exv10w1






Exhibit 10.1





 

 CONTINGENT PAYMENT RIGHTS REPURCHASE AGREEMENT




by and among




DELTA PETROLEUM CORPORATION




AND




TRACINDA CORPORATION




Dated as of May 15, 2009




 






 









 








CONTINGENT PAYMENT RIGHTS REPURCHASE AGREEMENT




     This CONTINGENT PAYMENT RIGHTS REPURCHASE AGREEMENT, dated as of May 15, 2009 (this
“Agreement”), is entered into by and among Delta Petroleum Corporation, a Delaware
corporation (the “Company”) and Tracinda Corporation, a Nevada corporation
(“Seller”).



RECITALS




     WHEREAS, the Company issued and sold to Seller the CPRs pursuant to the terms and conditions
of the Contingent Payment Rights Purchase Agreement dated as of March 26, 2009 (the “Purchase
Agreement”);



     WHEREAS, by letter dated May 15, 2009, Seller requested the Company repurchase the CPRs
pursuant to Section 5.4 of the Purchase Agreement;



     NOW, THEREFORE, in consideration of the foregoing premises and the consummation of the
transaction referred to above, it is mutually covenanted and agreed as follows:



ARTICLE I

DEFINITIONS




     Section 1.1 Definitions. Capitalized terms used and not otherwise defined herein shall
have the meanings ascribed to them as follows:



     “Board of Directors” means the board of directors of the Company.



     “Closing” means the consummation of the transaction as set forth in Article II.



     “CPR” means a right to receive a payment in cash pursuant to the terms of the Purchase
Agreement.



     “CPR Certificates” means the two certificates evidencing CPRs purchased by Seller
pursuant to the Purchase Agreement: (1) CPR No. 1 certificate for the amount of $14,900,000 dated
March 26, 2009 and (2) CPR No. 2 certificate for the amount of $10,100,000 dated April 1, 2009.



     “CPR Repurchase Price” has the meaning set forth in Section 2.2.



     “Encumbrances” means any and all liens, charges, security interests, financing
statements, encumbrances, options, claims, mortgages, pledges, proxies, voting trusts or
agreements, obligations, understandings or arrangements, defects or imperfections of title or other
restrictions on title or transfer of any nature whatsoever, including any conditional sale or other
title retention agreement.



     “Exchange Act” means the Securities and Exchange Act of 1934, as amended from time to
time, or any successor legislation, and any regulations or rules promulgated thereunder.



     “Governmental Entity” means any domestic or foreign court, arbitral tribunal,
administrative agency or commission or other governmental or other regulatory authority or agency.



     “Parties” means the Company and Seller, and “Party” means either, as applicable.



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     “Person” means any individual, corporation, partnership, joint venture, limited
liability company, business trust, association, joint-stock company, trust, estate, unincorporated
organization or government or any agency or political subdivision thereof.



     “Securities Act” means the Securities Act of 1933, as amended from time to time, or
any successor legislation, and any regulations or rules promulgated thereunder.



ARTICLE II

REPURCHASE OF CONTINGENT PAYMENT RIGHTS




     Section 2.1 Repurchase of CPRs. Subject to the terms and conditions of this
Agreement, at the Closing, the Company shall be obligated to purchase, and Seller shall be
obligated to sell to the Company, the CPRs, as set forth in this Article II, free and clear of all
Encumbrances, except for any restrictions on transfer arising under the Securities Act or any
applicable state securities laws.



     Section 2.2 Purchase Price. The Company agrees to pay, and Seller agrees to accept,
Twenty-Six Million dollars ($26,000,000) at the Closing as the purchase price for the CPRs (the
“CPR Repurchase Price”).



     Section 2.3 Closing; Closing Deliveries.



     (a) Closing. The Closing of the purchase and sale of the CPRs pursuant to this
Agreement shall occur at the offices of Davis Graham & Stubbs LLP located at 1550 Seventeenth
Street, Suite 500, Denver, CO 80202 at 10:00 a.m., Mountain Time, or at such other time or location
as agreed in writing by the Parties. The Closing of the purchase of the CPRs by the Company from
Seller shall occur concurrently with (i) the execution and delivery of this Agreement, and (ii)
termination and cancellation of the CPR Certificates.



     (b) Closing Deliveries by the Company. At the Closing, Seller shall deliver the CPR
Certificates.



     (c) Closing Deliveries by Purchaser. At the Closing, the Company shall deliver the
CPR Repurchase Price by wire transfer of immediately available funds to an account designated by
Seller in writing prior to the Closing.



ARTICLE III

REPRESENTATIONS AND WARRANTIES




     Section 3.1 Company Representations and Warranties. The Company hereby represents and
warrants to Seller as follows:



     (a) Organization. The Company is a corporation, duly organized, validly existing and
in good standing under the laws of the State of Delaware. The Company has the requisite corporate
power and authority to own, lease and operate its assets and properties and to carry on its
business as it is now being conducted. The Company is qualified to transact business and is in good
standing in each jurisdiction in which the properties owned, leased or operated by it or the nature
of the business conducted by it makes such qualification necessary, except where the failure to be
so qualified and in good standing would not reasonably be expected to have a material adverse
effect on the business, assets, liabilities, financial condition or results of operations of the
Company and its subsidiaries taken a whole, or a material adverse effect on the ability of the
Company to perform its obligations under this Agreement.



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     (b) Authorization; Validity of Agreement. The Company has full corporate power and
authority to execute and deliver this Agreement and to consummate the transaction contemplated
hereby. The execution, delivery and performance by the Company of this Agreement and the
consummation of the transaction contemplated hereby have been duly approved and authorized by (i) a
majority of the Board of Directors and (ii) a majority of the members of the Board of Directors
other than Messrs. Parker, Murren and Taylor. No other corporate action, including the vote or
consent of the Company’s stockholders on the part of the Company is necessary to authorize the
execution and delivery by the Company of this Agreement or the consummation of the transaction
contemplated hereby.



     (c) Execution; Validity of Agreement. This Agreement has been duly executed and
delivered by the Company and, assuming due and valid authorization, execution and delivery hereof
by Seller, is a valid and binding obligation of the Company, enforceable against the Company in
accordance with its terms: except as such enforceability may be limited by the effects of
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium, and other laws relating to
or affecting creditors’ rights, and the general principles of equity.



     (d) Consents and Approvals; No Violations. Except for the filings, permits,
authorizations, consents and approvals as may be required under, and other applicable requirements
of, the Securities Act, the Exchange Act, state securities or blue sky laws, none of the execution,
delivery or performance of this Agreement by the Company, the consummation by the Company of the
purchase of the CPRs in accordance herewith or compliance by the Company with any of the provisions
hereof will (1) conflict with or result in any breach of any provision of the certificate of
incorporation or by-laws of the Company, (2) require any filing with, or permit, authorization,
consent or approval of, any Governmental Entity or any other Person, or (3) result in a material
violation or breach of, or constitute (with or without due notice or lapse of time or both) a
default (or give rise to any right of termination, cancellation or acceleration) under, any of the
terms, conditions or provisions of any note, bond, mortgage, indenture, lease, license, contract,
agreement or other instrument or obligation.



     Section 3.2 Seller Representations and Warranties. Seller hereby represents and
warrants to the Company as follows:



     (a) Organization; Authorization; Validity of Agreement. Seller is a corporation duly
organized, validly existing and in good standing under the laws of the State of Nevada and has full
corporate power and authority to execute and deliver this Agreement and to consummate the
transaction contemplated hereby. The execution, delivery and performance by Seller of this
Agreement and the consummation of the transaction contemplated hereby have been duly authorized by
the board of directors of Seller, and no other corporate action, including the vote or consent of
Seller’s shareholder, on the part of Seller is necessary to authorize the execution and delivery by
Seller of this Agreement or the consummation of the transaction contemplated hereby.



     (b) Execution; Validity of Agreement. This Agreement has been duly executed and
delivered by Seller, and assuming due and valid authorization, execution and delivery hereof by the
Company, is a valid and binding obligation of Seller, enforceable against Seller in accordance with
its terms, except as such enforceability may be limited by the effects of bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium, and other laws relating to or affecting creditors’
rights, and the general principles of equity.



     (c) Consents and Approvals; No Violations. Except for the filings, permits,
authorizations, consents and approvals as may be required under, and other applicable requirements
of, the Securities Act, the Exchange Act, state securities or blue sky laws, none of the execution,
delivery or performance of this Agreement by Seller, the consummation by Seller of the sale of the
CPRs in accordance herewith



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or compliance by Seller with any of the provisions hereof will (1) conflict with or result in
any breach of any provision of the articles of incorporation or bylaws of Seller, (2) require any
filing with, or permit, authorization, consent or approval of, any Governmental Entity, (3) result
in a material violation or breach of, or constitute (with or without due notice or lapse of time or
both) a default (or give rise to any right of termination, cancellation or acceleration) under, any
of the terms, conditions or provisions of any note, bond, mortgage, indenture, lease, license,
contract, agreement or other instrument or obligation to which Seller is a party or to which its
assets are subject, or (4) violate any order, writ, injunction, decree, statute, rule or regulation
applicable to Seller.



     (d) Release of Pledge. Seller is the sole holder and has full ownership and control
of the CPRs free and clear of any Encumbrance.



     (e) Title. Upon the Closing, the Company will own and have unencumbered, good title
to the CPRs, free and clear of any Encumbrance.



     (f) Litigation Proceeds. Seller acknowledges that the Company expects to receive
Litigation Proceeds in the amount of approximately $60.0 million within the next 30 days. Seller
has no right or claim to any portion of the $60.0 million or any future Litigation Proceeds that
the Company may receive, including any portion of the $91.4 million judgment entered in the
Company’s favor on February 25, 2009. Seller irrevocably waives any right to assert any claim or
cause of action against the Company in connection with any Litigation Proceeds received by the
Company after the Closing.



ARTICLE IV

CONDITIONS TO CLOSINGS




     Section 4.1 Conditions to Each Party’s Obligation to Close. The respective
obligations of each Party to consummate the transaction contemplated by this Agreement shall be
subject to the satisfaction or waiver, at or prior to the Closing, of each of the following
conditions:



     (a) Statutes; Court Orders. No statute, rule or regulation shall have been enacted or
promulgated by any Governmental Entity which prohibits the consummation of the transaction
contemplated by this Agreement; and there shall be no order or injunction of a court of competent
jurisdiction in effect precluding or prohibiting consummation of the transaction contemplated by
this Agreement



     (b) Government Action. There shall not be threatened or pending any suit, action or
proceeding by any Governmental Entity seeking to restrain or prohibit the consummation of the
transaction contemplated by this Agreement.



     (c) Opinion. In connection with the Closing, the Parties shall have received
an opinion of Houlihan Lokey Howard & Zukin that the transaction contemplated by this Agreement is
not materially less favorable than that which might reasonably have been obtained in a comparable
transaction at such time on an arm’s-length basis from a non-affiliate.



ARTICLE V

MISCELLANEOUS PROVISIONS




     Section 5.1 Notices. Unless otherwise provided herein, any notice, request, waiver,
instruction, consent or document or other communication required or permitted to be given by this
Agreement shall be effective only if it is in writing and (i) delivered by hand or sent by
certified mail,



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return receipt requested, (ii) if sent by a nationally-recognized overnight delivery service
with delivery confirmed, or (iii) if faxed (or other similar electronic means), with receipt
confirmed as follows:



	 	 	 
	If to the Company:

	 	Delta Petroleum Corporation

370 17th Street, Suite 4300

Denver, Colorado 80202

Attn: Roger A. Parker

Fax: (303) 293-0066
	 
	 	 
	with a copy to:

	 	Davis Graham & Stubbs LLP

1550 17th Street, Suite 500

Denver, Colorado 80202

Attn: Ronald R. Levine, II

Fax: (303) 893-1379
	 
	 	 
	If to Seller:

	 	Tracinda Corporation

150 South Rodeo Drive

Suite 250

Beverly Hills, California 90212

Attn: Richard E. Sobelle

Fax: (310) 271-3416
	 
	 	 
	with a copy to:




	 	Glaser, Weil, Fink, Jacobs & Shapiro LLP

10250 Constellation Boulevard

19th Floor

Los Angeles, California 90067

Attn: Janet S. McCloud 

Fax: (310) 556-2920






     The parties shall promptly notify each other of any change in their respective addresses or
facsimile numbers or of the individual or entity or office to receive notices, requests or other
communications under this Section 5.1. Notice shall be deemed to have been given as of the date
when so personally delivered, when physically delivered by the U.S. Postal Service at the proper
address, the next day when delivered during business hours to an overnight delivery service
properly addressed or when receipt of a facsimile is confirmed, as the case may be, unless the
sending party has actual knowledge that such notice was not received by the intended recipient



     Section 5.2 Effect of Headings. The Article and Section headings herein are for
convenience only and shall not affect the construction hereof.



     Section 5.3 Successors and Assigns. All covenants and agreements in this Agreement by
the Company shall bind its successors and assigns, whether so expressed or not.



     Section 5.4 Benefits of Agreement. Nothing in this Agreement, express or implied,
shall give to any Person (other than the Parties hereto and their permitted successors and assigns
hereunder) any benefit or any legal or equitable right, remedy or claim under this Agreement or
under any covenant or provision herein contained, all such covenants and provisions being for the
sole benefit of the Parties hereto and their permitted successors and assigns hereunder.



     Section 5.5 Governing Law. This Agreement shall be governed by the laws of the State
of Delaware, without regard to conflict of laws principles.



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     Section 5.6 Choice of Venue. The parties agree that any actions or other proceedings
arising out of or relating to this Agreement shall be brought by the parties and held and
determined only in a Delaware state court or a federal court sitting in that state which shall be
the exclusive venue of any such action or proceeding. Each party waives any objection which such
party may now or hereafter have to the laying of venue of any such action or proceeding, and
irrevocably consents and submits to the jurisdiction of such court (and the appropriate appellate
courts) in any such action or proceeding. Any and all service of process and any other notice in
any such action or proceeding shall be effective against such party when transmitted in accordance
with Section 5.1. Nothing contained herein shall be deemed to affect the right of any Party to
serve process in any manner permitted by applicable laws.



     Section 5.7 Acknowledgment of Non-Party Status. The parties hereto acknowledge that
Kirk Kerkorian is not a party to this Agreement or any of the other documents delivered at the
Closing. Accordingly, the parties hereto hereby agree that in the event (i) there is any alleged
breach or default by any party under this Agreement, or (ii) any party hereto has any claim arising
from or relating to the transaction contemplated by this Agreement, no party hereto, nor any party
claiming through it (to the extent permitted by applicable law) shall commence any proceedings or
otherwise seek to impose any liability whatsoever against Mr. Kerkorian by reason of such alleged
breach, default or claim.



     Section 5.8 Severability Clause. In case any one or more of the provisions contained
in this Agreement shall for any reason be held to be invalid, illegal or unenforceable in any
respect, such invalidity, illegality or unenforceability shall not affect any other provisions of
this Agreement, but this Agreement shall be construed as if such invalid or illegal or
unenforceable provision had never been contained herein. Upon such determination that any term or
other provision is invalid, illegal or unenforceable, the court or other tribunal making such
determination is authorized and instructed to modify this Agreement so as to effect the original
intent of the parties as closely as possible so that the transaction and agreements contemplated
herein are consummated as originally contemplated to the fullest extent possible.



     Section 5.9 Counterparts. This Agreement may be signed in counterparts, each of which
shall be deemed to constitute but one and the same instrument.



     Section 5.10 Entire Agreement. This Agreement represents the entire understanding of
the parties hereto with reference to the transaction and matters contemplated hereby and thereby
and this Agreement supersedes any and all prior oral or written agreements regarding the
transaction and matters contemplated hereby and thereby.



     Section 5.11 Specific Performance. Seller and the Company each agree that irreparable
damage would occur in the event that any of the provisions of this Agreement were not performed by
them in accordance with the terms hereof and that each party shall be entitled to specific
performance of the terms hereof, in addition to any other remedy at law or equity. Each party
hereto expressly waives any requirement that any other party hereto obtain any bond or provide any
indemnity in connection with any action seeking injunctive relief or specific enforcement of the
provisions of the Agreement.



     Section 5.12 Time of the Essence. Time is of the essence in the performance of this
Agreement.



     Section 5.13 Amendments. This Agreement may not be amended, modified or changed; nor
shall any waiver of any provision hereof be effective, except by means of a written instrument that
has been executed by the Parties to be bound.



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[Signature page follows]




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     IN WITNESS WHEREOF, the parties have executed this Contingent Payment Rights Repurchase
Agreement of the date first written above.



	 	 	 	 	 
	 	DELTA PETROLEUM CORPORATION

 	 
	 	By:  	/s/ Kevin Nanke
 	 
	 	 	Name:  	Kevin Nanke 	 
	 	 	Title:  	CFO 	 
	 
	 	TRACINDA CORPORATION

 	 
	 	By:  	/s/ Anthony Mandekic
 	 
	 	 	Name:  	Anthony Mandekic 	 
	 	 	Title:  	Secretary/Treasurer