons (to the best of
PHC's knowledge) was convicted in a criminal proceeding (excluding traffic
violations or similar misdemeanors) or was a party to a civil proceeding of a
judicial or administrative body of competent jurisdiction and as a result or
such proceeding was or is subject to a judgment, decree or final order
enjoining future violations of, or prohibiting or mandating activities subject
to federal or state securities laws or finding any violation with respect to
such laws.
Item 3. - 6.
J. Morton Davis - see Items 3. - 6. of this statement.
David Nachamie may be deemed to beneficially own 2,341 shares or less
than one percent of the Issuer's securities. He has sole voting and
dispositive power over these shares, and has made no transactions in the
Issuer's securities in the previous sixty day.
Page 13 of 89 pages
- -----------------------------------------------------------------
PROPERTY ACQUISITION AGREEMENT
dated as of April 29, 1997
by and among
XPLOR CORPORATION
THE NEW VENUS EXPLORATION, INC.
LOMAK PRODUCTION I L.P.
LOMAK RESOURCES LLC
- -------------------------------------------------------------------------------
<PAGE>
Page 14 of 89 pages
Table of Contents
ARTICLE I
VENUS EXCHANGE AND LOMAK EXCHANGE.............................1
Section 1.01. Venus Exchange and Lomak Exchange..............1
Section 1.02. Closing........................................2
Section 1.03. Issuance of Xplor Stock and Warrants...........2
Section 1.04. Dissolution of Venus...........................2
Section 1.05. Code Sections 351 and 368(a)(1)(C).............3
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF XPLOR.......................3
Section 2.01. Organization, Etc..............................3
Section 2.02. Capitalization..................................3
Section 2.03. Authorization..................................4
Section 2.04. No Violation...................................4
Section 2.05. Approvals......................................5
Section 2.06. Xplor 10-K and Proxy Statement.................5
Section 2.07. Absence of Certain Changes.....................6
Section 2.08. Litigation.....................................6
Section 2.09. No Default.....................................7
Section 2.10. Compliance with Laws...........................7
Section 2.11. Oil and Gas Reserves; Wells....................7
Section 2.12. Title to Xplor Leases..........................8
Section 2.13. Other Real Property Owned or Leased...........10
Section 2.14. Title to Other Assets, Properties and Rights
and Related Matters...........................10
Section 2.15. No Misleading Statements......................11
Section 2.16. Brokerage Fees................................11
Section 2.17. Indebtedness. ................................11
Section 2.18. Taxes.........................................12
Section 2.19. Material Contracts...... ....................13
Section 2.20. No Undisclosed Liabilities....................13
Section 2.21. No Vote Required..............................13
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF VENUS......................13
Section 3.01. Organization, Etc.............................13
Section 3.02. Capitalization................................14
Section 3.03. Authorization.................................14
i
<PAGE>
Page 15 of 89 pages
Section 3.04. No Violation... ...............................15
Section 3.05. Approvals......................................15
Section 3.06. Venus Financial Statements.....................16
Section 3.07. Absence of Certain Changes.....................16
Section 3.08. Litigation.....................................17
Section 3.09. No Default.....................................17
Section 3.10. Compliance with Laws...........................17
Section 3.11. Oil and Gas Reserves; Wells....................18
Section 3.12. Title to Venus Leases..........................18
Section 3.13. Other Real Property Owned or Leased............20
Section 3.14. Title to Other Assets, Properties and
Rights and Related Matters.....................20
Section 3.15. No Misleading Statements.......................21
Section 3.16. Brokerage Fees.................................21
Section 3.17. Indebtedness...................................21
Section 3.18. Taxes..........................................21
Section 3.19. Material Contracts.............................23
Section 3.20. No Undisclosed Liabilities.....................23
Section 3.21. Vote Required; Solicitatio.....................23
Section 3.22. Ownership of Shares............................23
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE LOMAK ENTITIES..........23
Section 4.01. Organization, Etc..............................23
Section 4.02. Authorization..................................24
Section 4.03. No Violation...................................24
Section 4.04. Approvals......................................25
Section 4.05. Lomak Financial Statements.....................25
Section 4.06. Absence of Certain Changes.....................26
Section 4.07. Litigation.....................................26
Section 4.08. No Default.....................................26
Section 4.09. Compliance with Laws...........................26
Section 4.10. Oil and Gas Reserves; Wells....................27
Section 4.11. Title to Lomak Leases..........................27
Section 4.12. No Misleading Statements.......................27
Section 4.13. Brokerage Fees.................................28
Section 4.14. Indebtedness...................................28
Section 4.15. Taxes..........................................28
Section 4.16. Material Contracts.............................28
Section 4.17. No Undisclosed Liabilities.....................28
Section 4.18. No Vote Required...............................28
ii
<PAGE>
Page 16 of 89 pages
ARTICLE V
COVENANTS OF XPLOR............................................29
Section 5.01. Conduct of Xplor...............................29
Section 5.02. Access to Records..............................31
Section 5.03. No Other Bids..................................31
Section 5.04. Maintenance of Business........................31
Section 5.05. Compliance with Obligations....................32
Section 5.06. SEC and NASDAQ Filings; Venus
Stockholder Approval...........................32
ARTICLE VI
COVENANTS OF VENUS............................................32
Section 6.01. Conduct of Venus...............................32
Section 6.02. Access to Records..............................34
Section 6.03. No Other Bids..................................35
Section 6.04. Maintenance of Business........................35
Section 6.05. Compliance with Obligations....................35
Section 6.06. Venus Stockholder Approval.....................35
ARTICLE VII
COVENANTS OF THE LOMAK ENTITIES...............................36
Section 7.01. Conduct of the Lomak Entities..................36
Section 7.02. Access to Records..............................37
Section 7.03. No Other Bids..................................37
Section 7.04. Maintenance of the Lomak Properties............37
Section 7.05. Compliance with Obligations....................37
Section 7.06. Venus Stockholder Approval.....................37
ARTICLE VIII
COVENANTS OF ALL PARTIES......................................38
Section 8.01. Board of Directors, Officers of Xplor;
Employees of Venus.............................38
Section 8.02. Advice of Changes..............................38
Section 8.03. Regulatory Approvals...........................39
Section 8.04. Actions Contrary to Stated Intent..............39
Section 8.05. Certain Filings................................39
Section 8.06. Public Announcements...........................40
Section 8.07. Confidentiality................................40
Section 8.08. Issuance of Xplor Shares After Closing.........41
ARTICLE IX
CONDITIONS TO CLOSING.........................................41
Section 9.01. Conditions to All Parties' Obligations.........41
Section 9.02. Conditions to the Obligations of Xplor to Effect the
Venus
Exchange and Lomak Exchange..........................42
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Section 9.03. Conditions to the Obligations of Venus to Effect the Venus
Exchange.... .......................................43
Section 9.04. Conditions to the Obligations of the Lomak Entities to
Effect the Lomak Exchange..........................45
ARTICLE IX-A
ADJUSTMENTS AFTER CLOSING FOR LOMAK PROPERTIES.................47
9A.01. Adjustment for Interim Operations......................47
ARTICLE X
TERMINATION, AMENDMENTS AND WAIVERS............................49
Section 10.01. Termination....................................49
Section 10.02. Effect of Termination..........................51
Section 10.03. Amendment......................................51
Section 10.04. Waiver.........................................51
ARTICLE XI
DEFINITIONS....................................................52
ARTICLE XII
GENERAL PROVISIONS.............................................56
Section 12.01. Taking of Necessary Action; Specific Performance..56
Section 12.02. Survival of Representations and Warranties........57
Section 12.03. Effect of Due Diligence...........................57
Section 12.04. Expenses..........................................57
Section 12.05. Successors and Assigns............................57
Section 12.06. Entire Agreement..................................57
Section 12.07. Notices...........................................58
Section 12.08. Applicable Law....................................59
Section 12.09. Counterparts......................................59
Section 12.10. Headings........................................ .59
Xplor Disclosure Schedule.......................................Schedule A
Xplor Reserve Report................................. ..........Schedule AA
Xplor Other Properties................................ .........Schedule AAA
Venus Disclosure Schedule.......................................Schedule B
Venus Reserve Report............................................Schedule BB
Venus Other Properties..........................................Schedule BBB
Lomak Disclosure Schedule.......................................Schedule C
Lomak Reserve Report............................................Schedule CC
Warrants, form of...............................................Exhibit 1.03
Xplor Directors and Officers, post Closing............. ........Exhibit 8.01
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Stockholders Agreement....................................Exhibit 9.01(e)
Opinion of Jones & Faye, P.L.L.C..........................Exhibit 9.02(d)(i)
Opinion of Rubin Baum Levin Constant & Friedman...........Exhibit 9.02(d)(ii)
Opinion of Neville Shaver Hubbard & McLean................Exhibit 9.03(d)(i)
Share Purchase and Sale Agreement.........................Exhibit 9.03(i)
'
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4/26/97
PROPERTY ACQUISITION AGREEMENT
PROPERTY ACQUISITION AGREEMENT, dated as of April 29, 1997
(the "Agreement"), by and among Xplor Corporation, a Delaware corporation
("Xplor"), The New Venus Exploration, Inc., a Texas corporation ("Venus"), and
Lomak Production I L.P., a Texas limited partnership and Lomak Resources LLC, an
Oklahoma limited liability company (respectively, "Production" and "Resources"
and together the "Lomak Entities"). Certain capitalized terms used herein are
defined in Article XI hereof.
WHEREAS, each of the parties to this Agreement have determined
to engage in an exchange described in Section 351 of the Internal Revenue Code
of 1986, as amended ("Code"), pursuant to which Xplor will acquire all of the
assets and liabilities of Venus in exchange for shares of the common stock,
$0.01 par value, of Xplor ("Xplor Stock") and warrants to purchase Xplor Stock
(the "Venus Exchange"); and simultaneously with the Venus Exchange, Xplor will
acquire certain assets of the Lomak Entities in exchange for shares of Xplor
Stock and warrants to purchase Xplor Stock (the "Lomak Exchange");
WHEREAS, each of Venus and Xplor has determined to engage in
the Venus Exchange so that it will qualify as a tax-free reorganization under
368(a)(1)(C) of the Code.
NOW, THEREFORE, in consideration of the premises, the
representations, warranties and agreements herein contained and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and subject to the conditions set forth herein, the parties hereby
agree as follows:
ARTICLE I
VENUS EXCHANGE AND LOMAK EXCHANGE
Section 1.01. Venus Exchange and Lomak Exchange.
(a) At the Closing and subject to and upon the terms of this
Agreement, Xplor shall acquire substantially all of the assets of Venus and
shall assume substantially all of the liabilities of Venus in exchange for the
Xplor shares and warrants as herein provided.
(b) Simultaneously with the Venus Exchange, the Lomak Entities
will effect the Lomak Exchange by conveying all of their respective rights,
titles and interests in the assets referred to and described in Article IV
hereof (the "Lomak Properties") to Xplor, subject only to the liabilities set
forth in the Lomak Financial
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Statements referred to in Section 4.06 hereof and to such adjustments as are
required by Article IX-A hereof.
Section 1.02. Closing.
(a) Subject to the provisions of Article VII hereof, the
closing (the "Closing") of the Venus Exchange and Lomak Exchange shall take
place at 10:00 a.m., Central Time, at the offices of Venus no later than the
second Business Day after satisfaction of the latest to occur of the conditions
set forth in Article IX hereof (other than the delivery of the officers'
certificates and opinions referred to therein which are to be delivered on the
date of the Closing, and other than any conditions which are waived in
accordance with said Article) or such other time, place or date as the parties
may agree. Failure to consummate the transactions provided for in this Agreement
on the date and time selected pursuant to this Section 1.02(a) shall not, except
as permitted by Article X hereof, result in the termination of this Agreement
and shall not relieve any party to this Agreement of any obligation hereunder.
(b) The Venus Exchange and Lomak Exchange shall become
effective at the close of business on the Closing Date, provided that certain
adjusting payments may be required between Xplor and the Lomak Entities in
accordance with Article IX-A hereof.
Section 1.03. Issuance of Xplor Stock and Warrants.
(a) As of the Closing, Venus will convey all its assets to
Xplor (except for the assets listed on Schedule 1.03 hereto), and Xplor will
assume all the liabilities of Venus (except for the liabilities listed on
Schedule 1.03 hereto), in exchange for 5,626,473 fully-paid, validly issued and
non-assessable shares of Xplor Stock plus warrant(s) to purchase 272,353 shares
of Xplor Stock in the form of Exhibit 1.03 hereto ("Warrant(s)").
(b) As of the Closing, Production will convey its Lomak
Properties to Xplor in exchange for the issuance by Xplor of 1,813,082
fully-paid, validly issued and non-assessable shares of Xplor Stock plus
Warrant(s) to purchase an aggregate of 242,394 shares of Xplor Stock, and
Resources will convey its Lomak Properties to Xplor in exchange for the issuance
by Xplor of 224,089 fully-paid, validly issued and non-assessable shares of
Xplor Stock plus Warrant(s) to purchase an aggregate of 29,959 shares of Xplor
Stock.
Section 1.04. Dissolution of Venus. As a part of the
transactions contemplated hereby and conditioned on the Closing of the Venus
Exchange, Venus expects to distribute the Xplor Shares and Warrants it receives
hereunder to its shareholders and to dissolve promptly following the Closing.
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Section 1.05. Code Sections 351 and 368(a)(1)(C). The
transactions contemplated by this Agreement are intended to constitute an
exchange as described in Section 351 of the Code, and, as between Venus and
Xplor, an exchange as described in Section 368(a)(1)(C) of the Code. The parties
hereto shall not report or take any position with any taxing authority
inconsistent with such description.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF XPLOR
Except as set forth (by reference to the applicable Section of
this Agreement) in Xplor's disclosure schedule previously delivered to Venus and
the Lomak Entities (the "Xplor Disclosure Schedule"), a copy of which is
attached hereto as Schedule A, Xplor hereby agrees and represents and warrants
to Venus and the Lomak Entities as follows:
Section 2.01. Organization, Etc. Xplor is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware and has all requisite corporate power and corporate authority to
conduct its business as it is now being conducted and to own, operate or lease
the properties and assets it currently owns, operates or holds under lease.
Xplor is duly qualified or licensed to do business and is in good standing as a
foreign corporation in each jurisdiction where the character of its business or
the nature of its properties or assets makes such qualification or licensing
necessary, except where the failure to so qualify or be licensed would not have
a Material Adverse Effect. Schedule 2.01 to the Xplor Disclosure Schedule sets
forth a list of each jurisdiction in which Xplor is licensed or qualified to
transact business as a foreign entity. Xplor has heretofore delivered to Venus
and the Lomak Entities true and correct copies of its Certificate of
Incorporation and Bylaws as in effect on the date hereof. Schedule 2.01 to the
Xplor Disclosure Schedule sets forth a list of the officers and directors of
Xplor on the date hereof.
Section 2.02. Capitalization. The authorized capital stock of
Xplor consists of 15,000,000 shares of common stock, $.01 par value per share,
of which only 2,037,171 shares are issued and outstanding as of the date hereof
and 1,000,000 shares of Preferred Stock, $.01 par value per share, no shares of
which are issued and outstanding as of the date hereof. 558,502 shares of Xplor
Stock are held as treasury shares. The designations, powers, preferences,
rights, qualifications, limitations and restrictions in respect of each class
and series of authorized capital stock of Xplor are as set forth in Xplor's
Certificate of Incorporation, and all such designations, powers, preferences,
rights, qualifications, limitations and restrictions are valid, binding and
enforceable and in accordance with all applicable laws. All outstanding shares
of Xplor Stock have been duly authorized and validly issued and are fully paid
and non-assessable. All of the outstanding shares of Xplor Stock were issued in
compliance with all applicable Federal and state securities laws. None of the
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outstanding securities has been issued in violation of any pre-emptive rights,
rights of first refusal or similar rights. Except as set forth in the Xplor
Disclosure Schedule, there are no outstanding options, warrants, convertible
securities, calls, rights, commitments, preemptive rights or agreements or
instruments or understandings or other securities of any character to which
Xplor is a party or by which Xplor is bound, obligating Xplor to issue, deliver
or sell, or cause to be issued, delivered or sold, contingently or otherwise,
additional shares of capital stock of Xplor or any securities or obligations
convertible into or exchangeable for such shares or to grant, extend or enter
into any such option, warrant, convertible security, call, right, commitment,
preemptive right or agreement. There are no outstanding obligations, contingent
or otherwise, of Xplor to purchase, redeem or otherwise acquire any capital
stock of Xplor. There are no voting trust agreements or other contracts,
agreements, arrangements, commitments, plans or understandings restricting or
otherwise relating to voting, dividend or other rights with respect to Xplor's
capital stock. There are no bonds, debentures, notes or other indebtedness
having the right to vote (or convertible into securities having the right to
vote) on any matters on which Xplor stockholders may vote issued or outstanding.
There is no liability for dividends declared or accumulated but unpaid with
respect to any of the shares of Xplor Stock. Upon delivery of the certificates
for the shares of Xplor Stock to be issued in the Venus Exchange and in the
Lomak Exchange in accordance with the terms of this Agreement, such shares will
be validly issued, fully paid and non-assessable.
Section 2.03. Authorization. Xplor has all requisite corporate
power and corporate authority to enter into this Agreement and each of the other
agreements contemplated hereby, to carry out its obligations under this
Agreement and each of the other agreements contemplated hereby and to consummate
the transactions contemplated hereby and thereby. The execution and delivery by
Xplor of this Agreement, the consummation of the transactions contemplated
hereby and the performance by Xplor of its obligations hereunder have been duly
authorized by all necessary corporate action. This Agreement has been duly
executed and delivered by Xplor and, assuming that this Agreement constitutes
the legal, valid and binding obligation of the other parties hereto, constitutes
the legal, valid and binding obligation of Xplor, enforceable against it in
accordance with its terms.
Section 2.04. No Violation. The execution and delivery of this
Agreement by Xplor does not, and the consummation by Xplor of the transactions
contemplated hereby, and compliance with the terms hereof will not, (a) conflict
with, or result in any violation of or default (with or without notice or lapse
of time or both) or loss of any benefit under, any provision of its Certificates
of Incorporation or By-laws; (b) conflict with, or result in any violation of or
default (with or without notice or lapse of time or both) or loss of any benefit
under, any permit, concession, grant, assignment, franchise, license, law, rule
or regulation, or any judgment, decree or order of any court or other
governmental agency or instrumentality to which Xplor is a party or to which any
of its
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respective properties or assets is subject; (c) conflict with, or result in a
breach or violation of or default (with or without notice or lapse of time or
both) or loss of any benefit under, or accelerate the performance required by,
the terms of any material agreement, contract, indenture or other instrument to
which Xplor is a party or to which any of its properties is subject, or
constitute a default or loss of any right thereunder or an event which, with the
lapse of time or notice or both, might result in a material default or loss of
any material right thereunder or the creation of any lien, charge or encumbrance
upon any of the properties or assets of Xplor; or (d) result in any suspension,
revocation, impairment, forfeiture or non-renewal of any material Lease of
Xplor.
Section 2.05. Approvals. The execution and delivery of this
Agreement and each other agreement contemplated hereby, the performance by Xplor
of its obligations hereunder and thereunder and the consummation of the
transactions contemplated hereby and thereby by Xplor will not require the
consent, approval, order or authorization of any Governmental Entity or
Regulatory Authority or any other Person under any statute, law, rule,
regulation, permit, license, agreement, indenture or other instrument to which
Xplor is a party or to which any of its properties are subject, and no
declaration, filing or registration with any Governmental Entity or Regulatory
Authority is required or advisable by Xplor in connection with the execution and
delivery of this Agreement and each other agreement contemplated hereby, the
performance by Xplor of its obligations hereunder and thereunder the
consummation by Xplor of the transactions contemplated hereby and thereby other
than (i) compliance with any applicable requirements under the Exchange Act and
the Securities Act, (ii) foreign and state securities and "blue sky" laws, and
(iii) such other filings or registrations with, or authorizations, consents or
approvals of, governmental bodies, agencies, officials or authorities, the
failure of which to make or obtain would not have a Material Adverse Effect, or
would not materially adversely affect the ability of Xplor or to consummate the
Venus Exchange or Lomak Exchange.
Section 2.06. Xplor 10-K and Proxy Statement.
(a) Xplor has delivered to Venus and the Lomak Entities its
Annual Report on Form 10-K for the fiscal year ended December 31, 1996 (the
"Xplor 10-K") and its most recent proxy statement which is dated May 18, 1996
(the "Proxy Statement"). Neither the Xplor 10-K nor the Proxy Statement contain
any untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements made therein, in the light of the
circumstances under which they were made, not misleading, and the Xplor 10-K
(including the financial statements contained therein), and the Proxy Statement
as of its filing date, complied as to form in all material respects with the
applicable requirements of the Exchange Act and the applicable rules and
regulations thereunder.
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(b) The financial statements of Xplor (including the related
notes) included in the Xplor 10-K fairly present the financial position of Xplor
and the results of operations and changes in financial condition as of the dates
and periods therein specified. Such financial statements (including the related
notes) (i) have been prepared in accordance with generally accepted accounting
principles consistently applied throughout the periods involved (except as
otherwise noted therein) and with applicable accounting requirements and
published rules and regulations of the SEC with respect thereto and (ii) reflect
all liabilities of Xplor, whether or not accrued and whether contingent or
absolute, including, without limitation, those relating to taxes, environmental
compliance and hazardous materials, Leases, contracts and "employee benefit
plans" as such term is defined in Section 3(3) of ERISA and all Encumbrances as
are required to be reflected therein by such applicable principles,
requirements, rules and regulations.
Section 2.07. Absence of Certain Changes. Since December 31,
1996, there has not been (i) any Material Adverse Change in the assets or
liabilities, or in the business or condition, financial or otherwise, or in the
results of operations or prospects, of Xplor (ii) any adverse change in the
assets or liabilities or in the business or condition, financial or otherwise,
of Xplor except in the ordinary course of business, (iii) any increase or
establishment of any reserve for taxes or any other liability on Xplor's books
or other provision therefor, except as appropriate and consistent with past
practice; (iv) any change by Xplor in tax methods, principles or elections or in
accounting methods or principles that would be required to be disclosed under
generally accepted accounting principles; (v) any declaration, setting aside or
payment of any dividend or other distribution with respect to any Xplor Stock;
(vi) any issuance of any stock, bonds, options, warrants or other securities by
Xplor or any repurchase, redemption or other acquisition by Xplor of any
outstanding shares of Xplor Stock or any other equity securities of, or other
ownership interests in, Xplor; (vii) any cancellation of debt by Xplor or waiver
of any claim or right of substantial value to Xplor; (viii) any borrowing,
agreement to borrow funds or guaranty by Xplor or any termination or amendment
of any evidence of indebtedness, contract, agreement, deed, mortgage, lease,
license or other instrument to which Xplor is bound or by which Xplor or any of
its properties or assets is bound other than in the ordinary course of business
and consistent with past practice; or (ix) except for the execution of this
Agreement, any material transaction by Xplor, including, but not limited to, any
sale, lease or other disposition of properties and assets of Xplor, other than
in the ordinary course of business and consistent with past practices, and any
merger or consolidation of Xplor with any other entity, and, to the best
knowledge of Xplor, no fact or condition exists or is contemplated or threatened
which could reasonably be anticipated to cause such a change in the future.
Section 2.08. Litigation. There is no action, suit, arbitration, proceeding
or, to the best knowledge of Xplor, investigation pending or, to the best
knowledge of
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Xplor, threatened against or affecting or involving Xplor or any of its
properties, assets or rights or any of its officers, directors or employees in
their capacities as such, whether at law or equity ("Xplor Litigation"), and
Xplor has no knowledge of any facts that are likely to give rise to any Xplor
Litigation, that (in any case) is likely to have a Material Adverse Effect nor
is there any judgment, decree, injunction, rule or order of any Governmental
Entity or arbitrator outstanding against Xplor or any of its officers, directors
or employees in their capacities as such that is likely to have a Material
Adverse Effect or affect the ability of Xplor to consummate the transactions
contemplated by this Agreement.
Section 2.09. No Default. Xplor is not in default or violation
(and no event has occurred which, with notice or the lapse of time or both,
would constitute a default or violation) of any term, condition or provision of
(i) its Certificate of Incorporation and Bylaws, (ii) any note, bond, mortgage,
indenture, license, agreement or other instrument or obligation to which it is
now a party or by which it or any of its properties or assets may be bound or
(iii) any order, writ, injunction, decree, statute, rule or regulation
applicable to it, except in the case of (ii) and (iii) for defaults or
violations which individually or in the aggregate would not have a Material
Adverse Effect.
Section 2.10. Compliance with Laws. Xplor is in compliance
with all applicable laws, rules or regulations relating to or affecting the
operation, conduct or ownership of its properties or business, other than
violations that individually or in the aggregate would not, and insofar as may
reasonably be foreseen in the future will not, have a Material Adverse Effect,
except as described in Schedule 2.10 to the Xplor Disclosure Schedule. Neither
Xplor nor, to the best of Xplor's knowledge, any officer, consultant or employee
of Xplor (in their capacity as such), is in default with respect to any order,
writ, injunction or decree known to or served upon Xplor of any Governmental
Entity or Regulatory Authority, which default would have a Material Adverse
Effect. To the best of Xplor's knowledge, there is no existing law, rule,
regulation or order, whether Federal, state or local, which would prohibit or
materially restrict Xplor from, or otherwise materially adversely affect Xplor
in, conducting its business in any jurisdiction in which it is now conducting
business. Xplor holds all permits, licenses, variances, exemptions, orders,
franchises and approvals of all Governmental Entities necessary for the lawful
conduct of its business (the "Xplor Permits"), except where the failure so to
hold would not have a Material Adverse Effect. Xplor is in compliance with the
terms of the Xplor Permits, except where the failure so to comply would not have
a Material Adverse Effect.
Section 2.11. Oil and Gas Reserves; Wells.
(a) Xplor has provided to Venus and the Lomak Entities an
engineering report reviewed by Ryder Scott Company, independent petroleum
engineers, setting forth Xplor's oil and gas reserves and values as of December
31, 1996 (the "Xplor
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Reserve Report"), a copy of which is attached hereto as Schedule AA. The Xplor
Reserve Report sets forth a list of all Leases comprising Xplor's oil and gas
reserves and, to the best of Xplor's knowledge, accurately reflects Xplor's oil
and gas reserves as of its date and as of the date hereof, subject to normal
production. Xplor is not aware of any change to its Leases since the date of the
Xplor Reserve Report that could have a Material Adverse Effect. The independent
petroleum engineers were provided full access to Xplor's reserve records and all
other relevant information.
(b) Except as set forth in Schedule 2.11 to the Xplor
Disclosure Schedule, there is no well operated by Xplor, and to Xplor's
knowledge, there is no well operated by a third party on behalf of Xplor, that
(i) is no longer producing in commercial quantities and for which there are no
definitive plans to attempt to restore production in commercial quantities, (ii)
is subject to an exception to a requirement to plug and abandon issued by
regulatory authority having jurisdiction over the well, or (iii) has been
plugged and abandoned but has not been plugged and abandoned or reclaimed in
accordance with all applicable laws, and the proper plugging and abandonment or
reclamation of which would or could reasonably be expected to have a Material
Adverse Effect on Xplor.
Section 2.12. Title to Xplor Leases. As to the interests in
each of the Leases listed in the Xplor Reserve Report, such interests include
100% of the interests in such Leases owned by Xplor as of the date hereof, and
upon Closing, Xplor will have that title to such interests which
(i) entitles Xplor to receive not less than the interest shown
in Xplor Reserve Report as the "Net Revenue Interest" with respect to such Lease
in all hydrocarbons produced, saved and marketed from such Lease and in all
hydrocarbons produced, saved or marketed from any unit of which such Lease forms
a part and allocated to such Lease, all without reduction, suspension or
termination of such Net Revenue Interest throughout the duration of such Lease;
(ii) obligates Xplor to bear a percentage of the costs and
expenses relating to the maintenance and development of, and operations relating
to, such Lease in an amount not greater than the "Working Interest" set forth in
the Xplor Reserve Report with respect to such Lease; and
(iii) is free and clear of all liens, Encumbrances (except for
Permitted Encumbrances), gas imbalances, obligations or defects and is not
subject to any matters which will result in a breach of any representation or
warranty of Xplor herein affecting title.
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With respect to such Leases and any unit agreements, pooling agreements,
communitization agreements or other similar documents affecting or creating
interests therein,
(s) all such interests are valid and in full force and effect;
(t) neither Xplor, nor to the knowledge of Xplor, any other
party is in default under any contract, agreement or arrangement affecting such
Leases, except such defaults as would not have a Material Adverse Effect on
Xplor.
(u) except as set forth on Schedule 2.12 of the Xplor
Disclosure Schedule, there is no contract, agreement or arrangement (i)
requiring an expenditure now or in the future by the owner of the interest of
more than $50,000 or imposing an obligation or non contingent liability now or
in the future on the owner of the interests of more than $50,000, (ii) involving
the purchase or sale of hydrocarbons and which cannot be terminated without
penalty on thirty (30) days notice or less and/or (iii) governing the operations
among the working interest owners of the Leases which contains any provision
that is objectionable or unacceptable on the basis of generally recognized
industry standards applicable to the area where the affected Lease is situated
and which would have a material adverse effect on the ownership, use, value or
operation of the affected Lease;
(v) there are no express obligations to engage in continuous
development operations in order to maintain any such lease or other interest in
full force and effect except as described in the Xplor Reserve Report;
(w) there are no provisions applicable to such Leases or other
documents or interests which increase the royalty share of the lessor or the
overriding royalty interest of any other party or increase or decrease the
working interest of such interest without corresponding change in the Net
Revenue Interest;
(x) there are no royalty provisions which expressly prohibit
the payment of royalty on the basis of proceeds received under a prudently
negotiated arms-length contract;
(y) except for Pugh Clause provisions and similar provisions
relating to development of all zones, upon establishment of production in
commercial quantities and until such production should cease, such Leases may be
maintained in full force and effect over the economic life of the property
involved in accordance with the respective habendum clauses contained in the
Leases beyond the respective primary terms set forth in such Leases; and
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(z) there are no fixed lease terms which cannot be extended by production
at the end of the term.
Section 2.13. Other Real Property Owned or Leased. Schedule
AAA hereto contains a list and brief description of all interests in real
property owned or leased by Xplor other than the Leases referred to in Section
2.12, as well as all buildings and other structures and material improvements
located on such real property (including a brief description of the use to which
such property is being put or for which it was intended and in the case of any
such property which is leased, the name of the lessor, requirement of consent of
the lessor to assignment (including assignment by way of merger or change of
control), termination date or notice requirement with respect to termination,
annual rental and renewal or purchase options). With respect to such other real
property such interests represent all the interests in real property reasonably
required for the efficient operation of the Xplor Leases and, except as set
forth in Schedule AAA:
(i) Xplor is the owner or lessee, as the case may be, of all such real
property, free and clear of all Encumbrances (except Permitted Encumbrances);
(ii) Xplor has made available to Venus and the Lomak Entities
true and correct copies of all leases referred to in Schedule AAA hereto;
(iii) All improvements on such real property conform in all
material respects to applicable Federal, state, local and foreign laws and
regulations (including applicable environmental and occupational safety and
health laws and regulations) and zoning and building ordinances, and such real
property is zoned for the various purposes for which it is presently being used;
(iv) All improvements on such real property are generally in
good operating condition and repair and there does not exist any condition which
interferes with the economic value or use thereof. None of the buildings and
structures located on such real property nor any appurtenances thereto or
equipment thereon, nor the operation or maintenance thereof, violates in any
manner any restrictive covenants or encroaches on any property owned by others
nor does any building or structure of third parties encroach upon such property.
No condemnation proceeding is pending or threatened with respect to any such
property.
Section 2.14. Title to Other Assets, Properties and Rights and
Related Matters. Schedule AAA hereto contains a list and brief description of
all other assets, properties and rights which are owned, leased or used by Xplor
in the conduct of its business in addition to those assets referred to in
Sections 2.12 and 2.13. Xplor has good and marketable title to all such assets,
properties and rights, including all such assets, properties and rights
reflected in the Xplor 10-K as well as such of like kind and
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character acquired after the date thereof (except inventory or other property
sold or otherwise disposed of since that date in the ordinary course of
business) free and clear of all Encumbrances of any kind or character, except
(i) those set forth in Schedule AAA hereto and (ii) Permitted Encumbrances. Such
assets, properties and rights are generally in good operating condition and
repair (ordinary wear and tear excepted), and there does not exist any condition
which interferes with the economic value or use thereof. Except as provided in
this Section 2.14, XPLOR MAKES NO AND DISCLAIMS ANY REPRESENTATION OR WARRANTY,
WHETHER EXPRESS OR IMPLIED, AND WHETHER BY COMMON LAW, STATUTE OR OTHERWISE, AS
TO (i) THE QUALITY, CONDITION OR OPERABILITY OF ANY PERSONAL PROPERTY OR
EQUIPMENT, (ii) ITS MERCHANTABILITY, (iii) ITS FITNESS FOR ANY PARTICULAR
PURPOSE OR (iv) ITS CONFORMITY TO MODELS OR SAMPLES OF MATERIALS AND, EXCEPT AS
PROVIDED IN THIS SECTION, ALL PERSONAL PROPERTY AND EQUIPMENT IS DELIVERED "AS
IS, WHERE IS" IN THE CONDITION IN WHICH THE SAME EXISTS. Except as set forth in
Schedule AAA hereto, such assets, properties and rights shall include all
rights, properties, and interests in properties and assets (real, personal and
mixed, tangible and intangible, and all leases, licenses and other agreements)
necessary or desirable to permit Xplor to obtain the full economic benefit of
its business and of its ownership of the Xplor Leases as contemplated hereby.
Section 2.15. No Misleading Statements. This Agreement, the
information and Schedules and Exhibits referred to herein and the information
that has been furnished to Venus and the Lomak Entities by Xplor in connection
with the transactions contemplated hereby do not include any untrue statement of
a material fact and do not omit to state any material fact necessary to make the
statements contained herein or therein, in light of the circumstances under
which they were made, not misleading. Notwithstanding the foregoing, Xplor has
not and does not make any representation or warranty regarding any forecast or
projection of future events, pricing, valuation or results of future operations
of, or related to, Xplor's properties. Nothing in this Agreement shall be
considered as an assurance that any such forecast or projection will be correct
or is likely to be correct.
Section 2.16. Brokerage Fees. Xplor has not retained any
financial advisor, broker, agent or finder or paid or agreed to pay any
financial advisor, broker, agent or finder on account of this Agreement or any
transaction contemplated hereby or any transaction of like nature that would be
required to be paid by Xplor.
Section 2.17. Indebtedness. Except as described in Schedule 2.17 to the
Xplor Disclosure Schedule, Xplor has no outstanding indebtedness or financing
agreements or obligations under guaranties of third party debt.
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Section 2.18. Taxes
(a) Except as set forth on Schedule 2.18(a) to the Xplor
Disclosure Schedule, each of Xplor and any affiliated, combined or unitary group
of which any Xplor is or was a member has (i) timely (taking into account any
extensions) filed all federal and all material state, local and foreign returns,
declarations, reports, estimates, information returns and statements ("Returns")
required to be filed or sent by or with respect to it in respect of any Taxes,
(B) timely paid all Taxes that are due and payable (except for audit adjustments
not material in the aggregate or to the extent that liability therefor is
reserved for in the Xplor's most recent audited financial statements) for which
Xplor may be liable, (C) established reserves that are adequate for the payment
of all Taxes not yet due and payable with respect to the results of operations
of Xplor through the date hereof, and (D) complied in all material respects with
all applicable laws, rules and regulations relating to the payment and
withholding of Taxes and has in all material respects timely withheld from
employee wages and paid over to the proper governmental authorities all amounts
required to be so withheld and paid over.
(b) Schedule 2.18(a) to the Xplor Disclosure Schedule sets
forth the last taxable period through which the federal income Tax Returns of
Xplor have been examined by the Internal Revenue Service ("IRS") or otherwise
closed. Except to the extent being contested in good faith, all material
deficiencies asserted as a result of such examinations and any examination by
any applicable state or local taxing authority have been paid, fully settled or
adequately provided for in Xplor's most recent audited financial statements. No
material federal, state or local income or franchise tax audits or other
administrative proceedings or court proceedings are presently pending with
regard to any federal, state or local income or franchise Taxes for which Xplor
would be liable, and no material deficiency for any such income or franchise
Taxes has been proposed, asserted or assessed pursuant to such examination
against Xplor by any federal, state or local taxing authority with respect to
any period other than as set forth in Schedule 2.18(a) to the Xplor Disclosure
Schedule.
(c) Xplor has not executed or entered into (and prior to the
close of business on the Closing Date will not execute or enter into) with the
IRS or any taxing authority (i) any agreement or other document extending or
having the effect of extending the period for assessments or collection of any
federal, state or local income or franchise Taxes for which Xplor would be
liable or (ii) a closing agreement pursuant to Section 7121 of the Code, or any
predecessor provision thereof or any similar provision of state or local income
tax law that relates to the assets or operations of Xplor.
(d) Xplor is not a party to an agreement that provides for the
payment of any amount that would constitute a "parachute payment" within the
meaning of Section 280G of the Code.
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(e) Xplor is not a party to or bound by any tax sharing agreement or
similar agreement or arrangement.
Section 2.19. Material Contracts. The Xplor 10-K includes,
incorporates or specifically refers to all of the material contracts,
agreements, plans and commitments to which Xplor is a party or by which Xplor or
any of its properties or assets is bound:
Section 2.20. No Undisclosed Liabilities. There is no
existing, contingent or threatened liability, obligation, Encumbrance or claim
of any nature (absolute, accrued, contingent or otherwise) that relates to Xplor
or has been asserted or threatened to be asserted against Xplor, other than
liabilities pursuant to this Agreement.
Section 2.21. No Vote Required. No vote of the holders of any
class or series of Xplor capital stock is necessary to approve the issuance of
Xplor Stock pursuant to this Agreement and the transactions contemplated hereby.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF VENUS
Except as set forth (by reference to the applicable Section of
this Agreement) in Venus' disclosure schedule previously delivered to the Xplor
and the Lomak Entities (the "Venus Disclosure Schedule"), a copy of which is
attached hereto as Schedule B, Venus hereby agrees and represents and warrants
to Xplor and the Lomak Entities as follows:
Section 3.01. Organization, Etc. Venus is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Texas and has all requisite corporate power and corporate authority to conduct
its business as it is now being conducted and to own, operate or lease the
properties and assets it currently owns, operates or holds under lease. Venus is
duly qualified or licensed to do business and is in good standing as a foreign
corporation in each jurisdiction where the character of its business or the
nature of its properties or assets makes such qualification or licensing
necessary, except where the failure to so qualify or be licensed would not have
a Material Adverse Effect. Schedule 3.01 to the Venus Disclosure Schedule sets
forth a list of each jurisdiction in which Venus is licensed or qualified to
transact business as a foreign entity. Venus has heretofore delivered to Xplor
and the Lomak Entities true and correct copies of its respective Certificate of
Incorporation (and other documents of record with the Secretary of State of
Texas) and Bylaws as in effect on the date hereof. Schedule 3.01 to the Venus
Disclosure Schedule sets forth a list of the officers and directors of each of
Venus on the date hereof and all information with respect to all individuals
affiliated with Venus who will be directors and executive
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officers of Xplor following the Closing required by SEC Rule 14f-1 under the
Exchange Act.
Section 3.02. Capitalization.
The authorized capital stock of Venus consists of 400,000,000 shares of
Common Stock (par value of $0.001 per share), 200,000,000 shares of Convertible
Shares (par value of $0.001 per share) and 200,000,000 shares of Convertible
Redeemable Preference Shares (par value of $0.001 per share). No shares of Venus
Stock are held as treasury shares. The designations, powers, preferences,
rights, qualifications, limitations and restrictions in respect of each class
and series of authorized capital stock of Venus are as set forth in Venus's
Certificate of Incorporation or otherwise of record with the Secretary of State
of Texas, and all such designations, powers, preferences, rights,
qualifications, limitations and restrictions are valid, binding and enforceable
and in accordance with all applicable laws. All outstanding shares of Venus
Stock have been duly authorized and validly issued and are fully paid and
non-assessable. All of the outstanding shares of Venus Stock were issued in
compliance with all applicable Federal and state securities laws. None of the
outstanding securities has been issued in violation of any pre-emptive rights,
rights of first refusal or similar rights. Except as set forth in the Venus
Disclosure Schedule, there are no outstanding options, warrants, convertible
securities, calls, rights, commitments, preemptive rights or agreements or
instruments or understandings or other securities of any character to which
Venus is a party or by which Venus is bound, obligating Venus to issue, deliver
or sell, or cause to be issued, delivered or sold, contingently or otherwise,
additional shares of capital stock of Venus or any securities or obligations
convertible into or exchangeable for such shares or to grant, extend or enter
into any such option, warrant, convertible security, call, right, commitment,
preemptive right or agreement. There are no outstanding obligations, contingent
or other, of Venus to purchase, redeem or otherwise acquire any capital stock of
Venus. There are no voting trust agreements or other contracts, agreements,
arrangements, commitments, plans or understandings restricting or otherwise
relating to voting, dividend or other rights with respect to Venus's capital
stock. There are no bonds, debentures, notes or other indebtedness having the
right to vote (or convertible into securities having the right to vote) on any
matters on which Venus stockholders may vote issued or outstanding. There is no
liability for dividends declared or accumulated but unpaid with respect to any
of the shares of Venus Stock.
Section 3.03. Authorization. Venus has all requisite corporate
power and corporate authority to enter into this Agreement and each of the other
agreements contemplated hereby, to carry out its respective obligations under
this Agreement and each of the other agreements contemplated hereby and to
consummate the transactions contemplated hereby and thereby. The execution and
delivery by Venus of this Agreement, the consummation of the transactions
contemplated hereby and the
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performance by Venus of its obligations hereunder have been duly authorized by
all necessary corporate action except Venus Stockholder Approval. This Agreement
has been duly executed and delivered by Venus; and, assuming that this Agreement
constitutes the legal, valid and binding obligation of the other parties hereto,
constitutes the legal, valid and binding obligation of Venus, enforceable
against Venus in accordance with its terms, subject to Venus Stockholder
Approval.
Section 3.04. No Violation. The execution and delivery of this
Agreement by Venus does not, and the consummation by Venus of the transactions
contemplated hereby, and compliance with the terms hereof will not, (a) conflict
with, or result in any violation of or default (with or without notice or lapse
of time or both) or loss of any benefit under, any provision of its Certificate
of Incorporation (or other documents of record with the Secretary of State of
Texas) or By-laws; (b) conflict with, or result in any violation of or default
(with or without notice or lapse of time or both) or loss of any benefit under,
any permit, concession, grant, assignment, franchise, license, law, rule or
regulation, or any judgment, decree or order of any court or other governmental
agency or instrumentality to which Venus is a party or to which any of its
properties or assets is subject; (c) conflict with, or result in a breach or
violation of or default (with or without notice or lapse of time or both) or
loss of any benefit under, or accelerate the performance required by, the terms
of any material agreement, contract, indenture or other instrument to which
Venus is a party or to which any of its properties is subject, or constitute a
default or loss of any right thereunder or an event which, with the lapse of
time or notice or both, might result in a material default or loss of any
material right thereunder or the creation of any lien, charge or encumbrance
upon any of the properties or assets of Venus; or (d) result in any suspension,
revocation, impairment, forfeiture or non-renewal of any material Lease of
Venus.
Section 3.05. Approvals. The execution and delivery of this
Agreement and each other agreement contemplated hereby, the performance by Venus
of its obligations hereunder and thereunder and the consummation of the
transactions contemplated hereby and thereby by Venus will not require the
consent, approval, order or authorization of any Governmental Entity or
Regulatory Authority or any other Person under any statute, law, rule,
regulation, permit, license, agreement, indenture or other instrument to which
Venus is a party or to which any of its properties are subject, and no
declaration, filing or registration with any Governmental Entity or Regulatory
Authority is required or advisable by Venus in connection with the execution and
delivery of this Agreement and each other agreement contemplated hereby, the
performance by Venus of its obligations hereunder and thereunder, the
consummation by Venus of the transactions contemplated hereby and thereby other
than (i) compliance with any applicable requirements under the Exchange Act and
the Securities Act, (ii) foreign and state securities and "blue sky" laws, and
(iii) such other filings or registrations with, or authorizations, consents or
approvals of, governmental bodies, agencies, officials or authorities, the
failure of which to make or obtain would
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not have a Material Adverse Effect, or would not materially adversely affect the
ability of Venus to consummate the Venus Exchange.
Section 3.06. Venus Financial Statements.
(a) Venus has delivered to Xplor and the Lomak Entities true,
correct and complete copies of the audited balance sheet of Venus Energy PLC as
of December 31, 1996 and notes thereto with the independent accountants' report
of KPMG Peat Marwick LLP thereon as well as an income statements and statements
of cash flows for periods including the period ended December 31, 1996 (the
"Venus Financial Statements").
(b) The Venus Financial Statements (including the related
notes) fairly present the financial position of Venus and the results of
operations and changes in financial condition as of the dates and periods
therein specified. Such financial statements (including the related notes) (i)
have been prepared in accordance with generally accepted accounting principles
consistently applied throughout the periods involved (except as otherwise noted
therein) and (ii) reflect all liabilities of Venus, whether or not accrued and
whether contingent or absolute, including, without limitation, those relating to
taxes, environmental compliance and hazardous materials, Leases, contracts and
"employee benefit plans" as such term is defined in Section 3(3) of ERISA and
all Encumbrances as are required to be reflected therein by such applicable
principles, requirements, rules and regulations.
Section 3.07. Absence of Certain Changes. Since December 31,
1996, there has not been (i) any Material Adverse Change in the assets or
liabilities, or in the business or condition, financial or otherwise, or in the
results of operations or prospects, of Venus (ii) any adverse change in the
assets or liabilities or in the business or condition, financial or otherwise,
of Venus except in the ordinary course of business, (iii) any increase or
establishment of any reserve for taxes or any other liability on Venus 's books
or other provision therefor, except as appropriate and consistent with past
practice; (iv) any change by Venus in tax methods, principles or elections or in
accounting methods or principles that would be required to be disclosed under
generally accepted accounting principles; (v) any declaration, setting aside or
payment of any dividend or other distribution with respect to any Venus Stock;
(vi) any issuance of any stock, bonds, options, warrants or other securities by
Venus or any repurchase, redemption or other acquisition by Venus of any
outstanding shares of Venus Stock or any other equity securities of, or other
ownership interests in, Venus; (vii) any cancellation of debt by Venus or waiver
of any claim or right of substantial value to Venus; (viii) any borrowing,
agreement to borrow funds or guaranty by Venus or any termination or amendment
of any evidence of indebtedness, contract, agreement, deed, mortgage, lease,
license or other instrument to which Venus is bound or by which Venus or any of
its properties or assets is bound other than in the ordinary course of
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business and consistent with past practice; or (ix) except for the execution of
this Agreement, any material transaction by Venus, including, but not limited
to, any sale, lease or other disposition of properties and assets of Venus, and
any merger or consolidation of Venus with any other entity, other than in the
ordinary course of business and consistent with past practices and, to the best
knowledge of Venus, no fact or condition exists or is contemplated or threatened
which could reasonably be anticipated to cause such a change in the future.
Section 3.08. Litigation. There is no action, suit,
arbitration, proceeding or, to the best knowledge of Venus, investigation
pending or, to the best knowledge of Venus, threatened against or affecting or
involving Venus or any of their respective properties, assets or rights or any
of their officers, directors or employees in their capacities as such, whether
at law or equity ("Venus Litigation"), and Venus has no knowledge of any facts
that are likely to give rise to any Venus Litigation, that (in any case) is
likely to have a Material Adverse Effect nor is there any judgment, decree,
injunction, rule or order of any Governmental Entity or arbitrator outstanding
against Venus or any of its officers, directors or employees in their capacities
as such that is likely to have a Material Adverse Effect or affect the ability
of Venus to consummate the transactions contemplated by this Agreement.
Section 3.09. No Default. Venus is not in default or violation
(and no event has occurred which, with notice or the lapse of time or both,
would constitute a default or violation) of any term, condition or provision of
(i) its Certificate of Incorporation and Bylaws, (ii) any note, bond, mortgage,
indenture, license, agreement or other instrument or obligation to which it is
now a party or by which it or any of its properties or assets may be bound or
(iii) any order, writ, injunction, decree, statute, rule or regulation
applicable to it, except in the case of (ii) and (iii) for defaults or
violations which individually or in the aggregate would not have a Material
Adverse Effect.
Section 3.10. Compliance with Laws. Venus is in compliance
with all applicable laws, rules or regulations relating to or affecting the
operation, conduct or ownership of its properties or business, other than
violations that individually or in the aggregate would not, and insofar as may
reasonably be foreseen in the future will not, have a Material Adverse Effect,
all of which are described in Schedule 3.10 to the Venus Disclosure Schedule.
Neither Venus nor, to the best of Venus's knowledge, any officer, consultant or
employee of Venus (in their capacity as such), is in default with respect to any
order, writ, injunction or decree known to or served upon Venus of any
Governmental Entity or Regulatory Authority, which default would have a Material
Adverse Effect. To the best of Venus's knowledge, there is no existing law,
rule, regulation or order, whether Federal, state or local, which would prohibit
or materially restrict Venus from, or otherwise materially adversely affect
Venus in, conducting its business in any jurisdiction in which it is now
conducting business. Venus holds all
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permits, licenses, variances, exemptions, orders, franchises and approvals of
all Governmental Entities necessary for the lawful conduct of their respective
businesses (the "Venus Permits"), except where the failure so to hold would not
have a Material Adverse Effect. Venus is in compliance with the terms of the
Venus Permits, except where the failure so to comply would not have a Material
Adverse Effect.
Section 3.11. Oil and Gas Reserves; Wells.
(a) Venus has provided to Xplor and the Lomak Entities
engineering reports reviewed by the following independent petroleum engineers:
Williamson Petroleum Consultants; Hite, Powers & Associates; and Cawley,
Gillespie, setting forth Venus's oil and gas reserves and values as of December
31, 1996, April 1, 1997 and March 31, 1997, respectively, copies of which are
attached hereto as Schedule BB (collectively, the "Venus Reserve Report"). The
Venus Reserve Report sets forth a list of all Leases comprising Venus's oil and
gas reserves and, to the best of Venus's knowledge, accurately reflects Venus's
oil and gas reserves as of its date and as of the date hereof, subject to normal
production. Venus is not aware of any change to its Leases since the date of the
Venus Reserve Report that could have a Material Adverse Effect. The independent
petroleum engineers were provided full access to Venus's reserve records and all
other relevant information.
(b) Except as set forth in Schedule 3.11 to the Venus
Disclosure Schedule, there is no well operated by Venus, and to Venus's
knowledge, there is no well operated by a third party on behalf of Venus, that
(i) is no longer producing in commercial quantities and for which there are no
definitive plans to attempt to restore production in commercial quantities, (ii)
is subject to an exception to a requirement to plug and abandon issued by
regulatory authority having jurisdiction over the well, or (iii) has been
plugged and abandoned but has not been plugged and abandoned or reclaimed in
accordance with all applicable laws, and the proper plugging and abandonment or
reclamation of which would or could reasonably be expected to have a Material
Adverse Effect on Venus.
Section 3.12. Title to Venus Leases. As to the interests in
each of the Leases listed in the Venus Reserve Report, such interests include
100% of the interests in such Leases owned by Venus as of the date hereof, and
upon Closing, Venus will convey to Xplor that title to such interests that will:
(i) entitle Xplor to receive not less than the interest shown
in Venus Reserve Report as the "Net Revenue Interest" with respect to such Lease
in all hydrocarbons produced, saved and marketed from such Lease and or all
hydrocarbons produced, saved or marketed from any unit of which such Lease forms
a part and allocated to such Lease, all without reduction, suspension or
termination of such Net Revenue Interest throughout the duration of such Lease;
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(ii) obligate Xplor to bear a percentage of the costs and
expenses relating to the maintenance and development of, and operations relating
to, such Lease in an amount not greater than the "Working Interest" set forth in
the Venus Reserve Report with respect to such Lease; and
(iii) is free and clear of all liens, Encumbrances (except for
Permitted Encumbrances), gas imbalances, obligations or defects and is not
subject to any matters which will result in a breach of any representation or
warranty of Venus herein affecting title.
With respect to such Leases and any unit agreements, pooling agreements,
communitization agreements or other similar documents affecting or creating
interests therein:
(v) all such interests are valid and in full force and effect;
(w) neither Venus, nor to the knowledge of Venus, any other
party is in default under any contract, agreement or arrangement affecting such
Leases, except such defaults as would not have a Material Adverse Effect on
Venus.
(x) except as set forth on Schedule 3.12 of the Venus
Disclosure Schedule, there is no contract, agreement or arrangement (i)
requiring an expenditure now or in the future by the owner of the interest of
more than $50,000 or imposing an obligation or non contingent liability now or
in the future on the owner of the Interests of more than $50,000, (ii) involving
the purchase or sale of hydrocarbons and which cannot be terminated without
penalty on thirty (30) days notice or less and/or (iii) governing the operations
among the working interest owners of the Leases which contains any provision
that is objectionable or unacceptable on the basis of generally recognized
industry standards applicable to the area where the affected Lease is situated
and which would have a material adverse effect on the ownership, use, value or
operation of the affected Lease;
(y) except for Pugh Clause provisions and similar provisions
relating to development of all zones, upon establishment of production in
commercial quantities and until such production should cease, such Leases may be
maintained in full force and effect over the economic life of the property
involved in accordance with the respective habendum clauses contained in the
Leases beyond the respective primary terms set forth in such Leases; and
(z) there are no fixed lease terms which cannot be extended by production
at the end of the term.
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Section 3.13. Other Real Property Owned or Leased. Schedule
BBB hereto contains a list and brief description of all interests in real
property owned or leased by Venus other than the Leases referred to in Section
3.12, as well as all buildings and other structures and material improvements
located on such real property (including a brief description of the use to which
such property is being put or for which it was intended and in the case of any
such property which is leased, the name of the lessor, requirement of consent of
the lessor to assignment (including assignment by way of merger or change of
control), termination date or notice requirement with respect to termination,
annual rental and renewal or purchase options). With respect to such other real
property such interests represent all the interests in real property reasonably
required for the efficient operation of the Venus Leases and, except as set
forth in Schedule BBB:
(i) Venus is the owner or lessee, as the case may be, of all such real
property, free and clear of all Encumbrances (except Permitted Encumbrances);
(ii) Venus has made available to Xplor and the Lomak Entities
true and correct copies of all leases referred to in Schedule BBB hereto;
(iii) All improvements on such real property conform in all
material respects to applicable Federal, state, local and foreign laws and
regulations (including applicable environmental and occupational safety and
health laws and regulations) and zoning and building ordinances, and such real
property is zoned for the various purposes for which it is presently being used;
(iv) All improvements on such real property are generally in
good operating condition and repair and there does not exist any condition which
interferes with the economic value or use thereof. None of the buildings and
structures located on such real property nor any appurtenances thereto or
equipment thereon, nor the operation or maintenance thereof, violates in any
manner any restrictive covenants or encroaches on any property owned by others
nor does any building or structure of third parties encroach upon such property.
No condemnation proceeding is pending or threatened with respect to any such
property.
Section 3.14. Title to Other Assets, Properties and Rights and
Related Matters. Schedule BBB hereto contains a list and brief description of
all other assets, properties and rights which are owned, leased or used by Venus
in the conduct of its business in addition to those assets referred in Sections
3.12 and 3.13. Venus has good and marketable title to all such assets,
properties and rights, including all such assets, properties and rights
reflected in the Venus Financial Statements as well as such of like kind and
character acquired after the date thereof (except inventory or other property
sold or otherwise disposed of since that date in the ordinary course of
business) free and clear of all Encumbrances of any kind or character, except
(i) those
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set forth in Schedule BBB hereto and (ii) Permitted Encumbrances. Such assets,
properties and rights are generally in good operating condition and repair
(ordinary wear and tear excepted), and there does not exist any condition which
interferes with the economic value or use thereof. Except as provided in this
Section 3.14, VENUS MAKES NO AND DISCLAIMS ANY REPRESENTATION OR WARRANTY,
WHETHER EXPRESS OR IMPLIED, AND WHETHER BY COMMON LAW, STATUTE OR OTHERWISE, AS
TO (i) THE QUALITY, CONDITION OR OPERABILITY OF ANY PERSONAL PROPERTY OR
EQUIPMENT, (ii) ITS MERCHANTABILITY, (iii) ITS FITNESS FOR ANY PARTICULAR
PURPOSE OR (iv) ITS CONFORMITY TO MODELS OR SAMPLES OF MATERIALS AND, EXCEPT AS
PROVIDED IN THIS SECTION, ALL PERSONAL PROPERTY AND EQUIPMENT IS DELIVERED "AS
IS, WHERE IS" IN THE CONDITION IN WHICH THE SAME EXISTS. Except as set forth in
Schedule BBB hereto, such assets, properties and rights shall include all
rights, properties, and interests in properties and assets (real, personal and
mixed, tangible and intangible, and all leases, licenses and other agreements)
necessary or desirable to permit Venus to obtain the full economic benefit of
its business and of its ownership of the Venus Leases as contemplated hereby.
Section 3.15. No Misleading Statements. This Agreement, the
information and Schedules and Exhibits referred to herein and the information
that has been furnished to Xplor and the Lomak Entities by Venus in connection
with the transactions contemplated hereby do not include any untrue statement of
a material fact and do not omit to state any material fact necessary to make the
statements contained herein or therein, in light of the circumstances under
which they were made, not misleading. Notwithstanding the foregoing, Venus has
not and does not make any representation or warranty regarding any forecast or
projection of future events, pricing, valuation or results of future operations
or, or related to, Venus' properties. Nothing in this Agreement shall be
considered as an assurance that any such forecast or projection will be correct
or is likely to be correct.
Section 3.16. Brokerage Fees. Venus has not retained any
financial advisor, broker, agent or finder or paid or agreed to pay any
financial advisor, broker, agent or finder on account of this Agreement or any
transaction contemplated hereby or any transaction of like nature that would be
required to be paid by Venus.
Section 3.17. Indebtedness Except as described in Schedule
3.17 to the Venus Disclosure Schedule, Venus has no outstanding indebtedness or
financing agreements or obligations under guaranties of third party debt.
Section 3.18. Taxes.
(a) Except as set forth on Schedule 3.18(a) to the Venus
Disclosure Schedule, each of Venus and any affiliated, combined or unitary group
of which any
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Venus is or was a member has (i) timely (taking into account any extensions)
filed all federal and all material state, local and foreign returns,
declarations, reports, estimates, information returns and statements ("Returns")
required to be filed or sent by or with respect to it in respect of any Taxes,
(B) timely paid all Taxes that are due and payable (except for audit adjustments
not material in the aggregate or to the extent that liability therefor is
reserved for in the Venus's most recent audited financial statements) for which
Venus may be liable, (C) established reserves that are adequate for the payment
of all Taxes not yet due and payable with respect to the results of operations
of Venus through the date hereof, and (D) complied in all material respects with
all applicable laws, rules and regulations relating to the payment and
withholding of Taxes and has in all material respects timely withheld from
employee wages and paid over to the proper governmental authorities all amounts
required to be so withheld and paid over.
(b) Schedule 3.18(a) to the Venus Disclosure Schedule sets
forth the last taxable period through which the federal income Tax Returns of
Venus have been examined by the Internal Revenue Service ("IRS") or otherwise
closed. Except to the extent being contested in good faith, all material
deficiencies asserted as a result of such examinations and any examination by
any applicable state or local taxing authority have been paid, fully settled or
adequately provided for in Venus's most recent audited financial statements. No
material federal, state or local income or franchise tax audits or other
administrative proceedings or court proceedings are presently pending with
regard to any federal, state or local income or franchise Taxes for which Venus
would be liable, and no material deficiency for any such income or franchise
Taxes has been proposed, asserted or assessed pursuant to such examination
against Venus by any federal, state or local taxing authority with respect to
any period other than as set forth in Schedule 3.18(a) to the Venus Disclosure
Schedule.
(c) Venus has not executed or entered into (and prior to the
close of business on the Closing Date will not execute or enter into) with the
IRS or any taxing authority (i) any agreement or other document extending or
having the effect of extending the period for assessments or collection of any
federal, state or local income or franchise Taxes for which Venus would be
liable or (ii) a closing agreement pursuant to Section 7121 of the Code, or any
predecessor provision thereof or any similar provision of state or local income
tax law that relates to the assets or operations of Venus.
(d) Venus is not a party to an agreement that provides for the
payment of any amount that would constitute a "parachute payment" within the
meaning of Section 280G of the Code.
(e) Venus is not a party to or bound by any tax sharing agreement or
similar agreement or arrangement.
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Section 3.19. Material Contracts. Schedule 3.19 to Venus
Disclosure Schedule sets forth a complete list of all material contracts,
agreements, plans and commitments to which Venus is a party or by which Venus or
any of its properties or assets is bound:
Section 3.20. No Undisclosed Liabilities There is no existing,
contingent or threatened liability, obligation, Encumbrance or claim of any
nature (absolute, accrued, contingent or otherwise) that relates to Venus or has
been asserted or threatened to be asserted against Venus, other than liabilities
pursuant to this Agreement or arising after the date of the Venus Financial
Statements in the ordinary course of business and consistent with past practice.
Section 3.21. Vote Required; Solicitation. A vote of the
holders of two-thirds of each class of the capital stock of Venus is necessary
to constitute Venus Stockholder Approval of the Venus Exchange. To the knowledge
of Venus, the character and number of the stockholders of Venus are such that
Venus Stockholder Approval may be solicited and obtained, and the Venus Exchange
consummated, pursuant to SEC Regulation D under the Securities Act.
Section 3.22. Ownership of Shares. To the knowledge of Venus,
none of its stockholders, who will receive the shares of Xplor Stock issued to
Venus at the Closing upon the contemplated dissolution of Venus, has any plan or
intention of selling or otherwise disposing of such shares.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE LOMAK ENTITIES
Except as set forth (by reference to the applicable Section of
this Agreement) in the disclosure schedule of the Lomak Entities previously
delivered to the Xplor and Venus (the "Lomak Disclosure Schedule"), a copy of
which is attached hereto as Schedule C, each of the Lomak Entities hereby agrees
and represents and warrants to Xplor and Venus, severally with respect to itself
and the Lomak Properties being conveyed by it hereunder and jointly and
severally respect to Section 4.06 hereof, as follows:
Section 4.01. Organization, Etc. Production is a limited
partnership duly organized, validly existing and in good standing under the laws
of Texas, and Resources is a limited liability company duly organized, validly
existing and in good standing under the laws of Oklahoma and each has all
requisite power and authority to conduct its business as it is now being
conducted and to own, operate or lease the properties and assets it currently
owns, operates or holds under lease. Each of Production and Resources is duly
qualified or licensed to do business and is in good standing in each
jurisdiction where the character of its business or the nature of its
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properties makes such qualification or licensing necessary, except where the
failure to so qualify or be licensed would not have a Material Adverse Effect.
Each of Production and Resources has heretofore delivered to Xplor and Venus
true and correct copies of its respective limited partnership agreement and
articles of organization and operating agreement in effect on the date hereof
("Lomak Governing Documents"). Schedule 4.01 to the Lomak Disclosure Schedule
sets forth a list of the general partner(s) and manager(s) of each Production
and Resources on the date hereof and all information with respect to the
individual affiliated with the Lomak Entities who will be a director of Xplor
following the Closing required by SEC Rule 14f-1 under the Exchange Act.
Section 4.02. Authorization. Each of Production and Resources
has all requisite power and authority to enter into this Agreement and each of
the other agreements contemplated hereby, to carry out its respective
obligations under this Agreement and each of the other agreements contemplated
hereby and to consummate the transactions contemplated hereby and thereby. The
execution and delivery by Production and Resources of this Agreement, the
consummation of the transactions contemplated hereby and the performance by
Production and Resources of their respective obligations hereunder have been
duly authorized by all necessary action. This Agreement has been duly executed
and delivered by each of Production and Resources; and, assuming that this
Agreement constitutes the legal, valid and binding obligation of the other
parties hereto, constitutes the legal, valid and binding obligation of each of
Production and Resources, enforceable against each of Production and Resources
in accordance with its terms.
Section 4.03. No Violation. The execution and delivery of this
Agreement by each of Production and Resources do not, and the consummation by
each of Production and Resources of the transactions contemplated hereby, and
compliance with the terms hereof will not, (a) conflict with, or result in any
violation of or default (with or without notice or lapse of time or both) or
loss of any benefit under, any provision of their respective Lomak Governing
Documents; (b) conflict with, or result in any violation of or default (with or
without notice or lapse of time or both) or loss of any benefit under, any
permit, concession, grant, assignment, franchise, license, law, rule or
regulation, or any judgment, decree or order of any court or other governmental
agency or instrumentality to which Production or Resources is a party or to
which any of their respective properties or assets is subject; (c) conflict
with, or result in a breach or violation of or default (with or without notice
or lapse of time or both) or loss of any benefit under, or accelerate the
performance required by, the terms of any material agreement, contract,
indenture or other instrument to which Production or Resources is a party or to
which any of their respective properties is subject, or constitute a default or
loss of any right thereunder or an event which, with the lapse of time or notice
or both, might result in a material default or loss of any material right
thereunder or the creation of any lien, charge or encumbrance upon any of the
Lomak Properties; or (d) result in
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any suspension, revocation, impairment, forfeiture or non-renewal of any
material Lease of Production or Resources constituting part of the Lomak
Properties.
Section 4.04. Approvals. The execution and delivery of this
Agreement and each other agreement contemplated hereby, the performance by each
of Production and Resources of its respective obligations hereunder and
thereunder and the consummation of the transactions contemplated hereby and
thereby by Production and Resources will not require the consent, approval,
order or authorization of any Governmental Entity or Regulatory Authority or any
other Person under any statute, law, rule, regulation, permit, license,
agreement, indenture or other instrument to which Production or Resources is a
party or to which any of its properties are subject, and no declaration, filing
or registration with any Governmental Entity or Regulatory Authority is required
or advisable by Production or Resources in connection with the execution and
delivery of this Agreement and each other agreement contemplated hereby, the
performance by each of Production and Resources of its respective obligations
hereunder and thereunder the consummation by Production and Resources of the
transactions contemplated hereby and thereby other than filings or registrations
with, or authorizations, consents or approvals of, governmental bodies,
agencies, officials or authorities, the failure of which to make or obtain would
not have a Material Adverse Effect, or would not materially adversely affect the
Lomak Properties.
Section 4.05. Lomak Financial Statements.
(a) The Lomak Entities have delivered to Xplor and Venus true,
correct and complete copies of a statement of assets and liabilities of the
Lomak Properties as of December 31, 1996 and the related statements of revenues
and direct operating expenses for the fiscal year then ended together with
accompanying notes prepared by the Lomak Entities (the "Lomak Financial
Statements").
(b) The Lomak Financial Statements fairly present the
financial position of the Lomak Properties and the results of operations and
changes in financial condition as of the dates and periods therein specified.
Such financial statements (and accompanying notes), subject to independent audit
review and adjustment, (i) have been prepared in accordance with generally
accepted accounting principles consistently applied throughout the periods
involved (except as otherwise noted therein) and with applicable accounting
requirements and published rules and regulations of the SEC and (ii) reflect all
liabilities of the Lomak Properties, whether or not accrued and whether
contingent or absolute, including, without limitation, those relating to
severance and production taxes as are required to be reflected therein by such
applicable principles, requirements, rules and regulations.
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Section 4.06. Absence of Certain Changes. Since December 31,
1996, there has not been any Material Adverse Change in the condition, financial
or otherwise, or in the results of operations or prospects, of the Lomak
Properties.
Section 4.07. Litigation. There is no action, suit,
arbitration, proceeding or, to the best knowledge of the Lomak Entities,
investigation pending or, to the best knowledge of the Lomak Entities,
threatened against or affecting or involving Production or Resources or any of
their respective properties, assets or rights or any of their officers,
directors or employees in their capacities as such, whether at law or equity
("Lomak Litigation"), and the Lomak Entities have no knowledge of any facts that
are likely to give rise to any Lomak Litigation, that (in any case) is likely to
have a Material Adverse Effect nor is there any judgment, decree, injunction,
rule or order of any Governmental Entity or arbitrator outstanding against
Production or Resources or any of their partners, managers or employees in their
capacities as such that is likely to have a Material Adverse Effect or affect
the ability of Production or Resources to consummate the transactions
contemplated by this Agreement.
Section 4.08. No Default. The Lomak Entities are not in
default or violation (and no event has occurred which, with notice or the lapse
of time or both, would constitute a default or violation) of any term, condition
or provision of (i) the Lomak Governing Documents (ii) any note, bond, mortgage,
indenture, license, agreement or other instrument or obligation to which either
is now a party or by which either it or any of its properties or assets may be
bound or (iii) any order, writ, injunction, decree, statute, rule or regulation
applicable to it, except in the case of (ii) and (iii) for defaults or
violations which individually or in the aggregate would not have a Material
Adverse Effect.
Section 4.09. Compliance with Laws. Each of Production and
Resources is in compliance with all applicable laws, rules or regulations
relating to or affecting the operation, conduct or ownership of their respective
properties or business, other than violations that individually or in the
aggregate would not, and insofar as may reasonably be foreseen in the future
will not, have a Material Adverse Effect, all of which are described in Schedule
4.09 to the Lomak Disclosure Schedule. Neither the Lomak Entities nor, to the
best of the Lomak Entities' knowledge, any partner, manager, consultant or
employee of Production or Resources (in their capacity as such), is in default
with respect to any order, writ, injunction or decree known to or served upon
Production or Resources of any Governmental Entity or Regulatory Authority,
which default would have a Material Adverse Effect. To the best of the Lomak
Entities' knowledge, there is no existing law, rule, regulation or order,
whether Federal, state or local, which would prohibit or materially restrict
Production or Resources from, or otherwise materially adversely affect
Production or Resources in, conducting its business in any jurisdiction in which
it is now conducting business. Production and Resources hold all permits,
licenses, variances, exemptions, orders, franchises and
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approvals of all Governmental Entities necessary for the lawful conduct of their
respective businesses (the "Lomak Entities Permits"), except where the failure
so to hold would not have a Material Adverse Effect. Production and Resources
are in compliance with the terms of the Lomak Entities Permits, except where the
failure so to comply would not have a Material Adverse Effect.
Section 4.10. Oil and Gas Reserves; Wells. The Lomak Entities
have provided to Xplor and Venus an engineering report reviewed by Wright &
Company, Inc. setting forth oil and gas reserves comprising the Lomak Properties
and their values as of December 31, 1996 (the "Lomak Reserve Report"), a copy of
which is attached hereto as Schedule CC. The Lomak Reserve Report sets forth a
list of all Leases comprising the oil and gas reserves of the Lomak Properties
and, to the best of the Lomak Entities' knowledge, accurately reflects such oil
and gas reserves as of its date and as of the date hereof, subject to normal
production. The Lomak Entities are not aware of any change to their Leases since
the date of the Lomak Reserve Report that could have a Material Adverse Effect.
Wright & Company, Inc. were provided full access to the Lomak Entities' reserve
records and all other relevant information.
Section 4.11. Title to Lomak Leases. As to the interests in
each of the Leases listed in the Lomak Reserve Report, such interests include
100% of the interests in such Leases owned by the Lomak Entities as of the date
hereof, and upon Closing, the Lomak Entities will convey to Xplor that title to
such interests which will:
(i) entitle Xplor to receive not less than the interest shown
in the Lomak Reserve Report as the "Net Revenue Interest" with respect to such
Lease in all hydrocarbons produced, saved and marketed from such Lease and in
all hydrocarbons produced, saved or marketed from any unit of which such Lease
forms a part and allocated to such Lease, all without reduction, suspension or
termination of such Net Revenue Interest throughout the duration of such Lease;
(ii) obligate Xplor to bear a percentage of the costs and
expenses relating to the maintenance and development of, and operations relating
to, such Lease in an amount not greater than the "Working Interest" set forth in
the Lomak Reserve Report with respect to such Lease; and
(iii) be free and clear of all liens, Encumbrances (except for
Permitted Encumbrances), gas imbalances, obligations or defects and is not
subject to any matters which will result in a breach of any representation or
warranty of the Lomak Entities herein affecting title.
Section 4.12. No Misleading Statements. This Agreement, the information and
Schedules and Exhibits referred to herein and the information that has been
furnished to Xplor and Venus by the Lomak Entities in connection with the
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transactions contemplated hereby do not include any untrue statement of a
material fact and do not omit to state any material fact necessary to make the
statements contained herein or therein, in light of the circumstances under
which they were made, not misleading. Notwithstanding the foregoing, the Lomak
Entities have not and do not make any representation or warranty regarding any
forecast or projection of future events, pricing, valuation or results of future
operations or, or related to, the Lomak Properties. Nothing in this Agreement
shall be considered as an assurance that any such forecast or projection will be
correct or is likely to be correct.
Section 4.13. Brokerage Fees. the Lomak Entities have retained
no financial advisor, broker, agent or finder or paid or agreed to pay any
financial advisor, broker, agent or finder on account of this Agreement or any
transaction contemplated hereby or any transaction of like nature that would be
required to be paid by Production or Resources.
Section 4.14. Indebtedness. At Closing, the Lomak Entities
will have no outstanding indebtedness or financing agreements or obligations
under guaranties of third party debt which burden or relate to the Lomak
Properties.
Section 4.15. Taxes. The Lomak Entities have paid and/or made
provision for the payment of all Taxes payable as the result of their ownership
and/or operation of the Lomak Properties, and as of the Closing Xplor will
assume title to the Lomak Properties free and clear of all claims or liens for
Taxes accruing for all periods prior to the Closing, except as contemplated by
Article IX-A hereof.
Section 4.16. Material Contracts. Schedule 4.18 to the Lomak
Disclosure Schedule sets forth a complete list of all material contracts,
agreements, plans and commitments relating to the Lomak Properties subject to
which Xplor will take title to the Lomak Properties.
Section 4.17. No Undisclosed Liabilities There is no existing,
contingent or threatened liability, obligation, Encumbrance or claim of any
nature (absolute, accrued, contingent or otherwise) that relates to the Lomak
Properties or has been asserted or threatened to be asserted against the Lomak
Entities, other than liabilities pursuant to this Agreement or arising after the
date of the Lomak Financial Statements in the ordinary course of business and
consistent with past practice.
Section 4.18. No Vote Required. No vote or consent of the
partners, managers or members of the Lomak Entities which has not been obtained
is necessary for the execution of this Agreement and the consummation of the
transactions contemplated hereby.
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ARTICLE V
COVENANTS OF XPLOR
Xplor agrees that:
Section 5.01. Conduct of Xplor. From the date hereof until the
Closing and except as contemplated herein, Xplor shall in all material respects
conduct its business in the ordinary course. Without limiting the generality of
the foregoing, from the date hereof until the Closing, except as expressly
contemplated by this Agreement, without the written consent of Venus and the
Lomak Entities:
(a) Xplor will not adopt or propose any change in its
Certificate of Incorporation or Bylaws, or enter into any agreement or incur any
obligation, the terms of which would be violated by the consummation of the
transactions contemplated by this Agreement;
(b) Xplor will not:
(i) enter into any contract, agreement, plan or arrangement with any
director, officer or employee of Xplor, including, without limitation, any
written contract, agreement, plan or arrangement which provides for the making
of any payments, the acceleration of vesting of any benefit or right or any
other entitlement contingent upon (A) the consummation of the transactions
contemplated hereby or (B) the termination of employment after the consummation
of the transactions contemplated hereby;
(ii) enter into or amend any employment agreements (oral or written) to
increase the compensation payable or to become payable by it to any of its
employees or otherwise materially alter its employment relationship
with,officers, directors or consultants over the amount payable as of the date
hereof, or increase the compensation payable to any other employees, or adopt or
amend any employee benefit plan or arrangement (oral or written); or
(iii) loan or advance any money to any officer, director, employee,
stockholder or consultant of Xplor or to any other third party other than travel
advances in the ordinary course of business which do not exceed $1,000 at any
time outstanding to any one person;
(c) Except as expressly contemplated by this Agreement, Xplor
will not (i) purchase, acquire, issue, deliver, sell or authorize or propose the
issuance, delivery or sale of any stock appreciation rights or of any shares of
its capital stock of any class or any securities convertible into or
exchangeable for, or rights, warrants or options to acquire, any such shares or
convertible or exchangeable securities, (ii) make any
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changes in its capital structure or (iii) enter into any agreement or
understanding or take any preliminary action with respect to the matters
referred to in clause (i) or (ii) of this paragraph (c);
(d) Xplor will keep in full force and effect its existing
insurance policies and will not modify or reduce the coverage thereunder;
(e) Xplor will not (i) declare or pay any dividend or make any
other distribution to holders of its capital stock, (ii) split, combine or
reclassify any of its capital stock or propose or authorize the issuance of any
other securities in respect of or in lieu of or in substitution for any shares
of its capital stock, (iii) repurchase, redeem or otherwise acquire any shares
of its capital stock or (iv) take any preliminary action with respect thereto;
(f) Xplor will not incur any indebtedness (including without
limitation by way of guarantee or the issuance and sale of debt securities or
rights to acquire debt securities), or incur any account payable except in the
ordinary course of business consistent with past practice, or enter into or
modify any contract, agreement, commitment or arrangement with respect to the
foregoing;
(g) Xplor will not (i) sell, lease, release, forfeit or
otherwise dispose of, or create any mortgage liens, security interests or other
encumbrances on, any of its properties or assets having a book or market value
in excess of $10,000 in the aggregate or that are otherwise material,
individually or in the aggregate, to the business, results of operations or
financial condition of Xplor or (ii) enter into, or consent to the entering into
of, any agreement granting a preferential right to sell, lease, release, forfeit
or otherwise dispose of or create any mortgage liens, security interests or
other encumbrances on, any of such properties or assets or the production
therefrom;
(h) Xplor will not (i) enter into any new line of business;
(ii) change its investment, liability management and other material policies in
any material respect; (iii) incur or commit to any capital expenditures,
obligations or liabilities in connection therewith other than capital
expenditures, obligations or liabilities that (a) are listed on Schedule 5.01 of
the Xplor Disclosure Schedule or (b) individually do not exceed $10,000 and in
the aggregate do not exceed $10,000; (iv) acquire or agree to acquire by merging
or consolidating with, or acquire or agree to acquire by purchasing a
substantial portion of the assets of or equity interest in, or in any other
manner, any business or Person; (v) otherwise, except as to the acquisition of
materials and supplies necessary for the conduct of its business in the ordinary
course and consistent with past practice, acquire or agree to acquire any assets
for a total consideration in the aggregate in excess of $10,000; or (vi) make
any investment in any Person or (vii) authorize, recommend, propose or announce
an intention to adopt a plan of complete, or partial liquidation or dissolution
of Xplor;
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(i) Xplor will not (i) change its method of accounting in effect at
December 31, 1996 or (ii) change its fiscal year;
(j) Xplor will not settle or compromise, or agree to settle or
compromise, any suit or other litigation matter or any matter in an arbitration
proceeding for any material amount; and
(k) Xplor will not agree or commit to do any of the foregoing.
Section 5.02. Access to Records. At all reasonable times from
and after the date hereof until the Closing, Xplor shall afford Venus and the
Lomak Entities and their accountants, counsel, financial advisors and other
representatives full and complete access to the properties, employees and
officers of Xplor and to all books, accounts, financial and other records and
contracts of every kind of Xplor; provided, however, that no investigation
pursuant to this Section 5.02 shall affect any representation or warranty given
by Xplor hereunder.
Section 5.03. No Other Bids. From the date of this Agreement
until the Closing, Xplor shall not, nor shall it authorize or permit any
officer, director, partner or employee of, or any investment banker, attorney,
accountant or other representative or agent retained by Xplor to, ( i)
entertain, encourage, solicit or initiate any inquiries or the making of any
proposal that may reasonably be expected to lead to any "Takeover Proposal" or
(ii) except to the extent its Board of Directors determines, upon advice of
outside counsel, that such Board of Directors is otherwise required by its
fiduciary duties, participate in any discussions or negotiations, or provide
third parties with any information, relating to any such inquiry or proposal.
Xplor shall immediately advise Venus and the Lomak Entities of any such
inquiries or proposals. As used in this Section 5.03, "Takeover Proposal" shall
mean any proposal for a merger or other Business Combination involving Xplor or
for the acquisition of a substantial equity interest in Xplor or a substantial
portion of the assets of Xplor, in each case other than the transactions
contemplated hereby, and "substantial equity interest" shall mean any equity
ownership representing beneficial ownership of 10% percent or more of the
outstanding Xplor Shares.
Section 5.04. Maintenance of Business. From the date of this
Agreement until the Closing, Xplor will use its commercially reasonable efforts
to carry on its business, keep available the services of its officers and
employees and preserve its relationships with those of its suppliers, licensors,
licensees, customers and others having business relationships with it that are
material to its business in substantially the same manner as they have prior to
the date hereof. If Xplor becomes aware of a material deterioration or facts
which are likely to result in a material deterioration in the relationship with
any Person having a material business relationships with it, Xplor will
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promptly bring such information to the attention of Venus and the Lomak
Entities in writing.
Section 5.05. Compliance with Obligations. Prior to the
Closing, Xplor will use its commercially reasonable efforts to comply with (a)
all applicable Federal, state and local laws, rules and regulations, (b) all
agreements and obligations, including its Certificate of Incorporation and
Bylaws, by which it, its properties or its assets may be bound, and (c) all
Leases, decrees, orders, writs, injunctions, judgments, statutes, rules and
regulations applicable to it, its properties or its assets.
Section 5.06. SEC and NASDAQ Filings; Venus Stockholder
Approval. Xplor shall timely file all reports required to be filed by it with
the SEC and NASDAQ between the date hereof and the Closing and shall deliver to
Venus and the Lomak Entities copies of all such reports promptly after the same
are filed. Xplor shall also cooperate with Venus in connection with the
solicitation of Venus Stockholder Approval of the Venus Exchange and use
commercially reasonable efforts to provide the information and documentation
necessary to ensure compliance with the applicable requirements of federal,
state and foreign securities laws as contemplated by Section 6.06 hereof. On the
Closing Date or as soon thereafter as practicable, Xplor shall also file with
the SEC and send to its stockholders the notice required by SEC Rule 14f-1
occasioned by the reconstitution of the Xplor Board of Directors provided for by
Section 8.01 hereof.
ARTICLE VI
COVENANTS OF VENUS
Except as disclosed in Schedule 6.00 respecting the
repatriation of Venus from the United Kingdom to Texas, Venus agrees that:
Section 6.01. Conduct of Venus. From the date hereof until the
Closing and except as contemplated herein, Venus shall in all material respects
conduct its business in the ordinary course. Without limiting the generality of
the foregoing, from the date hereof until the Closing, except as expressly
contemplated by this Agreement, without the written consent of Xplor and the
Lomak Entities:
(a) Venus will not adopt or propose any change in its
Certificate of Incorporation or Bylaws, or enter into any agreement or incur any
obligation, the terms of which would be violated by the consummation of the
transactions contemplated by this Agreement;
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(b) Venus will not:
(i) enter into any contract, agreement, plan or arrangement with any
director, officer or employee of Venus, including, without limitation, any
written contract, agreement, plan or arrangement which provides for the making
of any payments, the acceleration of vesting of any benefit or right or any
other entitlement contingent upon (A) the consummation of the transactions
contemplated hereby or (B) the termination of employment after the consummation
of the transactions contemplated hereby;
(ii) enter into or amend any employment agreements (oral or written) to
increase the compensation payable or to become payable by it to any of its
employees or otherwise materially alter its employment relationship with,
officers, directors or consultants over the amount payable as of the date
hereof, or increase the compensation payable to any other employees, or adopt or
amend any employee benefit plan or arrangement (oral or written); or
(iii) loan or advance any money to any officer, director, employee,
stockholder or consultant of Venus or to any other third party other than travel
advances in the ordinary course of business which do not exceed $1,000 at any
time outstanding to any one person;
(c) Except as expressly contemplated by this Agreement, Venus
will not (i) purchase, acquire, issue, deliver, sell or authorize or propose the
issuance, delivery or sale of any stock appreciation rights or of any shares of
its capital stock of any class or any securities convertible into or
exchangeable for, or rights, warrants or options to acquire, any such shares or
convertible or exchangeable securities, (ii) make any changes in its capital
structure or (iii) enter into any agreement or understanding or take any
preliminary action with respect to the matters referred to in clause (i) or (ii)
of this paragraph (c);
(d) Venus will keep in full force and effect its existing
insurance policies and will not modify or reduce the coverage thereunder;
(e) Venus will not (i) declare or pay any dividend or make any
other distribution to holders of its capital stock, (ii) split, combine or
reclassify any of its capital stock or propose or authorize the issuance of any
other securities in respect of or in lieu of or in substitution for any shares
of its capital stock, (iii) repurchase, redeem or otherwise acquire any shares
of its capital stock or (iv) take any preliminary action with respect thereto;
(f) Venus will not incur any indebtedness (including without
limitation by way of guarantee or the issuance and sale of debt securities or
rights to acquire debt
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securities), or incur any account payable except in the ordinary course of
business consistent with past practice, or enter into or modify any contract,
agreement, commitment or arrangement with respect to the foregoing;
(g) Venus will not (i) sell, lease, release, forfeit or
otherwise dispose of, or create any mortgage liens, security interests or other
encumbrances on, any of its properties or assets having a book or market value
in excess of $10,000 in the aggregate or that are otherwise material,
individually or in the aggregate, to the business, results of operations or
financial condition of Venus or (ii) enter into, or consent to the entering into
of, any agreement granting a preferential right to sell, lease, release, forfeit
or otherwise dispose of or create any mortgage liens, security interests or
other encumbrances on, any of such properties or assets or the production
therefrom;
(h) Venus will not (i) enter into any new line of business;
(ii) change its investment, liability management and other material policies in
any material respect; (iii) incur or commit to any capital expenditures,
obligations or liabilities in connection therewith other than capital
expenditures, obligations or liabilities that (a) are listed on Schedule 6.01(h)
of the Venus Disclosure Schedule or (b) individually do not exceed $50,000 and
in the aggregate do not exceed $50,000; (iv) acquire or agree to acquire by
merging or consolidating with, or acquire or agree to acquire by purchasing a
substantial portion of the assets of or equity interest in, or in any other
manner, any business or Person; (v) otherwise, except as to the acquisition of
materials and supplies necessary for the conduct of its business in the ordinary
course and consistent with past practice, acquire or agree to acquire any assets
for a total consideration in the aggregate in excess of $10,000; or (vi) make
any investment in any Person or (vii) authorize, recommend, propose or announce
an intention to adopt a plan of complete, or partial liquidation or dissolution
of Venus;
(i) Except as set forth on Schedule 6.01(i), Venus will not
(i) change its method of accounting in effect at December 31, 1996 or (ii)
change its fiscal year;
(j) Venus will not settle or compromise, or agree to settle or
compromise, any suit or other litigation matter or any matter in an arbitration
proceeding for any material amount; and
(k) Venus will not agree or commit to do any of the foregoing.
Section 6.02. Access to Records. At all reasonable times from
and after the date hereof until the Closing, Venus shall afford Xplor and the
Lomak Entities and their accountants, counsel, financial advisors and other
representatives full and complete access to the properties, employees and
officers of Venus and to all books, accounts, financial and other records and
contracts of every kind of Venus; provided,
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however, that no investigation pursuant to this Section 6.02 shall affect any
representation or warranty given by Venus hereunder.
Section 6.03. No Other Bids. From the date of this Agreement
until the Closing, Venus shall not, nor shall it authorize or permit any
officer, director, partner or employee of, or any investment banker, attorney,
accountant or other representative or agent retained by Venus to, ( i)
entertain, encourage, solicit or initiate any inquiries or the making of any
proposal that may reasonably be expected to lead to any "Takeover Proposal" or
(ii) except to the extent its Board of Directors determines, upon advice of
outside counsel, that such Board of Directors is otherwise required by its
fiduciary duties, participate in any discussions or negotiations, or provide
third parties with any information, relating to any such inquiry or proposal.
Venus shall immediately advise Xplor and the Lomak Entities of any such
inquiries or proposals. As used in this Section 6.03, "Takeover Proposal" shall
mean any proposal for a merger or other Business Combination involving Venus or
for the acquisition of a substantial equity interest in Venus or a substantial
portion of the assets of Venus, in each case other than the transactions
contemplated hereby, and "substantial equity interest" shall mean any equity
ownership representing beneficial ownership of 10% percent or more of the
outstanding Venus Shares.
Section 6.04. Maintenance of Business. From the date of this
Agreement until the Closing, Venus will use its commercially reasonable efforts
to carry on its business, keep available the services of its officers and
employees and preserve its relationships with those of its suppliers, licensors,
licensees, customers and others having business relationships with it that are
material to its business in substantially the same manner as they have prior to
the date hereof. If Venus becomes aware of a material deterioration or facts
which are likely to result in a material deterioration in the relationship with
any Person having a material business relationships with it, Venus will promptly
bring such information to the attention of Xplor and the Lomak Entities in
writing.
Section 6.05. Compliance with Obligations. Prior to the
Closing, Venus will use its commercially reasonable efforts to comply with (a)
all applicable Federal, state and local laws, rules and regulations, (b) all
agreements and obligations, including its Certificate of Incorporation and
Bylaws, by which it, its properties or its assets may be bound, and (c) all
Leases, decrees, orders, writs, injunctions, judgments, statutes, rules and
regulations applicable to it, its properties or its assets.
Section 6.06. Venus Stockholder Approval. Venus shall promptly
solicit Venus Stockholder Approval of the Venus Exchange in compliance with the
applicable requirements of applicable federal, state and foreign securities
laws.
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ARTICLE VII
COVENANTS OF THE LOMAK ENTITIES
The Lomak Entities agree that:
Section 7.01. Conduct of the Lomak Entities. From the date
hereof until the Closing and except as contemplated herein, the Lomak Entities
shall in all material respects conduct their businesses relating to the Lomak
Properties in the ordinary course. Without limiting the generality of the
foregoing, from the date hereof until the Closing, except as expressly
contemplated by this Agreement, without the written consent of Xplor and Venus:
(a) the Lomak Entities will not adopt or propose any change in
the Lomak Governing Documents, or enter into any agreement or incur any
obligation, the terms of which would be violated by the consummation of the
transactions contemplated by this Agreement;
(b) the Lomak Entities will not enter into any contract,
agreement, plan or arrangement which would interfere with or limit Xplor's title
to the Lomak Properties or the ability of Xplor to obtain the full economic
benefit of its ownership of the Lomak Properties as contemplated hereby;
(c) the Lomak Entities will keep in full force and effect its
existing insurance policies and will not modify or reduce the coverage
thereunder;
(d) the Lomak Entities will not (i) sell, lease, release,
forfeit or otherwise dispose of, or create any mortgage liens, security
interests or other encumbrances on, any of the Lomak Properties having a book or
market value in excess of $10,000 in the aggregate or that are otherwise
material, individually or in the aggregate, to the results of operations or
financial condition of the Lomak Properties or (ii) enter into, or consent to
the entering into of, any agreement granting a preferential right to sell,
lease, release, forfeit or otherwise dispose of or create any mortgage liens,
security interests or other encumbrances on, any of the Lomak Properties or the
production therefrom;
(e) the Lomak Entities will not, with respect to the Lomak
Properties to the extent that they have any control as a non-operator of the
Lomak Properties, (i) incur or commit to any capital expenditures, obligations
or liabilities in connection therewith other than capital expenditures,
obligations or liabilities that (a) are listed on Schedule 7.01 of the Lomak
Disclosure Schedule or (b) individually do not exceed $10,000 and in the
aggregate do not exceed $10,000; (ii) acquire or agree to acquire by merging or
consolidating with, or acquire or agree to acquire by purchasing a substantial
portion of the assets of or equity interest in, or in any other manner, any
business or Person; (iii) otherwise, except as to the acquisition of materials
and supplies necessary for the
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operation of the Lomak Properties in the ordinary course and consistent with
past practice, acquire or agree to acquire any assets for a total consideration
in the aggregate in excess of $10,000; or (iv) authorize, recommend, propose or
announce an intention to adopt a plan of complete, or partial liquidation or
dissolution of the Lomak Entities;
(f) the Lomak Entities will not , with respect to the Lomak
Properties, settle or compromise, or agree to settle or compromise, any suit or
other litigation matter or matter in an arbitration proceeding for any material
amount; and
(g) the Lomak Entities will not agree or commit to do any of the foregoing.
Section 7.02. Access to Records. At all reasonable times from
and after the date hereof until the Closing, the Lomak Entities shall afford
Xplor and Venus and their accountants, counsel, financial advisors and other
representatives full and complete access to the properties, employees and
officers of the Lomak Entities and to all books, accounts, financial and other
records and contracts of every kind of the Lomak Entities; provided, however,
that no investigation pursuant to this Section 7.02 shall affect any
representation or warranty given by the Lomak Entities hereunder.
Section 7.03. No Other Bids. From the date of this Agreement
until the Closing, the Lomak Entities shall not, nor shall they authorize or
permit any partner, manager or employee of, or any investment banker, attorney,
accountant or other representative or agent retained by the Lomak Entities to,
entertain, encourage, solicit or initiate any inquiries or the making of any
proposal that may reasonably be expected to lead to any disposition of all or
any part of the Lomak Properties.
Section 7.04. Maintenance of the Lomak Properties. If, after
the date hereof, the Lomak Entities become aware of a material deterioration or
facts which are likely to result in a material deterioration in the relationship
with any Person having a material business relationships with the Lomak
Properties, the Lomak Entities will promptly bring such information to the
attention of Xplor and Venus in writing.
Section 7.05. Compliance with Obligations. Prior to the
Closing, the Lomak Entities will use commercially reasonable efforts to comply
with (a) all applicable Federal, state and local laws, rules and regulations,
(b) all agreements and obligations, including the Lomak Governing Documents, by
which they or the Lomak Properties may be bound, and (c) all Leases, decrees,
orders, writs, injunctions, judgments, statutes, rules and regulations
applicable to them and the Lomak Properties.
Section 7.06. Venus Stockholder Approval. The Lomak Entities shall also
cooperate with Venus in connection with the solicitation of Venus Stockholder
Approval of the Venus Exchange and use commercially reasonable efforts to
provide the
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information and documentation necessary to ensure compliance with the applicable
requirements of federal, state and foreign securities laws as contemplated by
Section 6.06 hereof.
ARTICLE VIII
COVENANTS OF ALL PARTIES
Each party to this Agreement agrees that:
Section 8.01. Board of Directors, Officers of Xplor; Employees
of Venus. As of the Closing, Xplor's Board of Directors will be reconstituted to
consist of seven members to assume office as soon as permitted by SEC Rule
14f-1. Two of the proposed directors will be designated by the persons currently
members of the Board of Directors of Xplor, four of the proposed directors will
be designated by Board of Directors of Venus and one of the proposed directors
will be designated by the Board of Directors of Lomak Petroleum Inc. Those
persons are named in Exhibit 8.01. As of the Closing, the officers of Xplor
shall be as set forth in Exhibit 8.01 hereof. After the Closing, Xplor agrees to
employ, to the extent available, all of the employees of Venus on the same terms
and conditions as they are currently employed, and Venus shall use its
commercially reasonable best efforts to cause its employees to accept such
employment.
Section 8.02. Advice of Changes. Each party will promptly advise the
other such parties in writing of:
(a) any notice or other communication from any Person alleging
that the consent of such Person is or may be required in connection with the
Venus Exchange or the Lomak Exchange;
(b) any notice or other communication from any Governmental
Entity or Regulatory Authority in connection with the Venus Exchange or the
Lomak Exchange;
(c) any actions, suits, claims, investigation or other
judicial proceedings commenced or threatened which, if pending on the date of
this Agreement, would have been required to have been disclosed pursuant to this
Agreement or which relate to the consummation of the Venus Exchange or the Lomak
Exchange;
(d) any event known to it occurring subsequent to the date of
this Agreement that would render any of its representations or warranties
contained in this Agreement, if made on or as of the date of such event or the
Closing Date, untrue, inaccurate or misleading in any material respect (other
than an event so affecting a representation or warranty which is expressly
limited to a state of facts existing at a time prior to the occurrence of such
event); and
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(e) any Material Adverse Change with respect to such party.
Each party will promptly provide each other copies of all filings made by such
party with any Governmental Entity or Regulatory Authority in connection with
this Agreement and the transactions contemplated hereby.
From time to time prior to the Closing, each of Xplor, Venus and the Lomak
Entities will promptly supplement or amend its respective Disclosure Schedule
and the Exhibits hereto with respect to any matter hereafter arising which, if
existing or occurring at the date of this Agreement, would have been required to
be set forth or described in such Schedule and Exhibits hereto. No supplement or
amendment of a Schedule or Exhibit made pursuant to this Section shall be deemed
to cure any breach of, affect or otherwise diminish any representation or
warranty made in this Agreement unless the other parties hereto specifically
agree thereto in writing.
Section 8.03. Regulatory Approvals. Prior to the Closing, each
party shall execute and file, or join in the execution and filing of, any
application or other document that may be necessary in order to obtain the
authorization, approval or consent of any Governmental Entity or Regulatory
Authority which may be reasonably required, or that one of the other parties may
reasonably request, in connection with the consummation of the Venus Exchange or
the Lomak Exchange. Each party shall use its commercially reasonable efforts to
obtain all such authorizations, approvals and consents.
Section 8.04. Actions Contrary to Stated Intent. Each party
will use its commercially reasonable efforts to cause the representations and
warranties contained in this Agreement with respect to such party to continue to
be true and correct and to obtain satisfaction of the conditions to Closing
relevant to such party. No party shall take any action that would, or might
reasonably be expected to, result in any of its representations and warranties
set forth herein being or becoming untrue in any material respect, or in any of
the conditions to the Venus Exchange or the Lomak Exchange set forth in Article
IX not being satisfied.
Section 8.05. Certain Filings. The parties shall cooperate with one
another:
(a) in determining whether any action by or in respect of, or
filing with, any Governmental Entity or Regulatory Authority is required, or any
actions, consents, approvals or waivers are required to be obtained from parties
to any material contracts, in connection with the consummation of the
transactions contemplated by this Agreement; and
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(b) in seeking any such actions, consents, approvals or
waivers or making any such filings, furnishing information required in
connection therewith and seeking timely to obtain any such actions, consents,
approvals or waivers.
Section 8.06. Public Announcements. Xplor, Venus and the Lomak
Entities will consult with one another before issuing any press release or
making any public statement with respect to this Agreement and the transactions
contemplated hereby and, except as may be required by applicable law as
evidenced by a written opinion from counsel, will not issue any such press
release or make any such public statement prior to such consultation and
unanimous agreement on the terms of such press release or other public
statement.
Section 8.07. Confidentiality. Each party hereto hereby agrees
to retain in strict confidence all Confidential Information received from any
other party hereto pursuant to, or in connection with, this Agreement. For
purposes of this Agreement, "Confidential Information" means all information and
data of any kind belonging to any party which by its nature is confidential or
proprietary and all other information and data which is so identified in writing
by any party. No party shall disclose any Confidential Information to any
person, firm or corporation or use any such Confidential Information for any
purpose not contemplated by this Agreement. Notwithstanding the foregoing, each
party may disclose Confidential Information to its directors, officers,
employees, attorneys and consultants, to the extent required for the performance
of its obligations under this Agreement, and to the extent required by law,
regulation or judicial order; provided that, such disclosure shall be
conditioned on and subject to the restrictions on disclosure set forth in this
Section 8.07.
The obligations of nondisclosure and nonuse pursuant to this
Section 8.07 shall not apply with respect to any Confidential Information which
any party can establish by written records:
(a) was known to such party prior to the disclosure thereof by
any other party or was subsequently and independently developed without
reference to the Confidential Information by such party; or
(b) was in the public domain prior to the disclosure thereof
to such party or subsequently entered the public domain by some means other than
as a result of a breach of this Agreement by such party; or
(c) was subsequently disclosed to such party by a third party
having a lawful right to make the disclosure.
The undertakings of each party pursuant to this Section 8.07 shall survive the
expiration or termination of this Agreement.
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Section 8.08. Issuance of Xplor Shares After Closing. Xplor
agrees that for a period of 30 days after the Closing hereunder it will not
issue additional shares of Xplor Stock (unless legally obligated to do so) if in
the reasonable opinion of tax advisers to the parties such issuance would
jeopardize the tax treatment contemplated by Section 1.05 hereof. This covenant
shall survive the Closing.
ARTICLE IX
CONDITIONS TO CLOSING
Section 9.01. Conditions to All Parties' Obligations. The
obligations of all the parties to this Agreement to effect the Venus Exchange
and Lomak Exchange shall be subject to the fulfillment of the following
conditions:
(a) Venus Stockholder Approval shall have been obtained by
Venus, and the Board of Directors and officers of Xplor shall have been
reconstituted as contemplated by Section 8.01 hereof, effective upon Closing,
and all other officers and directors of Xplor shall have resigned in writing.
(b) No temporary restraining order, preliminary or permanent
injunction or other order or restraint issued by any court of competent
jurisdiction, no order, decree, restraint or pronouncement by any Governmental
Entity or Regulatory Authority, and no other legal restraint or prohibition
which would prevent or have the effect of preventing the consummation of the
Venus Exchange or the Lomak Exchange shall have been issued or adopted or be in
effect;
(c) All material permits, approvals, filings and consents
required or advisable to be obtained or made, and all waiting periods required
or contemplated to expire, prior to the consummation of the Venus Exchange and
the Lomak Exchange under applicable federal laws of the United States or
applicable laws of any state or foreign country having jurisdiction over the
Venus Exchange, the Lomak Exchange and the other transactions contemplated
herein shall have been obtained, made or expired, as the case may be (all such
permits, approvals, filings and consents and the lapse of all such waiting
periods being referred to as the "Requisite Regulatory Approvals"), and all such
Requisite Regulatory Approvals shall be in full force and effect;
(d) The shares of Xplor Stock to be issued hereunder shall
have been included for quotation on NASDAQ SmallCap Market;
(e) A Stockholders Agreement substantially in the form set
form as Exhibit 9.01(e) shall have been entered into by the Ames Group, the
Blair Group and Lomak Petroleum Inc. (as such terms are defined in such
Agreement); and
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(f) The Venus Exchange and the Lomak Exchange shall be consummated
simultaneously.
Section 9.02. Conditions to the Obligations of Xplor to Effect
the Venus Exchange and Lomak Exchange. The obligations of Xplor under this
Agreement to effect the Venus Exchange and Lomak Exchange are subject to the
fulfillment at or prior to the Closing of the following conditions:
(a) Accuracy of Representations and Warranties. The
representations and warranties of Venus and of the Lomak Entities respectively
set forth in Articles III and IV hereof shall be true and correct in all
material respects as of the date when made and at and as of the Closing except
for such changes as are permitted by this Agreement (except to the extent a
representation or warranty speaks only as of an earlier date).
(b) Covenants and Agreements. Venus and the Lomak Entities
shall have duly performed and complied with, in all material respects their
respective covenants, agreements and conditions required by this Agreement to be
performed by or complied with by them prior to or at the Closing.
(c) Consents. All consents required for the consummation of
the Venus Exchange and the Lomak Exchange under any agreement, contract or Lease
described in any Exhibit or Schedule hereto or referred to herein, or for the
continued enjoyment by Xplor of the benefits of any such agreement, contract or
Lease after the Venus Exchange and the Lomak Exchange, shall have been obtained.
(d) Opinion of Counsel. Xplor shall have received the opinion
of Jones & Faye, P.L.L.C., counsel to Venus, and the opinion of Rubin Baum Levin
Constant & Friedman, counsel to the Lomak Entities, in form and content
reasonably satisfactory to Xplor, substantially in the form of Exhibit
9.02(d)(i) and Exhibit 9.02(d)(ii) hereof, respectively.
(e) Certificates of Venus and the Lomak Entities. Xplor shall
have received certificates of Venus and the Lomak Entities reasonably
satisfactory in form and substance to Xplor, executed on behalf of Venus and the
Lomak Entities by an executive officer, partner or manager, as to compliance
with the matters set forth in paragraphs (a), (b), (c) and (h) of this Section
9.02.
(f) No Adverse Decision. There shall not be any material
action taken or threatened, or any statute, rule, regulation or order enacted,
entered, overtly threatened, or deemed applicable to the transactions
contemplated hereby, by any Governmental Entity or Regulatory Authority or court
that, whether in connection with the grant of a Requisite Regulatory Approval,
any agreement proposed by any
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Governmental Entity or Regulatory Authority, or otherwise, which (i) requires or
could reasonably be expected to require any divestiture by Venus or the Lomak
Entities of a portion of its assets or business that Xplor in its reasonable
judgment believes will have a Material Adverse Effect on Xplor (ii) imposes any
condition upon either of such entities or their assets that in Xplor's
reasonable judgment (x) would be materially burdensome to Xplor or (y) would
materially increase the costs incurred or that will be incurred by Xplor as a
result of consummating the Venus Exchange and the Lomak Exchange and the other
transactions contemplated hereby. There shall be no action, suit, investigation
or proceeding pending overtly threatened by or before any Governmental Entity
which (i) seeks to restrain, enjoin, prevent the consummation of or otherwise
affect the transactions contemplated by this Agreement or (ii) questions the
validity or legality of any such transactions or seeks to recover damages or to
obtain other relief in connection with any such transactions.
(g) Proceedings; Receipt of Documents. All corporate and other
proceedings taken or required to be taken in connection with the transactions
contemplated hereby and all documents incident thereto shall be reasonably
satisfactory in form and substance to Xplor and Xplor's counsel, and Xplor and
Xplor's counsel shall have received all such information and such counterpart
originals or certified or other copies of such documents as Xplor or its counsel
may reasonably request. Xplor shall also have received such other agreements,
instruments, approvals, opinions and other documents as it may reasonably
request.
(h) Adverse Change. Neither Venus nor the Lomak Properties
shall have suffered any Material Adverse Change except as set forth in the Venus
Disclosure Schedule or the Lomak Disclosure Schedule, as the case may be,
supplied as of the date of this Agreement (whether or not such change is
described in any supplement to any such Disclosure Schedule).
(i) Certified Venus Financial Statements. Xplor shall have
received copies of the audited balance sheet of Venus as of December 31, 1996
and the related statements of operations, and statements of retained earnings
and cash flows for the fiscal year then ended with notes to such financial
statements together with an independent accountants' report of KPMG Peat Marwick
LLP thereon which are substantially the same in all material respects as the
Venus Financial Statements.
(j) Stratum Documentation. The documents setting forth the arrangements
anticipated by the letter agreement dated April 25, 1997 between Venus and
Stratum, L.P. shall have been executed in form and substance reasonably
satisfactory to Xplor.
Section 9.03. Conditions to the Obligations of Venus to Effect the Venus
Exchange. The obligations of Venus under this Agreement to effect the Venus
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Exchange are subject to the fulfillment at or prior to the Closing of the
following conditions:
(a) Accuracy of Representations and Warranties. The
representations and warranties of Xplor and of the Lomak Entities respectively
set forth in Articles II and IV hereof shall be true and correct in all material
respects as of the date when made and at and as of the Closing, except for such
changes as are permitted by this Agreement (except to the extent a
representation or warranty speaks only as of an earlier date).
(b) Covenants and Agreements. Xplor and the Lomak Entities
shall have duly performed and complied with in all material respects their
respective covenants, agreements and conditions required by this Agreement to be
performed by or complied with by them prior to or at the Closing.
(c) Consents. All consents required for the consummation of
the Venus Exchange and the Lomak Exchange under any agreement, contract or Lease
described in any Exhibit or Schedule hereto or referred to herein, or for the
continued enjoyment by Xplor of the benefits of any such agreement, contract or
Lease after the Venus Exchange and the Lomak Exchange, shall have been obtained.
(d) Opinion of Counsel. Venus shall have received the opinion
of Neville Shaver Hubbard & McLean, counsel to Xplor and the opinion of Rubin
Baum Levin Constant & Friedman, counsel to the Lomak Entities in form and
content reasonably satisfactory to Venus, substantially in the form of Exhibit
9.03(d)(i) and Exhibit 9.02(d)(ii) hereof, respectively.
(e) Certificates of Xplor and Lomak. Venus shall have received
certificates of Xplor and the Lomak Entities reasonably satisfactory in form and
substance to Venus, executed on behalf of each Xplor and The Lomak Entities by
an executive officer, partner or manager, as to compliance with the matters set
forth in paragraphs (a), (b), (c) and (h) of this Section 9.03.
(f) No Adverse Decision. There shall not be any material
action taken or overtly threatened, or any statute, rule, regulation or order
enacted, entered, threatened, or deemed applicable to the transactions
contemplated hereby, by any Governmental Entity or Regulatory Authority or court
that, whether in connection with the grant of a Requisite Regulatory Approval,
any agreement proposed by any Governmental Entity or Regulatory Authority, or
otherwise, which (i) requires or could reasonably be expected to require any
divestiture by Xplor or the Lomak Entities of a portion of its assets or
business that Venus in its reasonable judgment believes will have a Material
Adverse Effect on Xplor or (ii) imposes any condition upon either of such
entities or their assets that in Venus's reasonable judgment (x) would be
materially
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burdensome to Venus or Xplor or (y) would materially increase the costs incurred
or that will be incurred by Venus or Xplor as a result of consummating the Venus
Exchange and the Lomak Exchange and the other transactions contemplated hereby.
There shall be no action, suit, investigation or proceeding pending or overtly
threatened by or before any Governmental Entity which (i) seeks to restrain,
enjoin, prevent the consummation of or otherwise affect the transactions
contemplated by this Agreement or (ii) questions the validity or legality of any
such transactions or seeks to recover damages or to obtain other relief in
connection with any such transactions.
(g) Proceedings; Receipt of Documents. All corporate and other
proceedings taken or required to be taken in connection with the transactions
contemplated hereby and all documents incident thereto shall be reasonably
satisfactory in form and substance to Venus and Venus' counsel, and Venus and
Venus' counsel shall have received all such information and such counterpart
originals or certified or other copies of such documents as Venus or its counsel
may reasonably request. Venus shall also have received such other agreements,
instruments, approvals, opinions and other documents as it may reasonably
request.
(h) Adverse Change. Neither Xplor nor the Lomak Properties
shall have suffered any Material Adverse Change except as set forth in the Xplor
Disclosure Schedule or the Lomak Disclosure Schedule, as the case may be,
supplied as of the date of this Agreement (whether or not such change is
described in any supplement to such Disclosure Schedule).
(i) Percentage Interest in Xplor. Upon Closing, Venus and the Lomak
Entities shall own in the aggregate at least 80% of the outstanding shares of
Xplor Stock.
(j) Xplor Cash. At Closing, Xplor shall have at least $2.6
million in cash and cash equivalents, at least $2.4 million in net working
capital (current assets minus current liabilities) and no long-term debt.
Section 9.04. Conditions to the Obligations of the Lomak
Entities to Effect the Lomak Exchange. The obligations of the Lomak Entities
under this Agreement to effect the Lomak Exchange are subject to the fulfillment
at or prior to the Closing of the following conditions:
(a) Accuracy of Representations and Warranties. The
representations and warranties of Xplor and Venus respectively set forth in
Articles II and III hereof shall be true and correct in all material respects as
of the date when made and at and as of the Closing, except for such changes as
are permitted by this Agreement (except to the extent a representation or
warranty speaks only as of an earlier date).
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(b) Covenants and Agreements. Xplor and Venus shall have duly
performed and complied, in all material respects, with their respective
covenants, agreements and conditions required by this Agreement to be performed
by or complied with by them prior to or at the Closing.
(c) Consents. All consents required for the consummation of
the Venus Exchange and the Lomak Exchange under any agreement, contract or Lease
described in any Exhibit or Schedule hereto or referred to herein, or for the
continued enjoyment by Xplor of the benefits of any such agreement, contract or
Lease after the Venus Exchange and the Lomak Exchange, shall have been obtained.
(d) Opinion of Counsel. The Lomak Entities shall have received
the opinion of Neville Shaver Hubbard & McLean, counsel to Xplor and the opinion
of Jones & Faye, P.L.L.C., counsel to Venus in form and content reasonably
satisfactory to The Lomak Entities, substantially in the form of Exhibit
9.03(d)(i) and Exhibit 9.02(d)(ii) hereof, respectively.
(e) Certificates of Xplor and Venus. The Lomak Entities shall
have received certificates of Xplor and Venus reasonably satisfactory in form
and substance to the Lomak Entities, executed on behalf of Xplor and Venus by an
executive officer, as to compliance with the matters set forth in paragraphs
(a), (b), (c) and (h) of this Section 9.04.
(f) No Adverse Decision. There shall not be any material
action taken or threatened, or any statute, rule, regulation or order enacted,
entered, overtly threatened, or deemed applicable to the transactions
contemplated hereby, by any Governmental Entity or Regulatory Authority or court
that, whether in connection with the grant of a Requisite Regulatory Approval,
any agreement proposed by any Governmental Entity or Regulatory Authority, or
otherwise, which (i) requires or could reasonably be expected to require any
divestiture by Xplor or Venus of a portion of its business that the Lomak
Entities in their reasonable judgment believes will have a Material Adverse
Effect on Xplor (ii) imposes any condition upon either of such entities or their
assets that in the Lomak Entities' reasonable judgment (x) would be materially
burdensome to the Xplor or the Lomak Entities or (y) would materially increase
the costs incurred or that will be incurred by Xplor or the Lomak Entities as a
result of consummating the Venus Exchange and the Lomak Exchange and the other
transactions contemplated hereby. There shall be no action, suit, investigation
or proceeding pending or overtly threatened by or before any Governmental Entity
which (i) seeks to restrain, enjoin, prevent the consummation of or otherwise
affect the transactions contemplated by this Agreement or (ii) questions the
validity or legality of any such transactions or seeks to recover damages or to
obtain other relief in connection with any such transactions.
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(g) Proceedings; Receipt of Documents. All corporate and other
proceedings taken or required to be taken in connection with the transactions
contemplated hereby and all documents incident thereto shall be reasonably
satisfactory in form and substance to the Lomak Entities and the Lomak Entities'
counsel, and the Lomak Entities and their counsel shall have received all such
information and such counterpart originals or certified or other copies of such
documents as they or their counsel may reasonably request. The Lomak Entities
shall also have received such other agreements, instruments, approvals, opinions
and other documents as it may reasonably request.
(h) Adverse Change. Neither Xplor nor Venus shall have
suffered any Material Adverse Change except as set forth in the Xplor Disclosure
Schedule or the Venus Disclosure Schedule, as the case may be, supplied as of
the date of this Agreement (whether or not such change is described in any
supplement to such Disclosure Schedule).
(i) Share Purchase and Sale Agreement. A Share Purchase and Sale Agreement
substantially in the form set form as Exhibit 9.03(i) shall have been entered
into by the Lomak Petroleum Inc. and Venturetek, L.P.
(j) Percentage Interest in Xplor. Upon Closing, Venus and the Lomak
Entities shall own in the aggregate at least 80% of the outstanding shares
of Xplor
Stock.
(k) Certified Venus Financial Statements. The Lomak Entities
shall have received copies of the audited balance sheet of Venus as of December
31, 1996 and the related statements of operations and statements of retained
earnings and cash flows for the fiscal year then ended with notes to such
financial statements together with an independent accountants' report of KPMG
Peat Marwick LLP thereon which are substantially the same in all material
respects as the Venus Financial Statements.
(l) Stratum Documentation. The documents setting forth the arrangements
anticipated by the letter agreement dated April 25, 1997 between Venus and
Stratum, L.P. shall have been executed in form and substance reasonably
satisfactory to the Lomak Entities.
ARTICLE IX-A
ADJUSTMENTS AFTER CLOSING FOR LOMAK PROPERTIES
9A.01. Adjustment for Interim Operations. Within ninety (90) days after
Closing a final settlement statement will be prepared by the Lomak Entities and
submitted to Xplor showing income and expenses for the Lomak Properties during
the
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period between January 1, 1997 ("Operations Effective Date") and the
Closing. Based upon such statement (subject to audit and verification thereof by
Xplor),
(a) The appropriate Lomak Entities shall be credited with:
(i) The value as of the Operations Effective Date
of all hydrocarbons produced, saved and marketed from the Lomak
Properties (including all merchantable oil above the pipeline
connections in tanks at the Operations Effective Date) prior to the
Operations Effective Date for which payment has not been made to the
Lomak Entities;
(ii) The amount of all costs and expenses,
including, without limitation, royalties, rentals and other charges, ad
valorem and other taxes based upon or measured by the production of
hydrocarbons or the receipt of proceeds therefrom (not including income
taxes paid by the Lomak Entities) and expenses of operation of the
Lomak Properties (including prepaid expenses, if any) which were paid
by the Lomak Entities prior to the Closing and which are, in accordance
with generally accepted accounting principles, attributable to the
period after the Operations Effective Date;
(iii) The value of any other credits attributable to
the Lomak Properties for the period prior to the Operations Effective
Date, such as prepaid insurance or a credit based upon a working
interest audit, for which payment has not been made to the Lomak
Entities prior to the Closing; and
(iv) For purposes hereof, "value as of the Operations
Effective Date" shall mean the contract price (in the case of
hydrocarbons which were sold under contract) or the adjusted spot price
(in the case of hydrocarbons not required to be sold under contract) as
of the Operations Effective Date, less royalties and overriding
royalties and severance taxes (whether or not withheld by the purchaser
of such hydrocarbons).
(b) Xplor shall be credited with:
(i) The proceeds of all hydrocarbons produced,
saved and marketed from the Lomak Properties (not including
merchantable oil above the pipeline connections in tanks at the
Operations Effective Date) after the Operations Effective Date for
which payment has been made to the Lomak Entities;
(ii) The amount of all costs and expenses,
including, without limitation, royalties, rentals and other charges, ad
valorem and other taxes based upon or measured by the production of
hydrocarbons or the receipt of proceeds
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therefrom (not including income taxes paid by the Lomak Entities) and
expenses of operation of the Lomak Properties (including prepaid
expenses, if any) which were paid by Xplor and which are, in accordance
with generally accepted accounting principles, attributable to the
period prior to the Operations Effective Date; and
(iii) Any unpaid amount attributable to a casualty
loss affecting the Lomak Properties and occurring prior to the Closing.
(c) In addition to the foregoing, the settlement statement
shall include any other debits and credits, either cash or accrued, but
excluding income and franchise taxes, which under generally accepted accounting
principles would reflect transfer of the ownership of the Lomak Properties on
the Operations Effective Date.
(d) If the Lomak Entities and Xplor agree upon the amounts set
forth in the settlement statement, the net amount to be paid by the owing
party(s) shall be paid to the owed party(s) within thirty (30) days after
receipt of the settlement statement; provided, however, that Xplor shall have
the right for a period of six (6) months from the date of the settlement
statement to audit the matters covered thereby, and to require an adjustment of
the amount so paid based upon the results of such audit. The Lomak Entities
shall pay the amount of such adjustment within ten (10) days of written demand
therefor, subject to the following subparagraph.
(e) In the event that the Lomak Entities and Xplor are unable
mutually to agree upon the amount of the settlement statement, or in the event
that the Lomak Entities shall not agree with any proposed adjustment by Xplor
after an audit conducted by Xplor pursuant to the preceding subparagraph, an
audit shall be conducted by Ernst & Young or other independent certified public
accounting firm mutually acceptable to Xplor and the Lomak Entities. The Lomak
Entities and Xplor agree to be bound by the findings of such audit insofar as
the settlement statement is concerned. The fees and expenses involved in such
audit shall be paid by the party against which an adjustment is made.
ARTICLE X
TERMINATION, AMENDMENTS AND WAIVERS
Section 10.01. Termination. This Agreement may be terminated at any time
prior to the Closing:
(a) by the unanimous consent of Xplor, Venus and the Lomak Entities;
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(b) by Xplor or Venus or the Lomak Entities if the Closing
shall not have occurred on or before the close of business on May 15, 1997;
provided that, in any case, the terminating party is not in material breach of
its obligations hereunder;
(c) by Xplor or Venus or the Lomak Entities, if it is not in
material breach of its obligations under this Agreement, and if (A) there has
been a material breach by any other such party of any of its respective
representations and warranties hereunder such that Section 9.02(a), 9.03(a) or
9.04(a), as the case may be, will not be satisfied or (B) there has been the
willful breach on the part of any other party of any of its respective covenants
or agreements contained in this Agreement such that Section 9.02(b), 9.03(b) or
9.04(b), as the case may be, will not be satisfied, and, in both case (A) and
case (B), such breach has not been cured within ten (10) days after notice to
the breaching party;
(d) by Xplor, Venus or the Lomak Entities, if any court of
competent jurisdiction, or some other Governmental Entity or Regulatory
Authority shall have issued an order, decree or ruling or taken any other action
permanently restraining, enjoining or otherwise prohibiting the Venus Exchange
or the Lomak Exchange and such order, decree, ruling or other action shall have
become final and nonappealable;
(e) by Xplor, Venus or the Lomak Entities if Venus Stockholder
Approval shall not have been obtained by reason of the failure to obtain the
required vote upon a vote held at a duly held meeting of stockholders or at any
adjournment thereof.
(f) by Xplor, if, after the date of this Agreement, there
shall have occurred a Material Adverse Change in Venus or the Lomak Properties,
provided that any decrease in the cash held by Venus or increase in payables of
Venus related to expenses incurred in the ordinary course of business by Venus
including without limitation for the purpose of negotiating this Agreement (and
the Exhibits and Schedules hereto) and consummating the transactions
contemplated hereby (and thereby), shall not be deemed a Material Adverse Change
hereunder;
(g) by Venus, if, after the date of this Agreement, there
shall have occurred a Material Adverse Change in Xplor or the Lomak Properties,
provided that (i) any change in the market price of the Xplor Stock and/or (ii)
any decrease in the cash held by Xplor or increase in payables of Xplor related
to expenses incurred in the ordinary course of business by Xplor for the purpose
of negotiating this Agreement (and the Exhibits and Schedules hereto) and
consummating the transactions contemplated hereby (and thereby), shall not be
deemed a Material Adverse Change hereunder;
(h) by the Lomak Entities, if, after the date of this
Agreement, there shall have occurred a Material Adverse Change in Xplor or Venus
provided that (i) any change in the market price of the Xplor Stock and/or (ii)
any decrease in the cash held
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by Xplor or Venus or increase in payables of Xplor or Venus related to expenses
incurred in the ordinary course of business, including without limitation for
the purpose of negotiating this Agreement (and the Exhibits and Schedules
hereto) and consummating the transactions contemplated hereby (and thereby),
shall not be deemed a Material Adverse Change hereunder;
(i) by Xplor, Venus or the Lomak Entities, if the Board of
Directors of Xplor or Venus shall have approved or recommended any Takeover
Proposal which is financially superior to the Venus Exchange and the Lomak
Exchange and reasonably capable of being financed (as determined in each case in
good faith by such Board of Directors after consultation with financial
advisors) and such Board of Directors is advised by its outside counsel that the
fiduciary duties of such Board of Directors require acceptance or recommendation
of such Takeover Proposal.
Section 10.02. Effect of Termination. In the event of
termination of this Agreement as provided in Section 10.01 hereof, this
Agreement shall, except as provided herein with respect to Section 12.04 ,
forthwith become void and there shall not be any liability or obligation with
respect to the terminated provisions of this Agreement on the part of any of the
parties hereto or their respective officers or directors, except and to the
extent such termination results from the willful breach by a party of any of its
representations, warranties or agreements hereunder. Notwithstanding the
foregoing, if a party hereto terminates this Agreement pursuant to Section
10.01(c)(B), the party terminating the Agreement and the other non-breaching
party shall be entitled to reimbursement for all their out-of-pocket expenses
incurred in connection with this Agreement and the Venus Exchange and the Lomak
Exchange from the breaching party.
Section 10.03. Amendment. This Agreement may not be amended
except by an instrument in writing signed on behalf of each of the parties
hereto.
Section 10.04. Waiver. At any time prior to the Closing, the
parties hereto may (i) extend the time for the performance of any of the
obligations or other acts of the other parties hereto, (ii) waive any
inaccuracies in the representations and warranties of any other party hereto
contained herein or in any document delivered pursuant hereto and (iii) unless
precluded by law, waive compliance with any of the agreements or conditions
contained herein. Any agreement on the part of a party hereto to any such
extension or waiver shall be valid only if set forth in an instrument in writing
signed on behalf of such party. The failure of any party to this Agreement to
assert any of its rights hereunder or otherwise shall not constitute a waiver of
such rights except as expressly provided herein.
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ARTICLE XI
DEFINITIONS
As used in this Agreement, the following terms shall have the
meanings set forth:
Agreement shall mean this Property Acquisition Agreement.
Business Combination shall mean (i) any merger or
consolidation of a Person with or into any Person, (ii) any sale,
lease, exchange, transfer or other disposition (whether in one
transaction or a series of related transactions) of more than ten
percent of a Person's assets (including the stock or partnership
interests of such Person), (iii) the adoption of any plan or proposal
for the liquidation or dissolution of such Person, (iv) any issuance,
sale, purchase or redemption of equity securities, any reclassification
of equity securities or recapitalization of a Person and (v) any
transaction having an effect similar to those described above.
Business Day shall mean any day, other than a Saturday, Sunday
or legal holiday under the Federal laws of the United States.
Closing Date shall mean the date on which the Closing occurs.
Closing shall have the meaning given such term in Section 1.02
hereof.
Code shall mean the Internal Revenue Code of 1986, as amended.
Confidential Information shall have the meaning given such
term in Section 8.07 hereof.
Encumbrances shall mean and include security interests,
mortgages, liens, pledges, charges, easements, reservations,
restrictions, clouds, equities, rights or adverse claims of ownership
or use, or other encumbrance of any kind.
ERISA shall mean the Employee Retirement Income Security Act
of 1974, as amended.
Exchange Act shall mean the Securities Exchange Act of 1934,
as amended, and the rules and regulations thereunder.
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Governmental Entity shall mean any foreign or domestic court,
administrative agency or commission or other governmental authority or
instrumentality.
Leases shall mean the oil and gas leases enumerated and
described in the Xplor Reserve Report, the Venus Reserve Report or the
Lomak Reserve Report, as applicable.
Lomak shall mean Lomak Petroleum Inc, a Delaware corporation.
Lomak Disclosure Schedule shall have the meaning given such
term in the recitals to Article IV hereof.
Lomak Entities shall mean Production and Resources.
Lomak Exchange shall have the meaning set forth in the
recitals.
Lomak Financial Statements shall have the meaning given such
term in Section 4.05 hereof.
Lomak Governing Documents mean the limited partnership
agreement of Production and the articles of organization and operating
agreement of Resources respectively.
Lomak Properties shall have the meaning set forth in the
Section 1.01 hereof.
Lomak Reserve Report shall have the meaning given such term in
Section 4.10 hereof.
Material Adverse Change shall mean a change or a development
involving a prospective change which would have a Material Adverse
Effect.
Material Adverse Effect shall mean, with respect to any
Person, a material adverse effect on the business, prospects, results
of operations, financial condition, properties or assets of such
Person, and, with respect to the Lomak Entities, a material adverse
effect on the prospects, results of operations or condition, financial
or otherwise, of the Lomak Properties. In determining whether any
individual event would result in a Material Adverse Effect,
notwithstanding that such event does not of itself have such effect, a
Material Adverse Effect shall be deemed to have occurred if the
cumulative effect of such event and all other then existing events
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would result in a Material Adverse Effect. Notwithstanding anything
herein to the contrary, Venus shall not be considered to have undergone
a Material Adverse Change or experienced a Material Adverse Effect if a
change in its business, prospects, results of operations, financial
condition, properties or assets is due predominantly to the results of
any drilling program it is conducting currently.
Operations Effective Date shall have the meaning set forth in
Section 9A.01.
Permitted Encumbrances shall mean: (i) Lessor's royalties,
overriding royalties, reversionary interests and similar burdens if the
net cumulative effect of the burdens does not operate to reduce the
proportionate interest of party lessee with respect to all oil and gas
produced from any Lease below the Net Revenue Interest as set forth in
applicable Reserve Report; (ii) division orders and sales contracts
terminable without penalty upon no more than ninety (90) days' notice
to the purchaser; (iii) preferential rights to purchase and required
third-party consents and similar agreements, but only with respect to
which waivers or consents in form reasonably satisfactory to the other
parties hereto are obtained from the appropriate party or the
appropriate time period for asserting the rights has expired without an
exercise of the rights; (iv) all rights to consent by, required notices
to, filings with or other actions by any Government Entity or
Regulatory Authority in connection with the transactions contemplated
hereby, but only if (a) the other parties are advised thereof prior to
Closing, (b) they are customarily obtained subsequent to such
transaction(s) and (c) affected party has no reasonable basis to
believe that they cannot be obtained; (v) easements, rights-of-way,
servitudes, permits, surface leases and other rights in respect of
surface operations which do not materially interfere with the
operation, value or use of any of the Leases involved, do not prevent
Xplor from receiving the proceeds of production from the Leases
involved, do not reduce the interest of with respect to all oil and gas
produced from any Lease below the Net Revenue Interest for such Lease
set forth in applicable Reserve Report and do not increase the portion
of the costs and expenses relating to any Lease that Xplor, as the case
may be, will be obligated to pay above the percentage working interest
for such Lease set forth in the applicable Reserve Report; (vi) all
rights reserved to or vested in any Government Entity or Regulatory
Authority to control or regulate any of the Leases in any manner, and
all applicable laws, rules and orders of governmental authority; (vii)
any Encumbrance on or affecting any asset of a party which is paid or
discharged at or prior to the Closing;(viii) Encumbrances for inchoate
mechanics' and materialmen's
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liens for construction in progress and workmen's, repairmen's,
warehousemen's and carriers' liens arising in the ordinary course of
business which in the aggregate have a value of less than $50,000; (ix)
Encumbrances for Taxes not yet payable and for Taxes being contested in
good faith; and (x) any Encumbrance or other title defect relating to a
party which the other parties shall have expressly waived in writing.
Person shall mean an individual, corporation, partnership,
joint venture, trust or unincorporated organization, or a government or
any agency or political subdivision thereof.
Production shall mean Lomak Production I L.P., a Texas limited
partnership.
Proxy Statement shall mean the proxy statement of Xplor
referred to in Section 2.06(a) hereof.
Regulatory Authority shall mean any United States Federal,
state or local government or Governmental Entity the approval of which,
or filing with, is legally required or permitted for consummation of
the transactions contemplated by this Agreement.
Requisite Regulatory Approvals shall have the meaning given
such term in Section 9.01(c) hereof.
Resources shall mean Lomak Resources LLC, an Oklahoma limited
liability company.
SEC shall mean the Securities and Exchange Commission.
Securities Act shall mean the Securities Act of 1933, as
amended, and the rules and regulations thereunder.
Takeover Proposal shall have the meanings given such term in
Section 5.03 and Section 6.03 hereof.
Venus shall mean The New Venus Exploration, Inc, a Texas
corporation.
Venus Disclosure Schedule shall have the meaning given such
term in the recitals to Article III hereof.
Venus Exchange shall have the meaning set forth in the
recitals.
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Venus Financial Statements shall mean the financial statements
referred to in Section 3.06 hereof.
Venus Reserve Report shall have the meaning given such term in
Section 3.11 hereof.
Venus Stockholder Approval shall mean the affirmative vote of
the holders of two-thirds of the number of outstanding shares of each
class of capital stock of Venus as of the record date fixed for the
purpose of voting approval of the Venus Exchange.
Warrant(s) shall have the meaning given such term in Section
1.03.
Xplor shall mean Xplor Corporation, a Delaware corporation,
and, except where the context indicates otherwise, its subsidiaries
including the corporation and partnerships it controls.
Xplor Disclosure Schedule shall have the meaning given such
term in the recitals to Article II hereof.
Xplor Stock shall have the meaning given such term in the
recitals hereto.
Xplor 10-K shall have the meaning given such term in Section
2.06(a) hereof.
Xplor Reserve Report shall have the meaning given such term in
Section 2.11 hereof.
ARTICLE XII
GENERAL PROVISIONS
Section 12.01. Taking of Necessary Action; Specific
Performance. Subject to the terms and conditions of this Agreement, each of the
parties hereto agrees, subject to applicable laws, to use all reasonable efforts
promptly to take or cause to be taken all action and promptly to do or cause to
be done all things necessary, proper or advisable under applicable laws and
regulations to consummate and make effective the transactions contemplated by
this Agreement. Without limiting the foregoing, the parties shall use their best
efforts to obtain and make all consents, approvals, assurances and filings of or
with third parties and Governmental Entities necessary or, in the opinion of any
party, advisable for the consummation of the transactions contemplated by this
Agreement. Each party shall cooperate with the others in good faith to help the
others satisfy their obligations hereunder. If at any time
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after the Closing any further action is necessary or desirable to carry out the
purposes of this Agreement, or to vest Xplor with full title to and benefits of
all properties, assets, rights, approvals, immunities and franchises of Venus
and the Lomak Properties or the proper officers or directors of the appropriate
party(s) shall take all such necessary action.
Section 12.02. Survival of Representations and Warranties. All
representations and warranties of Xplor, Venus and the Lomak Entities contained
herein and in any certificate executed and delivered by such parties in
connection with this Agreement shall not survive the Closing Date and shall
terminate and expire thereupon, provided that Venus and the Lomak Entities shall
use commercially reasonable best efforts in assisting Xplor to attain the title
to the properties intended to be conveyed to Xplor in the Venus Exchange and the
Lomak Exchange, respectively, and provided further that this Section 12.02 is
not intended to deprive or relieve Xplor or the Lomak Entities of their rights
and obligations under Article IX-A hereof.
Section 12.03. Effect of Due Diligence. No investigation by or
on behalf of any party into the business, operations, prospects, assets or
condition (financial or otherwise) of any other party shall diminish in any way
the effect of any representations or warranties made by such other party in this
Agreement or shall relieve such other party of any of its respective obligations
under this Agreement.
Section 12.04. Expenses. Except as provided in Section 10.02,
all costs and expenses incurred in connection with this Agreement and the
transactions contemplated hereby shall be paid by the party incurring the same;
provided, however, that (as previously agreed orally) in the event the
transactions contemplated hereby do not close, (a) Lomak and Venus shall share
equally all expenses incurred to perform their due diligence investigations of
Xplor; (b) Xplor and Venus shall share equally all expenses incurred to perform
their due diligence investigations of the Lomak Properties; and (c) Lomak and
Xplor shall share equally all expenses incurred to perform their due diligence
investigations of Venus.
Section 12.05. Successors and Assigns. This Agreement will
inure to the benefit of and be binding upon the parties hereto and their
respective successors and permitted assigns. Neither this Agreement nor any of
the rights, interests or obligations hereunder shall be assigned by any of the
parties hereto without the prior written consent of the other parties hereto.
Section 12.06. Entire Agreement. This Agreement and the other
documents referred to herein contain the entire agreement among the parties
hereto with respect to the transactions contemplated hereby, and controls and
supersedes any prior understandings, agreements or representations by or between
the parties, written or oral, which conflicts with, or may have related to, the
subject matter hereof or thereof
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in any way. This Agreement may not be amended except by written agreement
signed by all the parties.
Section 12.07. Notices. All notices or other communications
hereunder shall be in writing and shall be deemed to have been duly given if
delivered personally or sent by telefax, by recognized overnight courier marked
for overnight delivery, or by registered or certified mail, postage prepaid,
addressed as follows:
If to Xplor: with copy to:
Xplor Corporation Neville Shaver Hubbard & McLean
16800 Greenspoint Park Drive Three Landmark Square
Suite 300 South Stamford, CT 06901
Houston, TX 77060 Attention: Richard M. Neville, Esq.
Attention: James E. Gayle Tel: 203-363-5300
Tel: 281-875-2780 Fax: 203-363-5323
Fax: 281-874-0770
If to Venus: with copies to:
Venus Exploration, Inc. Will C. Jones, IV, Esq.
700 N. St. Mary's St. - Ste. 1900 Jones & Faye, P.L.L.C.
San Antonio, TX 78205 112 E. Pecan, Suite 2500
Attention: Eugene L. Ames, Jr. San Antonio, TX 78205
Tel: 210-225-4722 Tel: 210-227-4260
Fax: 210-225-5687 Fax: 210-2274268
and
Charles Szalkowski, Esq.
Baker & Botts, LLP
910 Louisiana
Houston, TX 77002
Tel: 713-229-1480
Fax: 713-229-1522
If to the Lomak Entities: with copy to:
c/o Lomak Petroleum Inc. Walter M. Epstein, Esq.
500 Throckmorton St. - Ste. 2104 Rubin, Baum
Fort Worth, TX 76102 30 Rockefeller Plaza
Tel: 817-870-2601 New York, NY 10112
Fax: 817-870-2912 Tel: 212-698-7758
Fax: 212-698-7825
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or such other addresses as shall be furnished by like notice by such party. All
such notices and communications shall, when telefaxed (immediately thereafter
confirmed by telephone), be effective when telefaxed, or, if sent by nationally
recognized overnight courier service, be effective one Business Day after the
same has been delivered to such courier service marked for overnight delivery,
or, if mailed, be effective when received.
Section 12.08. Applicable Law. This Agreement shall be governed by, and
construed in accordance with, the internal laws of the State of Delaware,
without reference to or application of any conflicts of laws principles.
Section 12.09. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
Section 12.10. Headings. The headings used in this Agreement are for
convenience only and are not to be considered in construing or interpreting any
term or provision of this Agreement.
IN WITNESS WHEREOF, this Agreement has been duly executed and
delivered by the duly authorized representatives of the parties hereto as of the
date first written above.
XPLOR CORPORATION THE NEW VENUS EXPLORATION, INC
By: By:
LOMAK PRODUCTION I L.P. LOMAK RESOURCES LLC
By: By:
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Exhibit 9.03(i)
STOCKHOLDERS AGREEMENT dated as of May 21, 1997 by and among: (a) the
persons or entities listed in Exhibit 1 annexed hereto (the "Ames Group") acting
through Eugene L. Ames, Jr. (the "Ames Representative"); (b) the persons or
entities listed in Exhibit 2 annexed hereto (the "Blair Group") acting through
D. H. Blair Investment Banking Corp. (the "Blair Representative"); (c) the
entities listed in Exhibit 3 annexed hereto (the "Lomak Group") acting through
Lomak Petroleum, Inc. (the "Lomak Representative").
WHEREAS, the Blair Group owns 1,036,512 shares of the Common
Stock of Xplor and warrants to acquire an additional 30,000 of the Common Stock
of Xplor; and
WHEREAS, pursuant to the terms of a Property Acquisition
Agreement dated as of April 29, 1997 (the "Exchange Agreement"), the members of
the Ames Group own beneficially 3,553,896 shares of the Common Stock of Xplor
and warrants to acquire an additional 172,023 shares of the Common Stock of
Xplor; and
WHEREAS, of the shares of Common Stock of Xplor owned by the
Ames Group 372,599 are subject to transfer to Stratum Corp. ("Stratum shares")
43,199 are owned by Jere W. McKenny or subject to warrants ("JWM Director
Shares") and 199,796 are owned by James W. Gorman or subject to warrants ("JWG
Director Shares").
WHEREAS, pursuant to the terms of the Exchange Agreement and
the acquisition of additional shares of the Common Stock of Xplor from the Blair
Group contemplated therein, the Lomak Group owns beneficially 2,134,179 shares
of the Common Stock of Xplor and warrants to acquire an additional 192,353
shares of the Common Stock of Xplor; and
WHEREAS, it is a condition to the obligations of the parties
to the Exchange Agreement that this Agreement be executed by the parties hereto,
and the parties are willing to execute this Agreement and to be bound by the
provisions hereof;
NOW, THEREFORE, in consideration of the premises, the
agreements set forth below, and the parties' desire to further the interests of
Xplor and its present and future stockholders, the parties agree as follows:
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1. Definitions. As used in this Agreement, the term "Shares"
means all shares of the Common Stock of Xplor (a) now or hereafter owned (either
beneficially or of record) by any member of the Ames Group or by any member of
the Blair Group or by any of the Lomak Entities or by any affiliate of any of
them or (b) which a member of the Ames Group, the Blair Group or the Lomak
Entities does not own (either beneficially or of record) but as to which it now
or hereafter it or he has the right to exercise voting control. As used herein,
"beneficial" ownership shall be determined in accordance with Securities and
Exchange Commission Rule 13d-3.
2. Designation of Nominees.
(a) Subject to Section 8 hereof:
(i) during the term of the Agreement the Ames Group shall
have the right to designate four nominees for election as
directors of Xplor (together, the "Ames Nominees", and
individually an "Ames Nominee"). The initial Ames
Nominees are Eugene L. Ames, Jr., John Y. Ames, James
W. Gorman and Jere W. McKenny who shall be elected
directors of Xplor effective upon the Closing under the
Exchange Agreement and take office as soon as permitted
by Securities and Exchange Commission Rule 14f-1;
(ii) the Blair Group shall have the right to designate two
nominees for election as directors of Xplor (together, the
"Blair Nominees", and individually a "Blair Nominee") for the
one year term commencing with the Annual Meeting to be held in
1997 and the right to designate one nominee for election as a
director of Xplor for the one year term commencing with the
Annual Meeting to be held in 1998. The initial Blair Nominees
are Martin A. Bell and J. Morton Davis who are currently in
office and shall remain so when the Ames Nominees and the
Lomak Nominee take office as herein provided; and
(iii) during the term of the Agreement the Lomak Group shall
have the right to designate one nominee for election as a
director of Xplor (the "Lomak Nominee"). The initial Lomak
Nominee is John H. Pinkerton who shall be elected a director
of Xplor effective upon the Closing under the
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Exchange Agreement and take office as soon as permitted by
Securities and Exchange Commission Rule 14f-1.
(b) The Blair Group, the Ames Group and the Lomak Group shall
each cause its nominees who are directors to nominate the designees as the
management slate of directors.
(c) At least 50 days prior to any meeting (or written action
in lieu of a meeting) of stockholders of Xplor at or by which directors are to
be elected, each party entitled to name Nominee(s) for director(s) of Xplor
shall notify the other such parties and Xplor in writing of such party's
Nominee(s) for election as director(s), together in each case with information
about such Nominee(s) necessary for Xplor to comply with applicable disclosure
requirements. In the absence of any such notification, it shall be presumed that
the then incumbent Nominee(s) have been redesignated as the respective party's
Nominee(s).
3. Voting. (a) From and after the date hereof, each of the
Ames Group, the Blair Group and the Lomak Group shall vote all Shares at each
meeting (or written action in lieu of a meeting) of stockholders of Xplor to
elect, as directors of Xplor the Nominees designated in the manner provided in
Section 2 and shall vote all Shares against any proposal having the effect of
increasing the Board of Xplor to more than seven directors.
4. Successor Directors. If a Nominee shall cease to serve as a
director for any reason, the party which designated such person shall have the
right to designate a successor Nominee and the parties shall use their best
efforts to ensure that such successor Nominee is duly elected as a director,
including causing its nominees who are directors so to vote. If a party notifies
the other parties that such party desires to remove a director who serves as
such party's Nominee, the parties shall use their best efforts to ensure that,
consistent with Delaware law and the by-laws of Xplor, that such director is
duly removed as a director, if possible, or that a meeting of stockholders of
Xplor is promptly called for the purpose of electing a new management slate of
directors consistent with the designations of the parties to this Agreement.
5. Prohibited Transfers. No member of the Ames Group or the Lomak Group
shall sell, assign, transfer otherwise dispose of all or any Shares except as
expressly provided in this Agreement or as otherwise consented to in writing by
the Ames Representative and the Lomak Representative. Stratum Shares may be
transferred by the Ames Group as contemplated by the Letter agreement between
The New Venus Exploration, Inc. and Stratum Corp. dated April 25, 1997. JWM
Director Shares and/or JWG Director Shares, as the case may be transferred
without reference
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to this Agreement, including Section 5, 6 and 7 hereof, at such time as Jere W.
McKenny or James W. Gorman, as the case may be, is no longer a director of Xplor
following his anticipated election as a director of Xplor. Shares may be pledged
hypothecated, mortgaged or encumbered by members of the Ames Group or the Lomak
Group provided that document issued in connection therewith specifically
provides that the Rights of the holder thereof are subject to all the terms of
this Agreement. Notwithstanding the foregoing, (a) members of the Ames Group may
transfer Shares to any other member of the Ames Group, and members of the Lomak
Group may transfer any or all of their Shares to one or more "affiliates" of the
Lomak Group (as such term is defined in Securities and Exchange Commission
regulations) in which event each such transferee shall be bound by all of the
provisions of this Agreement to the same extent as if such transferee were a
party hereto; and (b) members of the Ames Group who are individuals may transfer
any or all of their Shares (i) by way of gift to any member of their respective
families or to any trust for the benefit of any such persons' family members or
the person himself or herself, provided that any such transferee shall agree in
writing with the other parties hereto, as a condition to such transfer, to be
bound by all of the provisions of this Agreement to the same extent as if such
transferee were a party hereto, or (ii) by will or the laws of descent and
distribution, in which event each such transferee shall be bound by all of the
provisions of this Agreement to the same extent as if such transferee were a
party hereto. As used herein, the word "family" shall include any spouse, lineal
ancestor or descendant, brother or sister.
6. Right of First Refusal.
(a) If at any time any member of the Ames Group or the Lomak
Group (a "Selling Stockholder") desires to sell its Shares (other than pursuant
to a transfer permitted pursuant to Section 5 hereof) pursuant to a bona fide
offer from a third party (the "Proposed Transferee"), the Selling Stockholder,
if a member of the Ames Group shall submit a written offer (the "First Offer")
to sell such Shares (the "Offered Shares") to the Lomak Representative and, if a
member of the Lomak Group to the Ames Representative on behalf of their
respective groups ("Non-Selling Stockholders") on terms and conditions,
including price, not less favorable to the Non-Selling Stockholders than those
on which the Selling Stockholder proposes to sell such Offered Shares to the
Proposed Transferee. The First Offer shall disclose the identity of the Proposed
Transferee, the number of Offered Shares proposed to be sold, the total number
of Shares owned by the Selling Stockholder, the terms and conditions, including
price, of the proposed sale, and any other material facts relating to the
proposed sale. Non-Selling Stockholders may acquire, in accordance with the
provisions of this Agreement, all but not any portion of the Offered Shares for
the price and upon the other terms and conditions, including deferred payment
(if applicable), set forth therein.
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(b) If a Non-Selling Stockholder desire to purchase the
Offered Shares, the Non-Selling Stockholder shall communicate in writing its
election to purchase to the Selling Stockholder, within 7 days of the date the
First Offer was made. Such communication shall, when taken in conjunction with
the First Offer, be deemed to constitute a valid, legally binding and
enforceable agreement for the sale and purchase of such Offered Shares. Sales of
the Offered Shares to be sold to the Non-Selling Stockholders pursuant to this
Section 6 shall be made at the offices of the Selling Stockholder on the 12th
day following the date the First Offer was made (or if such 12th day is not a
business day, then on the next succeeding business day). Such sales shall be
effected by the Selling Stockholder's delivery to the Non-Selling Stockholder of
a certificate or certificates evidencing the Offered Shares to be purchased by
it, duly endorsed for transfer to such Non-Selling Stockholder, against payment
to the Selling Stockholder of the purchase price therefor by such Non-Selling
Stockholder.
(c) If the Non-Selling Stockholders do not elect to purchase
the Offered Shares, the Offered Shares may be sold by the Selling Stockholder at
any time within 30 days after the date the First Offer was made, subject to the
provisions of Section 6 and 7. Any such sale shall be to the Proposed
Transferee, at not less than the price and upon other terms and conditions, if
any, not more favorable to the Proposed Transferee than those specified in the
First Offer. Any remaining Shares not sold within such 30-day period shall
continue to be subject to the requirements of prior offers pursuant to this
Section 6. If Offered Shares are sold pursuant to this Section 6 to any person
who is not a party to this Agreement, the Offered Shares so sold shall no longer
be subject to any of the restrictions imposed by this Agreement.
(d) Notwithstanding the foregoing subsections (a) through (c)
of this Section 6. if a Selling Stockholder wishes to sell Shares pursuant to
Rule 144 (or its successor provision), the Non-Selling Stockholder shall have
the right, exercisable within 7 business days following receipt of a Form 144
notice of sale, to purchase the Shares subject to such notice at the closing
price of the Shares on the first trade date immediately before the date of the
filing of such notice. If any Non-Selling Shareholder elects to purchase such
Shares the closing will be effected within 3 business days following its
election to purchase. If the Non-Selling Shareholder elect not to purchase, the
Selling Shareholder shall be free to sell the Shares covered by the notice for a
period of 30 days thereafter.
7. Right of Participation in Sales by Ames Group or Lomak Group.
(a) If at any time member(s) of the Ames Group or members of
the Lomak Group ("Participation Seller") desire to sell in the aggregate
thirty-five percent or more of the Participation Seller's then outstanding
ownership of Shares for cash or other consideration (other than pursuant to a
transfer permitted pursuant to Section 5 hereof) to any third party (the
"Buyer"), the other party, i.e. the Ames Group or The Lomak
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Group, as the case may be (the "Other Party") shall have the right to sell to
the Buyer, as a condition to such sale by the Participation Seller, at the same
price per share and on the same terms and conditions as involved in such sale by
the Participation Seller, the same percentage of the Shares owned by the Other
Party as the Shares to be sold by the Participation Seller to the Buyer
represents with respect to the Shares owned by the Participation Seller
immediately prior to the sale of any of such Participation Seller's Shares to
the Buyer. The obligation hereunder with respect to a party shall cease at such
time as that party owns less than 5% of the then outstanding shares of Xplor.
(b) The Other Party shall notify the Participation Seller in
writing of such intention as soon as practicable and in any event within ten
business days after the date the First Offer was made. Such notification shall
be given to such Participation Seller in accordance with Section 10 below.
(c) The Participation Seller and the Other Party shall sell to
the Buyer all, or at the option of the Buyer, any part of the Shares proposed to
be sold by them at not less than the price and upon other terms and conditions,
if any, not more favorable to the Buyer than those in the First Offer provided
by the Participation Seller under Section 6 above; provided, however, that any
purchase of less than all of such Shares by the Buyer shall be made from the
Participation Seller and the Other Party, pro rata, based upon the relative
amount of the Shares that the Participation Seller and the Other Party is
otherwise entitled to sell pursuant to Section 7(a).
(d) Any Shares sold by the Participation Seller or the Other
Party pursuant to this Section 7 shall no longer be subject to this Agreement.
8. Term. This Agreement shall continue through the third
anniversary of the date of this Agreement, provided, that the rights and
obligations of any party hereunder shall cease at such time that such party owns
beneficially fewer than 250,000 Shares.
9. Specific Enforcement. Each of parties hereto expressly
agrees that the other parties will be irreparably damaged by a breach of this
Agreement if this Agreement is not specifically enforced. Upon a breach or
threatened breach of the terms, covenants and/or conditions of this Agreement by
any party, a non-breaching party shall, in addition to all other remedies, be
entitled to a temporary or permanent injunction, without showing any actual
damage, and/or a decree for specific performance, in accordance with the
provisions hereof.
10. Notices. All notices or other communications given hereunder shall be
in writing and shall be deemed effective upon delivery at the address of the
party to be notified and shall be mailed by certified or registered mail, return
receipt requested, delivered by courier, telecopied, or sent by other facsimile
method (notices by telecopy
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or facsimile must be confirmed by next day courier delivery to be effective),
addressed to the Ames Representative in the case of notices to the Ames Group or
any member thereof, to the Blair Representative in the case of notices to the
Blair Group or any member thereof, or to the Lomak Representative, as the case
may be, at the address specified on the signature pages hereto or such other
address as such party may subsequently notify the other parties of in writing.
11. Entire Agreement and Amendments. This Agreement
constitutes the entire agreement of the parties with respect to the subject
matter hereof and neither this Agreement nor any provision hereof may be waived,
modified, amended or terminated except by a written agreement signed by Xplor,
and to the extent that the Ames Group, the Blair Group and/or the Lomak Group
still have the right to have designees on the Board of Directors pursuant to
Section 2, the Ames Representative, the Blair Representative and/or the Lomak
Representative, as the case may be
12. Designation of Representatives; Power of Attorney. Each
member of the Ames Group, the Blair Group and each of the Lomak Group,
respectively by his, her or its execution of this Agreement, hereby irrevocably
constitutes, appoints and designates the Ames Representative, Blair
Representative, the Lomak Representative respectively, named above as his, her
or its representative and attorney-in-fact for all purposes of this Agreement
with the authority to act for such member with the power, among other things:
(a) to perform the duties and functions assigned to the Ames Representative,
Blair Representative and the Lomak Representative named above as the case may
be, under this Agreement; (b) to receive notices to such member hereunder and to
agree to, execute and deliver any and all agreements, amendments, waivers,
consents and other documents in connection herewith; (c) to execute in such
member's name and on his, her or its behalf any and all filings with the
Securities and Exchange Commission which may be required by the Securities
Exchange Act of 1934, including without limitation Schedule 13D thereunder and
any amendments thereto. The other parties may conclusively rely upon the
appointment effected hereby, and any action taken by the Ames Representative or
the Blair Representative and the Lomak Representative named above hereunder
shall be binding on all members of their respective Groups, whether any such
members consented thereto or not.
13. Governing Law: Successors and Assigns. This Agreement shall be governed
by, and construed in accordance with, the laws of the State of Delaware without
regard to the principle of conflicts of laws and shall bind and inure to the
benefit of the heirs, personal representatives, executors, administrators,
successors and assigns of the parties.
14. Captions. Captions are for convenience only and are not deemed to be
part of this Agreement.
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15. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
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IN WITNESS WHEREOF the parties hereto have executed this
Agreement as of the date first above written.
THE AMES GROUP (Listed in Exhibit 1)
By:
Eugene L. Ames, Jr.
THE BLAIR GROUP (Listed in Exhibit 2)
By: D.H. Blair Investment Banking Corp.
By:
President
THE LOMAK GROUP (Listed in Exhibit 3)
By: Lomak Petroleum, Inc.
By:
John H. Pinkerton, President
XPLOR CORPORATION
By:
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EXHIBIT 1
Each of the undersigned hereby designates Eugene L. Ames, Jr.
or a successor selected by a majority in interest in Xplor Common Stock of the
undersigned, in writing, the Ames Representative under the Agreement authorized
to take any and all actions set forth for the Ames Representative thereunder.
Name Signature Xplor Xplor
Common Warrants
Owned Owned
E.L. James, Jr. 295,303 14,290
Ellen R.Y. Ames 1,168,211 56,548
John Y. Ames 452,449 21,901
Elizabeth A. Jones 262,373 12,700
Eugene L. Ames,III 262,373 12,700
Stephen J. Ames 262,373 12,700
George J. Ames 8,241 399
Carl Oliver, Trustee 4,120 199
Patrick A. Garcia 149,350 7,229
Raymond M. Koger 4,120 199
Gloria Barrett 45,284 2,192
Venus Oil Company 407,924 19,746
James W. Gorman 189,823 9,973
Jere W. McKenny 41,204 1,995
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EXHIBIT 2
Each of the undersigned hereby designates D.H. Blair Investment Banking
Corp. or a successor selected by a majority in interest in Xplor Common Stock of
the undersigned, in writing, the Blair Representative under the Agreement
authorized to take any and all actions set forth for the Blair Representative
thereunder
Name Signature Xplor Xplor
Common Warrants
Owned Owned
- ------------------ -------------------- --------------------- -----------------
D.H. Blair Investment
Banking Corp. 766,307 30,000
Rivkalex Corp. 116,411
Rosalind Davidowitz 70,954
Parliament Hill 35,840
Corporation
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EXHIBIT 3
Each of the undersigned hereby designates Lomak Petroleum,
Inc. or a successor selected by a majority in interest in Xplor Common Stock of
the undersigned, in writing, the Lomak Representative under the Agreement
authorized to take any and all actions set forth for the Lomak Representative
thereunder
Name Signature Xplor Xplor
Common Warrants
Owned Owned
Lomak Production I L.P. by: Lomak Production Company 1,899,419 171,194
General Partner
by:______________________
Lomak Resources, L.L.C. by: Lomak Production Company, 234,760 21,159
A Member
by: _________________________
by: Lomak Resources Company
A Member
by:_________________________
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