TERMS,
EXCEPT AS SUCH ENFORCEABILITY MAY BE LIMITED BY BANKRUPTCY, INSOLVENCY,
REORGANIZATION, MORATORIUM AND SIMILAR LAWS OF GENERAL APPLICABILITY AND BY
GENERAL PRINCIPLES OF EQUITY.
4.3
CAPITALIZATION.
(A)
THE AUTHORIZED EQUITY OWNERSHIP OF THE COMPANY CONSISTS SOLELY OF
THE MEMBERSHIP INTERESTS, WHICH ARE OWNED 100% OF RECORD AND BENEFICIALLY, FREE
AND CLEAR OF ANY LIENS (OTHER THAN LIENS THAT SHALL BE RELEASED AT OR PRIOR TO
CLOSING) BY SELLER, AND HAVE BEEN DULY AUTHORIZED AND VALIDLY ISSUED, AND ARE
FULLY PAID AND NON-ASSESSABLE.
THERE ARE NO OUTSTANDING OPTIONS, SUBSCRIPTIONS,
WARRANTS, CALLS, COMMITMENTS, PRE-EMPTIVE RIGHTS OR OTHER RIGHTS OBLIGATING THE
COMPANY TO ISSUE OR SELL ANY MEMBERSHIP INTERESTS OR ANY SECURITIES CONVERTIBLE
INTO OR EXERCISABLE FOR ANY MEMBERSHIP INTERESTS, OR OTHERWISE REQUIRING SELLER
OR THE COMPANY TO GIVE ANY PERSON THE RIGHT TO RECEIVE ANY BENEFITS OR RIGHTS
SIMILAR TO ANY RIGHTS ENJOYED BY OR ACCRUING TO THE HOLDERS OF MEMBERSHIP
INTERESTS OR ANY RIGHTS TO PARTICIPATE IN THE EQUITY OR NET INCOME OF THE
COMPANY.
ALL OF THE ISSUED MEMBERSHIP INTERESTS OF THE COMPANY WERE ISSUED, AND
TO THE EXTENT PURCHASED OR TRANSFERRED, HAVE BEEN SO PURCHASED OR TRANSFERRED,
IN COMPLIANCE WITH ALL APPLICABLE LAWS, INCLUDING FEDERAL AND STATE SECURITIES
LAWS, AND ANY PREEMPTIVE RIGHTS AND ANY OTHER STATUTORY OR CONTRACTUAL RIGHTS OF
ANY SELLER.
(B)
THE COMPANY HAS NO SUBSIDIARIES.
THE COMPANY DOES NOT OWN,
DIRECTLY OR INDIRECTLY, ANY CAPITAL OF OR OTHER EQUITY INTEREST IN OR HAS ANY
OTHER INVESTMENT IN OR OUTSTANDING LOANS TO ANY CORPORATION, PARTNERSHIP OR
OTHER ENTITY OR ORGANIZATION.
THERE ARE NO STOCKHOLDERS' AGREEMENTS, VOTING
TRUSTS OR OTHER AGREEMENTS OR UNDERSTANDINGS TO WHICH SELLER OR THE COMPANY IS A
PARTY OR BY WHICH EITHER IS BOUND WITH RESPECT TO THE TRANSFER OR VOTING OF ANY
MEMBERSHIP INTERESTS.
4.4
FINANCIAL STATEMENTS; OTHER FINANCIAL DATA.
ATTACHED HERETO ON
SCHEDULE 4.4 ARE CORRECT AND COMPLETE COPIES OF (I) THE AUDITED BALANCE SHEET OF
THE COMPANY AS OF DECEMBER 31, 2006, TOGETHER WITH THE RELATED AUDITED
STATEMENTS OF INCOME AND RETAINED EARNINGS AND OF CASH FLOWS FOR THE PERIOD
ENDED DECEMBER 31, 2006 AND (II) THE UNAUDITED BALANCE SHEET OF THE COMPANY AS
OF MARCH 31, 2007, TOGETHER WITH THE RELATED UNAUDITED STATEMENTS OF INCOME AND
10
RETAINED EARNINGS AND OF CASH FLOWS FOR THE QUARTER ENDED MARCH 31, 2007 (THE
"FINANCIAL STATEMENTS").
THE FINANCIAL STATEMENTS PRESENT FAIRLY IN ALL
MATERIAL RESPECTS THE FINANCIAL POSITION OF THE COMPANY AS OF THE DATES
INDICATED, AND THE RESULTS OF ITS OPERATIONS FOR THE RESPECTIVE PERIODS
INDICATED. THE FINANCIAL STATEMENTS HAVE BEEN PREPARED IN CONFORMITY WITH GAAP.
4.5
CONSENTS.
SCHEDULE 4.5 SETS FORTH THE CONSENTS, AUTHORIZATIONS
AND APPROVALS THAT MUST BE OBTAINED OR WAIVED PRIOR TO THE CONSUMMATION OR
PERFORMANCE BY THE COMPANY AND SELLER OF THE TRANSACTIONS CONTEMPLATED BY THIS
AGREEMENT; EXCLUDING, THEREFROM ANY CONSENTS, AUTHORIZATIONS AND APPROVALS THAT
THE BUYER MAY BE REQUIRED TO OBTAIN IN ORDER TO LAWFULLY CONDUCT BUSINESS IN
ALASKA GENERALLY AND TO OPERATE THE OIL AND GAS PROPERTIES, SPECIFICALLY.
4.6
NO DEFAULTS OR CONFLICTS.