respectively.
This Agreement has
been duly executed and delivered by Selling Stockholder and is a valid and
binding obligation of Selling Stockholder, enforceable against him in accordance
with its terms, and the Collateral Agreements when executed and delivered by the
Selling Stockholder, HLDM, or Arizona LNG, as applicable, shall be the valid and
binding obligations of such Parties, enforceable against them in accordance with
their terms, except to the extent that such enforceability (i) may be limited by
bankruptcy, insolvency, reorganization, moratorium, or other similar laws
relating to creditors' rights generally, and (ii) is subject to general
principles of equity.
(B)
SUBSIDIARIES.
HLDM'S ONLY SUBSIDIARY IS
ARIZONA LNG AND ARIZONA LNG HAS NO SUBSIDIARIES.
(C)
CAPITALIZATION.
THE AUTHORIZED STOCK OF
HLDM AND THE NUMBER OF SHARES OF CAPITAL STOCK THAT ARE ISSUED AND OUTSTANDING
AND THE MEMBER UNITS OF ARIZONA LNG ARE SET FORTH IN SCHEDULE 6.1(C) HERETO. THE
STOCK AND MEMBER UNITS LISTED ON SCHEDULE 6.1(C) HERETO CONSTITUTE ALL THE
ISSUED AND OUTSTANDING SHARES OF CAPITAL STOCK OF HLDM AND MEMBER UNITS OF
ARIZONA LNG AND HAVE BEEN VALIDLY AUTHORIZED AND ISSUED, ARE FULLY PAID AND
NONASSESSABLE, HAVE NOT BEEN ISSUED IN VIOLATION OF ANY PREEMPTIVE RIGHTS OR OF
ANY FEDERAL OR STATE SECURITIES LAW AND NO PERSONAL LIABILITY IS ATTACHED TO THE
OWNERSHIP THEREOF. THERE IS NO SECURITY, OPTION, WARRANT, RIGHT, CALL,
SUBSCRIPTION, AGREEMENT, COMMITMENT OR UNDERSTANDING OF ANY NATURE WHATSOEVER,
FIXED OR CONTINGENT, THAT DIRECTLY OR INDIRECTLY (I) CALLS FOR THE ISSUANCE,
SALE, PLEDGE OR OTHER DISPOSITION OF ANY SHARES OF CAPITAL STOCK OF HLDM OR
MEMBER UNITS OF ARIZONA LNG, OR ANY SECURITIES CONVERTIBLE INTO, OR OTHER RIGHTS
TO ACQUIRE, ANY SHARES OF CAPITAL STOCK OF HLDM OR MEMBER UNITS OF ARIZONA LNG;
OR (II) OBLIGATES EITHER OF THE COMPANIES TO GRANT, OFFER OR ENTER INTO ANY OF
THE FOREGOING; OR (III) RELATES TO THE VOTING OR CONTROL OF SUCH CAPITAL STOCK
OR MEMBER UNITS, SECURITIES OR RIGHTS, EXCEPT AS PROVIDED IN THIS AGREEMENT, OR
IN THE ARTICLES OF INCORPORATION OR BYLAWS OF HLDM, OR IN THE LIMITED LIABILITY
COMPANY AGREEMENT OF ARIZONA LNG. THE COMPANIES HAVE NOT AGREED TO REGISTER ANY
SECURITIES UNDER THE SECURITIES ACT.
(D)
GOVERNMENTAL APPROVALS.
SCHEDULE 6.1(D) SETS FORTH ALL GOVERNMENTAL APPROVALS HELD BY HLDM AND ARIZONA
LNG.
TO SELLING STOCKHOLDER'S KNOWLEDGE, NO GOVERNMENTAL APPROVALS OTHER THAN
THOSE LISTED ON SCHEDULE 6.1(D) ARE NECESSARY FOR THE TRANSACTION OF HLDM'S OR
ARIZONA LNG'S BUSINESS AS CURRENTLY CONDUCTED.
ALL SUCH GOVERNMENTAL APPROVALS
ARE CURRENTLY IN FORCE.
NO NOTICE OF ANY VIOLATION HAS BEEN RECEIVED IN RESPECT
OF ANY SUCH GOVERNMENTAL APPROVALS AND SELLING STOCKHOLDER HAS NO KNOWLEDGE OF
ANY PROCEEDING WHICH IS PENDING OR THREATENED THAT WOULD SUSPEND OR REVOKE OR
LIMIT ANY SUCH GOVERNMENTAL APPROVALS.
(E)
FINANCIAL REPORTS.
ATTACHED AS
SCHEDULE 6.1(E) ARE TRUE AND COMPLETE COPIES OF (I) A PRELIMINARY OCTOBER 2005
TRIAL BALANCE FOR HLDM DERIVED FROM HLDM'S ACCOUNTING RECORDS (THE "HLDM TRIAL
BALANCE"), AND (II) THE PRELIMINARY UNAUDITED BALANCE SHEET AND RELATED
STATEMENTS OF INCOME AND CASH FLOW OF