SUBJECT
INTERESTS, OTHER THAN SUCH DATA THAT IS INTERPRETIVE IN NATURE OR WHICH CANNOT
BE TRANSFERRED WITHOUT THE CONSENT OF OR PAYMENT TO ANY THIRD PARTY. FOR
PURPOSES OF THIS AGREEMENT, "THIRD PARTY" MEANS ANY PERSON OR ENTITY,
GOVERNMENTAL OR OTHERWISE, OTHER THAN SELLERS OR BUYER, AND THEIR RESPECTIVE
AFFILIATES; THE TERM INCLUDES, BUT IS NOT LIMITED TO, WORKING INTEREST OWNERS,
ROYALTY OWNERS, LEASE OPERATORS, LANDOWNERS, SERVICE CONTRACTORS AND
GOVERNMENTAL AGENCIES.
SECTION 1.03
EXCLUDED ASSETS. NOTWITHSTANDING THE FOREGOING, THE
ASSETS SHALL NOT INCLUDE, AND THERE IS EXCEPTED, RESERVED AND EXCLUDED FROM THE
SALE CONTEMPLATED HEREBY
2
(COLLECTIVELY, THE "EXCLUDED ASSETS"): (A) ALL CREDITS AND REFUNDS AND ALL
ACCOUNTS, INSTRUMENTS AND GENERAL INTANGIBLES (AS SUCH TERMS ARE DEFINED IN THE
TEXAS UNIFORM COMMERCIAL CODE) ATTRIBUTABLE TO THE ASSETS WITH RESPECT TO ANY
PERIOD OF TIME PRIOR TO THE EFFECTIVE TIME; (B) ALL CLAIMS OF SELLERS FOR
REFUNDS OF OR LOSS CARRY FORWARDS WITH RESPECT TO (I) AD VALOREM, SEVERANCE,
PRODUCTION OR ANY OTHER TAXES ATTRIBUTABLE TO ANY PERIOD PRIOR TO THE EFFECTIVE
TIME, (II) INCOME OR FRANCHISE TAXES, OR (III) ANY TAXES ATTRIBUTABLE TO THE
OTHER EXCLUDED ASSETS, AND SUCH OTHER REFUNDS, AND RIGHTS THERETO, FOR AMOUNTS
PAID IN CONNECTION WITH THE ASSETS AND ATTRIBUTABLE TO THE PERIOD PRIOR TO THE
EFFECTIVE TIME, INCLUDING REFUNDS OF AMOUNTS PAID UNDER ANY GAS GATHERING OR
TRANSPORTATION AGREEMENT; (C) ALL PROCEEDS, INCOME OR REVENUES (AND ANY SECURITY
OR OTHER DEPOSITS MADE) ATTRIBUTABLE TO (I) THE ASSETS FOR ANY PERIOD PRIOR TO
THE EFFECTIVE TIME, OR (II) ANY OTHER EXCLUDED ASSETS; (D) ALL OF SELLERS'
PROPRIETARY COMPUTER SOFTWARE, TECHNOLOGY, PATENTS, TRADE SECRETS, COPYRIGHTS,
NAMES, TRADEMARKS, LOGOS AND OTHER INTELLECTUAL PROPERTY; (E) ALL OF SELLERS'
RIGHTS AND INTERESTS IN GEOLOGICAL AND GEOPHYSICAL DATA THAT IS INTERPRETIVE IN
NATURE OR WHICH CANNOT BE TRANSFERRED WITHOUT THE CONSENT OF OR PAYMENT TO ANY
THIRD PARTY; (F) ALL DOCUMENTS AND INSTRUMENTS OF SELLERS THAT MAY BE PROTECTED
BY AN ATTORNEY-CLIENT PRIVILEGE; (G) DATA AND OTHER INFORMATION THAT CANNOT BE
DISCLOSED OR ASSIGNED TO BUYER AS A RESULT OF CONFIDENTIALITY OR SIMILAR
ARRANGEMENTS UNDER AGREEMENTS WITH PERSONS UNAFFILIATED WITH SELLERS; (H) ALL
AUDIT RIGHTS ARISING UNDER ANY OF THE CONTRACTS OR OTHERWISE WITH RESPECT TO ANY
PERIOD PRIOR TO THE EFFECTIVE TIME OR TO ANY OF THE OTHER EXCLUDED ASSETS;
(I) ALL CORPORATE, PARTNERSHIP, INCOME TAX RECORDS OF SELLERS; (J) THE ORIGINAL
OF ALL RECORDS; AND (I) IN ADDITION TO THE FOREGOING, THOSE ITEMS, SUCH AS
VEHICLES AND CERTAIN EQUIPMENT, SUPPLIES AND OFFICE EQUIPMENT, OR ANY OTHER
ITEMS OR PROPERTY INTERESTS DESCRIBED ON SCHEDULE 1.03.
ARTICLE II
PURCHASE PRICE
SECTION 2.01
PURCHASE PRICE. THE TOTAL CONSIDERATION FOR THE PURCHASE,
SALE AND CONVEYANCE OF THE ASSETS TO BUYER IS BUYER'S PAYMENT TO SELLERS OF THE
SUM OF NINETEEN MILLION NINE HUNDRED THOUSAND DOLLARS ($19,900,000) (THE
"PURCHASE PRICE"), AS ADJUSTED IN ACCORDANCE WITH THE PROVISIONS OF THIS
AGREEMENT. THE PURCHASE PRICE SHALL BE INCREASED BY INTEREST ON THE PURCHASE
PRICE FROM THE DATE OF THIS AGREEMENT UNTIL THE CLOSING DATE (AS