Exhibit 10.84


 


STOCK
ACQUISITION AGREEMENT


 


 


This
agreement is made and entered into by and between NewCorp Resources Electric
Cooperative, Inc., (formerly New West Resources, Inc.) sometimes hereinafter
referred to as “Shareholder”, United Fuel and Energy Corporation, hereinafter
sometimes referred to as “United”, and joined by its subsidiaries
Eddins-Walcher Company, hereinafter sometimes referred to as “EWC” and Three D
Oil Co. of Kilgore, Inc., hereinafter sometimes referred to as “Three D” and
Thomas E. Kelly, hereinafter sometimes referred to as “Kelly”.


RECITALS:


WHEREAS, Shareholder presently owns sixteen
percent, being one hundred sixty (160) shares of common stock, of the
outstanding shares of common stock of United Fuel & Energy Corporation, a
Texas corporation; and


WHEREAS,
Shareholder has acquired rights pursuant to a Warrant Agreement between
Shareholder, Kelly, Richard C. Skillern, and United, whereby Shareholder is
entitled to acquire an additional four percent (4%) of the outstanding shares of
Common Stock of United and Kelly, Richard C. Skillern, and United are obligated
to transfer said shares to Shareholder if Shareholder should exercise its
option granted to it under the Warrant Agreement; and


WHEREAS,
United and its subsidiaries, EWC and Three D have completed a refinancing of
their existing debt structure with CIT Business/Group Credit, Inc., Washington
Mutual Bank, FA, and First American Bank, SSB; and


WHEREAS, Kelly desires to acquire all of the
shares of the common stock of the Shareholder in United pursuant to the terms
and conditions herein; and


WHEREAS, the Shareholder desires to sell all
of its shares of common stock in United to Kelly pursuant to the terms and
conditions of this Agreement.


NOW THEREFORE, for and in consideration of
the mutual covenants and conditions hereinafter set forth, the parties hereto
agree as follows:


 


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Stock
Acquisition Agreement by and between NewCorp Resources Electric Cooperative,
Inc., Thomas E. Kelly, United Fuel & Energy Corporation, Eddins-Walcher
Company and Three D Oil Co. of Kilgore, Inc

















 


I.


Shareholder hereby agrees to sell all of its
shares of common stock in United, being one hundred sixty (160) shares of
common stock, to Kelly for and in consideration of one million three hundred
thousand dollars ($1,300,000.00).  Said
$1,300,000.00 shall be paid in the following manner:


On Closing Date (as specified herein), Kelly
will deliver to Shareholder a promissory note in the amount of one million
three hundred thousand dollars ($1,300,000.00) which will bear interest at a
rate of six percent (6%) per annum and will be payable in the following manner:
from Closing Date, interest will be payable quarterly  until Payment Date (as defined below) and on the Payment
Date  Kelly will pay to Shareholder the
sum of five hundred thousand ($500,000.00) plus any accrued unpaid interest and
the remaining principal balance of the promissory note (being eight hundred
thousand dollars ($800,000.00)) will be paid by Kelly to Shareholder in three
annual installments of two hundred sixty-six thousand six hundred sixty-six
dollars and sixty-six cents ($266,666.66) each plus accrued interest with the
first installment being due and payable one (1) year  from the Payment Date; Payment Date is defined as the first to
occur of (i) sixty (60) days after the completion of a reverse merger of United
and its subsidiaries into a publicly held corporation or (ii) twenty-four (24)
months from Closing Date.  The parties
agree that Kelly may prepay the promissory note at any time without penalty.


The parties hereto acknowledge that the one
hundred sixty shares of stock being purchased by Kelly from Shareholder has
been pledged by Shareholder as collateral for the indebtedness of EWC and Three
D to CIT Business/Group Credit, Inc. and Washington Mutual Bank, F.A.  If not a violation of the loan agreements
between United, EWC, and Three D with CIT Business/Group Credit, Inc. and/or
Washington Mutual Bank, F.A., upon the purchase of said shares of stock from
Shareholder, Kelly will pledge said shares to Shareholder as collateral for the
promissory note described hereinabove. 
Any pledge of collateral executed by Kelly to Shareholder shall be
subordinate to the current liens of CIT Business/Group Credit, Inc. and
Washington Mutual Bank, F.A.


 


 


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II.


The parties hereto understand and
acknowledge that Kelly has presently contracted with Richard C. Skillern
(“Skillern”) to purchase all of the shares of stock owned by Skillern in United
and with the execution of this Agreement by Shareholder and United, Kelly will
have a right to acquire all of the issued and outstanding shares of stock of
United not presently owned by Kelly.


Shareholder further acknowledges that United
has entered into negotiations with consultants whereby United may complete a
reverse merger and become a public corporation in the near future.  Shareholder understands that if United is
capable of completing its reverse merger, that its shares of stock presently
owned by Shareholder could possibly be valued well in excess of the one million
three hundred thousand dollars ($1,300,000.00) being paid by Kelly to
Shareholder.


III.


At the closing and as a condition precedent
to the consideration of being paid by United to Shareholder, Shareholder shall
cause stock certificates duly endorsed in blank or accompanying Stock Powers
duly endorsed in blank representing its 160 shares of common stock of United
being sold hereunder to be delivered to Kelly, and will execute a release
terminating all of its rights pursuant to the Warrant Agreement described
herein to acquire additional common stock in United.


IV.


Shareholder further understands and agrees
that as an additional condition precedent to closing, that Shareholder shall
obtain a resignation of David Pruitt as a member of the Board of Directors of
United at the time of closing and submit said resignation to United.


V.


Kelly and United do hereby agree that by the
Payment Date that they will use their best efforts to have Shareholder and its
parent company, Cap Rock Energy Corporation (“Cap Rock”) released from all
liabilities and guaranties issued by either Shareholder and/or Cap Rock to
Washington Mutual Bank, F.A. on the three million and five hundred thousand
dollar ($3,500,000.00) term note executed by EWC and Three D 


 


 


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to Washington
Mutual Bank, F.A. effective as of October 1, 2003, which note is to mature on
September 30, 2004.


VI.


For and in consideration of the monies paid
herein Shareholder does hereby agree at closing to execute a release that fully
releases, remises, quit claims and forever discharges United, Kelly, EWC, Three
D and their agents, employees, officers, directors, legal counsel and all other
persons, firms or corporations in privity with the released parties whatsoever
(the “Released Parties”), of and from all claims, demands or causes of action
in any way related to losses or damages sustained by Shareholder as a result of
the Released Parties actions or omissions to act in relation to their
ownership, directorship, management, or operation of United, EWC, Frank’s
Fuels, Inc. and/or Three D; said causes of action and claims being past and
present, whether known or unknown, which might allegedly be asserted in a law
suit against the Released Parties and/or Shareholder, and shall include any and
all losses sustained or that could be sustained by Shareholder which include
all legal fees and court costs associated with such loss.


Shareholder and United do hereby agree to
execute such release of liability in a form satisfactory to both Shareholder
and United and their legal counsel.


VII.


For and in consideration of the sale of
Shareholder’s ownership interest in United to Kelly, United and its
subsidiaries, EWC and Three D, and Kelly do hereby agree to execute at closing
a release that fully releases, remises, quit claims and forever discharges
Shareholder and its agents, officers, directors, employees, legal counsel and
all other persons, firms, or corporations in privity with the released parties
whatsoever (the “Released Parties”), of and from any and all claims, demands,
and causes of action in any kind and in any way related to losses or damages
sustained by United, Kelly, EWC and Three D, as a result of the Released
Parties acts or omissions to act in its ownership, directorship, management and
operations of United, EWC, Three D and/or Frank’s Fuels, Inc.; said causes of
action and claims being past and present, whether known or unknown, which might
allegedly be asserted against Released Parties and/or United and/or its
subsidiaries and Kelly; said release shall include any and all losses


 


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sustained by
United and/or its subsidiaries and Kelly which includes all legal fees and
court costs associated with such loss.


VIII.


The closing on the sale of stock from
Shareholder to Kelly shall take place on or before March 31, 2004 (“Closing
Date”) at the law offices of RUSH, KELLY, MORGAN, DENNIS, CORZINE & HANSEN,
P.C., 4001 E. 42nd Street, Suite 200, Odessa, Texas 79762 or at such
other time and place as may be mutually agreed upon by the parties hereto.  Kelly hereby agrees to allow Shareholder to
extend closing until April 30, 2004 if Shareholder notifies Kelly in writing of
its desire to extend said closing on or before March 29, 2004.


IX.


This Agreement shall be binding on and inure
to the benefit of the parties hereto and their respective heirs, executors,
administrators, successors and assigns.


X.


This Agreement may be enforced in accordance
with the laws of the State of Texas and venue shall lie in Midland, Midland
County, Texas.


XI.


This Agreement sets forth the entire
Agreement of the parties hereto and it may not be amended or modified without
the express written consent of all parties hereto.


EFFECTIVE AS OF March 18, 2004.


 


SHAREHOLDER:


                                                                                NewCorp
Resources Electric Cooperative, Inc.,


 


 


 


	
   

  	
   

  	
   

  	
  By:

  	
  /s/
  David W. Pruitt

  



 


 


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  UNITED:

  
	
   

  	
   

  	
   

  	
  United
  Fuel & Energy Corporation

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  /s/
  Thomas E. Kelly

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  SUBSIDIARIES:

  
	
   

  	
   

  	
   

  	
  EWC:

  
	
   

  	
   

  	
   

  	
  Eddins-Walcher
  Company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  /s/
  Thomas E. Kelly

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  THREE
  D:

  
	
   

  	
   

  	
   

  	
  Three
  D Oil Co. Of Kilgore, Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  /s/
  Thomas E. Kelly

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  KELLY:

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  /s/
  Thomas E. Kelly

  
	
   

  	
   

  	
   

  	
   

  	
  Thomas
  E. Kelly

  	
   

  



 


 


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