Document:

Exhibit 10(ii)

Exhibit 10(ii)

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLORADO

Judge Christine M. Arguello

Civil Action No. 10-cv-01808-CMA-MEH

(Consolidated with 10-cv-01833-PAB-MEH, 10-cv-01846-MSK-KMT, and

10-cv-01852-MSK-MJW)

MORTON FINKEL,

JEFFREY P. FEINMAN, and

JEFFREY VEIGEL, Individually

and on Behalf of All Others Similarly Situated,

Plaintiffs,

v.

AMERICAN OIL & GAS, INC., a Nevada Corporation,

PATRICK D. O’BRIEN,

ANDREW P. CALERICH,

JON R. WHITNEY,

NICK DEMARE,

C. SCOTT HOBBS,

HESS CORPORATION, a Delaware Corporation, and

HESS INVESTMENT CORP., a Nevada Corporation,

Defendants.

STIPULATION AND AGREEMENT OF SETTLEMENT AND RELEASE

This Stipulation and Agreement of Settlement and Release dated as of November 12, 2010 (the
“Settlement Agreement”), is made and entered into in the above-captioned consolidated
action (the “Action”) by Plaintiffs (defined below), by and through their undersigned
counsel, and Defendants (defined below), by and through their undersigned counsel (Plaintiffs and
Defendants, collectively, the “Parties”), and is made pursuant to Rule 23 of the Federal
Rules of Civil Procedure and subject to the
approval of this Court (defined below). This Settlement Agreement is intended to fully, finally
and forever resolve, discharge, release and settle the Action, and the Settled and Released Claims
(defined below), upon and subject to the terms and conditions hereof.

 

 

 

WHEREAS, the Parties state the following:

I. BACKGROUND

A. The Merger Agreement

1. On or about July 27, 2010, Defendant American Oil & Gas, Inc. (“American”) publicly
announced that it had entered into a definitive merger agreement (the “Merger Agreement”)
for Defendant Hess Corporation (“Hess”) to acquire all of the outstanding shares of
American common stock in a stock-for-stock transaction in which each share of American common stock
will receive 0.1373 shares of Hess common stock (the “Proposed Merger”).

B. The Consolidated Colorado Federal Action

2. On or about July 30, 2010, Plaintiff Morton Finkel commenced a putative class action in
this Court challenging the Proposed Merger and alleging claims of (i) breaches of fiduciary duties
against Andrew Calerich, Patrick O’Brien, Jon Whitney, Nick DeMare, and C. Scott Hobbs (the
“Individual Defendants”), and (ii) aiding and abetting such breaches of fiduciary duty
against American, Hess, and Hess Investment Corp. (the “Finkel Action”).

3. On or about August 2, 2010, Plaintiff Edgar Cobb filed a complaint in this Court captioned
Cobb v. American Oil & Gas, Inc., et al., a putative stockholder class
action alleging the same claims of breach of fiduciary duties and aiding and abetting arising
out of the Proposed Merger (the “Cobb Action”).

 

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4. On or about August 3, 2010, Plaintiff Jeffrey P. Feinman filed a complaint in this Court
captioned Feinman v. American Oil & Gas, Inc., et al., a putative stockholder class action alleging
the same claims of breach of fiduciary duties and aiding and abetting arising out of the Proposed
Merger (the “Feinman Action”).

5. On or about August 3, 2010, Plaintiff Jeffrey Veigel filed a complaint in this Court
captioned Veigel v. American Oil & Gas, Inc., et al., a putative stockholder class action alleging
the same claims of breach of fiduciary duties and aiding and abetting arising out of the Proposed
Merger (the “Veigel Action”).

6. On or about August 20, 2010, Plaintiffs Morton Finkel, Jeffrey P. Feinman, and Jeffrey
Veigel filed a Motion for Consolidation of Related Actions and Appointment of Plaintiffs’ Lead &
Liaison Counsel to consolidate the Finkel, Veigel, Feinman, and Cobb Actions (the “Motion to
Consolidate”).

7. On or about September 10, 2010, Plaintiff Finkel moved this Court to enter an order
pursuant to Fed. R. Civ. P. 26(d) for expedited discovery and the issues presented in the motion
were resolved by the discovery stipulation (the “Expedited Discovery Stipulation”), filed
on or about September 15, 2010 and entered as an Order by this Court on or about September 20,
2010. Identical motions to expedite were filed in the Veigel and Feinman Actions, and those
motions were also resolved by the entry of an Expedited Discovery Stipulation.

 

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8. On or about October 5, 2010, the Court granted the Motion to Consolidate the Finkel, Cobb,
Feinman, and Veigel Actions under Finkel v. American Oil & Gas, Inc. (the “Consolidated
Colorado Federal Action”).

9. On or about October 15, 2010, Plaintiffs Morton Finkel, Edgar Cobb, Jeffrey P. Feinman, and
Jeffrey Veigel filed a Motion for a Preliminary Injunction seeking to enjoin the Proposed Merger
(the “Preliminary Injunction Motion”).

10. On or about October 29, 2010, Plaintiffs Morton Finkel, Jeffrey P. Feinman, and Jeffrey
Veigel filed Plaintiffs’ Consolidated Complaint in the Action (the “Consolidated
Complaint”). The Cobb Action was dismissed without prejudice.

11. In the Consolidated Complaint, Plaintiffs allege, inter alia, that the Individual
Defendants breached their fiduciary duties in connection with the Proposed Merger by purportedly
failing (i) to disclose material information in connection with the Proposed Merger and (ii) to
obtain adequate consideration for American’s shareholders, and that American, Hess, and Hess
Investment Corp. aided and abetted such breaches of fiduciary duties.

C. The Related Actions

12. In July and August 2010, certain putative class actions identified below were filed in
Colorado state court and Nevada state court challenging the Proposed Merger and alleging the same
claims of breach of fiduciary duties and aiding and abetting against the same Defendants based on
essentially the same facts and seeking essentially the same relief (collectively, the “Related
Actions”):

	 	(i)	 	Richard Buckman, Individually and on Behalf of All Others Similarly Situated
v. American Oil & Gas, et al., Case No. 10 DC 00322, filed in the
First Judicial District Court of the State of Nevada in and for Carson City (the
“Buckman Action”);

 

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	 	(ii)	 	Joseph Luvara, Individually and on Behalf of All Others Similarly Situated v.
American Oil & Gas, et al., Case No. 10-DC-0032-1B, filed in the First Judicial
District Court of the State of Nevada in and for Carson City (the Luvara
Action”);

	 	(iii)	 	Michael Kunaman, Individually and on Behalf of All Others Similarly Situated
v. American Oil & Gas, et al., Case No. 10 CV 002484, filed in the Second Judicial
District Court of the State of Nevada in and for the county of Washoe (the “Kunaman
Action”), and

	 	(iv)	 	Jeffrey Veigel, Individually and on Behalf of All Others Similarly Situated v.
American Oil & Gas, et al., 1:10-CV-01852-MSK, filed in the District Court of the State
of Colorado For the City and County of Denver (the “Veigel State
Action”).

13. The plaintiffs in the Related Actions (the “Related Plaintiffs”) are also
represented by the undersigned Plaintiffs’ Counsel, and such Related Plaintiffs join in this
Settlement by and through their undersigned counsel.

14. Following removal of the Buckman and Luvara Actions to Nevada federal court, on or about
August 26, 2010, Defendants moved pursuant to Federal Rule of Civil Procedure 42 and 28 U.S.C. §
1414(a) to consolidate and transfer the Buckman, and Luvara to this Court (the “Transfer
Motion”). The plaintiffs in such actions have contested removal and transfer, and the Transfer
Motion is pending.

D. Expedited Discovery Proceedings

15. Defendants offered to provide the document and deposition discovery provided under the
Expedited Discovery Stipulation to counsel for all parties in pending litigations challenging the
Proposed Merger.

 

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16. Plaintiffs have participated in the expedited discovery, which included the production by
Defendants of over 30,000 pages of documents and eight (8) depositions, including the depositions
of certain of the Individual Defendants, a Hess representative, and a representative from Tudor,
Pickering, & Holt Co. Securities, Inc., which rendered a fairness opinion to American in connection
with the Proposed Merger.

E. The Proxy Statement

17. On or about August 23, 2010, Hess filed a preliminary proxy statement (the
“Preliminary Proxy Statement”) with the Securities and Exchange Commission (the
“SEC”) setting forth information about the Proposed Merger.

18. On or about October 1, 2010, Hess filed an amended preliminary proxy statement (the
“Amended Preliminary Proxy Statement”).

F. Settlement Discussions

19. Following the investigation and review of the Preliminary Proxy Statement and the Amended
Preliminary Proxy Statement, public filings by Hess and American, analyst and media reports, and
the document and deposition discovery conducted under the Expedited Discovery Stipulation,
Plaintiffs, Defendants, and their respective counsel participated in arm’s length settlement
negotiations and have reached an agreement in principle providing for the settlement of the Action,
subject to Court approval.

20. Defendants deny all of Plaintiffs’ substantive allegations, including that they committed
or attempted to commit any violation of law or breach of duty, including
breach of any fiduciary duty owed to American’s shareholders, aided and abetted any breach of
fiduciary duty, or otherwise have acted in any improper manner.

 

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21. Defendants also maintain substantive defenses to the claims in the Action, including but
not limited to the following: (i) Plaintiffs fail to state a claim upon which relief can be
granted; (ii) the conduct challenged by Plaintiffs’ allegations is subject to the procedural and
substantive protections of the business judgment rule; (ii) the Individual Defendants are shielded
from liability for breaches of the duty of care by Nevada Revised Statute § 78.7502, which provides
that directors and officers of Nevada corporations shall be indemnified if they “[a]cted in good
faith and in a manner which he reasonably believed to be in or not opposed to the best interests of
the corporation;” (iii) Plaintiffs have not suffered any loss, damage, or injury as a result of any
purported act or omission by any of the Defendants; (iv) Plaintiffs’ claims are barred by waiver,
acquiescence, and/or estoppel; (v) Plaintiffs’ claims are barred, in whole or in part, by the
doctrine of laches; and (vi) under Nevada law a corporation itself owes no fiduciary duties to the
Plaintiffs.

22. All Parties recognize and acknowledge the very substantial time and expense that would be
incurred by further litigation in this Action and the uncertainties inherent in any such
litigation.

 

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23. After weighing the costs, risks, and delay associated with continuing litigation against
the benefits of the Settlement as reflected in the Settlement Agreement, Plaintiffs’ Counsel
believes that the Settlement at this time, and as provided in this Settlement Agreement is fair,
reasonable, and adequate resolution of the Action
and in the best interests of Plaintiffs and the Settlement Class Members (defined below).
Defendants’ Counsel believes that the Settlement is in the best interests of Defendants because the
Settlement would (i) eliminate the burden and expense of further litigation, (ii) put the Settled
and Released Claims (as defined below) to rest, finally and forever, without in any way
acknowledging wrongdoing, fault, liability, or damage to the Plaintiffs or the Settlement Class (as
defined below), and (iii) permit the Proposed Merger to close without risk of injunctive or other
relief.

NOW, THEREFORE, THE PARTIES AGREE TO SETTLE THIS ACTION AND THE SETTLED AND RELEASED CLAIMS
(SUBJECT TO APPROVAL OF THE COURT) ON THE FOLLOWING TERMS:

II. DEFINITIONS

24. The following terms, as used in this Settlement Agreement, shall have the following
meanings:

a. “Attorneys’ Fees and Expenses Award” means the amount of attorneys’ fees and
expenses awarded, if any, not to exceed $850,000, by the Court to Plaintiffs’ Counsel and/or to any
counsel for a Settlement Class Member (defined below) pursuant to Section VII of this Settlement
Agreement.

b. “Consolidated Complaint” means the Consolidated Complaint filed by Plaintiffs
Morton Finkel, Jeffrey P. Feinman, and Jeffrey Veigel on or about October 29, 2010.

c. “Court” means this United States District Court for the District of Colorado.

 

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d. “Defendants” means, individually and collectively, American, Hess, Hess Investment
Corp., Andrew Calerich, Patrick O’Brien, Jon Whitney, Nick DeMare, C. Scott Hobbs, and Joseph B.
Feiten.

e. “Defendants’ Counsel” means the law firms of White & Case LLP and Patton Boggs LLP.

f. “Effective Date” means the date upon which all of the conditions set forth in
paragraph 63 below shall have been satisfied.

g. “Final Court Approval” means entry by the Court of the Final Judgment and Order
(defined below), and the expiration of the time to appeal or seek reargument, certification,
certiorari or other review with respect to such Final Judgment and Order, or, if any appeal,
reargument, writ of certiorari or other review is filed and not dismissed, after such Final
Judgment and Order is upheld in all material respects and is no longer subject to appeal,
reargument, certiorari or other review, or, in the event the Court enters an order and final
judgment in a form other than provided above (the “Alternative Judgment”) and none of the
Parties hereto elects to terminate this Settlement, the date such Alternative Judgment becomes
final and no longer subject to appeal, reargument, certification, certiorari or other review.

h. “Final Judgment and Order” means the proposed Final Judgment and Order Approving
Class Action Settlement in the form of Exhibit D or materially in the form of Exhibit D attached
hereto or as modified pursuant to agreement of the Parties.

 

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i. “Individual Defendants” means Andrew Calerich, Patrick O’Brien, Jon Whitney, Nick
DeMare, C. Scott Hobbs, and Joseph B. Feiten.

j. “Interest Rate” means interest calculated on a simple interest basis based upon the
90-day Treasury bill rate on the first (1st) day of each month.

k. “Notice” means the Notice of Pendency and Proposed Settlement of Class Action that
is to be sent to Settlement Class Members substantially in the form of Exhibit C (attached hereto)
or as modified pursuant to agreement of the Parties or order of the Court.

l. “Parties” means Plaintiffs and the Defendants, and, where applicable, their
respective counsel.

m. “Person” means any individual, corporation, partnership, limited liability company,
association, affiliate, joint stock company, estate, trust, unincorporated association,
governmental entity and any political subdivision thereof, or any type of business, personal,
political or legal entity.

n. “Plaintiffs” means Morton Finkel, Jeffrey P. Feinman, and Jeffrey Veigel.

o. “Plaintiffs’ Counsel” means the law firms of Bragar Wexler Eagel & Squire, PC,
Harwood Feffer LLP, Pomerantz Haudek Grossman & Gross LLP, Robbins Gellar Rudman & Dowd, LLP, and
Dyer & Berens LLP.

p. “Preliminary Approval Order” means the order preliminarily approving the class
action settlement, directing notice thereof, and setting a date for the
Settlement Hearing substantially in the form of Exhibit B (attached hereto) or as modified
pursuant to agreement of the Parties or order of the Court.

 

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q. “Related Plaintiffs” means the named plaintiffs in the Related Actions, Richard
Buckman, Joseph V. Luvara, and Michael Kunaman.

r. “Release” means the release set forth in Section III of this Settlement Agreement.

s. “Releasees” means each Defendant named in the Action and the Related Actions, and
each of their past, present or future families, parents, affiliates, subsidiaries, officers,
directors, shareholders, members, trustees, partners, principals, employees, control persons,
predecessors, successors, and agents, including, without limitation, any of their investment
bankers, lenders, accountants, financial advisors, consultants, advisors, insurers, reinsurers, and
attorneys.

t. “Releasors” means Plaintiffs, the Related Plaintiffs, and the Settlement Class on
behalf of themselves, their heirs, executors, administrators, successors, and assigns, and any
person they represent.

 

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u. “Settled and Released Claims” means any and all actions, causes of action, suits,
debts, dues, sums of money, accounts, reckonings, bonds, bills, covenants, controversies, damages,
judgments, extents, executions, liabilities, attorneys’ fees and expenses (excluding the Attorneys’
Fees and Expenses Award defined herein), claims and demands whatsoever, in law, admiralty or
equity, whether known claims or Unknown Claims (as defined herein), whether based on acts or
omissions, whether arising under federal, state, local, statutory and/or common law
and/or any other law, rule or regulation (including, without limitation, the federal
securities laws), that have been or could have been asserted, either directly, derivatively or
otherwise, in any forum by the Releasors, and/or any of them, against any of the Releasees, that
arise out of, are based upon, are in connection with and/or are related in any way, directly or
indirectly, to the allegations, transactions, acts, omissions, occurrences, representations,
misrepresentations, and/or any other matter, thing or cause whatsoever, or any series thereof,
involved, set forth, and/or related to the Complaints and/or the Consolidated Complaint in the
Action or the Related Actions, including without limitation the Merger Agreement, the Proposed
Merger, the merger consideration, and any and all disclosures, disclosure materials (including
supplements) and proxy solicitation materials related thereto, provided however
that the Settled and Released Claims shall not include the right of any of the Releasors or any of
the Releasees to enforce the terms of the Settlement. For purposes of clarification, and without
limiting the definition of Settled and Released Claims above, the Parties agree that the Settled
and Released Claims shall not include claims under the federal securities laws against Hess that do
not relate in any way, directly or indirectly, to the allegations, transactions, acts, omissions,
occurrences, representations, misrepresentations, and/or any other matter, thing or cause
whatsoever, or any series thereof, involved, set forth and/or related to the Complaints and/or the
Consolidated Complaint in the Action or the Related Actions, including without limitation the
Merger Agreement, the Proposed Merger, the merger consideration, and any and all
disclosures, disclosure materials (including supplements) and proxy solicitation materials
related thereto.

 

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v. “Settlement” means the settlement contemplated by this Settlement Agreement.

w. “Settlement Agreement” means this Stipulation and Agreement of Settlement and
Release and the annexed Exhibits hereto, including any subsequent amendments thereto.

x. “Settlement Class” and “Settlement Class Member” means a mandatory, non
opt-out class, and a member of such class, that has been certified by the Court, to the fullest
extent permitted by federal law and Rule 23 of the Federal Rules of Civil Procedure, for settlement
purposes only, consisting of record holders or beneficial owners of American common stock from July
27, 2010 through and including the earlier of the date of the consummation of the Proposed Merger
or the date of the termination of the Merger Agreement, including the legal representatives,
trustees, heirs, predecessors and successors in interest, transferees and/or assigns of all such
foregoing record holders and/or beneficial owners, immediate and remote, but excluding Defendants
and any Person, firm, trust, corporation, or other entity affiliated with any Defendant.

y. “Settlement Hearing” means the hearing at or after which the Court will make a
final decision whether to approve this Settlement Agreement as fair, reasonable, and adequate, and
in the best interest of the Settlement Class.

 

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z. “Unknown Claims” includes any and all claims that Plaintiffs, the Related
Plaintiffs, and any or all members of the Settlement Class, and any and all other persons and
entities whose claims are being released, do not know or suspect to exist at the time of the
Release, which, if known by him, her or it, might affect his, her or its agreement to release the
Settled and Released Claims, or might affect his, her or its decision to object or not to object to
the Settlement. In addition, Releasors shall also be deemed to knowingly and voluntarily waive and
relinquish any and all provisions, rights and benefits conferred by any law of the United States or
any state or territory of the United States, or principle of common law, which governs or limits a
person’s release of unknown claims, comparable or equivalent to California Civil Code § 1542, which
provides:

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF
KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE
DEBTOR.

Plaintiffs, as Settlement Class representatives, have acknowledged that members of the Settlement
Class may discover facts in addition to or different from those that they now know or believe to be
true with respect to the subject matter of the Release herein, but that it is their intention, on
behalf of the Settlement Class, to fully, finally and forever settle and release any and all claims
released hereby, known or unknown, suspected or unsuspected, which now exist, or heretofore
existed, or may hereafter exist, and without regard to the subsequent discovery or existence of
such additional or different facts.

 

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25. Capitalized terms used in this Settlement Agreement, but not defined above, shall have the
meanings ascribed to them elsewhere in this Settlement Agreement.

III. TERMS OF THE SETTLEMENT

A. Supplemental Disclosures

26. Plaintiffs have alleged the omission from the Preliminary Proxy Statement and Amended
Preliminary Proxy Statement of certain purported material information related to the Proposed
Merger. The Defendants have agreed to supplement the disclosures contained in the Preliminary
Proxy Statement and Amended Preliminary Proxy Statement by filing with the SEC a Second Amended
Preliminary Proxy Statement containing certain additional disclosures recommended by the Plaintiffs
(“Plaintiffs’ Supplemental Disclosures”). A copy of Plaintiffs’ Supplemental Disclosures
is attached hereto as Exhibit A. Defendants agree to file the Second Amended Preliminary Proxy
Statement containing Plaintiffs’ Supplemental Disclosures with the SEC for review and inclusion in
the final Proxy Statement. The Parties understand and agree that no additional supplemental
disclosures are required as a condition of this Settlement. The Parties also understand and agree
that any comments, disclosures, and/or changes to the Second Amended Preliminary Proxy Statement
based on the review by the SEC shall not terminate, or affect the terms of, the Settlement
Agreement.

 

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27. Plaintiffs, advised by Plaintiffs’ Counsel, agree that the terms and conditions of the
Settlement Agreement and Plaintiffs’ Supplemental Disclosures are a fair, reasonable and adequate
settlement for Plaintiffs and the Settlement Class.
Defendants do not dispute that Plaintiffs’ Supplemental Disclosures, in the aggregate,
benefited the Settlement Class. Defendants expressly reserve, and do not waive, their rights to
challenge the materiality of Plaintiffs’ Supplemental Disclosures on an individual basis. In
addition, the Parties acknowledge that Plaintiffs contend that the First Amended Proxy Statement
was filed, in part, as a result of information adduced during the discovery in this Action and
Defendants dispute Plaintiffs’ contention.

B. Release, Waiver, And Order of Dismissal

28. Upon the Effective Date of this Settlement, the Releasors hereby release, compromise,
settle, discharge and dismiss with prejudice, pursuant to the terms and conditions set forth
herein, each and every Settled and Released Claim against each of the Releasees, and shall be
forever enjoined from prosecuting each and every Settled and Released Claim against each of the
Releasees.

29. Upon the Effective Date of this Settlement, Defendants and the Releasees release
Plaintiffs and Plaintiffs’ counsel, from all claims arising out of the instituting, prosecution,
settlement or resolution of the Action, provided however, that the Defendants and Releasees shall
retain the right to enforce the terms of the Settlement.

30. Pending consummation of this Settlement and until the Effective Date, Plaintiffs and the
Related Plaintiffs shall not seek relief in any forum, or take any action in the Action or the
Related Actions, including, without limitation, seeking a preliminary injunction, and all
proceedings in the Action, the Related Actions, or otherwise shall be stayed and suspended, except
that the Parties shall take all such action and file all such papers as are necessary or
appropriate to effect the consummation and approval of the
Settlement. Plaintiffs shall voluntarily withdraw their pending Preliminary Injunction Motion
filed in this Action promptly after execution of this Settlement Agreement.

 

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31. The obligations incurred pursuant to this Settlement Agreement shall be in full and final
disposition of the Action with prejudice and of any and all Settled and Released Claims as against
all Releasees.

32. Should the Court grant final approval of the Settlement Agreement, the Action shall be
dismissed with prejudice and without costs to any party. The Related Plaintiffs, by and through
their undersigned counsel below, shall voluntarily dismiss their individual actions with prejudice
and without costs to any party thereof.

33. The Parties will seek and obtain from the Court a Final Judgment and Order as further
described below in Section IX. The Final Judgment and Order shall, among other things, (i) approve
the Settlement as fair, reasonable and adequate pursuant to Federal Rule of Civil Procedure 23;
(ii) dismiss the Action as to the Defendants with prejudice and on the merits; (iii) incorporate
the terms of the Release; (iv) incorporate the agreed upon Attorneys’ Fees and Expenses set forth
in Section VII, and (v) certify the class for settlement purposes, finding Plaintiffs to be
adequate representatives of the class and their undersigned Plaintiffs’ Counsel to be adequate
class counsel.

34. A copy of the proposed Final Judgment and Order is attached hereto as Exhibit D.

 

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C. Class Certification For Settlement Only

35. Plaintiffs have asserted that this Action should be maintained as a class action as
defined in the Federal Rules of Civil Procedure. For settlement purposes only, and for no purpose
other than as set forth in and to effectuate this Settlement Agreement, Defendants will not object
to certification of the Action as a non opt-out class pursuant to Federal Rule of Civil Procedure
23 (b)(1) and/or (b)(2) with (i) Plaintiffs Morton Finkel, Jeffrey P. Feinman, and Jeffrey Veigel
as Settlement Class representatives, (ii) Plaintiffs’ Counsel as Settlement Class counsel, and
(iii) the Settlement Class as defined above.

36. By stipulating to certification of a non opt-out class for settlement purposes, Defendants
have not taken any position as to whether this Action could be certified as a class action as
defined in the Federal Rules of Civil Procedure if this question were fully litigated before the
Court. If this Settlement Agreement is not approved, Defendants reserve, and have not waived, any
rights, arguments, and/or defenses with respect to contesting class certification, Plaintiffs will
not argue that Defendants are equitably or judicially estopped from contesting the certification of
the class in this Action, and Plaintiffs reserve the right to move for certification of a class
under any provision of Rule 23 of the Federal Rules of Civil Procedure.

IV. SUBMISSION TO JURISDICTION OF COURT

37. Plaintiffs, Defendants, and each and every member of the Settlement Class submits to the
jurisdiction of the Court and shall be bound by the terms of this Settlement Agreement, including
without limitation, the Release and the terms of the
Final Judgment and Order, as well as any other order of the Court, including, without
limitation, the Final Judgment and Order barring further litigation against any of the Defendants
in connection with any claim arising from the Proposed Merger. Any and all disputes related to the
Action or this Settlement Agreement shall be submitted to the Court for final resolution.

 

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V. NOTICE TO MEMBERS OF THE CLASS AND RIGHT OF COMMUNICATION

A. Notice

38. Subject to the requirements of the Preliminary Approval Order, and no later than thirty
(30) calendar days before the Settlement Hearing, Defendants shall cause the Notice to be delivered
to each Settlement Class Member by first-class mail, postage prepaid to the address of each member
of the Settlement Class at the addresses provided by the Defendants, or such other addresses as
Plaintiffs’ Counsel has available. In addition, American will make the Notice available on the
www.americanog.com website beginning thirty (30) calendar days before the Settlement Hearing and
continuing through the date of the Settlement Hearing. Defendants shall bear all costs associated
with the Notice. If practicable, and at Defendants’ option, the Notice can be delivered to class
members together with the final Proxy Statement issued in connection with the approval of the
Proposed Merger.

 

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39. The Notice shall: (i) contain a short and plain statement of the background of the Action
and the proposed Settlement; (ii) generally describe the nature of the relief provided; (iii) state
that any relief is contingent on the Court’s final approval of the proposed Settlement; (iv) inform
Settlement Class Members of the date of the
Settlement Hearing and of their right to object to the Settlement Agreement; (v) set forth the
range of the Attorneys’ Fees and Expenses Award agreed to by the Parties; (vi) set forth the
Release in Section III, together with all associated Definitions; (vii) conform to the requirements
of the Federal Rules of Civil Procedure, the United States Constitution (including the Due Process
Clause), the Rules of the Court, and any other applicable law; and (viii) otherwise be in a manner
and form agreed upon by the Parties to this Settlement Agreement and approved by the Court. A copy
of the proposed Notice is attached hereto as Exhibit C.

B. Right of Communication with Stockholders

40. American expressly reserves the right to communicate with and respond to inquiries by its
stockholders, including Settlement Class Members, with respect to matters other than this
Settlement Agreement, expressly including any matters relating to or described in the Merger
Agreement, the Preliminary Proxy Statement, the Amended Preliminary Proxy Statement, and the Second
Amended Preliminary Proxy Statement and may do so through any appropriate agency.

41. American may undertake such efforts to communicate with Settlement Class Members regarding
the Notice and terms of this Settlement Agreement as American deems necessary or appropriate,
including telephone communications. Any written communication to American by any Settlement Class
Member regarding the Settlement Agreement, or any written communication to a Settlement Class
Member by American regarding the Settlement Agreement, shall be provided to Plaintiffs’ Counsel
as soon as practical after the communication is received or generated, as the case may be.

 

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C. Media Communications

42. Plaintiffs’ Counsel and Defendants’ Counsel agree to cooperate in good faith to ensure
that (i) any comments about or descriptions of the Settlement in the media or any other public
forum are balanced, fair and accurate and (ii) any press releases announcing the proposed
Settlement are provided in advance to Plaintiffs’ Counsel and Defendants’ Counsel before
dissemination or publication; provided however, that Defendants shall be able to
make, without notification to or prior review or approval by Plaintiffs’ Counsel, any and all
disclosures regarding the Settlement Agreement that Defendants believe may be required or
appropriate under applicable law or by the rules of any securities exchange on which American’s
securities trade, or as required in connection with a judicial or regulatory proceeding.

VI. OBJECTIONS TO THE SETTLEMENT

43. Any Settlement Class Member who wishes to object to the fairness, reasonableness or
adequacy of this Settlement Agreement, or to any aspect of the Settlement, must deliver to
Plaintiffs’ Counsel and Defendants’ Counsel, and file with the Court, no later than fourteen (14)
calendar days before the Settlement Hearing or as the Court may otherwise direct, a statement of
his, her or its objection, as well as the specific reason(s), if any, for each objection, including
any legal support the Settlement Class Member wishes to bring to the Court’s attention and any
evidence the Settlement Class Member wishes to introduce in support of the objection. Settlement
Class
Members may so object either on their own or through an attorney hired at their own expense.

 

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44. If a Settlement Class Member hires an attorney to represent him, her or it, the attorney
must (i) file a notice of appearance with the Clerk of the Court no later than fourteen (14)
calendar days before the Settlement Hearing, or as the Court otherwise may direct, and (ii) deliver
to Plaintiffs’ Counsel and Defendants’ Counsel no later than fourteen (14) calendar days before the
Settlement Hearing a copy of the same.

45. Any Settlement Class Member who files and serves a written objection, as described in this
Section, may appear at the Settlement Hearing, either in person or through counsel hired at the
Settlement Class Member’s expense, to object to the fairness, reasonableness or adequacy of this
Settlement Agreement. Settlement Class Members or their attorneys who intend to make an appearance
at the Settlement Hearing must deliver to Plaintiffs’ Counsel and Defendants’ Counsel no later than
fourteen (14) calendar days before the Settlement Hearing, or as the Court may otherwise direct, a
notice of intention to appear.

46. Any Settlement Class Member who fails to comply with the provisions of this Section shall
waive and forfeit any and all rights he, she or it may have to appear separately and/or object to
this Settlement Agreement.

 

22

 

VII. ATTORNEYS’ FEES AND EXPENSES

47. Plaintiffs’ Counsel shall follow the applicable rules and procedures for obtaining Court
approval of any Attorneys’ Fees and Expenses Award, and shall file its fee application upon a
contested briefing schedule to be determined by the Court.
Plaintiffs and Plaintiffs’ Counsel shall not make an application for an Attorneys’ Fees and
Expenses Award in excess of $850,000. Defendants agree that they will not object to an Attorneys’
Fees and Expenses Award up to $200,000, and Defendants reserve all rights, positions, arguments,
and defenses as to an Attorneys’ Fees and Expenses Award greater than $200,000.

48. Defendants will pay an Attorneys’ Fees and Expenses Award not in excess of $850,000 by
making such payment by check payable to “Bragar, Wexler, Eagel & Squire PC and Robbins Geller
Rudman & Dowd LLP”, as receiving agents for Plaintiffs’ Counsel, within fifteen (15) days after the
later of the date (i) the Court enters a judgment and order on Plaintiffs’ Counsel’s fee
application which provides the Attorneys’ Fees and Expenses Award, or (ii) the Court enters the
Final Judgment and Order approving the Settlement.

49. Plaintiffs’ Counsel shall be solely responsible for allocating the Attorneys’ Fees and
Expenses Award among Plaintiffs’ Counsel and counsel for any Settlement Class Member. Defendants
shall bear no responsibility or liability whatsoever for the allocation of the Attorneys’ Fees and
Expenses Award. By making the payment called for in this Section, Defendants fully and finally
extinguish its liability for any and all attorneys’ fees, expenses and/or other costs in connection
with this Action, the Settlement Class, and any counsel for the Settlement Class members.
Defendants shall not have any responsibility for, or incur any liability whatsoever with respect to
(a) any dispute or issue any person or entity may have with respect to the Attorneys’ Fees
and Expenses Award or (b) any claim by any person or entity to any portion of the Attorneys’
Fees and Expenses Award.

 

23

 

50. If (i) the Final Judgment and Order approving the Settlement is reversed, vacated,
modified and/or remanded for further proceedings or otherwise disposed of in any manner other than
one resulting in an affirmance of such Final Judgment and Order and the Defendants or Plaintiffs
properly and timely terminate the Settlement in accordance with Section X of the Settlement
Agreement or (ii) the Effective Date does not occur for any reason, then Plaintiffs’ Counsel shall
within 10 business days return to Defendants the amount of Attorneys’ Fees and Expenses Award paid
by Defendants with interest at the Interest Rate.

51. Plaintiffs’ Counsel agrees that the terms of its obligation to return any of the
Attorneys’ Fees and Expenses Award in the event of such reversal, vacation, modification or remand
described in paragraph 50 above shall be evidenced by a written agreement acceptable to the
Parties. In addition, Plaintiffs’ Counsel, as a condition of receiving Attorneys’ Fees and Expenses
Award, on behalf of itself and each partner and/or shareholder of it, agrees that their respective
law firms and their partners and/or shareholders are subject to the jurisdiction of the Court for
the purpose of enforcing this Section of the Settlement Agreement. Without limitation, the law
firms and their partners and/or shareholders agree that the Court may, upon application of
Defendants, on notice to the law firms, summarily issue orders, including, but not limited to,
judgments and attachment orders, against them or any of them should the law firms fail timely to
repay any amounts pursuant to this Section.

 

24

 

VIII.
ORDER PRELIMINARILY APPROVING CLASS ACTION SETTLEMENT AND NOTICE, AND SETTING SETTLEMENT
HEARING

52. Plaintiffs undertake to make every reasonable effort, in coordination with Defendants, to
obtain the Preliminary Approval Order as expeditiously as possible and acknowledge that Plaintiffs’
undertaking in this respect is a material term of this Settlement Agreement. If Plaintiffs breach
this undertaking, Defendants may terminate this Settlement Agreement pursuant to Section X below.

53. Promptly after execution of this Settlement Agreement, but in no event later than three
(3) business days after the Settlement Agreement is signed, Plaintiffs and Defendants shall submit
the Settlement Agreement together with its Exhibits to the Court and shall jointly move the Court,
by order to show cause or other expedited basis, for the entry of the Preliminary Approval Order,
substantially in the form attached hereto as Exhibit B, or as modified pursuant to agreement of the
Parties or order of the Court:

(a) providing for the certification of the Settlement Class for settlement purposes
only;

(b) finding that the Settlement Agreement is sufficient to warrant publishing Notice
to Settlement Class Members;

(c) scheduling the Settlement Hearing, to be held on such date as the Court may
direct, to consider the fairness, reasonableness and adequacy of all aspects of the
Settlement and whether its provisions should be approved by the Court;

(d) approving the proposed Notice and notice methodology described in this Settlement
Agreement;

 

25

 

(e) directing Defendants to cause the Notice to be mailed to each Settlement Class
Member in the same manner no later than thirty (30) days before the Settlement Hearing;

(f) determining that the Notice to be provided to the Settlement Class Members in
this Action and the manner in which the Notice is to be mailed pursuant to this Settlement
Agreement, constitute the best practicable notice and satisfy the requirements of the
Federal Rules of Civil Procedure (including Rule 23), the United States Constitution
(including the Due Process Clause) and any other applicable law, and constitute due and
sufficient notice of the Settlement Agreement and Settlement Hearing to all persons or
entities entitled to receive such notice;

(g) requiring Defendants to file proof of the mailing of the Notice at or before the
Settlement Hearing;

(h) authorizing Defendants to communicate with Settlement Class Members about the
Action and the terms of the proposed Settlement, subject to the terms of Section V of this
Settlement Agreement, and to engage in any other communications within the normal course
of American’s business, including but not limited to communications in connection with the
transaction described in the Merger Agreement, the Preliminary Proxy Statement, the
Amended Preliminary Proxy Statement, and the Second Amended Preliminary Proxy Statement;

 

26

 

(i) preliminarily enjoining Plaintiffs, Related Plaintiffs, and all Settlement Class
Members, or any of their respective representatives, trustees, successors, heirs and
assigns, from filing, commencing, prosecuting, intervening in, participating in (as
members of a class action or otherwise), or receiving any benefits or other relief from,
any other lawsuit, arbitration, or administrative, regulatory or other proceeding or order
against the Releasees in any jurisdiction based on or relating to the claims and causes of
action that are released by this Settlement Agreement pending the final ruling of the
Court on the Settlement;

(j) preliminarily enjoining all persons from filing, commencing or prosecuting any
other lawsuit as a class action (including by seeking to amend a pending complaint to
include class allegations or by seeking class certification in a pending action in any
jurisdiction) on behalf of Settlement Class Members, if such other lawsuit is based on or
relates in any way to the claims and causes of action, or the facts and circumstances
relating thereto, in this Action, the Related Actions, and/or the claims or causes of
action subject to the Release;

(k) requiring each Settlement Class Member who wishes to object to the fairness,
reasonableness or adequacy of this Settlement Agreement to deliver to Plaintiffs’ Counsel
and Defendants’ Counsel and to file with the Court, no later than fourteen (14) calendar
days before the Settlement Hearing, or at such other time as the Court may direct, a
statement of his or her objection, as well as the specific reasons, if any, for each
objection, including any legal
support the Settlement Class Member wishes to bring to the Court’s attention and any
evidence the Settlement Class Member wishes to introduce in support of his or her
objection, or be forever barred from separately objecting;

 

27

 

(l) requiring any attorney hired by a Settlement Class Member at the Settlement Class
Member’s expense for the purpose of objecting to this Settlement Agreement or the
Attorneys’ Fees and Expenses Award, to file with the Clerk of the Court and deliver to
Plaintiffs’ Counsel and Defendants’ Counsel no later than fourteen (14) calendar days
before the Settlement Hearing, or as the Court may otherwise direct, a notice of
appearance;

(m) requiring any Settlement Class Member who files and serves a written objection
and who intends to make an appearance at the Settlement Hearing, either in person or
through personal counsel hired at the Settlement Class Member’s expense, to file with the
Court and deliver to Plaintiffs’ Counsel and Defendants’ Counsel no later than fourteen
(14) calendar days before the Settlement Hearing, or as the Court may otherwise direct, a
notice of intention to appear;

(n) directing Plaintiffs’ Counsel and Defendants’ Counsel promptly to furnish each
other with copies of any and all objections that might come into their possession; and

(o) containing any additional provisions that might be necessary to implement and
administer the terms of this Settlement Agreement.

 

28

 

IX. FINAL APPROVAL, FINAL JUDGMENT AND ORDER APPROVING
CLASS ACTION SETTLEMENT

54. At or after the Settlement Hearing, and upon the Court’s approval of this Settlement
Agreement, the Parties shall seek and obtain from the Court a Final Judgment and Order. The Final
Judgment and Order shall, among other things, and taking into consideration all of the facts and
circumstances outlined in this Settlement Agreement:

(a) find that Plaintiffs held or beneficially owned common stock of American and
otherwise have standing to prosecute this Action on behalf of the Settlement Class;

(b) find that the Court has jurisdiction over the Settlement Class Members and
jurisdiction to approve the Settlement Agreement;

(c) finally certify the Settlement Class for settlement purposes;

(d) approve the Settlement Agreement as fair, reasonable and adequate, consistent and
in compliance with all applicable requirements of the United States Constitution (including
the Due Process Clause), the Federal Rules of Civil Procedure, the Rules of the Court, and
any other applicable law, and in the best interests of the Settlement Class;

(e) direct the Parties and their counsel to implement and consummate this Settlement
Agreement according to its terms and provisions;

 

29

 

(f) declare this Settlement Agreement to be binding on — and, as to all claims and
issues that have or could have been raised in this Action, to have res judicata and other
preclusive effect in all pending and future lawsuits or other
proceedings maintained by or on behalf of — the Parties and Settlement Class Members,
as well as their past, present and future parents, subsidiaries, predecessors, successors
and assigns and affiliates and each of their respective past, present and future officers,
directors, employees, agents, representatives, attorneys, heirs, administrators, executors,
insurers, predecessors, successors, and assigns, or any of them, including any person or
entity controlled by or controlling or under the control of any of them;

(g) find that the Notice provided to the Settlement Class in this Action and notice
methodology implemented pursuant to this Settlement Agreement, constituted the best
practicable notice and satisfied the requirements of the Federal Rules of Civil Procedure
(including Rule 23), the United States Constitution (including the Due Process Clause) and
any other applicable law, and constituted due and sufficient notice of the Settlement
Agreement and Settlement Hearing to all persons or entities entitled to receive such notice;

(h) find that Plaintiffs and counsel for Plaintiffs brought the Action in good faith
and have adequately represented the interests of the Settlement Class for purposes of
entering into and implementing the Settlement Agreement;

(i) dismiss the Action as to the Defendants on the merits and with prejudice;

(j) incorporate the Release set forth above in Section III, make the Release effective
as of the date of the Effective Date, and forever discharge the Releasees from any Settled
and Released Claims;

 

30

 

(k) permanently bar and enjoin all Settlement Class Members from (i) filing,
commencing, prosecuting, intervening in, participating in (as members of a class action or
otherwise), or receiving any benefits or other relief from, any other lawsuit, arbitration,
or administrative, regulatory or other proceeding or order in any jurisdiction based on or
relating in any way to the Settled and Released Claims, and (ii) organizing Settlement Class
Members into a separate class for purposes of pursuing as a purported class action
(including by seeking to amend a pending complaint to include class allegations, or by
seeking class certification in a pending action) in any lawsuit based on or relating to the
Settled and Released Claims;

(l) authorize the Parties, without further approval from the Court, to agree to and
adopt such amendments, modifications and expansions of this Settlement Agreement as (i) are
consistent with the Final Judgment and Order and (ii) do not limit the rights of the
Settlement Class under this Settlement Agreement;

(m) without affecting the finality of the Final Judgment and Order for purposes of
appeal, retain jurisdiction as to all matters relating to the administration, consummation,
enforcement and interpretation of this Settlement Agreement, the Final Judgment and Order,
and for any other necessary purpose; provided however, that nothing in this
subsection shall restrict the ability of the Parties to exercise their rights under
paragraph 56 below;

(n) and incorporate any other provisions that the Court deems necessary and just.

55. A copy of the proposed Final Judgment and Order is attached hereto as Exhibit D.

 

31

 

X. MODIFICATION OR TERMINATION OF THE SETTLEMENT AGREEMENT

56. The terms and provisions of this Settlement Agreement may be amended, modified or expanded
by written agreement of the Parties and approval of the Court; provided however,
that, after entry of the Final Judgment and Order, the Parties may by written agreement effect such
amendments, modifications or expansions of this Settlement Agreement and its implementing documents
(including all exhibits thereto) without notice to or approval by the Court if such changes are
consistent with the Court’s Final Judgment and Order and do not limit the rights of the Settlement
Class under the Settlement Agreement.

57. This Settlement Agreement may not be modified or amended, nor may any of its provisions be
waived, except by a writing executed by all the signatories hereto.

58. Any Plaintiff or Defendant shall have the right to terminate this Settlement Agreement by
providing written notice of its election to do so (“Termination Notice”) to Defendants’
Counsel and Plaintiffs’ Counsel within thirty (30) days of: (a) the Court’s declining to enter a
Preliminary Approval Order, in a form consistent with the substance of the proposed order set forth
at Exhibit B hereto; (b) the Court’s declining to enter the Final Judgment and Order; (c) the date
upon which the Final Judgment and Order is
modified or reversed on appeal, reargument, certiorari or other review; or (d) the breach by
the non terminating party in any material respect of any provision of this Settlement Agreement.
In addition, Hess may terminate the Settlement Agreement if the amount of attorneys’ fees and
expenses, in the aggregate, awarded in any forum(s) to counsel for Settlement Class Members is
greater than $850,000.

 

32

 

59. In the event the Settlement Agreement is terminated or fails to become effective:

(i) this Settlement Agreement shall be null and void and shall have no force or effect,
and no party to this Settlement Agreement shall be bound by any of its terms, except for the
terms of this subsection;

(ii) this Settlement Agreement, all of its provisions, and all negotiations, statements
and proceedings relating to it shall be without prejudice to the rights of Plaintiffs, the
Related Plaintiffs, and Defendants, all of whom shall be restored to their respective
positions existing immediately before the execution of this Settlement Agreement;

(iii) Defendants, and their current and former parents, subsidiaries, predecessors,
successors, heirs, agents, assigns, officers, directors, employees, partners, principals,
attorneys and representatives expressly and affirmatively reserve, and do not waive, all
defenses, rights, positions, arguments and motions as to all claims that have been or might
later be asserted in the Action and the Related Actions;

 

33

 

(iv) Plaintiffs, the Related Plaintiffs, and their current and former parents,
subsidiaries, predecessors, successors, heirs, agents, assigns, officers, directors,
employees, partners, principals, attorneys and representatives expressly and affirmatively
reserve all motions as to, and arguments in support of, all claims that have been or might
later be asserted in the Action and the Related Actions;

(v) any Attorneys’ Fees and Expenses Award paid by Defendants will be returned to
Defendants pursuant to in Section VII above;

60. In the event that the Settlement Agreement is not consummated, no party shall be entitled
to recover costs or expenses incurred in connection with the proposed Settlement.

61. In the event that this Settlement Agreement is terminated as set forth in paragraph 58
above, the Parties shall, within two weeks of a notice of termination, jointly request a status
conference with the Court to be held at the Court’s first available date. At such status
conference, the Parties shall ask the Court’s assistance in scheduling continued proceedings in the
Action. Pending such status conference or the expiration of sixty (60) days from the Parties’
joint request for a status conference, whichever occurs first, none of the Parties shall file or
serve any motions on any of the other Parties in connection with the Action, nor shall any response
be due by any Party to any outstanding pleading or motion by any other Party.

 

34

 

XI. NO ADMISSION OF WRONGDOING

62. Defendants deny and continue to deny that they have committed, attempted to commit, and/or
aided or abetted others in committing, any violations of law or breached any duty owed to
American’s shareholders or the Settlement Class or otherwise.

XII. CONDITIONS OF SETTLEMENT

63. This Settlement Agreement and the Settlement provided for herein is subject to and
contingent upon the occurrence of each of the following events: (a) final certification by the
Court, for settlement purposes only, of a Settlement Class, as defined herein, and (b) Final Court
Approval of the Settlement Agreement and dismissal of the Action in its entirety with prejudice and
without awarding costs to any party (except those costs provided in Section VII above).

64. In the event that: (a) the Court disapproves this Settlement Agreement, including any
amendments thereto agreed upon by all of the Parties; or (b) the Court approves this Settlement
Agreement or any amendment thereto approved by all of the Parties, but such approval is reversed on
appeal and such reversal becomes final and not subject to further appeal or review (by exhaustion
of any possible appeal or review, lapse of time or otherwise), then in any such event, any Final
Judgment and Order that has been entered shall be vacated, and this Settlement Agreement and the
Settlement contemplated herein (including any amendments hereof), and any actions taken or to be
taken with respect to the Settlement contemplated hereby, shall terminate, be null and void and
without further force and effect and without prejudice to any of the Parties.

 

35

 

XIII. MISCELLANEOUS PROVISIONS

65. The Parties may agree, subject to approval of the Court where necessary, to reasonable
extensions of time to carry out any of the provisions of this Settlement Agreement.

66. Each of the attorneys executing this Settlement Agreement on behalf of his or her
respective client(s) hereby represents and warrants that he or she has been duly authorized and
empowered to execute this Settlement Agreement on behalf of each such party, and that he or she has
the authority to take appropriate action required or permitted to be taken pursuant to the
Settlement Agreement to effect its terms.

67. The captions to this Settlement Agreement appear for the purposes of convenience only and
have no legal effect.

68. By execution of this Settlement Agreement, Defendants do not, and do not intend to,
release any claim against any insurer for any cost or expense hereunder, including attorneys’ fees
and costs.

69. None of the Plaintiffs and none of the Related Plaintiffs will object to the Settlement
Agreement, file an appeal therefrom or otherwise seek review of any order approving the Settlement
Agreement. In addition, the Parties agree that they will participate in good faith in responding
to the objections to this Settlement, and in the event any person should file a notice of appeal
from the Court’s Final Judgment and Order, to seek a resolution as expeditiously as possible,
including, if appropriate, jointly moving to dismiss the appeal or jointly moving to expedite the
appeal.

 

36

 

70. When this Settlement Agreement requires or contemplates that one party shall or may give
notice to another, notice shall be provided by e-mail and next-day (excluding Sunday) express
delivery service as follows:

	 	(i)	 	If to Defendants’ Counsel, then to:

Glenn M. Kurtz

Robert E. Tiedemann

Claudine Columbres

WHITE & CASE LLP

1155 Avenue of the Americas

New York, NY 10036-2787

Tel: (212) 819-8200

Fax: (212) 354-8113

gkurtz@whitecase.com

rtiedemann@whitecase.com

ccolumbres@whitecase.com

Philip M. Smith

PATTON BOGGS LLP

1185 Avenue of the Americas

New York, NY 10036

Tel: (646) 557-5145 

Fax: (646) 557-5101

pmsmith@pattonboggs.com

	 	(ii)	 	If to Plaintiffs’ Counsel, then to:

Lawrence P. Eagel

Jeffrey H. Squire

BRAGAR WEXLER EAGEL & SQUIRE, PC

885 Third Avenue, Suite 3040

New York, NY 10022

Tel: (212) 308-5858

Fax: (212) 486-0462

eagel@bragarwexler.com

squire@bragarwexler.com

Robert Harwood

James G. Flynn

HARWOOD FEFFER LLP

 

37

 

488 Madison Avenue, 8th Floor

New York, NY 10022

Tel: (212) 935-7400

Fax: (212) 753-3630

rharwood@hfesq.com

jflynn@hfesq.com

Marc I. Gross

H. Adam Prussin

POMERANTZ HAUDEK GROSSMAN & GROSS LLP

100 Park Avenue

New York, NY 10017

Tel: (212) 661-1100

Fax: (212) 661-8665

migross@pomlaw.com

haprussin@pomlaw.com

Darren J. Robbins

Randall J. Baron

David T. Wissbroecker

ROBBINS GELLER RUDMAN & DOWD LLP

655 West Broadway, Suite 1900

San Diego, CA 92101-3301

Tel: (619) 231-1058

Fax: (619) 231-7423

darrenr@rgrdlaw.com

randyb@rgrdlaw.com

dwissbroecker@rgrdlaw.com

Robert J. Dyer III

Jeffrey A. Berens

Darby K. Kennedy

DYER & BERENS LLP

303 East 17th Avenue, Suite 300

Denver, CO 80203

Tel: (303) 861-1764

Fax: (303) 395-0393

bob@dyerberens.com

jeff@dyerberens.com

darby@dyerberens.com

 

38

 

71. All time periods set forth herein shall be computed in calendar days unless otherwise
expressly provided. In computing any period of time prescribed or allowed by this Settlement
Agreement or by order of Court, the day of the act, event, or default from which the designated
period of time begins to run shall not be included. The last day of the period so computed shall
be included, unless it is a Saturday, a Sunday or a legal holiday, in which case the period shall
run until the end of the next day that is not one of the aforementioned days. As used in this
subsection, “legal holiday” includes New Year’s Day, Martin Luther King, Jr. Day, Presidents’ Day,
Memorial Day, Independence Day, Labor Day, Columbus Day, Veterans Day, Thanksgiving Day, Christmas
Day and any other day appointed as a federal holiday.

72. This Settlement Agreement, together with the Exhibits hereto, constitutes the Parties’
entire agreement concerning the Settlement and supersedes any prior oral or written communications
by the Parties with respect thereto, and no representations, warranties, or inducements have been
made by any party hereto concerning this Settlement Agreement and its Exhibits other than those
contained and memorialized in such documents.

73. If any action is filed in state or federal court asserting claims that are related to the
subject matter of the Action prior to final Court approval of the Settlement, all Parties shall use
their best efforts to effect a withdrawal or dismissal of the claims, and Plaintiffs and its
counsel shall cooperate with Defendants in obtaining dismissal or withdrawal of any such related
action, including, where appropriate, joining in any motion to dismiss such related action.

 

39

 

74. This Settlement Agreement and all Exhibits hereto shall be governed by and interpreted and
enforced in accordance with Colorado law, without giving effect to principles of conflicts of law
thereof.

75. The terms of this Settlement shall inure to and be binding upon the Parties and their
respective agents, executors heirs, assigns and successors in interest.

76. Any failure by any party to insist upon the strict performance by any other party of any
of the provisions of this Settlement Agreement shall not be deemed a waiver of any of the
provisions, and such party, notwithstanding such failure, shall have the right thereafter to insist
upon the strict performance of any and all of the provisions of this Settlement Agreement to be
performed by such other party.

77. All Parties agree that this Settlement Agreement was drafted at arm’s length, and that no
parol or other evidence may be offered to explain, construe, contradict or clarify its terms, the
intent of the Parties or their counsel, or the circumstances under which the Settlement Agreement
was made or executed; and there shall be no presumption for or against any Party that drafted all
or any portion of this Settlement Agreement.

78. The Parties to the Settlement Agreement and their counsel agree: (i) that it is their
intent to consummate this Settlement Agreement, (ii) to act expeditiously to implement the terms of
this Settlement Agreement in good faith, and to use good faith in resolving any disputes that may
arise in the implementation of its terms, (iii) to cooperate fully with one another and to act
expeditiously in seeking Court approval of
this Settlement Agreement, and (iv) to use their best efforts to effect the prompt
consummation of this Settlement Agreement.

 

40

 

79. This Settlement Agreement may be executed in any number of counterparts, on separate
counterparts, each of which shall constitute an original, but all counterparts shall constitute one
and the same document.

80. All Releasees who are not parties to this Settlement Agreement are intended third-party
beneficiaries entitled to enforce the terms of the Release set forth herein.

81. Administration and consummation of the terms of this Settlement Agreement shall take place
under the supervision and authority of the Court, and all Parties expressly consent to the
jurisdiction of the Court for such purposes.

 

41

 

IT IS SO STIPULATED AND AGREED THIS __ DAY OF NOVEMBER 2010

PATTON BOGGS LLP

	 	 	 	 	 
	/s/ Philip M. Smith	 	 
	 	 	 
	By:

	 	Philip M. Smith	 	 

1185 Avenue of the Americas

New York, NY 10036

Tel: (646) 557-5145

Fax: (646) 557-5101

pmsmith@pattonboggs.com

Counsel Defendants American Oil & Gas, Inc., Patrick D. O’Brien, Andrew P. Calerich, Jon R.
Whitney, Nick DeMare, C. Scott Hobbs, and Joseph B. Feiten

WHITE & CASE LLP

	 	 	 	 	 
	/s/ Glenn M. Kurtz	 	 
	 	 	 
	By:

	 	Glenn M. Kurtz	 	 

Glenn M. Kurtz

Robert E. Tiedemann

Claudine Columbres

1155 Avenue of the Americas

New York, NY 10036-2787

Tel: (212) 819-8200

Fax: (212) 354-8113

gkurtz@whitecase.com

rtiedemann@whitecase.com

ccolumbres@whitecase.com

Counsel for Defendants Hess Corporation and Hess Investment Corp.

 

42

 

BRAGAR WEXLER EAGEL & SQUIRE, PC

	 	 	 	 	 
	/s/ Lawrence P. Eagel	 	 
	 	 	 
	By:

	 	Lawrence P. Eagel	 	 

Lawrence P. Eagel

Jeffrey H. Squire

885 Third Avenue, Suite 3040

New York, NY 10022

Tel: (212) 308-5858

Fax: (212) 486-0462

eagel@bragarwexler.com

squire@bragarwexler.com

Counsel for Plaintiff Jeffrey P. Feinman

HARWOOD FEFFER LLP

	 	 	 	 	 
	/s/ James G. Flynn	 	 
	 	 	 
	By:

	 	James G. Flynn	 	 

Robert Harwood

James G. Flynn

488 Madison Avenue, 8th Floor

New York, NY 10022

Tel: (212) 935-7400

Fax: (212) 753-3630

rharwood@hfesq.com

jflynn@hfesq.com

Counsel for Plaintiff Jeffrey Veigel

 

43

 

POMERANTZ HAUDEK GROSSMAN & GROSS LLP

	 	 	 	 	 
	/s/ H. Adam Prussin	 	 
	 	 	 
	By:

	 	H. Adam Prussin	 	 

Marc I. Gross

H. Adam Prussin

Fei-Lu Qian

100 Park Avenue

New York, NY 10017

Tel: (212) 661-1100

Fax: (212) 661-8665

migross@pomlaw.com

haprussin@pomlaw.com

Counsel for Plaintiff Morton Finkel

ROBBINS GELLER RUDMAN & DOWD LLP

	 	 	 	 	 
	/s/ David T. Wissbroecker	 	 
	 	 	 
	By:

	 	David T. Wissbroecker	 	 

Darren J. Robbins

Randall J. Baron

David T. Wissbroecker

655 West Broadway, Suite 1900

San Diego, CA 92101-3301

Tel: (619) 231-1058

Fax: (619) 231-7423

darrenr@rgrdlaw.com

randyb@rgrdlaw.com

dwissbroecker@rgrdlaw.com

Counsel for Plaintiffs Richard Buckman, Joseph V. Luvara, and Michael Kunaman

 

44

 

DYER & BERENS LLP

	 	 	 	 	 
	/s/ Darby Kennedy	 	 
	 	 	 
	By:

	 	Darby Kennedy	 	 

Robert J. Dyer III

Jeffrey A. Berens

Darby K. Kennedy

303 East 17th Avenue, Suite 300

Denver, CO 80203

Tel: (303) 861-1764

Fax: (303) 395-0393

bob@dyerberens.com

jeff@dyerberens.com

darby@dyerberens.com

Counsel for Plaintiffs Morton Finkel, Jeffrey Veigel, and Jeffrey P. Feinman

 

45exv10w1

Exhibit 10.1

Summary of Jones Soda Co. 2010 Bonus Plan For Executive Officers

Applicability; Effective Date. The Jones Soda Co. (the “Company”) 2010 Bonus Plan for Executive
Officers (the “2010 Bonus Plan”) applies to William Meissner (the Company’s President and Chief
Executive Officer), and Michael O’Brien (the Company’s Chief Financial Officer) and is effective
for the fiscal year 2010 performance period.

Target Bonus Amounts. Mr. Meissner’s target bonus under the 2010 Bonus Plan is set at 50% of his
annual base salary, pro rated for the portion of the 2010 fiscal year that Mr. Meissner is employed
by the Company as its President and Chief Executive Officer (resulting in a target bonus for 2010
of $93,750). Mr. O’Brien’s target bonus under the 2010 Bonus Plan is set at 50% of his annual base
salary (resulting in a target bonus for 2010 of $100,000).

Bonus Criteria. The portion, if any, of an executive’s target bonus payable pursuant to the 2010
Bonus Plan shall be determined at the sole discretion of the Company’s Compensation and Governance
Committee (the“Committee”) based upon such factors as the Committee deems appropriate with respect
to the performance of the Company and/or the executive.

Payment of Bonuses. In all cases, payout of any bonus will be made only if the executive is
continuously employed through December 31, 2010, subject to the sole discretion of the Committee to
determine whether any portion of the bonus will be paid in the event of an executive’s termination
of service prior to that date.

Payment of bonuses, if any, under the 2010 Bonus Plan shall be made as soon as practicable after
December 31, 2010, but shall be paid no later than March 15, 2011. Except as set forth below, the
bonuses shall be paid in cash in a single lump sum, subject to payroll taxes and tax withholding.

In order to preserve cash, Messrs. Meissner and O’Brien have each agreed that the Committee may, in
its sole discretion after consultation with the Company’s Board of Directors, elect to satisfy up
to 50% of the total bonus payable to such executive (the “Non-cash Bonus Amount”) by granting to
such executive by no later than March 15, 2011 a stock option to purchase a number of shares of the
Company’s common stock equal to (a) the Non-cash Bonus Amount multiplied by three, divided by (b)
the closing price of the Company’s common stock as listed on The Nasdaq Stock Market on the date
the stock option is granted. Any stock option, if granted, will be granted pursuant to the terms
of the Company’s 2002 Stock Option and Restricted Stock Plan, will have an exercise price equal to
the closing price of the Company’s common stock as listed on The Nasdaq Stock Market on the date
the stock option is granted and will be fully vested and exercisable on the date of grant.

Any bonuses that may become payable under the 2010 Bonus Plan shall be paid solely from the general
assets of the Company. Nothing in the 2010 Bonus Plan should be construed to create a trust or to
establish or evidence an executive’s claim of any right to payment of a bonus other than as an
unsecured general creditor with respect to any payment to which an executive may be entitled.

The Committee, in its sole discretion, may modify or terminate the 2010 Bonus Plan at any time.

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