SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
JANUARY 4, 2000
DELTA PETROLEUM CORPORATION
(Exact name of registrant as specified in its charter)
Colorado 0-16203 84-1060803
(State of Commission (I.R.S. Employer
Incorporation) File No. Identification No.)
Suite 3310
555 17th Street
Denver, Colorado 80202
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (303) 293-9133
ITEM 5. OTHER EVENTS
A. On November 23, 1999, the Company agreed to amend its
July 29, 1999 agreement with GlobeMedia AG of Goppingen, Germany and
thereby issue warrants to GlobeMedia to purchase 250,000 shares of the
Company's common stock at prices ranging from $2.00 to $4.00 per share
for six months to 12 months from the effective date of a registration
covering the shares underlying the warrants. A copy of the July 29,
1999 agreement along with the November 23, 1999 amendment, is
incorporated herein as Exhibit 99.1.
B. On December 8, 1999, the Company completed the sale of
428,000 shares of its restricted common stock in a private offshore
transaction to Bank Leu of Zurich, Switzerland for $749,000 U.S. under
SEC Regulation S. A fee of $75,000 was paid to an unaffiliated
individual, non-U.S. citizen, as consideration for his efforts and
consultation related to the private placement. In addition, warrants
to purchase 250,000 shares of common stock at prices ranging from
$2.00 to $4.00 per share for six months to twelve months were issued
to GlobeMedia AG of Goppingen, Germany as consideration for its
efforts and consultation related to the private offering. A copy of
the Investment Representation Agreement is incorporated herein as
Exhibit 99.2 and a copy of the November 23, 1999 letter agreement with
GlobeMedia AG is incorporated herein as Exhibit 99.3.
C. On December 30, 1999, the Company entered into an
agreement with Burdette A. Ogle amending the Purchase and Sale
Agreement between them dated January 3, 1995 to provide for and
clarify the sharing of any compensation which the Company might
receive in any form as consideration for any agreement, settlement,
regulatory action or other arrangement with or by any governmental
unit or other party precluding the further development of the
properties acquired by the Company pursuant to the January 3, 1995
Purchase and Sale Agreement. A copy of the December 30, 1999
agreement is incorporated herein as Exhibit 99.4.
D. On January 4, 2000, the Company completed the sale of
175,000 shares of its restricted common stock in a private transaction
to Evergreen Resources, Inc. ("Evergreen") for $350,000. A copy of
the Investment Representation Agreement between Evergreen and the
Company dated December 17, 1999 is incorporated herein as Exhibit
99.5. In addition, Evergreen was granted an option to acquire a
portion of certain interests owned by the Company in undeveloped
properties offshore Santa Barbara, California. A copy of the Option
Agreement between the parties dated December 17, 1999 (effective as of
January 4, 2000) is incorporated herein as Exhibit 99.6.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
99.1 July 29, 1999 Agreement between GlobeMedia AG and Delta
Petroleum Corporation with November 23, 1999 amendment.
99.2 Investment Representation Agreement between Bank Leu AG and Delta
Petroleum Corporation.
99.3 Letter Agreement between GlobeMedia AG and Delta Petroleum
Corporation.
99.4 Agreement dated December 30, 1999 between Burdette A. Ogle
and Delta Petroleum Corporation.
99.5 Investment Representation Agreement dated December 17, 1999
between Evergreen Resources, Inc. and Delta Petroleum
Corporation.
99.6 Option Agreement between Evergreen Resources, Inc. and Delta
Petroleum Corporation dated December 17, 1999 (effective as of
January 4, 2000).
Pursuant to the requirements of the Securities and Exchange Act
of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned hereunto duly authorized.
DELTA PETROLEUM CORPORATION
(Registrant)
Date: January 10, 2000
By: s/Aleron H. Larson, Jr.
Aleron H. Larson, Jr.
Chairman/C.E.O.
INDEX TO EXHIBITS
(1) Underwriting Agreement. Not applicable.
(2) Plan of Acquisition, Reorganization, Arrangement, Liquidation or
Succession. Not applicable.
(3) (i) Articles of Incorporation. Not applicable.
(ii) Bylaws. Not applicable.
(4) Instruments Defining the Rights of Security Holders, including
Indentures. Not applicable.
(5) Opinion: re: Legality. Not applicable.
(6) Opinion: Discount on Capital Shares. Not applicable.
(7) Opinion: re: Liquidation Preference. Not Applicable.
(8) Opinion: re: Tax Matters. Not Applicable.
(9) Voting Trust Agreement. Not Applicable.
(10) Material Contracts. Not Applicable.
(11) Statement re: Computation of Per Share Earnings.
Not Applicable.
(12) Statement re: Computation of Ratios. Not Applicable.
(13) Annual Report to Security Holders, etc. Not Applicable.
(14) Material Foreign Patents. Not Applicable.
(15) Letter re: Unaudited Interim Financial Information.
Not Applicable.
(16) Letter re: Change in Certifying Accountant.
Not applicable.
(17) Letter re: Director Resignation. Not applicable.
(18) Letter re: Change in Accounting Principles. Not Applicable.
(19) Report Furnished to Security Holders. Not Applicable.
(20) Other Documents or Statements to Security Holders.
Not applicable.
(21) Subsidiaries of the Registrant. Not Applicable.
(22) Published Report Regarding Matters Submitted to Vote of Security
Holders. Not Applicable.
(23) Consents of Experts and Counsel. Not applicable.
(24) Power of Attorney. Not applicable.
(25) Statement of Eligibility of Trustee. Not Applicable.
(26) Invitations for Competitive Bids. Not Applicable.
(27) Financial Data Schedule. Not Applicable.
(99) Additional Exhibits.
99.1 July 29, 1999 Agreement between GlobeMedia AG and Delta
Petroleum Corporation with November 23, 1999 amendment.
99.2 Investment Representation Agreement between Bank Leu AG and Delta
Petroleum Corporation.
99.3 Letter Agreement between GlobeMedia AG and Delta Petroleum
Corporation.
99.4 Agreement dated December 30, 1999 between Burdette A. Ogle
and Delta Petroleum Corporation.
99.5 Investment Representation Agreement dated December 17, 1999
between Evergreen Resources, Inc. and Delta Petroleum
Corporation.
99.6 Option Agreement between Evergreen Resources, Inc. and Delta
Petroleum Corporation dated December 17, 1999 (effective as of
January 4, 2000).
Delta Petroleum Corporation
Buzz Larson, Chairman
Roger A. Parker, President Hr. Spoddig
555 17th Street, Suite 3310 Tel.: 089/649110-03
Denver, Colorado, 80202 07/14/99
USA
Dear Buzz, dear Roger,
We are pleased to offer you our service, as we discussed, for a
new, additional investor relations project:
Delta Petroleum on n-tv business channel
Highlights of the offer:
* Company introduction in the most important German business
tv channel n-tv
* Internet coverage during the project period
* Introduction to fund managers, banks, portfolio managers
in Germany and Switzerland
* Road show in Frankfurt, Munich and Zurich and other new activities
* Continual recommendations in Swiss stock market letters
Details: See 3.1
Project Start Date: 08/01/99
Project Manager: GlobeMedia AG and GlobeMedia.de Mr. Seybold
AG Mr. Bucher,
for Germany Mr. Frommert,
Mr. Mayer
Delta Petroleum Corporation
Project Crew: GlobeMedia AG and GlobeMedia.de AG 2-6
Project End Date: 07/31/2000
Fixed Price: US $ 110.000,--
This offer will give you the right success for the German
retail market and also the Swiss market and bring additional
liquidity in your home market in the US directly and by
arbitrage.
Please feel free to contact us if you have any questions.
Kind regards,
GlobeMedia AG
s/Karl Heinz Spoddig
Karl-Heinz Spoddig cc: Peter Bucher
07/14/99
Delta Petroleum Corporation
O F F E R
Project: Delta Petroleum on n-tv business channel
Content
1. Project Description 3
2. Requirements 4
2.1. Contractor 4
2.2. Customer 4
3. Offer 5
3.1. Description 5
3.2. Time Schedule 6
4. Conditions 7
4.1. Prices 7
4.2. Payments 7
5. Terms and conditions 7
1. Project Description
Financial Public Relations made by GlobeMedia AG means the
active structuring of communication for a clientele which
mainly comes from abroad, creating, enhancing and securing
their scopes of acting in the German speaking areas. We
communicate this financial communication - or Investor
Relations in other words - on the three most important media to
create Shareholder Value:
- - business television
- - Internet
- - business newspapers
* Road Show
- - To get the special interest of professional and semi-
professional investors, we will arange a personnell meeting
with the management of DELTA PETROLEUM CORP. in Frankfurt or
Zurich/Switzerland. We will send out special invitations to
these specific investment communities. The professional edge of
the stock market is an important module to get a fair value in
the market.
* TV Production of a company portrait and broadcasting
* We will have a 10 minute investor relations show for
shareholders which will be broadcasted monthly or every two
weeks. This show will start in the fourth quarter of this year.
It is broadcasted via the only business channel in Germany
called n-tv.
* In our opinion it is the fastest way for small companies
in Germany to be introduced to the public. We are very excited
to get a broadcasting during the trading hours in Germany.
* Internet Services
* The Internet Services will cover the whole process of the
TV broadcasting. That includes different ways to reach a
potential investor with the information you want to be
published.
* Most of the German investors in small cap stocks receive
the information they want via the internet.
* Print Media
* We inform with advertisements in German business
newspapers about your company before and after the TV
broadcasting to create interest in the German shareholder
community. This way is used to reach the people who don't have
access to the internet.
This offer does not cover:
Fixed price for additional effort for CD ROM duplication
of the TV broadcasting.
Requirements
2.1 Contractor
* According to this offer GlobeMedia.de AG produces and
delivers the items described in the offer description (3.1).
* Project management at GlobeMedia AG:Mr. Seybold, Mr.
Bucher
* Project Team: 2 - 6 people of GlobeMedia AG and
Globemedia.de AG. The number of people working for this project
differs depending on the tasks.
* The contractor will write a monthly status report and a
final report of the project success.
Customer
* The customer DELTA PETROLEUM CORP. will deliver all
documentation needed to bring this project to success. That
also includes all information to plan the visit in the USA.
* The Customer supports the members of the team preparing
the TV introduction show.
* The Customer has to ensure that the people needed for the
TV takes are available as agreed in a detailed time schedule
which is to prepare by the contractor and the customer.
Offer
3.1 Description
* Road Show
* Our database of more than 5,000 potential investors
includes more than 100 addresses of business pressmen and
executives of several venture capital funds and small cap
investment funds.
* TV Production of a company portrait
* The TV pictures are taken directly on your site in the USA
(two locations). The four members of our TV team will take
pictures of interesting items and also record an interview with
the management. The film will be a 3 minute part in our own 10
minute TV show broadcasted on the most important business
channel in Germany, n-tv.
* The television channel n-tv is a joint venture of CNBC and
famous German publishers like Handelsblatt. Our show will be
broadcasted in the afternoon in Germany between 2:00 and 3:00
p.m. while the German market is open and before the market
opens in the USA at 3:30 p.m. German Time.
* The TV show can be repeated in the night between 0:00 a.m.
and 1:00 a.m for the spectators working at day time.
* The broadcasted TV contribution will also be available on
a CD ROM in MPEG format for the PC users.
* Internet Services
* We place banner and text advertisements on important
German internet business pages to make people know that DELTA
PETROLEUM CORP. can be seen on televison.
* We will write an article about DELTA PETROLEUM CORP. in
our investor relations letter BORSE XTRA, which is published
via the internet and by e-mail.
* We will maintain an internet page for DELTA PETROLEUM
CORP. in German during the period of contract.
* We will use our network of business services in the
internet to make the people take notice of your company.
* Print Media
* We will place two advertisements in German business
newspapers before and after the TV broadcasting to create
interest in the German shareholder community.
3.2 Time Schedule
Start of Project: 08/01/99
End of Project: 07/31/00
The detailed time schedule for the TV production is to be
agreed before 08/31/99.
4. Conditions
4.1 Prices
Fixed price: $ 110,000
CD ROM Copies: $ 2,500 for each 1,000 items
4.2 Payments
GlobeMedia AG will charge
01.08.1999 $ 40,000
01.09.1999 $ 20,000
01.10.1999 $ 20,000
01.11.1999 $ 30,000
Payments have to be received in our accounts before target
date.
5. Terms and conditions
The price fixing is valid until 09/30/99.
Regensdorf, 07/14/99
GlobeMedia AG This is to confirm that your
offer is accepted July 29,
1999
s/K.H. Spoddig DELTA PETROLEUM CORPORATION
Karl-Heinz Spoddig By: s/Aleron H. Larson, Jr.
Aleron H. Larson, Jr.
CEO/Chairman
November 23, 1999
Mr. Karl Heinz Spoddig
GlobeMedia AG
Adlikerstrasse 246
CH-8105 Regensdorf
Switzerland
Dear Karl:
This is to confirm that we have mutually agreed to amend our July
29, 1999 agreement whereby Delta will issue to you the following warrants:
Number of
Price/Share Warrants Duration*
$2.00 50,000 6 months
2.50 50,000 6 months
3.00 50,000 9 months
3.50 50,000 1 year
4.00 50,000 1 year
250,000
* These periods under "Duration" will begin upon the effective date
of a registration statement covering the shares underlying the warrants.
Please acknowledge that this is your understanding with your signature
below.
GLOBEMEDIA AG DELTA PETROLEUM CORPORATION
By:s/K.H. Spoddig By: s/Aleron H. Larson, Jr.
Authorized Officer Aleron H. Larson, Jr. Chairman/CEO
INVESTMENT REPRESENTATION AGREEMENT
Delta Petroleum Corporation
C/O 555 17th Street, Suite 3310
Denver, Colorado 80202
Gentlemen:
1. Subscription. The undersigned BANK LEU AG
whose address is Bahnhofstrasse 32, 8022 Zurich Switzerland (and its designees)
hereby agrees to acquire, from Delta Petroleum Corporation
("DPC" or the "Company") 428,000 shares of the restricted and legended
common stock of DPC (collectively the "Securities"),
at a price of $1.75 per share for an aggregate of $749,000
in a private negotiated transaction pursuant to Section 3(b)
and/or 4(2) of the Act (and the regulations promulgated thereunder)
and/or other applicable statute, rule and\or regulation.
2. Representations and Warranties. The undersigned
warrants and represents to the Company that:
a. The Securities are being acquired by the
undersigned for investment for its own account, and not with a
view to the offer or sale in connection therewith, or the
distribution thereof, and that the undersigned is not now, and
will not in the future, participate, directly or indirectly, in
an underwriting of any such undertaking except in compliance with
applicable registration provisions of the Act.
b. The undersigned will not take, or cause to be
taken, any action that would cause it to be deemed an underwriter
of the Securities, as defined in Section 2(11) of the Securities
Act of 1933, as amended (the "Act").
c. The undersigned has been afforded an opportunity
to examine such documents and obtain such information concerning
the Company as it may have requested, including without
limitation all publicly available information, and has had the
opportunity to request such other information (and all
information so requested has been provided) for the purpose of
verifying the information furnished to it and for the purpose of
answering any question it may have had concerning the business
affairs of the Company and it has reviewed to the extent desired
by it the Articles, Bylaws and Minutes of the Company,
documentation concerning the Company's financial condition,
assets, liabilities, share ownership and capital structure,
operations, sales, management, public market, public filings,
litigation and other material contracts and matters.
d. The undersigned (and its officers, directors and/or
agents, as applicable) have had an opportunity to personally ask
questions of, and receive answers from, one or more of the
officers and directors of the Company and/or the attorneys for
the Company to ascertain and verify the accuracy and completeness
of all material information regarding the Company, its business
and its officers, directors, and promoters. The undersigned has
had an opportunity to ask questions of and receive answers from
duly designated representatives of the Company concerning the
terms and conditions pursuant to which the Securities are being
acquired by it.
e. The undersigned understands that its acquisition of the
Securities from the Company is a negotiated private transaction.
f. By reason of the knowledge and experience of the
undersigned (and that of its officers and directors and their
respective advisors and investment bankers) in financial and
business matters in general, and investments in particular, it is
capable of evaluating the merits and risks of an investment in
the Securities.
g. The undersigned is capable of bearing the economic
risks of an investment in the Securities.
h. The undersigned's present financial condition is such
that it is under no present or contemplated future need to
dispose of any portion of the Securities to satisfy any existing
or contemplated undertaking, need or indebtedness.
i. If required to do so, it has retained to advise it, as
to the merits and risks of a prospective investment in the
Securities, a purchaser representative, legal counsel, financial
and accounting advisors, investment bankers, etc.
j. The undersigned hereby represents and warrants to the
Company that all of the representations, warranties and
acknowledgements contained in this agreement, and the agreements,
if any, to which this document is attached as an exhibit are
true, accurate and complete as of the date herein and
acknowledges that the Company, its officers, directors, agents,
and affiliates have relied on its representations and warranties
herein in consenting to the restricted issuance and/or transfer
of the Securities and the undersigned hereby agrees to indemnify
and hold the Company (together with its officers, directors,
agents and affiliates) harmless with respect to any and all
expenses, claims or litigation (including without limitation
reasonable attorney's fees related thereto) arising from or
related to breach of this agreement including without limitation
breach of any warranty or representation herein.
3. Restrictions. The undersigned acknowledges and
understands that the Securities are unregistered and must be held
indefinitely by the undersigned and/or its assignees unless they
are subsequently registered under the Act or an exemption from
such registration is available. The undersigned further
acknowledges that it is fully aware of the applicable limitations
on the resale of the Securities. For instance, Rule 144 (the
"Rule") permits sales of "Restricted Securities" held for not
less than two years and upon compliance with the requirements of
such Rule. Further, the Securities must be sold in an active
market and appropriate information relating to the Company must
be generally available in order to effectuate a transaction
pursuant to the Rule by an affiliate of the Company. Any and all
certificates representing the Securities and any and all
securities issued in replacement or conversion thereof or in
exchange thereof shall bear the following legend, or one
substantially similar thereto, which the undersigned has read and
understands:
The Securities represented by this Certificate have not been
registered under the Securities Act of 1933 (the "Act") and
are "restricted securities" as that term is defined in Rule
144 under the Act. The Securities may not be offered for
sale, sold or otherwise transferred except pursuant to an
effective registration statement under the Act or pursuant
to an exemption from registration under the Act, the
availability of which is to be established to the
satisfaction of the Company.
The undersigned further agrees that the Company shall have the
right to issue a stop transfer instruction to its transfer agent,
if any, or to note a stop transfer instruction in its stockholder
records, which will prevent any resale of the securities prior to
two years from purchase which is not in compliance with the Rule
or subject to an effective registration statement, without
written consent from the Company, and it acknowledges that the
Company has informed it of its intention to issue such
instructions when and if necessary.
4. Registration Rights. Within ninety (90) days of the
consummation of this transaction the Company shall file a
registration statement (or similar document) with the U.S.
Securities & Exchange Commission and shall include such shares
issued pursuant hereto in such registration statement, at the
Company's sole cost.
5. Successors and Assigns. This agreement shall be
binding upon and shall inure to the benefit of the parties hereto
and to the successors and assigns of the Company and to the
personal and legal representatives, heirs, guardians, successors
and permitted assignees of the undersigned.
6. Applicable Law. This agreement shall be governed by
and construed in accordance with the laws of the State of
Colorado and, to the extent it involves any United States
statute, in accordance with the laws of the United States, and
jurisdiction and venue for any dispute related hereto shall be in
the District Court for the City and County of Denver, Colorado.
s/Andre Tinner, Asst. Vice President By:s/Andre Tinner
Typed or Printed Name Signature
P.O. Box
Social Security or Tax Address
Identification Number
BANK LEU AG
ZURICH
Bahnhofstrasse 32, Zurich
Switzerland 8022
City, State and Zip Code
ACCEPTED:
Delta Petroleum Corporation
By:s/Aleron H. Larson, Jr.
Dated: December 28, 1999
November 23, 1999
Mr. Karl Heinz Spoddig
GlobeMedia AG
Adlikerstrasse 246
CH-8105 Regensdorf
Switzerland
Dear Karl:
This is to confirm that Delta Petroleum Corporation will
issue the following warrants to you as compensation for your
involvement in the private placement of 428,572 shares of Delta
common stock:
Number of
Price/Share Warrants Duration *
$2.00 50,000 6 months
2.50 50,000 6 months
3.00 50,000 9 months
3.50 50,000 1 year
4.00 50,000 1 year
250,000
* These periods under "Duration" will begin upon the
effective date of a registration statement covering the
shares underlying the warrants.
Please acknowledge that this is your understanding with your
signature below.
GLOBEMEDIA AG DELTA PETROLEUM CORPORATION
By:/K.H. Spoddig By:s/Aleron H. Larson, Jr.
Authorized Officer Aleron H. Larson, Jr.,
President & CEO Chairman/CEO
AGREEMENT
This Agreement is entered into effective as of December 30,
1999, by and between Delta Petroleum Corporation, a Colorado
corporation, 555 17th Street, Suite 3310, Denver, Colorado 80202
and Burdette A. Ogle, 1224 Coast Village Circle, Suite 24, Santa
Barbara, California 93108.
RECITALS
A. The parties hereto are also parties to that certain
A Purchase and Sale Agreement dated January 3, 1995 (the
A Purchase and Sale Agreement), those several instruments of
conveyance of even date therewith and related thereto each of
which is entitled AAssignment, Conveyance and Bill of Sale of
Federal Oil and Gas Leases Reserving a Production Payment
(collectively, the Assignments), and to that certain Agreement
dated December 17, 1998 amending the Assignments (the First
Amendment).
B. The parties desire to further amend the Assignments.
AGREEMENT
FOR VALUABLE CONSIDERATION, the receipt and adequacy of
which are acknowledged, the parties agree as follows:
1. Each of the Assignments is hereby amended to add a new
Section II-11 which shall read as follows:
11. In the event Assignee receives any
compensation in any form as consideration for any
agreement, settlement, regulatory action or other
arrangement, whether voluntary or involuntary,
with or by any governmental unit (whether federal,
state or local) or other party precluding the
further development of the Interests, Assignee
shall pay Assignor the lesser of: (x) three
percent (3%) of the stated value of such
compensation; or, (y) the remaining balance of the
Production Payment. To the extent that such
agreement, settlement, regulatory action or other
arrangement precludes development of less than all
of the Interests, the amount paid to Assignor
pursuant to this Section 11 shall be deducted from
and reduce amounts due under the Production
Payment upon actual production of Substances, but
the Production Payment shall otherwise remain in
effect with respect to any Interest, the
development of which is not so precluded.
2. The parties hereby ratify the Purchase and Sale
Agreement and the Assignments, as amended by the First Amendment
and this Agreement.
3. This Agreement may be executed in one or more
counterparts, which shall together constitute one document. This
Agreement may be executed by means of facsimile signatures
without the necessity of further proof of execution.
Executed effective as of the date first above written.
DELTA PETROLEUM CORPORATION
s/Burdette A. Ogle By:s/Aleron H. Larson, Jr.
BURDETTE A. OGLE Authorized Officer
INVESTMENT REPRESENTATION AGREEMENT
Delta Petroleum Corporation
C/O 555 17th Street, Suite 3310
Denver, Colorado 80202
Gentlemen:
1. Subscription. The Undersigned, EVERGREEN RESOURCES,
INC. ("Evergreen" or "Undersigned") and its designees, hereby
agrees to acquire from Delta Petroleum Corporation ("Delta" or
the "Company") 175,000 shares of the restricted and legended
common stock of Delta (collectively the "Securities") for an
aggregate of $350,000 in a private negotiated transaction
pursuant to Section 3(b) and/or 4(2) of the Act (and the
regulations promulgated thereunder) and/or other applicable
statute, rule and\or regulation. Closing, including delivery of
the Securities and payment therefore, shall take place as of
January 4, 2000.
2. Representations and Warranties. The Undersigned
warrants and represents to the Company that:
a. The Securities are being acquired by the
Undersigned for investment for its own account, and not with a
view to the offer or sale in connection therewith, or the
distribution thereof, and that the Undersigned is not now, and
will not in the future, participate, directly or indirectly, in
an underwriting of any such undertaking except in compliance with
applicable registration provisions of the Act.
b. The Undersigned will not take, or cause to be
taken, any action that would cause it to be deemed an underwriter
of the Securities, as defined in Section 2(11) of the Securities
Act of 1933, as amended (the "Act").
c. The Undersigned has been afforded an opportunity
to examine such documents and obtain such information concerning
the Company as it may have requested, including without
limitation all publicly available information, and has had the
opportunity to request such other information (and all
information so requested has been provided) for the purpose of
verifying the information furnished to it and for the purpose of
answering any question it may have had concerning the business
affairs of the Company and it has reviewed to the extent desired
by it the Articles, Bylaws and Minutes of the Company,
documentation concerning the Company's financial condition,
assets, liabilities, share ownership and capital structure,
operations, sales, management, public market, public filings,
litigation and other material contracts and matters.
d. The Undersigned (and its officers, directors and/or
agents, as applicable) have had an opportunity to personally ask
questions of, and receive answers from, one or more of the
officers and directors of the Company and/or the attorneys for
the Company to ascertain and verify the accuracy and completeness
of all material information regarding the Company, its business
and its officers, directors, and promoters. The Undersigned has
had an opportunity to ask questions of and receive answers from
duly designated representatives of the Company concerning the
terms and conditions pursuant to which the Securities are being
acquired by it.
e. The Undersigned understands that its acquisition of the
Securities from the Company is a negotiated private transaction.
f. By reason of the knowledge and experience of the
Undersigned (and that of its officers and directors and their
respective advisors and investment bankers) in financial and
business matters in general, and investments in particular, it is
capable of evaluating the merits and risks of an investment in
the Securities.
g. The Undersigned is capable of bearing the economic
risks of an investment in the Securities.
h. The Undersigned's present financial condition is such
that it is under no present or contemplated future need to
dispose of any portion of the Securities to satisfy any existing
or contemplated undertaking, need or indebtedness.
i. If required to do so, it has retained to advise it, as
to the merits and risks of a prospective investment in the
Securities, a purchaser representative, legal counsel, financial
and accounting advisors, investment bankers, etc.
j. The Undersigned hereby represents and warrants to the
Company that all of the representations, warranties and
acknowledgements contained in this agreement, and the agreements,
if any, to which this document is attached as an exhibit are
true, accurate and complete as of the date herein and
acknowledges that the Company, its officers, directors, agents,
and affiliates have relied on its representations and warranties
herein in consenting to the restricted issuance and/or transfer
of the Securities and the Undersigned hereby agrees to indemnify
and hold the Company (together with its officers, directors,
agents and affiliates) harmless with respect to any and all
expenses, claims or litigation (including without limitation
reasonable attorney's fees related thereto) arising from or
related to breach of this agreement including without limitation
breach of any warranty or representation herein.
3. Restrictions. The Undersigned acknowledges and
understands that the Securities are unregistered and must be held
indefinitely by the Undersigned and/or its assignees unless they
are subsequently registered under the Act or an exemption from
such registration is available. The Undersigned further
acknowledges that it is fully aware of the applicable limitations
on the resale of the Securities. For instance, Rule 144 (the
"Rule") permits sales of "Restricted Securities" held for not
less than two years and upon compliance with the requirements of
such Rule. Further, the Securities must be sold in an active
market and appropriate information relating to the Company must
be generally available in order to effectuate a transaction
pursuant to the Rule by an affiliate of the Company. Any and all
certificates representing the Securities and any and all
securities issued in replacement or conversion thereof or in
exchange thereof shall bear the following legend, or one
substantially similar thereto, which the Undersigned has read and
understands:
The Securities represented by this Certificate have not been
registered under the Securities Act of 1933 (the "Act") and
are "restricted securities" as that term is defined in Rule
144 under the Act. The Securities may not be offered for
sale, sold or otherwise transferred except pursuant to an
effective registration statement under the Act or pursuant
to an exemption from registration under the Act, the
availability of which is to be established to the
satisfaction of the Company.
4. Registration Rights. Subject to the approval of an
underwriter, if any, involved in a registration relating to a
public offering of the Company's securities, in the event that
the Company shall file a registration statement (or similar
document) with the U.S. Securities & Exchange Commission on a
form which would legally allow inclusion of the shares issued
pursuant hereto, the Company shall include such shares in such
registration statement, at the Company's sole cost.
5. Successors and Assigns. This agreement shall be
binding upon and shall inure to the benefit of the parties hereto
and to the successors and assigns of the Company and to the
personal and legal representatives, heirs, guardians, successors
and permitted assignees of the Undersigned.
6. Applicable Law. This agreement shall be governed by
and construed in accordance with the laws of the State of
Colorado and, to the extent it involves any United States
statute, in accordance with the laws of the United States, and
jurisdiction and venue for any dispute related hereto shall be in
the District Court for the City and County of Denver, Colorado.
Evergreen Resources, Inc. By:s/Mark S. Sexton
Typed or Printed Name Signature
Mark S. Sexton
President & CEO for
Evergreen Resources, Inc.
84-0834147 1401 17th Street, Suite 1200
Social Security or Tax Address
Identification Number
Denver, Colorado 80202
City, State and Zip Code
ACCEPTED:
DELTA PETROLEUM CORPORATION
By:s/Aleron H. Larson, Jr.
Dated: December 17, 1999
OPTION
Effective January 4, 2000 for good and valuable
consideration the receipt of which is hereby acknowledged,
Evergreen Resources, Inc. ("Evergreen") is hereby granted an
option ("Option"), until September 30, 2000 to acquire 50% of
those property interests owned by Delta Petroleum Corporation
("Delta") which are listed on the attached Exhibit A (the
"Properties") by transferring to Delta the 175,000 shares
purchased by Evergreen under an Investment Representation
Agreement of even date herewith. Delta will warrant and defend
title against all persons claiming title thereto through Delta.
In the event that Evergreen exercises its option to acquire the
Properties, Delta will assign 50% of its interest in the
Properties to Evergreen subject to its proportionate share of the
reserved production payment in favor of Burdette A. Ogle ("Ogle")
described in the copies of the documents attached hereto and
listed below (the "Documents").
The Documents provide for the reservation of an undivided
three percent (3%) of substances produced from the Properties
("Production Payment") until an aggregate amount of $8,000,000
(or a reduced amount as provided in the Documents under certain
circumstances) has been paid to Ogle or his successors either
from any production attributable to the reserved 3% or the
minimum annual advanced payment ("Minimum Payment") discussed
below. The Documents further provide that, irrespective of
whether the Properties are producing or non-producing at any
time, that Ogle shall be paid a Minimum Payment in the amount of
$350,000 per year. This Minimum Payment may be composed of the
proceeds from the production of the reserved 3%, a direct cash
payment or a combination thereof. Upon exercise of its option,
Evergreen will assume and agree to pay the direct cash portion of
the Minimum Payment under the terms set forth in the Documents
until the production proceeds from the reserved 3% from 100% of
the Properties are adequate to cover the Minimum Payment. It is
provided, however, that Evergreen shall be responsible only for
payment of the cash portion of the Minimum Payment with respect
to the Properties and that the reserved Production Payment
derived from the reservation of an undivided three percent (3%)
of substances produced from the Properties shall burden and be
paid from 100% of the substances produced from the Properties
equally and proportionately regardless of ownership.
Delta represents that it has paid $1,550,000 to date in
Minimum Payments, thereby correspondingly reducing the maximum
aggregate amount due under the Production Payment from $8,000,000
to $6,450,000. Each successive payment shall further reduce the
remaining amount due under the Production Payment.
The following Document copies are attached hereto:
* Lease interests Purchase Option Agreement between Delta
and Ogle;
* Purchase and Sale Agreement between Delta and Ogle;
* Assignments from Ogle to Delta for interests in OCS-
P409, OCS-P0415,
OCS-P-0416, OCS-P0421, OCS-P0422, OCS-P0460, OCS-P0462,
and OCS-P464;
In the event Evergreen exercises its Option, the parties will
enter into agreements and assignments in the format of those
included in the attached Documents.
Until September 30, 2000, or the exercise of the Option,
whichever occurs first, Delta agrees: 1) that it will pay all
costs associated with or derived from the ownership of the
Properties, including payments to Ogle as provided in the
attached Documents; 2) that it will not otherwise encumber the
Properties or allow the Properties to be encumbered in any
fashion through operation of law or otherwise except as is
already provided in the attached documents in favor of Ogle and
his successors.
In the event of any failure by Delta to pay costs associated
with or derived from the ownership of the Properties or in the
event of the placement of any encumbrance upon the Properties,
Delta will notify Evergreen in writing within three business days
of such event. Upon such notification, Evergreen shall have the
option, but not the obligation, to pay such unpaid cost(s) or to
pay the funds necessary to prevent or remove any such
encumbrance. If Evergreen advances funds to Delta or directly to
others for such purposes, Delta will execute a twelve month
promissory note in an amount equal to the funds advanced with
interest at ten percent (10%) per annum in favor of Evergreen and
the Properties shall secure the repayment thereof under
documentation customary in such transactions.
Dated: December 17, 1999
DELTA PETROLEUM CORPORATION
s/Roger A. Parker
Authorized Officer,
Roger A. Parker, President
EVERGREEN RESOURCES, INC.
s/Mark S. Sexton
Authorized Officer, Mark S. Sexton,
President, CEO
AGGREGATE LIST OF OIL & GAS LEASES
SUBJECT TO RESERVED PRODUCTION PAYMENTS
1. San Miguel Field
OCS-P 0409: Oil and Gas Lease from the United States of America,
as Lessor, to Oxy Petroleum, Inc., et al, as Lessee, effective
July 1, 1981, designated Serial No. OCS-P 0409 and covering all
of Block 22, OCS Official Protraction Diagram NI 10-6, Santa
Maria (Tract 53-182).
Leasehold Interest: 12.67169%
2. Point Sal Unit
OCS-P 0415: Oil and Gas Lease from the United States of America,
as Lessor, to Ogle Petroleum Inc., et al., as Lessee, effective
July 1, 1981 designated Serial No. OCS-P 0415, and covering all
of Block 66, OCS Official Protraction Diagram, NI 10-6, Santa
Maria.
Leasehold Interest: 1.88682%
OCS-P 0416: Oil and Gas Lease from the United States of America,
as Lessor, to Ogle Petroleum Inc., et al., as Lessee, effective
July 1, 1981 designated Serial No. OCS-P 0416, and covering all
of Block 67, OCS Official Protraction Diagram, NI 10-6, Santa
Maria.
Leasehold Interest: 3.03049%
OCS-P 0421: Oil and Gas Lease from the United States of America,
as Lessor, to Ogle Petroleum Inc., et al., as Lessee, effective
July 1, 1981 designated Serial No. OCS-P 0421, and covering all
of Block 110, OCS Official Protraction Diagram, NI 10-6, Santa
Maria.
Leasehold Interest: 1.88682%
OCS-P 0422: Oil and Gas Lease from the United States of America,
as Lessor, to Ogle Petroleum Inc., et al., as Lessee, effective
July 1, 1981 designated Serial No. OCS-P 0422, and covering all
of Block 111, OCS Official Protraction Diagram, NI 10-6, Santa
Maria.
Leasehold Interest: 4.50000%
5. Gato Canyon Unit
OCS-P 0460: Oil and Gas Lease from the United States of America,
as Lessor, to Atlantic Richfield Company, as Lessee, effective
August 1, 1982, designated Serial No. OCS-P 046O, and covering
all of Block 53N 72W, that portion seaward of the Three
Geographical Mile Line, Channel Islands Area, OCS Leasing Map No.
6A.
Leasehold Interest: 1.52930%
OCS-P 0462: Oil and Gas Lease from the United States of America,
as Lessor, to Ogle Petroleum Inc., et al., as Lessee, effective
August 1, 1982, designated Serial No. OCS-P 0462, and covering
all of Block 52N 72W, Channel Islands Area, OCS Leasing Map No.
6A.
Leasehold Interest: 1.52930%
OCS-P 0464: Oil and Gas Lease from the United States of America,
as Lessor, to Atlantic Richfield Company, as Lessee, effective
August 1, 1982, designated Serial No. OCS-P 0464, and covering
all of Block 53N 71W, that portion seaward of the Three
Geographical Mile Line, Channel Islands Area, OCS Leasing Map No.
6B.
Leasehold Interest: 1.52930%
